Investing.com -- Shares in Aflac Incorporated (N:AFL) ticked up in after-hours trading after the largest provider of supplemental insurance in the U.S. reported a considerable increase in its operating profit during the fourth quarter.
For Aflac's fourth quarter of fiscal year 2015, which ended in late-December, the company reported earnings of $730 million or 1.71 per share, up from $703 million or 1.57 per share during the same period in 2014. For the three-month period, Aflac's earnings were suppressed by a weaker yen as the Japanese currency traded at an average of 121.54 versus the dollar in the fourth quarter. It represented a decline of nearly 6% in comparison with the dollar-yen exchange rate in the final quarter a year earlier. As a result, the impact of foreign exchange translation contributed to a 0.05 loss per share in quarterly earnings, Aflac said.
Aflac derives a significant portion of its global business from its Japanese segment. Over the last year, the company insured approximately a quarter of all households in Asia's second-largest economy.
“We are very pleased with Aflac’s financial performance for both the quarter and year," Aflac CEO Daniel P. Amos said in a statement. "Aflac had a very strong quarter, and we finished the year above the top of the range for operating earnings per diluted share, excluding the impact of foreign currency."
While Aflac's revenues fell by 3.5% to 5.32 billion on the quarter, the company still topped analysts' forecasts of 5.22 billion for the period. In Japan, Aflac's premium income gained 0.3% in yen terms but fell more than 5.5% to $3.6 billion when measured in dollar-denominated terms. Aflac's revenue and premium income in its U.S. division both increased by more than 2% on the quarter.
Amos also sounded optimistic about the company's third sector sales in 2015, which were driven by a 40% increase in its cancer insurance revenues. For the year as a whole, the company's third sector sales soared by 13.6%, achieving their strong growth rate in more than a decade.
"As we indicated during our December outlook call, we anticipate that for 2016, sales of third sector products will be down mid-single digits following very robust production results in 2015," Amos added. "We continue to believe the long-term compound annual growth rate will be in the range of 4% to 6%."
Shares in Alfac gained 0.86 or 1.52% to 57.38 in after-hours.