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.
MONTRÉAL, Aug. 5, 2022 /CNW Telbec/ - Power
Corporation of Canada (Power
Corporation or the Corporation) (TSX: POW) today reported earnings
results for the three and six months ended June 30, 2022.
Power Corporation
Consolidated results for the
period ended June 30, 2022
HIGHLIGHTS
Power Corporation
- Net earnings [1] were $527
million or $0.78 per share
[2] for the second quarter of 2022, compared with
$994 million or $1.47 per share in 2021.
Adjusted net earnings [1][3] were $584 million or $0.87 per share, compared with $1,020 million or $1.51 per share in the second quarter of
2021.
- Adjusted net asset value per share [3] was
$41.49 at June
30, 2022, compared with $52.60
at December 31, 2021. The
Corporation's book value per participating share [4] was
$33.18 at June
30, 2022, compared with $34.56
at December 31, 2021.
- In the second quarter, the Corporation purchased for
cancellation 4.3 million subordinate voting shares for a total of
$159 million under its normal course
issuer bid. In the six-months ended June 30,
2022, the Corporation has purchased for cancellation 8.8
million subordinate voting shares for a total of $334 million under its normal course issuer
bids.
Great-West Lifeco Inc. (Lifeco)
- Second quarter net earnings were $735
million, compared with $784
million in the second quarter of 2021.
Adjusted net earnings [5] were $830 million, compared with $826 million in the second quarter of 2021.
- Total assets were $670 billion
and assets under administration [3] were $2.3 trillion at June 30,
2022, compared with total assets of $630 billion and assets under administration of
$2.3 trillion at December 31, 2021.
- On April 1, 2022, Lifeco's U.S.
subsidiary, which operates primarily as Empower, closed its
strategic acquisition of the full-service retirement business of
Prudential Financial, Inc. Empower's reach in the U.S. has expanded
to more than 17.4 million retirement plan participants and assets
under administration to US$1.3
trillion on behalf of approximately 71,000 workplace savings
plans as of June 30, 2022.
IGM Financial Inc. (IGM)
- Second quarter net earnings were $207.1
million, compared with $237.4
million in the second quarter of 2021.
- Assets under management and advisement [4] of
$242.1 billion, decreased 7.6% from
the second quarter of 2021 and 9.8% from March 31, 2022.
- Net outflows were $527 million in
the second quarter of 2022, compared with net inflows of
$2.9 billion in 2021. Year-to-date
net inflows of $1.9 billion remained
strong in a challenging environment.
Groupe Bruxelles Lambert (GBL)
- GBL reported a net asset value [4] of €17.8 billion,
representing €116.53 per share, compared with €22.5 billion or
€143.91 per share at December 31,
2021.
- In the second quarter of 2022, GBL completed €176 million of
share buybacks.
- In June 2022, GBL completed the
sale of a 3.5% interest in Mowi ASA, generating cash proceeds of
€386 million and realized a gain of €86 million.
Sagard Holdings Inc. (Sagard) and Power Sustainable Capital Inc.
(Power Sustainable)
- Assets under management [4], including unfunded
commitments, of the alternative asset investment platforms were
$19 billion, an increase from
$12 billion at June 30, 2021.
- On June 15, 2022, Power
Sustainable announced the initial $210
million close of its North American agri-food private equity
fund, Lios Fund I. Power Sustainable Lios is a specialized
agri-food private equity investment platform focusing on the
sustainability transformation occurring in our food system.
- In the second quarter of 2022, Sagard reached its initial $400 million
fundraising target for its inaugural Canadian private equity fund,
Sagard Private Equity Canada.
- On July 28, 2022, Portage
Ventures announced the launch of its late-stage, fintech-focused
Portage Capital Solutions Fund, a strategy focusing on structured
opportunities in fintech and financial services companies
globally.
|
|
[1]
|
Attributable to
participating shareholders.
|
[2]
|
All per share amounts
are per participating share of the Corporation.
|
[3]
|
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.
|
[4]
|
See the Other Measures
section later in this news release.
|
[5]
|
Defined as base
earnings by Lifeco, a non-IFRS financial measure; see the Non-IFRS
Financial Measures section later in this news release.
|
|
|
SECOND QUARTER
Net earnings attributable to participating shareholders were
$527 million or $0.78 per share, compared with $994 million or $1.47 per share in 2021.
Adjusted net earnings attributable to participating shareholders
[1] were $584 million or $0.87 per share, compared with $1,020 million or $1.51 per share in 2021.
Contributions to Power Corporation's Earnings
(in millions of
dollars, except per share amounts)
|
Net
Earnings
|
Adjusted Net
Earnings
|
|
2022
|
2021
|
2022
|
2021
|
Lifeco
[2]
|
489
|
523
|
552
|
551
|
IGM
[2]
|
129
|
148
|
129
|
148
|
GBL
[2]
|
(44)
|
24
|
(44)
|
24
|
Effect of consolidation
[3]
|
21
|
94
|
15
|
92
|
Publicly traded
operating companies
|
595
|
789
|
652
|
815
|
Alternative asset
investment platforms [4][5]
|
(34)
|
121
|
(34)
|
121
|
ChinaAMC
[6]
|
15
|
15
|
15
|
15
|
Standalone businesses
[5]
|
27
|
154
|
27
|
154
|
|
603
|
1,079
|
660
|
1,105
|
Corporate operations
and Other [7]
|
(76)
|
(85)
|
(76)
|
(85)
|
|
527
|
994
|
584
|
1,020
|
|
|
|
|
|
Per participating
share
|
0.78
|
1.47
|
0.87
|
1.51
|
Average shares
outstanding (in millions)
|
670.9
|
676.8
|
670.9
|
676.8
|
|
|
|
|
|
Publicly traded operating companies: contribution to
net earnings and adjusted net earnings were $595 million and
$652 million, representing a decrease of 24.6% and 20.0%,
respectively, from the second quarter of 2021:
Lifeco: contribution to net earnings
decreased by 6.5% and contribution to adjusted net earnings was
comparable with 2021.
IGM: contribution to net and adjusted net earnings
decreased by 12.8%.
GBL: negative contribution to net earnings of
$44 million, which includes fair value decreases and
impairments in its alternative asset portfolio.
Alternative asset investment platforms: net earnings
include a negative contribution of $51 million from Power
Sustainable mainly related to realized losses in the
Power Sustainable China portfolio of $70 million, partially
offset by a gain on disposal of $17 million on a portfolio of
solar assets in Power Sustainable Infrastructure.
Standalone businesses: contribution to net and adjusted
net earnings of $27 million; results
in 2022 include a positive impact of $28
million related to the Corporation's share of The Lion
Electric Company (Lion) which includes a reversal of long-term
incentives due to the decrease in market value of Lion. Results in
2021 included a positive impact of $153
million resulting from the gains on the change in ownership
in Lion on the completion of Lion's business combination with
Northern Genesis Acquisition Corp. (Northern Genesis).
Corporate operations and Other: includes a gain of
$17 million on the remeasurement of cash-settled share-based
payments, net of the loss on remeasurement of the related
derivative instrument.
Adjustments in the second quarter of 2022, excluded from
adjusted net earnings, were a net negative impact to earnings of
$57 million or $0.09 per share,
mainly related to the Corporation's share of Lifeco's adjustments,
which consisted of negative market-related impacts on liabilities
and transaction, restructuring and integration charges, partially
offset by actuarial assumption changes and management actions.
Adjustments in the second quarter of 2021 were a negative net
impact to earnings of $26 million or $0.04 per share, mainly related to the
Corporation's share of Lifeco's adjustments.
[1]
|
A non-IFRS financial
measure; see the Non-IFRS Financial Measures section later in this
news release.
|
[2]
|
As reported by Lifeco,
IGM and GBL.
|
[3]
|
Refer to the detailed
table in the Contribution to Net Earnings and Adjusted Net Earnings
section of the Corporation's most recent MD&A for additional
information.
|
[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 section of the Corporation's
most recent MD&A.
|
[6]
|
China Asset Management
Co., Ltd. (ChinaAMC).
|
[7]
|
Includes operating and
other expenses, dividends on non-participating shares of the
Corporation and Power Financial Corporation's (Power Financial)
corporate operations; refer to the Earnings Summary
below.
|
|
|
SIX MONTHS
Net earnings attributable to participating shareholders were
$1,005 million or $1.49 per share, compared with $1,550 million or $2.29 per share in 2021.
Adjusted net earnings attributable to participating shareholders
[1] were $1,099 million or $1.63 per share, compared with $1,806 million or $2.67 per share in 2021.
Contributions to Power Corporation's Earnings
(in millions of
dollars, except per share amounts)
|
Net
Earnings
|
Adjusted Net
Earnings
|
|
2022
|
2021
|
2022
|
2021
|
Lifeco
[2]
|
1,002
|
996
|
1,091
|
1,045
|
IGM
[2]
|
264
|
273
|
264
|
273
|
GBL
[2]
|
(73)
|
74
|
(73)
|
74
|
Effect of consolidation
[3]
|
61
|
(29)
|
56
|
78
|
Publicly traded
operating companies
|
1,254
|
1,314
|
1,338
|
1,470
|
Alternative asset
investment platforms [4][5]
|
(130)
|
276
|
(120)
|
376
|
ChinaAMC
|
28
|
28
|
28
|
28
|
Standalone businesses
[5]
|
31
|
155
|
31
|
155
|
|
1,183
|
1,773
|
1,277
|
2,029
|
Corporate operations
and Other [6]
|
(178)
|
(223)
|
(178)
|
(223)
|
|
1,005
|
1,550
|
1,099
|
1,806
|
|
|
|
|
|
Per participating
share
|
1.49
|
2.29
|
1.63
|
2.67
|
Average shares
outstanding (in millions)
|
673.3
|
676.9
|
673.3
|
676.9
|
|
|
[1]
|
A non-IFRS financial
measure; see the Non-IFRS Financial Measures section later in this
news release.
|
[2]
|
As reported by Lifeco,
IGM and GBL.
|
[3]
|
Refer to the detailed
table in the Contribution to Net Earnings and Adjusted Net Earnings
section of the Corporation's most recent MD&A for additional
information.
|
[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 section of the Corporation's
most recent MD&A.
|
[6]
|
Includes operating and
other expenses, dividends on non-participating shares of the
Corporation and Power Financial corporate operations; refer to the
Earnings Summary below.
|
|
|
Great-West Lifeco, IGM Financial and Groupe Bruxelles
Lambert
Results for the quarter ended June 30, 2022
The information below
is derived from Lifeco and IGM's second quarter 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 half-year report at
June 30, 2022. Further information on GBL's results is
available on its website at www.gbl.be.
|
|
GREAT-WEST LIFECO INC.
SECOND QUARTER
Net earnings attributable to common shareholders were
$735 million or $0.79 per share, compared with $784 million or $0.84 per share in 2021.
Adjusted net earnings [1] attributable to common
shareholders were $830 million or $0.89 per share, compared with $826 million
or $0.89 per share in 2021.
Adjustments in the second quarter of 2022, excluded from
adjusted net earnings, were a net negative earnings impact of
$95 million, compared with a net negative earnings impact of
$42 million in 2021.
IGM FINANCIAL INC.
SECOND QUARTER
Net earnings available to common shareholders were $207.1 million or $0.87 per share, compared with $237.4 million or $0.99 per share in 2021.
Assets under management and advisement at June 30, 2022
were $242.1 billion, a decrease
of 7.6% from the second quarter of 2021 and 9.8% from March 31, 2022.
GROUPE BRUXELLES
LAMBERT
SECOND QUARTER
GBL reported [2] a net loss of €204 million,
compared with net earnings of €110 million in 2021.
GBL reported a net asset value at June 30, 2022 of
€17,828 million, representing €116.53 per share, compared with
€22,501 million or €143.91 per share at December 31,
2021.
[1]
|
Defined as "base
earnings" by Lifeco. For additional information, please refer to
the Non-IFRS Financial Measures section later in this news
release.
|
[2]
|
GBL adopted IFRS 9 in 2018. Power Corporation continues
to apply IAS 39; this resulted in a positive adjustment to the
contribution from GBL of $17 million in the second quarter of
2022.
|
|
|
Alternative and Other Investments
Results for the
quarter ended June 30, 2022
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.
|
|
SECOND QUARTER
Net loss of alternative and other investments, including
standalone businesses, was $7 million, compared with net
earnings of $275 million in the corresponding period in
2021.
SAGARD AND POWER
SUSTAINABLE
Net earnings in the second quarter include a negative
contribution of $56 million from Sagard and Power Sustainable comprised of:
- A negative contribution of $39
million from the asset management activities of Sagard and Power Sustainable;
- A net negative contribution from investing activities of
$17 million comprised of i) a
positive contribution from Sagard
of $31 million, offset by ii) a
negative contribution from Power Sustainable's investing activities
of $48 million which includes
realized losses in the Power Sustainable China portfolio of
$70 million, partially offset by a
net gain on disposal of a portfolio of solar assets of $17 million by Power Sustainable
Infrastructure.
Summary of assets under
management [1] (including unfunded
commitments):
(in billions of dollars)
|
June 30,
2022
|
June 30,
2021
|
Sagard [2][3]
|
16.4
|
8.6
|
Power
Sustainable [3]
|
2.8
|
3.0
|
Total
|
19.2
|
11.6
|
Percentage of
third-party and associates
|
85 %
|
65 %
|
|
|
|
STANDALONE BUSINESSES
Net earnings of the standalone businesses in the second quarter
of 2022 were $27 million, compared with $154 million in
2021. Net earnings in the period include a contribution of
$28 million related to the investment in Lion which includes
remeasurements attributable to the decline in market value of Lion
in the quarter and is comprised of i) share of earnings of Lion
which includes a recovery related to the revaluation of its
warrants, ii) a recovery related to the decrease in amounts payable
by Power Sustainable to its management for long-term incentive
plans, and iii) a loss related to the revaluation of call rights
held by Power Sustainable.
At June 30, 2022, the fair value of standalone businesses
was $1.0 billion, compared with
$2.3 billion at June 30,
2021.
[1]
|
See the Other Measures
section later in this news release.
|
[2]
|
Includes
ownership in Wealthsimple Financial Corp.
(Wealthsimple) valued at $0.9 billion at June 30, 2022
($2.1 billion at June 30, 2021) and excludes assets under
management of Sagard's wealth management business.
|
[3]
|
Excludes the fair value
of interests held in standalone businesses.
|
|
|
Adjusted Net Asset Value and Participating Shareholders'
Equity
At June 30, 2022
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 (the
gross asset value) less their net debt and preferred shares. Refer
to the 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
$41.49 at June 30, 2022,
compared with $52.60 at
December 31, 2021, representing a decrease of 21.1%.
|
(in millions of
dollars, except per share amounts)
|
June 30,
2022
|
December 31,
2021
|
Variation %
|
Publicly
Traded
Operating
Companies
|
Lifeco
|
19,494
|
23,545
|
(17)
|
IGM
|
5,104
|
6,749
|
(24)
|
GBL
|
2,384
|
3,157
|
(24)
|
|
|
26,982
|
33,451
|
(19)
|
Alternative
Asset
Investment
Platforms
|
|
|
|
|
|
|
|
|
Sagard
[1]
|
949
|
1,515
|
(37)
|
Power
Sustainable [1]
|
1,463
|
1,654
|
(12)
|
|
|
2,412
|
3,169
|
(24)
|
|
|
|
|
|
Other
|
ChinaAMC
|
1,150
|
1,150
|
−
|
Standalone businesses
[2]
|
914
|
1,331
|
(31)
|
Other assets and
investments
|
575
|
661
|
(13)
|
Cash and cash
equivalents
|
1,492
|
1,635
|
(9)
|
|
|
4,131
|
4,777
|
(14)
|
|
|
|
|
|
|
Gross asset
value
|
33,525
|
41,397
|
(19)
|
|
Liabilities and
preferred shares
|
(5,745)
|
(5,810)
|
1
|
|
Adjusted net asset
value
|
27,780
|
35,587
|
(22)
|
|
|
|
|
|
|
Shares outstanding
(millions)
|
669.5
|
676.6
|
|
|
Adjusted net asset
value per share
|
41.49
|
52.60
|
(21)
|
|
|
[1]
|
Includes the management
companies of the investment platforms at their carrying
value.
|
[2]
|
Includes Lion, LMPG
Inc. (LMPG) and Peak Achievement Athletics Inc. (Peak).
|
|
|
Power Corporation's
Ownership in Publicly Traded Operating Companies
|
|
|
|
|
|
|
|
Shares
held [1] (in millions)
|
Share
price
|
|
Ownership [1] (%)
|
June 30,
2022
|
December 31,
2021
|
Lifeco
|
66.6
|
620.3
|
$31.43
|
$37.96
|
IGM
|
62.2
|
147.9
|
$34.50
|
$45.62
|
GBL
[2]
|
14.9
|
22.8
|
€79.68
|
€98.16
|
|
|
[1]
|
As at June 30,
2022.
|
[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
$33.18 at June 30, 2022,
compared with $34.56 at
December 31, 2021, a decrease of 4.0%.
|
(in millions of
dollars, except per share amounts)
|
June 30,
2022
|
December 31,
2021
|
Variation %
|
Publicly
Traded
Operating
Companies
|
Lifeco
|
15,667
|
15,496
|
1
|
IGM
|
3,552
|
3,434
|
3
|
GBL
|
3,216
|
4,278
|
(25)
|
|
|
22,435
|
23,208
|
(3)
|
Alternative
Asset
Investment
Platforms
|
|
|
|
|
|
|
|
|
Sagard
|
698
|
822
|
(15)
|
Power
Sustainable
|
1,280
|
1,389
|
(8)
|
|
|
1,978
|
2,211
|
(11)
|
|
|
|
|
|
Other
|
ChinaAMC
|
738
|
766
|
(4)
|
Standalone businesses
[1]
|
760
|
725
|
5
|
Other assets and
investments
|
517
|
611
|
(15)
|
Cash and cash
equivalents
|
1,492
|
1,635
|
(9)
|
|
|
3,507
|
3,737
|
(6)
|
|
|
|
|
|
|
Total assets
|
27,920
|
29,156
|
(4)
|
|
Liabilities and
preferred shares
|
(5,704)
|
(5,771)
|
1
|
|
Participating
shareholders' equity
|
22,216
|
23,385
|
(5)
|
|
|
|
|
|
|
Shares outstanding
(millions)
|
669.5
|
676.6
|
|
|
Book value per
participating share
|
33.18
|
34.56
|
(4)
|
|
|
[1]
|
Includes Lion, LMPG and
Peak.
|
|
|
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
November 1, 2022 to shareholders of
record September 29, 2022.
Dividends on Power Corporation Non-Participating Preferred
Shares
The Board of Directors also declared quarterly dividends on the
Corporation's preferred shares, payable October 15, 2022 to shareholders of record
September 23, 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 second 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 Monday, August 8,
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 1-888-886-7786 toll-free in North America
or
416-764-8658 for international calls.
A replay of the
conference call will be available from August 8, 2022 at 11:30 a.m.
(Eastern Time) until November 8, 2022 by calling 1-888-886-7786
toll-free in North America or
416-764-8658 for international calls, using the access code
082058#. A webcast archive will also be available on Power
Corporation's website.
|
Investor Relations Contact:
|
|
Treasury
514-286-7400 investor.relations@powercorp.com
|
|
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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 June 30, 2022, Power Corporation held the following
economic interests:
100% – Power Financial
|
www.powerfinancial.com
|
66.6 %
|
Great-West
Lifeco [1] (TSX: GWO)
|
www.greatwestlifeco.com
|
62.2 %
|
IGM Financial
(TSX: IGM)
|
www.igmfinancial.com
|
14.9 %
|
GBL [2] (Euronext:
GBLB)
|
www.gbl.be
|
54.5 %
|
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]
|
On January 5, 2022, 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 15.2 million common
shares of Lifeco, representing a 1.6% interest in Lifeco, to
Power Financial. Refer to the ChinaAMC section in the Corporation's
most recent MD&A.
|
[2]
|
Held through
Parjointco, a jointly controlled corporation (50%).
|
[3]
|
Undiluted equity
interest held by Portag3 Ventures Limited Partnership (Portage I),
Power Financial and IGM, representing a fully diluted equity
interest of 42.5%.
|
[4]
|
The Corporation holds
an 83.1% 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
June 30,
|
Six months ended
June 30,
|
|
2022
|
2021
|
2022
|
2021
|
Adjusted net
earnings [1]
|
|
|
|
|
Lifeco
[2]
|
552
|
551
|
1,091
|
1,045
|
IGM
[2]
|
129
|
148
|
264
|
273
|
GBL
[2]
|
(44)
|
24
|
(73)
|
74
|
Effect of consolidation
[3]
|
15
|
92
|
56
|
78
|
|
652
|
815
|
1,338
|
1,470
|
Alternative asset
investment platforms and other [4][5]
|
(34)
|
121
|
(120)
|
376
|
ChinaAMC
|
15
|
15
|
28
|
28
|
Standalone businesses
[4][6]
|
27
|
154
|
31
|
155
|
Corporate operating and
other expenses
|
(29)
|
(38)
|
(85)
|
(129)
|
Dividends on
non-participating and perpetual preferred shares
|
(47)
|
(47)
|
(93)
|
(94)
|
Adjusted net
earnings [7]
|
584
|
1,020
|
1,099
|
1,806
|
Adjustments
[8]
|
(57)
|
(26)
|
(94)
|
(256)
|
Net
earnings
|
|
|
|
|
Lifeco
[2]
|
489
|
523
|
1,002
|
996
|
IGM
[2]
|
129
|
148
|
264
|
273
|
GBL
[2]
|
(44)
|
24
|
(73)
|
74
|
Effect of consolidation
[3]
|
21
|
94
|
61
|
(29)
|
|
595
|
789
|
1,254
|
1,314
|
Alternative asset
investment platforms and other [4][5]
|
(34)
|
121
|
(130)
|
276
|
ChinaAMC
|
15
|
15
|
28
|
28
|
Standalone businesses
[4][6]
|
27
|
154
|
31
|
155
|
Corporate operating and
other expenses
|
(29)
|
(38)
|
(85)
|
(129)
|
Dividends on
non-participating and perpetual preferred shares
|
(47)
|
(47)
|
(93)
|
(94)
|
Net
earnings [7]
|
527
|
994
|
1,005
|
1,550
|
|
|
[1]
|
For a reconciliation of
Lifeco and Alternative and other investments' non-IFRS adjusted net
earnings to their net earnings, refer to the Non-IFRS Financial
Measures and Alternative and Other Investments sections
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 include: a) an adjustment related
to Lifeco's investment in Power Sustainable Energy Infrastructure
Partnership (PSEIP); and b) an allocation of the results of the
fintech portfolio including Wealthsimple, 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 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 most recent
MD&A.
|
[4]
|
Presented in
Alternative and other investments in the Contribution to Net
Earnings and Adjusted Net Earnings section of the Corporation's
most recent 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 and GP Strategies Corporation (GP Strategies) (up
to the date of disposal in the fourth quarter of 2021).
|
[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
June 30,
|
Six months ended
June 30,
|
|
2022
|
2021
|
2022
|
2021
|
Adjusted net
earnings per share – basic [1]
|
|
|
|
|
Lifeco
[2]
|
0.82
|
0.81
|
1.62
|
1.54
|
IGM
[2]
|
0.19
|
0.22
|
0.39
|
0.40
|
GBL
[2]
|
(0.07)
|
0.03
|
(0.11)
|
0.11
|
Effect of consolidation
[3]
|
0.04
|
0.14
|
0.09
|
0.12
|
|
0.98
|
1.20
|
1.99
|
2.17
|
Alternative asset
investment platforms and other [4][5]
|
(0.05)
|
0.18
|
(0.18)
|
0.56
|
ChinaAMC
|
0.02
|
0.02
|
0.04
|
0.04
|
Standalone businesses
[4][6]
|
0.04
|
0.23
|
0.05
|
0.23
|
Corporate operating and
other expenses and dividends
on non‑participating and perpetual preferred
shares
|
(0.12)
|
(0.12)
|
(0.27)
|
(0.33)
|
Adjusted net
earnings per share [7]
|
0.87
|
1.51
|
1.63
|
2.67
|
Adjustments
[8]
|
(0.09)
|
(0.04)
|
(0.14)
|
(0.38)
|
Net earnings per
share – basic
|
|
|
|
|
Lifeco
[2]
|
0.72
|
0.76
|
1.48
|
1.46
|
IGM
[2]
|
0.19
|
0.22
|
0.39
|
0.40
|
GBL
[2]
|
(0.07)
|
0.03
|
(0.11)
|
0.11
|
Effect of consolidation
[3]
|
0.05
|
0.15
|
0.10
|
(0.03)
|
|
0.89
|
1.16
|
1.86
|
1.94
|
Alternative asset
investment platforms and other [4][5]
|
(0.05)
|
0.18
|
(0.19)
|
0.41
|
ChinaAMC
|
0.02
|
0.02
|
0.04
|
0.04
|
Standalone businesses
[4][6]
|
0.04
|
0.23
|
0.05
|
0.23
|
Corporate operating and
other expenses and dividends
on non‑participating and perpetual preferred
shares
|
(0.12)
|
(0.12)
|
(0.27)
|
(0.33)
|
Net earnings per
share – basic [7]
|
0.78
|
1.47
|
1.49
|
2.29
|
|
|
[1]
|
For a reconciliation of
Lifeco and Alternative and other investments' non-IFRS adjusted net
earnings to their net earnings, refer to the Non-IFRS Financial
Measures and Alternative and Other Investments sections
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 include: a) an adjustment related
to Lifeco's investment in PSEIP; and b) an allocation of the
results of the fintech portfolio including Wealthsimple, 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 most recent MD&A.
|
[4]
|
Presented in
Alternative and other investments in the Contribution to Net
Earnings and Adjusted Net Earnings section of the Corporation's
most recent 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 and GP Strategies (up to the date of disposal in
the fourth quarter of 2021).
|
[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
June 30,
|
Six months ended
June 30,
|
|
2022
|
2021
|
2022
|
2021
|
Adjusted net
earnings (loss)
|
|
|
|
|
Asset management
activities [1]
|
|
|
|
|
Sagard
[2]
|
(36)
|
3
|
(50)
|
62
|
Power
Sustainable
|
(3)
|
(7)
|
(15)
|
(11)
|
Investing activities
(proprietary capital)
|
|
|
|
|
Sagard
[3]
|
31
|
65
|
45
|
35
|
Power Sustainable
[4]
|
(48)
|
55
|
(117)
|
266
|
Standalone businesses
[5]
|
27
|
154
|
31
|
155
|
Investment and hedge
funds and Other [6]
|
22
|
5
|
17
|
24
|
Adjusted net
earnings (loss)
|
(7)
|
275
|
(89)
|
531
|
Adjustments
[7]
|
−
|
−
|
(10)
|
(100)
|
Net earnings
(loss)
|
(7)
|
275
|
(99)
|
431
|
|
|
[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]
|
The first and second
quarters of 2022 include a reversal of net carried interest of $13
million and $42 million, respectively, mainly due to a decrease in
the fair value of Wealthsimple and investments held by Portage II
in the period.
|
[3]
|
Includes the
Corporation's share of earnings (losses) of Wealthsimple. The first
and second quarters of 2022 include a reversal of carried interest
payable of $13 million and $25 million, respectively,
mainly due to a decrease in the fair value of Wealthsimple and
investments held by Portage II in the period. The first quarter of
2021 included 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 as excluded 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). The net decrease in fair value of the Corporation's
investment, including its investment held through Power Financial,
in Portage I, Portage II, Portage III, KOHO Financial Inc. and
Wealthsimple was $428 million in the six-month period ended
June 30, 2022, compared with an increase of $609 million
in fair value in the corresponding period in 2021.
|
[4]
|
Includes a gain on
disposal of a portfolio of solar assets of $17 million in the
second quarter of 2022, and unrealized gains on derivative
contracts hedging energy infrastructure projects of $16 million in
each of the first and second quarters of 2022. As well, the
Corporation realized a loss of $54 million and $70 million in the
first and second quarters of 2022, respectively, on the disposal of
investments in Power Sustainable China and $13 million in
impairments recognized in the first quarter of 2022 due to a
decline in Chinese equity markets (realized gains of $229 million
and $54 million in the first and second quarters of 2021,
respectively).
|
[5]
|
Includes the
Corporation's share of earnings (losses) of Lion, LMPG, Peak and GP
Strategies (up to the date of disposal in the fourth quarter of
2021). The second quarter of 2022 includes a contribution of
$28 million related to the investment in Lion which includes
remeasurements attributable to the decline in market value of Lion
in the quarter and is comprised of i) share of earnings of
$17 million which includes a recovery related to the
revaluation of its warrants, ii) a recovery of $18 million
related to the decrease in amounts payable by Power Sustainable to
its management for long-term incentive plans, and iii) a loss of
$5 million related to the revaluation of call rights held by
Power Sustainable. In the second quarter of 2021, the Corporation
recorded a net gain of $153 million related to its investment
in Lion which was 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, 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 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 of 2021.
|
[6]
|
Other consists mainly
of foreign exchange gains or losses and interest on cash and cash
equivalents. The second quarter of 2022 includes a gain on disposal
of a property by the Corporation of $7 million.
|
[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 other management actions, direct
equity and interest rate market impacts on insurance and investment
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, the gross asset value, 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
holding company or its overall fair value.
Adjusted net earnings attributable to participating
shareholders, adjusted net asset value, gross 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 include 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. The discussions included in the
sections "Financial Position" and "Cash Flows" of the Corporation's
most recent MD&A present the segmented balance sheet and cash
flow statement of the holding company; these non-consolidated
statements are presented in Note 19 of the Corporation's Interim
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.
RECONCILIATIONS OF NON-IFRS FINANCIAL MEASURES
Power Corporation
ADJUSTED NET EARNINGS
(in millions of
dollars)
|
Three months ended
June 30,
|
Six months ended
June 30,
|
|
2022
|
2021
|
2022
|
2021
|
Adjusted net earnings –
Non-IFRS financial measure [1]
|
584
|
1,020
|
1,099
|
1,806
|
Share of Adjustments
[2], net of tax
|
|
|
|
|
Lifeco
|
(63)
|
(25)
|
(89)
|
(57)
|
IGM
|
6
|
(1)
|
5
|
(99)
|
Alternative and other
investments
|
−
|
−
|
(10)
|
(100)
|
|
(57)
|
(26)
|
(94)
|
(256)
|
Net earnings – IFRS
financial measure [1]
|
527
|
994
|
1,005
|
1,550
|
|
|
[1]
|
Attributable to
participating shareholders of Power Corporation.
|
[2]
|
Refer to the
Adjustments section for more detail on Adjustments from Lifeco,
IGM, and alternative and other investments.
|
|
|
ADJUSTMENTS (excluded from Adjusted net earnings)
(in millions of
dollars)
|
Three months ended
June 30,
|
Six months ended
June 30,
|
|
2022
|
2021
|
2022
|
2021
|
Lifeco
[1]
|
|
|
|
|
Actuarial assumption
changes and other management actions (pre-tax)
|
16
|
29
|
10
|
32
|
Income tax (expense)
benefit
|
(2)
|
(4)
|
(2)
|
(3)
|
Market-related impacts
on liabilities (pre-tax)
|
(15)
|
(9)
|
(24)
|
(26)
|
Income tax (expense)
benefit
|
5
|
(4)
|
7
|
(3)
|
Transaction costs
related to acquisitions (pre-tax)
|
(44)
|
(16)
|
(50)
|
(18)
|
Income tax (expense)
benefit
|
6
|
−
|
7
|
1
|
Restructuring and
integration charges (pre-tax)
|
(40)
|
(14)
|
(51)
|
(25)
|
Income tax (expense)
benefit
|
11
|
4
|
14
|
7
|
Tax legislative
changes impact on liabilities
|
−
|
(14)
|
−
|
(14)
|
|
(63)
|
(28)
|
(89)
|
(49)
|
Effect of consolidation
(pre-tax) [2]
|
−
|
3
|
−
|
(8)
|
Income tax (expense)
benefit
|
−
|
−
|
−
|
−
|
|
(63)
|
(25)
|
(89)
|
(57)
|
IGM
|
|
|
|
|
Effect of consolidation
(pre-tax) [2]
|
6
|
(1)
|
5
|
(99)
|
Income tax (expense)
benefit
|
−
|
−
|
−
|
−
|
|
6
|
(1)
|
5
|
(99)
|
Alternative and other
investments
|
|
|
|
|
Remeasurements of
Wealthsimple's put right liability
|
−
|
−
|
−
|
(100)
|
Impairment charges on
direct energy infrastructure investments (pre-tax)
|
−
|
−
|
(13)
|
−
|
Income tax (expense)
benefit
|
−
|
−
|
3
|
−
|
|
−
|
−
|
(10)
|
(100)
|
|
(57)
|
(26)
|
(94)
|
(256)
|
|
|
[1]
|
As reported by
Lifeco.
|
[2]
|
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 Adjustments reported by Lifeco and IGM,
which includes an allocation of the Adjustments related to the
fintech portfolio based on their respective interest, (iii) IGM's
share of Lifeco's Adjustments, in accordance with the Corporation's
definition of Adjusted net earnings, and (iv) adjustments in
accordance with IAS 39 for IGM.
|
|
|
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
$41.49 at June 30, 2022,
compared with $52.60 at
December 31, 2021, representing a decrease of 21.1%. The
Corporation's book value per participating share was $33.18 at June 30, 2022, compared with
$34.56 at December 31, 2021,
representing a decrease of 4.0%.
|
|
June 30,
2022
|
|
December 31,
2021
|
(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
|
15,667
|
3,827
|
19,494
|
15,496
|
8,049
|
23,545
|
IGM
|
3,552
|
1,552
|
5,104
|
3,434
|
3,315
|
6,749
|
GBL
[1]
|
3,216
|
(832)
|
2,384
|
4,278
|
(1,121)
|
3,157
|
Alternative and other
investments
|
|
|
|
|
|
|
Asset management
companies [2]
|
|
|
|
|
|
|
Sagard
|
73
|
−
|
73
|
116
|
−
|
116
|
Power
Sustainable
|
18
|
−
|
18
|
21
|
−
|
21
|
Investing
activities
|
|
|
|
|
|
|
Sagard
[3]
|
625
|
251
|
876
|
706
|
693
|
1,399
|
Power
Sustainable
|
1,262
|
183
|
1,445
|
1,368
|
265
|
1,633
|
Other
|
|
|
|
|
|
|
Standalone businesses
[4]
|
760
|
154
|
914
|
725
|
606
|
1,331
|
Other
|
238
|
58
|
296
|
262
|
50
|
312
|
ChinaAMC
|
738
|
412
|
1,150
|
766
|
384
|
1,150
|
Cash and cash
equivalents
|
1,492
|
−
|
1,492
|
1,635
|
−
|
1,635
|
Other assets
|
279
|
−
|
279
|
349
|
−
|
349
|
Total assets
|
27,920
|
5,605
|
33,525
|
29,156
|
12,241
|
41,397
|
Liabilities and
non-participating shares
|
|
|
|
|
|
|
Debentures and other
debt instruments
|
897
|
−
|
897
|
897
|
−
|
897
|
Other liabilities
[5][6]
|
1,027
|
41
|
1,068
|
1,090
|
39
|
1,129
|
Non-participating
shares and perpetual
preferred shares
|
3,780
|
−
|
3,780
|
3,784
|
−
|
3,784
|
Total liabilities and
non-participating shares
|
5,704
|
41
|
5,745
|
5,771
|
39
|
5,810
|
Net
value
|
|
|
|
|
|
|
Participating
shareholders'
equity / Adjusted net asset value
|
22,216
|
5,564
|
27,780
|
23,385
|
12,202
|
35,587
|
Per
share
|
33.18
|
|
41.49
|
34.56
|
|
52.60
|
|
|
[1]
|
The Corporation's share
of GBL's reported net asset value was $3.6 billion
(€2.7 billion) at June 30, 2022 ($4.7 billion
(€3.3 billion) at December 31, 2021).
|
[2]
|
The management
companies of the investment funds are presented at their carrying
value and are primarily composed of cash and net carried interest
receivable.
|
[3]
|
Includes the
Corporation's investments in Portage I, Portage II and
Wealthsimple, held by Power Financial.
|
[4]
|
An additional deferred
tax liability of $16 million has been included in the adjusted net
asset value at June 30, 2022 ($80 million at December 31, 2021)
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]
|
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.
|
[6]
|
At June 30, 2022, an
additional deferred tax liability of $41 million ($39 million at
December 31, 2021) 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 section
below 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's second quarter MD&A, as prepared and disclosed in
accordance with applicable securities legislation, and which is
also available either directly from SEDAR (www.sedar.com) or from
its website, www.greatwestlifeco.com.
Lifeco
ADJUSTED NET EARNINGS ATTRIBUTABLE TO
LIFECO'S COMMON SHAREHOLDERS
Adjusted net earnings (loss) [1] reflect
Lifeco 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
June 30,
|
Six months ended
June 30,
|
|
2022
|
2021
|
2022
|
2021
|
Adjusted net earnings –
Non-IFRS financial measure [1][2]
|
830
|
826
|
1,639
|
1,565
|
Adjustments
|
|
|
|
|
Actuarial assumption
changes and other management actions (pre-tax)
|
24
|
42
|
15
|
46
|
Income tax (expense)
benefit
|
(3)
|
(5)
|
(3)
|
(4)
|
Market-related impacts
on liabilities (pre-tax)
|
(19)
|
(14)
|
(33)
|
(39)
|
Income tax (expense)
benefit
|
4
|
(5)
|
7
|
(4)
|
Transaction costs
related to acquisitions (pre-tax)
|
(71)
|
(25)
|
(79)
|
(27)
|
Income tax (expense)
benefit
|
14
|
1
|
15
|
2
|
Restructuring and
integration charges (pre-tax)
|
(60)
|
(21)
|
(77)
|
(37)
|
Income tax (expense)
benefit
|
16
|
6
|
21
|
10
|
Tax legislative
changes impact on liabilities
|
−
|
(21)
|
−
|
(21)
|
|
(95)
|
(42)
|
(134)
|
(74)
|
Net earnings – IFRS
financial measure [2]
|
735
|
784
|
1,505
|
1,491
|
|
|
[1]
|
Defined 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, other assets under management and
other assets under administration. Please refer to the "Glossary"
section of Lifeco's most recent Management's Discussion and
Analysis for additional information regarding other assets under
management and other assets under administration.
(in billions of dollars)
|
June 30,
2022
|
December 31,
2021
|
Total assets per
financial statements
|
670.3
|
630.5
|
Other assets under
management
|
318.7
|
377.2
|
Assets under
management
|
989.0
|
1,007.7
|
Other assets under
administration [1]
|
1,353.3
|
1,283.9
|
Assets under
administration [1]
|
2,342.3
|
2,291.6
|
|
|
[1]
|
Comparative figures for
2021 have been restated to include Financial Horizons Group and
Excel Private Wealth Inc. assets under administration in the Canada
segment.
|
|
|
OTHER MEASURES
This news 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 most recent MD&A, which can be located in the
Corporation's profile on SEDAR at www.sedar.com, for definitions of
such measures, which definitions are 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 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, statements concerning
deferred taxes, fundraising activities by investment platforms and
capital commitments by the Power group and third parties.
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 (such as the invasion of
Ukraine), 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 that the list of
risks and uncertainties 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