Sun Life Financial Inc. said Thursday that geographic and product diversification helped the company post record earnings for the first quarter of 2005.

The Toronto-based company, Canada’s second-biggest insurer, said net income for the three-month period ended March 31 came in at $458 million (77¢ a share) vs $365 million (61¢) a year ago, a jump of 25.5%.

Bloomberg Canada news agency said the 77¢ per-share result is 1¢ better than the average estimate of 10 analysts polled by Thomson Financial.

Q1 sales fell 7.6% to $5.12 billion. Sun Life said the financial results presented Thursday are unaudited.

“Our strategy of diversifying across geographies and between protection and wealth management products has once again generated strong results,” CEO Donald Stewart said in as release.

The company said return on common equity grew to 12.6% for the quarter, up from 10.3% for the first quarter of 2004.

Results in the year-earlier period included $59 million in costs from a settlement Sun Life’s MFS unit made with the U.S. Securities and Exchange Commission.

The company said strength in sales production in the first quarter was boosted by the US$728 million in net sales at MFS Investment Management, a turnaround of US$2 billion compared to a year ago, and by a 45% increase in market-based RRSP product sales in SLF Canada.

“We continue to write profitable business, as evidenced by the value of new business generated by our sales,” Stewart said. “In 2005 Sun Life Financial is placing significant focus on expanding distribution capacity in all of our operations. Significant additions have been made to the number of wholesalers in the annuity sales force in the U.S. and the third-party distribution channel in Canada. In China, we have received initial approval to commence operations in a third city and have obtained a license to sell group insurance in that country.”

Sun Life said earnings from its Canadian unit were up 6.5% in the first quarter, helped by increases in earnings from individual insurance and group retirement services.

Sun Life’s Massachusetts Financial Services fund unit had profit of $46 million, compared with a $13 million loss a year earlier. Earnings at the U.S. insurance business dropped 16% to $65 million, and profit from Asia fell 14% to $6 million.