Readers are referred to the sections "Non-IFRS Financial
Measures" and "Forward-Looking Statements" at the end of this
release. All figures are expressed in Canadian dollars unless
otherwise noted.
MONTREAL, March 17, 2022 /CNW Telbec/ - Power Corporation
of Canada (Power Corporation or
the Corporation) (TSX: POW) today reported earnings results
for the fourth quarter and twelve months ended December 31, 2021.
Power Corporation
Consolidated results for the
period ended December 31,
2021
HIGHLIGHTS
Power Corporation
- The Corporation reported record-high net and adjusted net
earnings [1][2] for 2021 of $2,917 million and $3,230
million, respectively, representing record-high net earnings
per share of $4.31 and adjusted net
earnings per share [1] of $4.77.
- Net earnings per share of $0.93
for the fourth quarter of 2021, compared with $0.92 in 2020 and adjusted net earnings per share
of $1.00, compared with $0.93 in 2020.
- Adjusted net asset value per share [1] increased
27.5% to $52.60 at December 31, 2021, compared with $41.27 at December 31,
2020. The Corporation's book value per participating share
was $34.56 at December 31, 2021, compared with $31.38 at December 31,
2020, an increase of 10%.
- On January 5, 2022, the
Corporation announced the consolidation of its interest in
China Asset Management Co., Ltd.
(ChinaAMC) under IGM Financial Inc.
- On February 24, 2022, the
Corporation announced its intention to purchase for cancellation up
to 30 million subordinate voting shares under a normal course
issuer bid for up to one year.
- For a second consecutive year, the Corporation was one of only
three Canadian companies to earn an A ("Leadership") for its
response to the CDP's 2021 Climate Change Questionnaire.
- The Corporation has achieved its $50
million targeted cost reduction.
Great-West Lifeco Inc. (Lifeco)
- Lifeco reported fourth quarter adjusted net earnings
[3] of $825 million, up
11% compared to the fourth quarter of 2020, reflecting the results
of recent acquisitions as well as business growth in all
segments.
- Lifeco reported total assets of $630
billion and assets under administration [1] of
$2.3 trillion at December 31, 2021, an increase of 5% and 15.5%,
respectively, from December 31,
2020.
- On November 1, 2021, a Lifeco
subsidiary, Irish Life Group Limited (Irish
Life) completed the acquisition of Ark Life Assurance
Company dac (Ark Life) from Phoenix Group Holdings plc for a total
cash consideration of €230 million.
- On November 19, 2021, Lifeco and
Sagard Holdings Inc. (Sagard)
completed the sale of Lifeco's United
States-based subsidiaries EverWest Real Estate Investors,
LLC and EverWest Advisors, LLC (EverWest) to Sagard.
- Lifeco announced, on January 25,
2022, its intention to purchase for cancellation up to 20
million common shares under a normal course issuer bid for up to
one year.
IGM Financial Inc. (IGM)
- Record-high fourth quarter net earnings of $268.5 million, up 17% from the fourth quarter of
2020, driven by record-high net sales, positive investment returns
for its clients, and increased earnings contributions from
strategic investments.
- Record-high assets under management and advisement
[4] of $277.1 billion, up
4.5% in the fourth quarter and 15.5% from December 31, 2020.
- IGM announced, on February 10,
2022, its intention to purchase for cancellation up to 6
million common shares under a normal course issuer bid for up to
one year.
Groupe Bruxelles Lambert (GBL)
- GBL reported a net asset value [4] of €22.5 billion,
representing €143.91 per share, an increase of 13% on a per share
basis compared with December 31,
2020, following the cancellation of 5 million treasury
shares. In 2021, GBL completed €407 million of share buybacks.
- GBL increased its private and alternative assets from 17% of
the portfolio at year-end 2020, to 25% at year-end 2021.
|
|
[1]
|
Adjusted net
earnings, adjusted net asset value and assets under administration
(reported by Lifeco) are non-IFRS financial measures. Adjusted net
earnings per share and adjusted net asset value per share are
non-IFRS ratios. See the Non-IFRS Financial Measures section later
in this news release. All per share amounts are based on
participating shares of the Corporation.
|
[2]
|
Attributable to
participating shareholders.
|
[3]
|
Referred to as base
earnings by Lifeco, a non-IFRS financial measure, see the Non-IFRS
Financial Measures section later in this news release.
|
[4]
|
See the "Other
Measures" section later in this news release.
|
FOURTH QUARTER
Net earnings attributable to participating shareholders were
$626 million or $0.93 per share, compared with $623 million or $0.92 per share in 2020.
Adjusted net earnings attributable to participating shareholders
[1] were $676 million or
$1.00 per share, compared with
$627 million or $0.93 per share in 2020.
Contributions to Power Corporation's Earnings per
Share
|
|
2021
|
|
2020
|
(in dollars per Power
Corporation share)
|
Net
Earnings
|
Adjusted
Net Earnings
|
Net
Earnings
|
Adjusted
Net Earnings
|
Lifeco
[2]
|
0.77
|
0.82
|
0.89
|
0.73
|
IGM
[2]
|
0.24
|
0.24
|
0.21
|
0.19
|
GBL
[2]
|
(0.01)
|
(0.01)
|
0.02
|
0.02
|
Effect of
consolidation [3]
|
(0.01)
|
(0.01)
|
(0.23)
|
(0.05)
|
|
0.99
|
1.04
|
0.89
|
0.89
|
Alternative asset
investment platforms [4][5]
|
0.03
|
0.05
|
0.05
|
0.05
|
ChinaAMC
|
0.02
|
0.02
|
0.02
|
0.02
|
Standalone businesses
[5]
|
0.02
|
0.02
|
0.07
|
0.07
|
|
1.06
|
1.13
|
1.03
|
1.03
|
Corporate operations
and Other [6]
|
(0.13)
|
(0.13)
|
(0.11)
|
(0.10)
|
|
0.93
|
1.00
|
0.92
|
0.93
|
Average shares
outstanding (in millions)
|
|
676.5
|
|
676.7
|
Lifeco: contribution to net earnings per share
decreased by 13.5% and contribution to adjusted net earnings per
share increased by 12.3%.
IGM: contribution to net earnings per share
increased by 14.3% and contribution to adjusted net earnings per
share increased by 26.3%.
GBL: negative contribution to net earnings per share
of $0.01. Results include a charge of
$0.01 per share in the fourth quarter
of 2021 for losses due to an increase in the put right liability of
the non-controlling interests in Webhelp Group (Webhelp) and
charges related to Webhelp's employee incentive plan.
Alternative asset investment platforms: net earnings
per share includes a contribution of $0.09 per share from Sagard mainly related to fair value increases
within its venture capital (fintech) funds, partially offset by a
negative contribution of $0.07 per
share from Power Sustainable Capital Inc. (Power Sustainable)
mainly related to an impairment and operating losses in its energy
infrastructure platform.
ChinaAMC: On January 5,
2022, the Corporation entered into an agreement under which
the Power Group's current combined 27.8% equity ownership stake in
ChinaAMC will be consolidated at IGM. Under the agreement, the
Corporation will sell its 13.9% interest to Mackenzie, a wholly owned subsidiary of IGM,
for aggregate consideration of $1.15 billion in cash. To partially fund the
transaction, IGM has agreed to sell 15,200,662 Lifeco common shares
to Power Financial Corporation (Power Financial), for aggregate
consideration of $575 million. These transactions are expected
to close in the first half of 2022 and are subject to customary
closing conditions, including Chinese regulatory approvals.
Standalone businesses: results include a positive
impact of $0.02 per share resulting
from the contribution from The Lion Electric Company (Lion) in the
quarter which consists of the Corporation's share of earnings of
Lion, a decrease in the fair value of the outstanding call rights
held by Power Sustainable and a decrease in amounts payable for
long-term incentive plans, net of related taxes.
Corporate operations and Other: As part of the
reorganization completed in February
2020 (the Reorganization), the Corporation projected
near-term cost reductions of approximately $50 million per year within two years by
eliminating duplicative public company-related expenses and
rationalizing other general and administrative expenses. At
December 31, 2021, the Corporation had implemented actions to
achieve its targeted reduction, including the reorganization of the
Corporation's asset management activities, restructuring of the
Power group of companies' research and advisory services model, the
reorganization of travel services, rationalization of its real
estate business, reduction of certain public company expenses of
Power Financial and other restructuring activities, as well as a
decrease in the cost of the senior management group following the
retirement of the Corporation's former Co-Chief Executive Officers.
The Corporation continues to examine and undertake initiatives to
improve the efficiency of its oversight and operations while
adapting to the development of the Group's business.
[1]
|
A non-IFRS financial
measure; see Non-IFRS Financial Measures later in this news
release.
|
[2]
|
As reported by
Lifeco, IGM and GBL.
|
[3]
|
Effect of
consolidation reflects: i) the elimination of intercompany
transactions, including in the fourth quarter of 2020 the gain
recognized by Lifeco on the sale of GLC Asset Management Group Ltd.
(GLC), and the gain recognized by IGM on the sale of the Quadrus
Group of Funds (QGOF); ii) the application of the Corporation's
accounting method for investments under common control to the
reported net earnings of the publicly traded operating companies,
which includes: a) an adjustment related to Lifeco's investment in
the Power Sustainable Energy Infrastructure Partnership (PSEIP);
and b) an allocation of the results of the fintech portfolio
including Wealthsimple Financial Corp. (Wealthsimple), Koho
Financial Inc. (Koho), Portag3 Ventures Limited Partnership
(Portage I), Portag3 Ventures II Limited Partnership (Portage II)
and Portage Ventures III Limited Partnership (Portage III) to the
contributions from Lifeco and IGM based on their respective
interest; and iii) adjustments in accordance with International
Accounting Standards (IAS) 39 for IGM and GBL. Refer to the
detailed table in the Contribution to Net Earnings and Adjusted Net
Earnings section of the Corporation's 2021 Annual
MD&A.
|
[4]
|
Alternative asset
investment platforms includes earnings (losses) from investment
platforms including controlled and consolidated subsidiaries and
other investments.
|
[5]
|
Presented in
Alternative and other investments in the Contribution to Net
Earnings and Adjusted Net Earnings of the Corporation's 2021 Annual
MD&A.
|
[6]
|
Includes operating
and other expenses, dividends on non-participating shares of the
Corporation and Power Financial's corporate operations; refer to
the Earnings Summary below.
|
Adjustments in the fourth quarter of 2021, excluded from
adjusted net earnings, were a net negative impact to earnings of
$50 million or $0.07 per share, mainly related to the
Corporation's share of Lifeco's and IGM's net adjustments and the
Corporation's share of an impairment charge of $15 million recognized by Power Sustainable on
direct investments in energy assets. Adjustments in the fourth
quarter of 2020 were a negative impact to earnings of $4 million or $0.01
per share, mainly related to the Corporation's net charges of
$8 million in conjunction with the Reorganization, partially
offset by the Corporation's share of Lifeco's and IGM's net
adjustments.
TWELVE MONTHS
Net earnings attributable to participating shareholders were
$2,917 million or $4.31 per share, compared with $1,994 million or $3.08 per share in 2020.
Adjusted net earnings attributable to participating shareholders
were $3,230 million or $4.77 per share, compared with $1,988 million or $3.07 per share in 2020.
Contributions to Power Corporation's Earnings per
Share
|
|
2021
|
|
2020 [1]
|
(in dollars per Power
Corporation share)
|
Net
Earnings
|
Adjusted
Net Earnings
|
Net
Earnings
|
Adjusted
Net Earnings
|
Lifeco
[2]
|
3.09
|
3.22
|
2.93
|
2.65
|
IGM
[2]
|
0.89
|
0.89
|
0.71
|
0.71
|
GBL
[2][3]
|
0.08
|
0.08
|
0.13
|
0.14
|
Effect of
consolidation [4]
|
(0.04)
|
0.10
|
(0.38)
|
(0.13)
|
|
4.02
|
4.29
|
3.39
|
3.37
|
Alternative asset
investment platforms [5][6]
|
0.50
|
0.67
|
0.09
|
0.13
|
ChinaAMC
|
0.09
|
0.09
|
0.06
|
0.06
|
Standalone businesses
[6]
|
0.34
|
0.34
|
0.09
|
0.05
|
|
4.95
|
5.39
|
3.63
|
3.61
|
Corporate operations
and Other [7]
|
(0.64)
|
(0.62)
|
(0.55)
|
(0.54)
|
|
4.31
|
4.77
|
3.08
|
3.07
|
Average shares
outstanding (in millions)
|
|
676.8
|
|
647.5
|
Adjustments in the twelve-month period of 2021, excluded from
adjusted net earnings, were a net negative impact to earnings of
$313 million or $0.46 per share,
mainly related to the Corporation's net charges of $13 million in conjunction with the
Reorganization, the Corporation's share of an impairment charge of
$15 million recognized by Power
Sustainable on direct energy infrastructure investments, its share
of Lifeco's adjustments and its share of the charge arising from
the remeasurement of the put right liability of certain of the
non-controlling interests in Wealthsimple to fair value
of $208 million recognized in the first quarter. These
were reflected in the Adjustments of the alternative and other
investments and in the Effect of consolidation based on Lifeco's
and IGM's respective interest. Adjustments in the twelve-month
period of 2020 were a net positive impact to earnings of
$6 million or $0.01 per share, mainly related to the
Corporation's share of Lifeco's adjustments, a recovery on the
deconsolidation of IntegraMed America, Inc. (IntegraMed), partially
offset by the Corporation's share of IGM's adjustments and the
share of the charge arising from the remeasurement of the put right
liability of certain of the non-controlling interests in
Wealthsimple to fair value of $45 million.
[1]
|
Pursuant to the
Reorganization, the Corporation acquired the minority interests of
Power Financial and now holds 100% of the common shares of Power
Financial.
|
[2]
|
As reported by
Lifeco, IGM and GBL.
|
[3]
|
Adjustments in 2020
are as previously reported by Pargesa Holding SA
(Pargesa).
|
[4]
|
Effect of
consolidation reflects: i) the elimination of intercompany
transactions, including in the fourth quarter of 2020 the gain
recognized by Lifeco on the sale of GLC, and the gain recognized by
IGM on the sale of the QGOF; ii) the application of the
Corporation's accounting method for investments under common
control to the reported net earnings of the publicly traded
operating companies, which includes: a) an adjustment related to
Lifeco's investment in PSEIP; and b) an allocation of the results
of the fintech portfolio including Wealthsimple, Koho, Portage I,
Portage II and Portage III to the contributions from Lifeco and IGM
based on their respective interest; and iii) adjustments in
accordance with IAS 39 for IGM and GBL. Refer to the detailed table
in the Contribution to Net Earnings and Adjusted Net Earnings
section of the Corporation's 2021 Annual MD&A.
|
[5]
|
Alternative asset
investment platforms includes earnings (losses) from investment
platforms including controlled and consolidated subsidiaries and
other investments.
|
[6]
|
Presented in
Alternative and other investments in the Contribution to Net
Earnings and Adjusted Net Earnings of the Corporation's 2021 Annual
MD&A.
|
[7]
|
Includes operating
and other expenses, dividends on non-participating shares of the
Corporation and Power Financial's corporate operations; refer to
the Earnings Summary below.
|
Great-West Lifeco, IGM Financial and Groupe Bruxelles
Lambert
Results for the quarter ended December 31, 2021
The information below is derived from Lifeco and IGM's annual
MD&As, as prepared and disclosed by the respective companies in
accordance with applicable securities legislation, and which are
also available either directly from SEDAR (www.sedar.com) or from
their websites, www.greatwestlifeco.com and www.igmfinancial.com.
The information below related to GBL is derived from publicly
disclosed information, as issued by GBL in its fourth quarter press
release at December 31, 2021. Further
information on GBL's results is available on its website at
www.gbl.be.
GREAT-WEST LIFECO INC.
FOURTH QUARTER
Net earnings attributable to common shareholders were
$765 million or $0.82 per share, compared with $912 million or $0.98 per share in 2020.
Adjusted net earnings [1] attributable to common
shareholders were $825 million or
$0.89 per share, compared with
$741 million or $0.80 per share in 2020.
Adjustments in the fourth quarter of 2021, excluded from
adjusted net earnings, were a net negative earnings impact of
$60 million, compared with a net
positive impact to earnings of $171
million in 2020. Lifeco's adjustments in 2021 consisted of a
net negative impact on earnings from:
- Transaction costs of $74 million
related to the acquisitions of the full-service retirement business
of Prudential Financial, Inc. (Prudential), Personal Capital
Corporation (Personal Capital) and the retirement services business
of Massachusetts Mutual Life Insurance Company (MassMutual);
- Restructuring and integration costs of $15 million; and
- A net charge on business dispositions of $14 million in the Europe Corporate business
unit.
Partially offset by:
- Actuarial assumption changes and other management actions of
$23 million; and
- Market-related impact on liabilities of $20 million.
IGM FINANCIAL INC.
FOURTH QUARTER
Net earnings available to common shareholders were $268.5 million or $1.11 per share, compared with $229.1 million or $0.96 per share in 2020.
Adjusted net earnings [2] available to common
shareholders were $260.8 million or
$1.08 per share, compared with
$204.3 million or $0.86 per share in 2020.
Adjustments in the fourth quarter of 2021, excluded from
adjusted net earnings, were a positive impact of $7.7 million consisting of additional
consideration receivable related to the sale of IGM's equity
interest in Personal Capital in 2020.
Assets under management and advisement at December 31, 2021 were $277.1 billion, an increase of 4.5% in the
quarter and 15.5% from the prior year.
GROUPE BRUXELLES
LAMBERT
FOURTH QUARTER
GBL reported a net loss of €12 million, compared with net
earnings of €68 million in 2020.
GBL reported a net asset value at December 31, 2021 of €22,501 million,
representing €143.91 per share, compared with €20,498 million
or €127.03 per share at December 31,
2020.
GBL adopted IFRS 9 in 2018. Power Corporation continues to apply
IAS 39; this resulted in a negative adjustment to the contribution
from GBL of $24 million in the fourth
quarter of 2021.
[1]
|
Described as "base
earnings" by Lifeco. For additional information, please refer to
the Non-IFRS Financial Measures section later in this news
release.
|
[2]
|
Adjusted net earnings
is a non-IFRS measure. For additional information, please refer to
the Non-IFRS Financial Measures section later in this news
release.
|
Alternative and Other Investments
Results for the
quarter ended December 31,
2021
Alternative and other investments are comprised of the results
of the Corporation's alternative asset investment platforms,
Sagard and Power Sustainable,
which includes income earned from asset management activities and
investing activities. Asset management activities includes
management fees and carried interest net of investment platform
expenses. Investing activities comprises income earned on the
capital invested by the Corporation (proprietary capital) in the
investment funds managed by each platform and the share of earnings
(losses) of controlled and consolidated subsidiaries held within
the alternative asset investment platforms. Other includes the
share of earnings (losses) of standalone businesses and the
Corporation's investments in investment and hedge funds. For
additional information, refer to the table later in this news
release.
FOURTH QUARTER
Net earnings of alternative and other investments, including
standalone businesses, was $36 million, compared with
$78 million in the corresponding period in 2020. Adjusted net
earnings of alternative and other investments was $51 million,
compared with $78 million in the corresponding period in
2020.
SAGARD AND POWER
SUSTAINABLE
Sagard
announced in the fourth quarter the successful first closing of
Sagard Private Equity Canada's Canadian mid-market private equity
fund with commitments totalling $200
million.
Net earnings in the fourth quarter include a net contribution of
$16 million from the asset management
activities of Sagard and
Power Sustainable, and a net contribution from investing activities
of Sagard of $32 million primarily related to fair value gains
in its venture capital (fintech) funds, offset by a negative
contribution from Power Sustainable's investing activities of
$35 million which includes a
$15 million impairment charge on direct energy infrastructure
investments.
Summary of assets under
management [1] (including unfunded
commitments):
(in billions of
dollars)
|
December 31,
2021
|
December 31,
2020
|
Sagard [2][3]
|
16.2
|
6.6
|
Power
Sustainable [3]
|
2.9
|
1.9
|
Total
|
19.1
|
8.5
|
Percentage of
third-party and associates
|
81%
|
58%
|
STANDALONE BUSINESSES
Net earnings of the standalone
businesses in the fourth quarter of 2021 were $12 million, compared with $47 million in the comparative period in 2020.
The fourth quarter of 2021 includes a net contribution of
$16 million from Lion which consists
of the Corporation's share of earnings of Lion, a decrease in the
fair value of outstanding call rights held by Power Sustainable and
a decrease in amounts payable for long-term incentive plans, net of
related taxes.
At December 31, 2021, the fair
value of standalone businesses was $1.5
billion, compared with $1.4
billion at December 31,
2020.
[1]
|
See "Other Measures"
section later in the news release.
|
[2]
|
Includes ownership in
Wealthsimple valued at $2.1 billon based on its May 2021 investment
round and excludes assets under management of Sagard's wealth
management business. In the fourth quarter of 2021, Sagard acquired
EverWest, a real estate investment management firm.
|
[3]
|
Excludes the fair
value of interests held in standalone businesses.
|
Adjusted Net Asset Value and Participating Shareholder's
Equity
At December 31,
2021
ADJUSTED NET ASSET VALUE
Adjusted net asset value per share represents management's
estimate of the fair value of participating shareholders' equity of
the Corporation. Adjusted net asset value is the fair value of the
assets of the combined Power Corporation and Power Financial
holding company balance sheet less their net debt and preferred
shares. Refer to Non-IFRS Financial Measures section later in this
news release for a reconciliation with the combined holding company
balance sheet.
The Corporation's adjusted net asset value per share was
$52.60 at December 31, 2021, compared with $41.27 at December 31,
2020, representing an increase of 27.5%.
|
(in millions of
dollars, except per share amounts)
|
December 31,
2021
|
December 31,
2020
|
Variation
%
|
Publicly
Traded
Operating
Companies
|
Lifeco
|
23,545
|
18,825
|
25
|
IGM
|
6,749
|
5,105
|
32
|
GBL
|
3,157
|
2,870
|
10
|
|
|
33,451
|
26,800
|
25
|
Alternative
Asset Investment
Platforms
|
Sagard [1]
|
1,515
|
1,298
|
17
|
Power Sustainable
[1]
|
1,654
|
1,872
|
(12)
|
|
|
3,169
|
3,170
|
−
|
Other
|
ChinaAMC
|
1,150
|
715
|
61
|
Standalone businesses
[2]
|
1,331
|
1,351
|
(1)
|
Other assets and
investments
|
661
|
548
|
21
|
Cash and cash
equivalents
|
1,635
|
1,226
|
33
|
|
Gross asset
value
|
41,397
|
33,810
|
22
|
|
Liabilities and
preferred shares
|
(5,810)
|
(5,859)
|
1
|
|
Adjusted net asset
value
|
35,587
|
27,951
|
27
|
|
Shares outstanding
(millions)
|
676.6
|
677.2
|
|
|
Adjusted net asset
value per share
|
52.60
|
41.27
|
27
|
[1]
|
Includes the
management companies of the investment platforms at their carrying
value.
|
[2]
|
Includes Lion, LMPG
Inc. (LMPG), Peak Achievement Athletics Inc. (Peak) and GP
Strategies (disposed of in the fourth quarter of 2021).
|
Power
Corporation's Ownership in Publicly Traded Operating
Companies
|
|
|
|
|
Share
price
|
|
Ownership [1]
(%)
|
Shares
held [1]
(in millions)
|
December 31,
2021
|
December 31,
2020
|
Lifeco
|
66.7
|
620.3
|
$37.96
|
$30.35
|
IGM
|
61.7
|
147.9
|
$45.62
|
$34.51
|
GBL [2]
|
14.6
|
22.8
|
€98.16
|
€82.52
|
[1]
|
As at December 31,
2021.
|
[2]
|
Held through
Parjointco SA (Parjointco), a jointly controlled corporation
(50%).
|
PARTICIPATING SHAREHOLDERS' EQUITY
Book value per participating share represents Power
Corporation's participating shareholders' equity divided by the
number of participating shares outstanding at the end of the
reporting period. Participating shareholders' equity is the total
assets of the combined Power Corporation and Power Financial
holding company balance sheet, including investments in
subsidiaries presented using the equity method, less their net debt
and preferred shares.
The Corporation's book value per participating share was
$34.56 at December 31, 2021, compared with $31.38 at December 31,
2020, an increase of 10.1%.
|
(in millions of
dollars, except per share amounts)
|
December 31,
2021
|
December 31,
2020
|
Variation
%
|
Publicly
Traded Operating
Companies
|
Lifeco
|
15,496
|
14,451
|
7
|
IGM
|
3,434
|
2,853
|
20
|
GBL
|
4,278
|
4,216
|
1
|
|
|
23,208
|
21,520
|
8
|
Alternative
Asset Investment
Platforms
|
Sagard
|
822
|
988
|
(17)
|
Power
Sustainable
|
1,389
|
1,569
|
(11)
|
|
|
2,211
|
2,557
|
(14)
|
Other
|
ChinaAMC
|
766
|
715
|
7
|
Standalone
businesses [1]
|
725
|
563
|
29
|
Other assets and
investments
|
611
|
529
|
16
|
Cash and cash
equivalents
|
1,635
|
1,226
|
33
|
|
Total
assets
|
29,156
|
27,110
|
8
|
|
Liabilities and
preferred shares
|
(5,771)
|
(5,859)
|
2
|
|
Participating
shareholders' equity
|
23,385
|
21,251
|
10
|
|
Shares outstanding
(millions)
|
676.6
|
677.2
|
|
|
Book value per
participating share
|
34.56
|
31.38
|
10
|
[1]
|
Includes Lion, LMPG,
Peak and GP Strategies (disposed of in the fourth quarter of
2021).
|
Dividend on Power Corporation Participating Shares
The Board of Directors declared a quarterly dividend
of 49.50 cents per share on the Participating Preferred Shares
and the Subordinate Voting Shares of the Corporation, payable
April 29, 2022 to shareholders of
record March 31, 2022.
Dividends on Power Corporation Non-Participating Preferred
Shares
The Board of Directors also declared quarterly dividends on the
Corporation's preferred shares, payable April 15, 2022 to shareholders of record
March 29, 2022:
Series
|
Stock
Symbol
|
Amount
|
Series
|
Stock
Symbol
|
Amount
|
Series A
|
POW.PR.A
|
35¢
|
Series D
|
POW.PR.D
|
31.25¢
|
Series B
|
POW.PR.B
|
33.4375¢
|
Series G
|
POW.PR.G
|
35¢
|
Series C
|
POW.PR.C
|
36.25¢
|
|
|
|
Investor Information
|
|
|
Access to
Quarterly
Results Materials:
|
|
Quarterly Earnings
Conference Call:
|
The fourth quarter
earnings
news release and shareholder
report are available on the
Power Corporation website at www.powercorporation.com/en/
investors
|
|
Power Corporation
will host an earnings call and live audio webcast on Friday,
March 18, 2022 at 8:30 a.m. (Eastern Time). A
question-and-answer period with analysts will follow the
presentation. Shareholders, investors, and other stakeholders are
welcome to participate on a listen-only basis.
The live audio webcast and
presentation materials will be available at:
www.powercorporation.com/en/investors/events-presentations.
To listen via telephone,
please dial 1-833-979-2697 toll-free in North America or
647-689-6826 for international calls and enter passcode
3389258#.
A replay of the conference call will be available from March 18,
2022 at 11:30 a.m. (Eastern Time) until May 10, 2022 by calling
1-800-585-8367 toll-free in North America or 416-621-4642 for
international calls, using the access code 3389258#. A webcast
archive will also be available on Power Corporation's
website.
|
Investor Relations
Contact:
|
|
Treasury
514-286-7400 investor.relations@powercorp.com
|
|
About Power Corporation
Power Corporation is an international management and holding
company that focuses on financial services in North America, Europe and Asia. Its core holdings are leading insurance,
retirement, wealth management and investment businesses, including
a portfolio of alternative asset investment platforms. To learn
more, visit www.PowerCorporation.com.
At December 31, 2021, Power
Corporation held the following economic interests:
|
|
100% – Power
Financial
|
www.powerfinancial.com
|
66.7%
|
Great-West
Lifeco [1] (TSX: GWO)
|
www.greatwestlifeco.com
|
61.7%
|
IGM
Financial (TSX: IGM)
|
www.igmfinancial.com
|
14.6%
|
GBL [2] (Euronext:
GBLB)
|
www.gbl.be
|
54.8%
|
Wealthsimple [3]
|
www.wealthsimple.com
|
|
Investment
Platforms
|
|
100%
|
Sagard [4]
|
www.sagard.com
|
100%
|
Power
Sustainable
|
www.powersustainable.com
|
|
13.9% –
ChinaAMC [1][5]
|
www.chinaamc.com
|
[1]
|
Subsequent to
year-end, the Corporation and IGM entered into an agreement under
which the interest in ChinaAMC will be consolidated at IGM. In a
separate agreement, IGM will sell approximately 1.6% of IGM's 4.0%
interest in Lifeco to Power Financial. Refer to the section "China
Asset Management Company, Ltd. (ChinaAMC)" in the section "2021
Highlights" in the Corporation's 2021 Annual MD&A.
|
[2]
|
Held through
Parjointco, a jointly controlled corporation (50%).
|
[3]
|
Undiluted equity
interest held by Portage I, Power Financial and IGM, representing a
fully diluted equity interest of 42.5%.
|
[4]
|
The Corporation holds
an 86.3% interest in Sagard Holdings Management Inc.
|
[5]
|
IGM also holds a
13.9% interest in ChinaAMC.
|
Earnings Summary
Contribution to
Adjusted Net Earnings and Net Earnings
|
(in millions of
dollars)
|
Three
months ended
December 31,
|
Twelve
months ended
December 31,
|
|
2021
|
2020
|
2021
|
2020
|
Adjusted net
earnings [1]
|
|
|
|
|
Lifeco [2]
|
550
|
495
|
2,175
|
1,784
|
IGM [2]
|
161
|
127
|
601
|
474
|
GBL
[2]
|
(3)
|
16
|
60
|
89
|
Effect of
consolidation [3]
|
(6)
|
(34)
|
68
|
(44)
|
|
702
|
604
|
2,904
|
2,303
|
Alternative asset
investment platforms and other [4][5]
|
39
|
31
|
460
|
81
|
ChinaAMC
|
17
|
12
|
62
|
42
|
Standalone businesses
[4][6]
|
12
|
47
|
225
|
31
|
Corporate operating
and other expenses
|
(47)
|
(20)
|
(233)
|
(164)
|
Dividends on
non-participating and perpetual preferred shares
|
(47)
|
(47)
|
(188)
|
(189)
|
Non-controlling
interests of Power Financial
|
−
|
−
|
−
|
(116)
|
Adjusted net
earnings [7]
|
676
|
627
|
3,230
|
1,988
|
Adjustments
[8]
|
(50)
|
(4)
|
(313)
|
6
|
Net earnings
[7]
|
|
|
|
|
Lifeco
[2]
|
511
|
609
|
2,088
|
1,967
|
IGM
[2]
|
166
|
143
|
606
|
475
|
GBL
[2]
|
(3)
|
16
|
60
|
83
|
Effect of
consolidation [3]
|
(7)
|
(160)
|
(35)
|
(209)
|
|
667
|
608
|
2,719
|
2,316
|
Alternative asset
investment platforms and other [4][5]
|
24
|
31
|
345
|
59
|
ChinaAMC
|
17
|
12
|
62
|
42
|
Standalone businesses
[4][6]
|
12
|
47
|
225
|
58
|
Corporate operating
and other expenses
|
(47)
|
(28)
|
(246)
|
(172)
|
Dividends on
non-participating and perpetual preferred shares
|
(47)
|
(47)
|
(188)
|
(189)
|
Non-controlling
interests of Power Financial
|
−
|
−
|
−
|
(120)
|
|
626
|
623
|
2,917
|
1,994
|
[1]
|
For a reconciliation
of Lifeco, IGM and Alternative and other investments' non-IFRS
adjusted net earnings to their net earnings, refer to the sections
"Non-IFRS Financial Measures" and "Alternative and Other
Investments" below.
|
[2]
|
As reported by
Lifeco, IGM and GBL.
|
[3]
|
Effect of
consolidation reflects: i) the elimination of intercompany
transactions; ii) the application of the Corporation's accounting
method for investments under common control to the reported net
earnings of the publicly traded operating companies, which
includes: a) an adjustment related to Lifeco's investment in the
PSEIP; and b) an allocation of the results of the fintech portfolio
including Wealthsimple, Koho, Portage I, Portage II and Portage III
to the contributions from Lifeco and IGM based on their respective
interest; and iii) adjustments in accordance with IAS 39 for IGM
and GBL. Refer to the detailed table in the Contribution to
net earnings and adjusted net earnings section of the Corporation's
2021 Annual MD&A.
|
[4]
|
Presented in
Alternative and other investments in the Contribution to net
earnings and adjusted net earnings section of the
Corporation's 2021 Annual MD&A.
|
[5]
|
Includes earnings of
the Corporation's alternative asset investment platforms including
investments held through Power Financial.
|
[6]
|
Includes the results
of Lion, LMPG, Peak, GP Strategies (up to the date of disposal in
the fourth quarter of 2021) and IntegraMed (up to the date of
deconsolidation on May 20, 2020).
|
[7]
|
Attributable to
participating shareholders.
|
[8]
|
Refer to the detailed
table of Adjustments in the "Non-IFRS Financial Measures" section
below.
|
Contribution to
Adjusted Net Earnings per Share and Net Earnings per
Share
|
|
|
|
|
(in dollars per
share)
|
Three months
ended December 31,
|
Twelve months
ended
December
31,
|
|
2021
|
2020
|
2021
|
2020
|
Adjusted net
earnings per share – basic [1]
|
|
|
|
|
Lifeco
[2]
|
0.82
|
0.73
|
3.22
|
2.65
|
IGM
[2]
|
0.24
|
0.19
|
0.89
|
0.71
|
GBL
[2]
|
(0.01)
|
0.02
|
0.08
|
0.14
|
Effect of
consolidation [3]
|
(0.01)
|
(0.05)
|
0.10
|
(0.13)
|
|
1.04
|
0.89
|
4.29
|
3.37
|
Alternative asset
investment platforms and Other [4][5]
|
0.05
|
0.05
|
0.67
|
0.13
|
ChinaAMC
|
0.02
|
0.02
|
0.09
|
0.06
|
Standalone businesses
[4][6]
|
0.02
|
0.07
|
0.34
|
0.05
|
Corporate operating
and other expenses and dividends on non‑participating and
perpetual preferred shares
|
(0.13)
|
(0.10)
|
(0.62)
|
(0.54)
|
Adjusted net
earnings per share [7]
|
1.00
|
0.93
|
4.77
|
3.07
|
Adjustments
[8]
|
(0.07)
|
(0.01)
|
(0.46)
|
0.01
|
Net earnings per
share – basic [7]
|
|
|
|
|
Lifeco
[2]
|
0.77
|
0.89
|
3.09
|
2.93
|
IGM
[2]
|
0.24
|
0.21
|
0.89
|
0.71
|
GBL
[2]
|
(0.01)
|
0.02
|
0.08
|
0.13
|
Effect of
consolidation [3]
|
(0.01)
|
(0.23)
|
(0.04)
|
(0.38)
|
|
0.99
|
0.89
|
4.02
|
3.39
|
Alternative asset
investment platforms and other [4][5]
|
0.03
|
0.05
|
0.50
|
0.09
|
ChinaAMC
|
0.02
|
0.02
|
0.09
|
0.06
|
Standalone businesses
[4][6]
|
0.02
|
0.07
|
0.34
|
0.09
|
Corporate operating
and other expenses and dividends on non‑participating and
perpetual preferred shares
|
(0.13)
|
(0.11)
|
(0.64)
|
(0.55)
|
|
0.93
|
0.92
|
4.31
|
3.08
|
[1]
|
For a reconciliation
of Lifeco, IGM and Alternative and other investments' non-IFRS
adjusted net earnings to their net earnings, refer to the sections
"Non-IFRS Financial Measures" and "Alternative and Other
Investments" below.
|
[2]
|
As reported by
Lifeco, IGM and GBL.
|
[3]
|
Effect of
consolidation reflects: i) the elimination of intercompany
transactions; ii) the application of the Corporation's accounting
method for investments under common control to the reported net
earnings of the publicly traded operating companies, which
includes: a) an adjustment related to Lifeco's investment in the
PSEIP; and b) an allocation of the results of the fintech portfolio
including Wealthsimple, Koho, Portage I, Portage II and Portage III
to the contributions from Lifeco and IGM based on their respective
interest; and iii) adjustments in accordance with IAS 39 for IGM
and GBL. Refer to the detailed table in the Contribution to
net earnings and adjusted net earnings section of the Corporation's
2021 Annual MD&A.
|
[4]
|
Presented in
Alternative and other investments in the Contribution to net
earnings and adjusted net earnings section of the
Corporation's 2021 Annual MD&A.
|
[5]
|
Includes earnings of
the Corporation's alternative asset investment platforms including
investments held through Power Financial.
|
[6]
|
Includes the results
of Lion, LMPG, Peak, GP Strategies (up to the date of disposal in
the fourth quarter of 2021) and IntegraMed (up to the date of
deconsolidation on May 20, 2020).
|
[7]
|
Attributable to
participating shareholders.
|
[8]
|
Refer to the detailed
table of Adjustments in the "Non-IFRS Financial Measures" section
below.
|
Alternative and Other Investments – Earnings
(in millions of dollars)
|
Three
months ended
December 31,
|
Twelve
months ended
December 31,
|
|
2021
|
2020
|
2021
|
2020
|
Adjusted net
earnings
|
|
|
|
|
Asset management
activities [1]
|
|
|
|
|
Sagard
|
28
|
(3)
|
72
|
(3)
|
Power
Sustainable
|
(12)
|
(8)
|
(31)
|
(22)
|
Investing activities
(proprietary capital)
|
|
|
|
|
Sagard
[2][3]
|
32
|
40
|
122
|
50
|
Power Sustainable
[4]
|
(20)
|
(13)
|
259
|
39
|
Standalone businesses
[5]
|
12
|
47
|
225
|
31
|
Investment and hedge
funds and Other [6]
|
11
|
15
|
38
|
17
|
Adjusted net
earnings
|
51
|
78
|
685
|
112
|
Adjustments
[7]
|
(15)
|
−
|
(115)
|
5
|
Net
earnings
|
36
|
78
|
570
|
117
|
[1]
|
Includes management
fees charged by the investment platforms on proprietary capital.
Management fees paid by the Corporation are deducted from income
from investing activities.
|
[2]
|
Includes a realized
gain of $66 million recognized by the Corporation on disposal of
its limited partner interest in Sagard Europe 3 in the third
quarter of 2021, as well as realized gains on disposals by Sagard
Europe 3 of private equity investments in the second and third
quarters of 2021.
|
[3]
|
Includes the
Corporation's share of earnings (losses) of Wealthsimple and Koho
(up to the date of deconsolidation on December 1, 2020). The first
quarter of 2021 includes a charge of $52 million related to the
Corporation's share of the carried interest payable due to
increases in fair value of investments held in the Portage Funds
and Wealthsimple; as well, excludes a charge of $100 million
related to the remeasurement of the put right liability held by
certain of the non-controlling interests in Wealthsimple to fair
value which has been included in Adjustments (see "Adjustments"
section below). In the fourth quarter of 2020, the Corporation's
share of the gain on deconsolidation of Koho was $31 million.
The increase in fair value of the Corporation's investment,
including its investment held through Power Financial, in Portage
I, Portage II, Portage III, Koho and Wealthsimple was $650 million
in the twelve-month period ended December 31, 2021, compared
with an increase of $201 million in fair value in the corresponding
period in 2020.
|
[4]
|
The fourth quarter of
2021 includes a negative contribution of $27 million from the Power
Sustainable Energy Platform; operating losses in the fourth quarter
are mainly attributable to lower insolation, seasonality, and snow
losses, as well as charges associated with the replacement of
certain solar panels with higher generating capacity. Investing
activities also include gains (losses) realized on the disposal of
investments and dividends received in Power Sustainable China. In
2021, the Corporation recognized realized gains on the disposal of
investments in Power Sustainable China of $229 million,
$56 million, $18 million and $10 million in the first, second,
third and fourth quarters, respectively.
|
[5]
|
The third and fourth
quarters of 2021 include a net contribution of $55 million and $16
million, respectively, from Lion which consists of the
Corporation's share of earnings of Lion, a decrease in the fair
value of outstanding call rights held by Power Sustainable and a
decrease in amounts payable for long-term incentive plans, net of
related taxes. In the second quarter of 2021, the Corporation
recorded a net gain of $153 million related to its investment
in Lion which is comprised of i) a gain of $62 million related
to the effect of the change in ownership as a result of the
completion of the merger transaction between Lion and Northern
Genesis Acquisition Corp. (Northern Genesis), ii) a gain of
$147 million related to the revaluation of call rights held by
Power Sustainable, a portion of which were exercised during the
second quarter, and iii) an expense of $56 million related to
the increase in amounts payable for long-term incentive plans and
deferred taxes. The Corporation also recorded a reversal of a
previously recognized impairment on its investment in GP Strategies
of $33 million in the second quarter. Includes the
Corporation's share of earnings (losses) of IntegraMed (up to the
date of deconsolidation on May 20, 2020), LMPG, Peak, GP Strategies
(up to the date of disposal in the fourth quarter of 2021) and
Lion.
|
[6]
|
Other consists mainly
of foreign exchange gains or losses and interest on cash and cash
equivalents.
|
[7]
|
Refer to the detailed
table of Adjustments in the "Non-IFRS Financial Measures" section
below.
|
Non-IFRS Financial Measures
Net earnings attributable
to participating shareholders are comprised of:
- Adjusted net earnings attributable to participating
shareholders; and
- Adjustments, which include the after-tax impact of any item
that in management's judgment, including those identified by
management of its publicly traded operating companies, would make
the period-over-period comparison of results from operations less
meaningful. Includes the Corporation's share of Lifeco's impact of
actuarial assumption changes and management actions, direct equity
and interest rate market impacts on insurance contract liabilities
net of hedging, as well as items that management believes are not
indicative of the underlying business results which include those
identified by a subsidiary or a jointly controlled corporation.
Items that management and management of its subsidiaries believe
are not indicative of the underlying business results include
restructuring or reorganization costs, integration costs related to
business acquisitions, material legal settlements, material
impairment charges, impact of substantially enacted income tax rate
changes and other tax impairments, certain non-recurring material
items, and net gains, losses or costs related to the disposition or
acquisition of a business.
Management uses these financial measures in its presentation and
analysis of the financial performance of Power Corporation and
believes that they provide additional meaningful information to
readers in their analysis of the results of the Corporation.
Adjusted net earnings, as defined by the Corporation, assist the
reader in comparing the current period's results to those of
previous periods as it reflects management's view of the operating
performance of the Corporation and its subsidiaries and excludes
items that are not considered to be part of the underlying business
results.
Adjusted net asset value is commonly used by holding companies
to assess their value. Adjusted net asset value is the fair value
of the assets of the combined Power Corporation and Power Financial
holding company balance sheet less their net debt and preferred
shares. The investments held in public entities (including Lifeco,
IGM and GBL) are measured at their market value and investments in
private entities and investment funds are measured at management's
estimate of fair value. This measure presents the fair value of the
net assets of the holding company to management and investors, and
assists the reader in determining or comparing the fair value of
investments held by the company or its overall fair value.
Adjusted net earnings attributable to participating
shareholders, adjusted net asset value, adjusted net earnings per
share and adjusted net asset value per share are non-IFRS financial
measures and ratios that do not have a standard meaning and may not
be comparable to similar measures used by other entities.
Presentation of Holding Company
Activities
The Corporation's reportable segments
are Lifeco, IGM and GBL, which represent the Corporation's
investments in publicly traded operating companies. These
reportable segments, in addition to the asset management and
holding company activities, reflect Power Corporation's management
structure and internal financial reporting. The Corporation
evaluates its performance based on the operating segment's
contribution to earnings.
The holding company activities comprise the corporate activities
of the Corporation and Power Financial, on a combined basis, and
present the investment activities of the Corporation as a holding
company. The investment activities of the holding company,
including the investments in Lifeco, IGM and controlled entities
within the alternative asset investment platforms, are presented
using the equity method. The holding company activities also
present the corporate assets and liabilities managed, including the
cash and non-participating shares, which fund a portion of the
capital invested in other operations. The discussions included in
the sections "Financial Position" and "Cash Flows" of the
Corporation's 2021 Annual MD&A present the segmented balance
sheet and cash flow statement of the holding company; these
non-consolidated statements are presented in Note 33 of the
Corporation's 2021 Consolidated Financial Statements. This
presentation is useful to the reader as it presents the holding
company's (parent) results separately from the results of its
consolidated operating subsidiaries.
Comparative Figures
In the first quarter of 2021, the charge related to the
remeasurement of the put right liability of certain of the
non-controlling interests in Wealthsimple to fair value was
presented as an Adjustment as these rights were extinguished at the
close of the transaction and thereafter will not have future fair
value changes. The fair value changes in the put right obligations
were not previously presented as an Adjustment as they were
expected to be recurring. The related amounts in the comparative
periods have been reclassified as an Adjustment to reflect this
presentation. Adjusted net earnings in 2020 has been restated to
reflect this change.
The Corporation's share of the charge on the remeasurement of
the put right liability was $45
million in the third quarter of 2020. The charge has been
reflected in the Adjustments of the alternative asset investment
platforms, Lifeco and IGM based on their respective interest in the
Effect of consolidation of $22
million, $2 million and
$21 million, respectively.
Reconciliations of Non-IFRS Financial Measures
Power Corporation
ADJUSTED NET EARNINGS
(in millions of
dollars)
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
|
2021
|
2020
|
2021
|
2020
|
Adjusted net earnings
– Non-IFRS financial measure [1][4]
|
676
|
627
|
3,230
|
1,988
|
Share of Adjustments
[2], net of tax
|
|
|
|
|
Lifeco
|
(38)
|
7
|
(89)
|
74
|
IGM
|
3
|
(3)
|
(96)
|
(55)
|
GBL
[3]
|
−
|
−
|
−
|
(6)
|
Alternative and other
investments
|
(15)
|
−
|
(115)
|
5
|
Corporate
operations
|
−
|
(8)
|
(13)
|
(8)
|
Attributable to
non-controlling interests of Power Financial
|
−
|
−
|
−
|
(4)
|
|
(50)
|
(4)
|
(313)
|
6
|
Net earnings – IFRS
financial measure [1]
|
626
|
623
|
2,917
|
1,994
|
[1]
|
Attributable to
participating shareholders of Power Corporation.
|
[2]
|
Refer to the
"Adjustments" section for more detail on Adjustments from Lifeco,
IGM, GBL, alternative and other investments, and corporate
operations.
|
[3]
|
Previously reported
by Pargesa.
|
[4]
|
Adjusted net earnings
in 2020 has been restated to reflect the charge related to the
remeasurement of the put right liability of certain of the
non-controlling interests in Wealthsimple to fair value.
|
ADJUSTMENTS
(Excluded from Adjusted Net Earnings)
|
|
|
(in millions of
dollars)
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
|
2021
|
2020
|
2021
|
2020
|
|
Lifeco[1]
|
|
|
|
|
|
Actuarial assumption
changes and other
management actions (pre-tax)
|
19
|
(47)
|
99
|
41
|
|
Income tax (expense)
benefit
|
(3)
|
32
|
(9)
|
35
|
|
Market-related impacts
on liabilities (pre-tax)
|
14
|
(14)
|
23
|
(119)
|
|
Income tax (expense)
benefit
|
(1)
|
(7)
|
(7)
|
34
|
|
Transaction costs
related to acquisitions (pre-tax)
|
(51)
|
(39)
|
(139)
|
(63)
|
|
Income tax (expense)
benefit
|
2
|
8
|
13
|
11
|
|
Tax legislative
changes impact on liabilities
|
−
|
−
|
(14)
|
−
|
|
Revaluation of a
deferred tax asset
|
−
|
131
|
−
|
131
|
|
Net gain on business
dispositions (pre-tax)
|
(9)
|
91
|
(9)
|
155
|
|
Income tax (expense)
benefit
|
−
|
4
|
−
|
3
|
|
Restructuring and
integration charges (pre-tax)
|
(14)
|
(59)
|
(60)
|
(59)
|
|
Income tax (expense)
benefit
|
4
|
14
|
16
|
14
|
|
|
(39)
|
114
|
(87)
|
183
|
|
Effect of
consolidation (pre-tax)[2]
|
1
|
(105)
|
(2)
|
(107)
|
|
Income tax (expense)
benefit
|
−
|
(2)
|
−
|
(2)
|
|
|
(38)
|
7
|
(89)
|
74
|
|
IGM[1]
|
|
|
|
|
|
Net gain on business
dispositions (pre-tax)
|
7
|
16
|
7
|
39
|
|
Income tax (expense)
benefit
|
(2)
|
(2)
|
(2)
|
(6)
|
|
Restructuring and
other charges (pre-tax)
|
−
|
−
|
−
|
(46)
|
|
Income tax (expense)
benefit
|
−
|
−
|
−
|
12
|
|
Share of Lifeco's
adjustments[1]
|
−
|
2
|
−
|
2
|
|
|
5
|
16
|
5
|
1
|
|
Effect of
consolidation (pre-tax)[2]
|
(2)
|
(26)
|
(101)
|
(65)
|
|
Income tax (expense)
benefit
|
−
|
7
|
−
|
9
|
|
|
3
|
(3)
|
(96)
|
(55)
|
|
GBL[3]
|
|
|
|
|
|
Other
charges
|
−
|
−
|
−
|
(6)
|
|
Alternative and other
investments
|
|
|
|
|
|
Remeasurements of
Wealthsimple's put right liability
|
−
|
−
|
(100)
|
(22)
|
|
Impairment charges on
direct energy infrastructure
investments (pre-tax)
|
(19)
|
−
|
(19)
|
−
|
|
Income tax (expense)
benefit
|
4
|
−
|
4
|
−
|
|
Recovery on
deconsolidation of IntegraMed
|
−
|
−
|
−
|
27
|
|
|
(15)
|
−
|
(115)
|
5
|
|
Corporate
operations
|
|
|
|
|
|
Reorganization
charges
|
−
|
(8)
|
(13)
|
(8)
|
|
Non-controlling
interests of Power Financial
|
−
|
−
|
−
|
(4)
|
|
|
(50)
|
(4)
|
(313)
|
6
|
|
[1]
|
As reported by Lifeco
and IGM.
|
[2]
|
Effect of
consolidation reflects (i) the elimination of intercompany
transactions, including in the fourth quarter of 2020 the gain
recognized by Lifeco on the sale of GLC, and the gain recognized by
IGM on the sale of the QGOF, (ii) the application of the
Corporation's accounting method for investments under common
control to the Adjustments reported by Lifeco and IGM, which
includes an allocation of the Adjustments related to the fintech
portfolio based on their respective interest and (iii) IGM's share
of Lifeco's Adjustments for the impact of actuarial assumption
changes and management actions and market impact on insurance
contract liabilities, in accordance with the Corporation's
definition of Adjusted net earnings. As well, the three- and
twelve-month periods ended December 31, 2020 reflect the
adjustment to the Corporation's share of IGM's Adjustment related
to the gain on disposal of Personal Capital; the Corporation has
not included this amount as an Adjustment as the gain recognized by
the Corporation relates to the remeasurement of the investment in
Personal Capital at fair value on the date Lifeco acquired
control.
|
[3]
|
As previously
reported by Pargesa.
|
ADJUSTED NET ASSET VALUE
Adjusted net asset value represents management's estimate of the
fair value of the participating shareholders' equity of the
Corporation. Adjusted net asset value is the fair value of the
assets of the combined Power Corporation and Power Financial
holding company balance sheet less their net debt and preferred
shares. The Corporation's adjusted net asset value per share is
presented on a look-through basis.
The Corporation's adjusted net asset value per share was
$52.60 at December 31, 2021, compared with $41.27 at December 31,
2020, representing an increase of 27.5%. The
Corporation's book value per participating share was $34.56 at December 31,
2021, compared with $31.38 at
December 31, 2020, an increase of 10.1%.
|
|
|
December 31,
2021
|
|
|
December 31,
2020
|
(in millions of
dollars, except per share amounts)
|
Holding
company
balance sheet
|
Fair value
adjustment
|
Adjusted net
asset value
|
Holding
company
balance sheet
|
Fair value
adjustment
|
Adjusted net
asset value
|
Assets
|
|
|
|
|
|
|
Investments
|
|
|
|
|
|
|
Power
Financial
|
|
|
|
|
|
|
Lifeco
|
15,496
|
8,049
|
23,545
|
14,451
|
4,374
|
18,825
|
IGM
|
3,434
|
3,315
|
6,749
|
2,853
|
2,252
|
5,105
|
GBL
|
4,278
|
(1,121)
|
3,157
|
4,216
|
(1,346)
|
2,870
|
Alternative and other
investments
|
|
|
|
|
|
|
Asset management
companies [1]
|
|
|
|
|
|
|
Sagard
|
116
|
−
|
116
|
163
|
−
|
163
|
Power
Sustainable
|
21
|
−
|
21
|
8
|
−
|
8
|
Investing
activities
|
|
|
|
|
|
|
Sagard
[2]
|
706
|
693
|
1,399
|
825
|
310
|
1,135
|
Power
Sustainable
|
1,368
|
265
|
1,633
|
1,561
|
303
|
1,864
|
Other
|
|
|
|
|
|
|
Standalone businesses
[3][4]
|
725
|
606
|
1,331
|
563
|
788
|
1,351
|
Other
|
262
|
50
|
312
|
247
|
19
|
266
|
ChinaAMC
[5]
|
766
|
384
|
1,150
|
715
|
−
|
715
|
Cash and cash
equivalents
|
1,635
|
−
|
1,635
|
1,226
|
−
|
1,226
|
Other
assets
|
349
|
−
|
349
|
282
|
−
|
282
|
Total
assets
|
29,156
|
12,241
|
41,397
|
27,110
|
6,700
|
33,810
|
Liabilities and
non-participating shares
|
|
|
|
|
|
|
Debentures and other
debt instruments
|
897
|
−
|
897
|
1,006
|
−
|
1,006
|
Other liabilities
[6][7]
|
1,090
|
39
|
1,129
|
1,067
|
−
|
1,067
|
Non-participating
shares and perpetual
preferred shares
|
3,784
|
−
|
3,784
|
3,786
|
−
|
3,786
|
Total liabilities and
non-participating shares
|
5,771
|
39
|
5,810
|
5,859
|
−
|
5,859
|
Net
value
|
|
|
|
|
|
|
Participating
shareholders'
equity / Adjusted net asset value
|
23,385
|
12,202
|
35,587
|
21,251
|
6,700
|
27,951
|
Per
share
|
34.56
|
|
52.60
|
31.38
|
|
41.27
|
[1]
|
The management
companies of the investment funds are presented at their carrying
value in accordance with IFRS and are primarily composed of cash
and net carried interest receivable.
|
[2]
|
Includes the
Corporation's investments in Portage I, Portage II and
Wealthsimple, held by Power Financial.
|
[3]
|
At December 31, 2020,
the investment in Lion was valued based on the subscription price
of US$10.00 per share for the private placement of common shares
announced as part of the merger transaction with Northern
Genesis.
|
[4]
|
An additional
deferred tax liability of $80 million has been included in the
adjusted net asset value with respect to the investments in
standalone businesses at fair value, without taking into account
possible tax planning strategies. The Corporation has tax
attributes (not otherwise recognized on the balance sheet) that
could be available to minimize the tax if the Corporation were to
dispose of its interests held in the standalone
businesses.
|
[5]
|
Subsequent to
year-end, the Corporation announced the sale of its interest in
ChinaAMC to IGM for aggregate consideration of $1.15 billion. At
December 31, 2021, the investment in ChinaAMC has been
presented in the adjusted net asset value at this amount. Valued at
carrying value in accordance with IFRS at December 31,
2020.
|
[6]
|
In accordance with
IAS 12, Income Taxes, no deferred tax liability is
recognized with respect to temporary differences associated with
investments in subsidiaries and jointly controlled corporations as
the Corporation is able to control the timing of the reversal of
the temporary differences and it is probable that the temporary
differences will not reverse in the foreseeable future. If the
Corporation were to dispose of an investment in a subsidiary or a
jointly controlled corporation, income taxes payable on such
disposition would be minimized through careful and prudent tax
planning and structuring, as well as with the use of available tax
attributes not otherwise recognized on the balance sheet, including
tax losses, tax basis, safe income and foreign tax surplus
associated with the subsidiary or jointly controlled
corporation.
|
[7]
|
An additional
deferred tax liability of $39 million has been included in the
adjusted net asset value related to the investment in
ChinaAMC at fair value.
|
This news release also contains other non-IFRS financial
measures which are publicly disclosed by the Corporation's
subsidiaries including adjusted net earnings, adjusted net earnings
per share and Lifeco's assets under administration. The below
section includes the description and reconciliation of the non-IFRS
financial measures included in this news release as reported by the
Corporation's subsidiaries. The information below is derived from
Lifeco and IGM's annual MD&As, as prepared and disclosed by the
respective companies in accordance with applicable securities
legislation, and which are also available either directly from
SEDAR (www.sedar.com) or from their websites,
www.greatwestlifeco.com and www.igmfinancial.com.
Lifeco
ADJUSTED NET EARNINGS ATTRIBUTABLE TO
LIFECO'S COMMON SHAREHOLDERS
Adjusted net earnings
(loss) [1] reflect Lifeco's management's view
of the underlying business performance of Lifeco and provide an
alternate measure to understand the underlying business performance
compared to IFRS net earnings. Adjusted net earnings (loss) exclude
the following items:
- The impact of actuarial assumption changes and other management
actions;
- The net earnings impact related to the direct equity and
interest rate market impacts on insurance and investment contract
liabilities, net of hedging, and related deferred tax liabilities,
which includes:
-
- the impact of hedge ineffectiveness related to segregated fund
guarantee liabilities that are hedged and the performance of
the
related hedge assets;
- the impact on segregated fund guarantee liabilities not
hedged;
- the impact on general fund equity and investment properties
supporting insurance contract liabilities;
- other market impacts on insurance and investment contract
liabilities and deferred tax liabilities, including those arising
from the difference between actual and expected market movements;
and
- Certain items that, when removed, assist in explaining Lifeco's
underlying business performance including restructuring costs,
integration costs related to business acquisitions, material legal
settlements, material impairment charges related to goodwill and
intangible assets, impact of substantially enacted income tax rate
changes and other tax impairments and net gains, losses or costs
related to the disposition or acquisition of a business.
(in millions of
dollars)
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
|
2021
|
2020
|
2021
|
2020
|
Adjusted net earnings
– Non-IFRS financial measure [1][2]
|
825
|
741
|
3,260
|
2,669
|
Adjustments
|
|
|
|
|
Actuarial assumption
changes and other
management actions (pre-tax)
|
28
|
(71)
|
148
|
61
|
Income tax (expense)
benefit
|
(5)
|
48
|
(14)
|
52
|
Market-related
impacts on liabilities (pre-tax)
|
22
|
(21)
|
35
|
(178)
|
Income tax (expense)
benefit
|
(2)
|
(10)
|
(11)
|
51
|
Transaction costs
related to acquisitions (pre-tax)
|
(76)
|
(59)
|
(207)
|
(95)
|
Income tax (expense)
benefit
|
2
|
12
|
18
|
17
|
Restructuring and
integration charges (pre-tax)
|
(21)
|
(88)
|
(90)
|
(88)
|
Income tax (expense)
benefit
|
6
|
21
|
24
|
21
|
Tax legislative
changes impact on liabilities
|
−
|
−
|
(21)
|
−
|
Net gain/charge on
business dispositions (pre-tax)
|
(14)
|
137
|
(14)
|
232
|
Income tax (expense)
benefit
|
−
|
6
|
−
|
5
|
Revaluation of a
deferred tax asset
|
−
|
196
|
−
|
196
|
|
(60)
|
171
|
(132)
|
274
|
Net earnings – IFRS
financial measure [2]
|
765
|
912
|
3,128
|
2,943
|
[1]
|
Described as "base
earnings" and identified as a non-GAAP financial measure by
Lifeco.
|
[2]
|
Attributable to
Lifeco common shareholders.
|
LIFECO'S ASSETS UNDER MANAGEMENT AND ASSETS UNDER
ADMINISTRATION
Total assets under administration includes total assets per
Lifeco's financial statements, proprietary mutual funds and
institutional assets and other assets under administration. Please
refer to the "Glossary" section of Lifeco's 2021 Annual
Management's Discussion and Analysis for additional information
regarding proprietary mutual funds and institutional net assets and
other assets under administration.
(in billions of
dollars)
|
December 31,
2021
|
December 31,
2020
|
Total assets per
financial statements
|
630.5
|
600.5
|
Proprietary mutual
funds and institutional assets
|
377.2
|
350.9
|
Assets under
management
|
1,007.7
|
951.4
|
Other assets under
administration
|
1,271.9
|
1,024.4
|
Assets under
administration
|
2,279.6
|
1,975.8
|
IGM Financial
ADJUSTED NET EARNINGS ATTRIBUTABLE
TO IGM'S COMMON SHAREHOLDERS
Net earnings available to common shareholders may be subdivided
into two components consisting of:
- Adjusted net earnings available to common shareholders;
and
- Other items, which include the after-tax impact of any item
that management considers to be of a non-recurring nature or that
could make the period-over-period comparison of results from
operations less meaningful.
(in millions of
dollars)
|
Three months
ended
December 31,
|
Twelve months
ended
December 31,
|
|
2021
|
2020
|
2021
|
2020
|
Adjusted net earnings –
Non-IFRS financial measure [1]
|
260.8
|
204.3
|
971.2
|
762.9
|
Adjustments
|
|
|
|
|
Gain on sale of
Personal Capital (pre-tax)
|
10.6
|
−
|
10.6
|
37.2
|
Income tax (expense)
benefit
|
(2.9)
|
−
|
(2.9)
|
(5.8)
|
Gain on sale of
Quadrus Group of Funds (pre-tax)
|
−
|
25.2
|
−
|
25.2
|
Income tax (expense)
benefit
|
−
|
(3.8)
|
−
|
(3.8)
|
Restructuring and
other (pre-tax)
|
−
|
−
|
−
|
(74.5)
|
Income tax (expense)
benefit
|
−
|
−
|
−
|
19.8
|
Proportionate share
of associate's adjustments
|
−
|
3.4
|
−
|
3.4
|
|
7.7
|
24.8
|
7.7
|
1.5
|
Net earnings – IFRS
financial measure [1]
|
268.5
|
229.1
|
978.9
|
764.4
|
[1] Available to IGM
common shareholders
|
OTHER MEASURES
This press release and other continuous
disclosure documents also include other measures used to discuss
activities of the Corporation's consolidated publicly traded
operating companies and alternative asset investment platforms
including, but not limited to, "assets under management", "assets
under administration", "assets under management and advisement",
"book value per participating share", "carried interest", "net
asset value", and "unfunded commitments". Refer to the section
"Other Measures" in the Corporation's 2021 Annual MD&A, which
can be located in the Corporation's profile on SEDAR at
www.sedar.com, for a definition of such measure, which definition
is incorporated herein by reference.
ELIGIBLE DIVIDENDS
For purposes of the Income Tax
Act (Canada) and any similar
provincial legislation, all of the above dividends on the
Corporation's preferred shares (including the Participating
Preferred Shares) and Subordinate Voting Shares are eligible
dividends.
FORWARD-LOOKING STATEMENTS
Certain statements in this
news release, other than statements of historical fact, are
forward-looking statements based on certain assumptions and reflect
the Corporation's current expectations, or with respect to
disclosure regarding the Corporation's public subsidiaries, reflect
such subsidiaries' disclosed current expectations. Forward-looking
statements are provided for the purposes of assisting the
reader in understanding the Corporation's financial performance,
financial position and cash flows as at and for the periods ended
on certain dates and to present information about management's
current expectations and plans relating to the future and the
reader is cautioned that such statements may not be appropriate for
other purposes. These statements may include, without limitation,
statements regarding the operations, business, financial condition,
expected financial results, performance, prospects, opportunities,
priorities, targets, goals, ongoing objectives, strategies and
outlook of the Corporation and its subsidiaries, the expected
impact of the COVID-19 pandemic on the Corporation and its
subsidiaries' operations, results and dividends, as well as the
outlook for North American and international economies for the
current fiscal year and subsequent periods, the intended effects of
the Reorganization, the Corporation's normal course issuer bid
commenced in 2022, the Corporation's sale of its interest in
ChinaAMC to IGM, including IGM's sale of a portion of its interest
in Lifeco, and related impacts and timing thereof, management of
standalone businesses to realize value over time, fundraising
activities by investment platforms, capital commitments by the
Power Group and third parties, the objective to maintain a minimum
cash and cash equivalents relative to fixed charges, and the
Corporation's subsidiaries' disclosed expectations, including the
acquisition of the Prudential's full-service retirement business as
well as the funding of the transaction and related synergies,
impacts, and timing thereof as well as a result of the acquisition
of the retirement services business of MassMutual, Personal
Capital, Northleaf Capital Group Ltd., ClaimSecure Inc., Ark Life
and related synergies, impacts and timing thereof as well as the
impacts of the EverWest transaction. Forward-looking statements
include statements that are predictive in nature, depend upon or
refer to future events or conditions, or include words such as
"expects", "anticipates", "plans", "believes", "estimates",
"seeks", "intends", "targets", "projects", "forecasts" or negative
versions thereof and other similar expressions, or future or
conditional verbs such as "may", "will", "should", "would" and
"could".
By its nature, this information is subject to inherent risks and
uncertainties that may be general or specific and which give rise
to the possibility that expectations, forecasts, predictions,
projections or conclusions will not prove to be accurate, that
assumptions may not be correct and that objectives, strategic goals
and priorities will not be achieved. A variety of factors, many of
which are beyond the Corporation's and its subsidiaries' control,
affect the operations, performance and results of the Corporation
and its subsidiaries and their businesses, and could cause actual
results to differ materially from current expectations of estimated
or anticipated events or results. These factors include, but are
not limited to: the impact or unanticipated impact of general
economic, political and market factors in North America and internationally,
fluctuations in interest rates, inflation and foreign exchange
rates, monetary policies, business investment and the health of
local and global equity and capital markets, management of market
liquidity and funding risks, risks related to investments in
private companies and illiquid securities, risks associated with
financial instruments, changes in accounting policies and methods
used to report financial condition (including uncertainties
associated with significant judgments, estimates and assumptions),
the effect of applying future accounting changes, business
competition, operational and reputational risks, technological
changes, cybersecurity risks, changes in government regulation and
legislation, changes in tax laws, unexpected judicial or regulatory
proceedings, catastrophic events, man-made disasters, terrorist
attacks, wars and other conflicts, or an outbreak of a public
health pandemic or other public health crises (such as COVID-19),
the Corporation's and its subsidiaries' ability to complete
strategic transactions, integrate acquisitions and implement other
growth strategies, the Corporation's and its subsidiaries' success
in anticipating and managing the foregoing factors and with respect
to forward-looking statements of the Corporation's subsidiaries'
disclosed in this news release, the factors identified by such
subsidiaries in their respective MD&A.
The reader is cautioned to consider these and other factors,
uncertainties and potential events carefully and not to put undue
reliance on forward-looking statements. Information contained in
forward-looking statements is based upon certain material
assumptions that were applied in drawing a conclusion or making a
forecast or projection, including management's perceptions of
historical trends, current conditions and expected future
developments, as well as other considerations that are believed to
be appropriate in the circumstances, including the availability of
cash to complete purchases under the Corporation's normal course
issuer bid, that the list of factors in the previous
paragraph, collectively, are not expected to have a material impact
on the Corporation and its subsidiaries and with respect to
forward-looking statements of the Corporation's subsidiaries
disclosed in this news release, the risks identified by such
subsidiaries in their respective MD&A and Annual Information
Form most recently filed with the securities regulatory authorities
in Canada and available at
www.sedar.com. While the Corporation considers these assumptions to
be reasonable based on information currently available to
management, they may prove to be incorrect.
Other than as specifically required by applicable Canadian law,
the Corporation undertakes no obligation to update any
forward-looking statement to reflect events or circumstances after
the date on which such statement is made, or to reflect the
occurrence of unanticipated events, whether as a result of new
information, future events or results, or otherwise.
Additional information about the risks and uncertainties of the
Corporation's business and material factors or assumptions on which
information contained in forward-looking statements is based is
provided in its disclosure materials, including its most recent
Management's Discussion and Analysis and Annual Information Form,
filed with the securities regulatory authorities in Canada and available at www.sedar.com.
SOURCE Power Corporation of Canada