Great-West Lifeco reports second quarter 2017 adjusted net earnings of $712 million, up 6% from the second quarter of 2016

TSX:GWO

Readers are referred to the cautionary notes regarding Forward-Looking Information and Non-IFRS Financial Measures at the end of this release. All figures are expressed in Canadian dollars, except as noted.

TORONTO, Aug. 2, 2017 /CNW/ - Great-West Lifeco Inc. (Lifeco or the Company) today announced net earnings attributable to common shareholders of $585 million or $0.591 per common share.  Included in Lifeco's net earnings for the second quarter of 2017 were restructuring costs of $127 million, primarily related to the realignment of the Canada segment operations.  Excluding these costs, adjusted net earnings for the second quarter of 2017 were $712 million or $0.719 per common share, up 6% compared to $671 million or $0.675 per common share for the same quarter last year.  The increase in adjusted net earnings reflects strong business results and the impact of ongoing expense management initiatives.

For the six months ended June 30, 2017, excluding the impact of restructuring costs, Lifeco's adjusted net earnings were $1,331 million or $1.345 per common share compared to $1,291 million or $1.300 per common share for the same period last year.

"We were very pleased with the second quarter results, which reflected strong operating performances across businesses and geographies," said Paul Mahon, President and Chief Executive Officer. "Restructuring initiatives undertaken earlier in the year are delivering expected cost savings. We are managing expenses carefully while continuing to invest in core markets and new capabilities to improve customer experiences and drive future growth."

Consolidated assets under administration at June 30, 2017 were over $1.3 trillion, an increase of $60.7 billion from December 31, 2016.

Highlights – In Quarter

Fee income of $1.4 billion up 12%

  • Fee and other income was $1.4 billion, up 12% from the second quarter of 2016, primarily as a result of increases in all segments driven by market performance and business growth.

Capital strength and financial flexibility maintained

  • The Great-West Life Assurance Company reported a Minimum Continuing Capital Surplus Requirements (MCCSR) ratio of 239% at June 30, 2017.

  • Lifeco declared a quarterly common dividend of $0.3670 per common share payable September 29, 2017.

  • Adjusted Return on Equity (ROE), excluding the impact of restructuring costs, was 13.9%.

Completed offering of US$700 million of senior notes and redeemed $1.0 billion hybrid subordinated debenture

  • On May 26, 2017, a subsidiary of the Company issued US$700 million principal amount 4.150% senior unsecured notes that are fully and unconditionally guaranteed by Lifeco, maturing on June 3, 2047.

  • On June 21, 2017, a subsidiary of the Company redeemed all $1.0 billion principal amount of its 5.691% subordinated debentures due June 21, 2067 at a redemption price equal to 100% of the principal amount of the debentures, plus any accrued interest up to but excluding the redemption date.

Completed offering of $200 million of Preferred Shares

  • On May 18, 2017 Lifeco issued 8,000,000 Series T, 5.15% Non-Cumulative First Preferred Shares at $25.00 per share for gross proceeds of $200 million.

SEGMENTED OPERATING RESULTS

For reporting purposes, Lifeco's consolidated operating results are grouped into four reportable segments - Canada, United States, Europe and Lifeco Corporate - reflecting geographic lines as well as the management and corporate structure of the companies.  For more information, please refer to the Company's 2017 second quarter MD&A.

CANADA

  • Canada progresses business transformation – Following the realignment into two new business units: one focused on individual customers and the other on group customers, the Canadian operations made progress on the previously announced targeted annual expense reductions of $200 million pre-tax. As of June 30, 2017, the Company has achieved approximately $46 million pre-tax in annualized reductions, which resulted in expense reductions of $18 million pre-tax for the first half of 2017, approximately $14 million relating to the common shareholders' account and $4 million relating to the participating accounts. As part of this effort, the Company incurred a $215 million pre-tax restructuring charge, which impacted net earnings attributable to the common shareholders by $126 million.

  • Q2 Canada sales up 21% – Sales in the second quarter of 2017 were $3.2 billion, up 21% from the second quarter of 2016. The increase reflects strong sales in individual and group investment funds and single premium group annuities as well as higher group insurance sales.

  • Q2 Canada segment adjusted net earnings of $311 million – Adjusted net earnings attributable to common shareholders for the second quarter of 2017 were $311 million compared to $327 million in the second quarter of 2016, primarily due to lower contributions from investment experience which were partially offset by strong core business results including higher fee income and more favourable morbidity and mortality experience. For the six months ended June 30, 2017, adjusted net earnings attributable to common shareholders were $566 million compared to $603 million for the same period last year.

  • Great-West Life completes acquisition of Financial Horizons Group, the leading MGA in the Canadian market – Subsequent to the second quarter of 2017, the Company, through its subsidiary Great-West Life, completed the acquisition of Financial Horizons Group, a Canadian Managing General Agency (MGA), that offers access to life and health insurance, employee benefits, pensions, investments, structured settlements, and risk management products and services to advisors throughout Canada.

UNITED STATES

  • Q2 U.S. segment net earnings up 55% – Net earnings attributable to common shareholders for the second quarter of 2017 were US$62 million, up 55%, compared to net earnings of US$40 million in the second quarter of 2016 driven by growth in fee income and lower expenses for both Empower Retirement and Putnam. For the six months ended June 30, 2017, net earnings attributable to common shareholders were US$104 million compared to US$87 million for the same period last year.

  • Q2 sales for Great-West Financial up 9% – Sales in the second quarter of 2017 were US$5.1 billion, up 9% from the second quarter of 2016 primarily due to higher Empower Retirement sales.

  • Putnam average assets up 10%Putnam average assets under management for the three months ended June 30, 2017 were US$161.8 billion compared to US$146.7 billion for the same quarter last year, an increase of 10%, primarily due to the cumulative impact of market performance and net asset inflows from the institutional business over the twelve month period. Putnam ending assets under management at June 30, 2017 were US$162.9 billion.

  • Improved Putnam mutual fund net cash flowsPutnam's net cash outflows from mutual funds of US$406 million for the three months ended June 30, 2017 were a US$2.0 billion improvement from the same period last year.

EUROPE

  • Q2 Europe segment net earnings up 10% – Net earnings attributable to common shareholders for the second quarter of 2017 were $321 million compared to $293 million in the second quarter of 2016 driven by strong investment performance and earnings growth across all regions in local currency. For the six months ended June 30, 2017, net earnings attributable to common shareholders were $610 million compared to $580 million for the same period last year.

  • Irish Life Health remains on track to deliver target expense reductions – As of June 30, 2017, the Company has achieved €8 million pre-tax of annualized synergies to date, relating to the integration of the Irish Life Health operations and remains on track to achieve targeted annual cost savings of €16 million pre-tax within the next six months. Irish Life has also achieved €5 million pre-tax annualized expense reductions in its retail division with a target of €8 million pre-tax by the end of 2017.

  • Europe assets under management up 8% – Assets under management as of June 30, 2017 were $203.8 million, up 8% from the second quarter of 2016 and contributed to Europe fee and other income increasing 13% over the same period.

QUARTERLY DIVIDENDS

At its meeting today, the Board of Directors approved a quarterly dividend of $0.3670 per share on the common shares of Lifeco payable September 29, 2017 to shareholders of record at the close of business September 1, 2017.

In addition, the Directors approved quarterly dividends on Lifeco's preferred shares, as follows:

First Preferred Shares

Record Date 

Payment Date 

Amount, per share

Series F 

September 1, 2017 

September 29, 2017 

$0.36875

Series G 

September 1, 2017 

September 29, 2017 

$0.3250

Series H 

September 1, 2017 

September 29, 2017 

$0.30313

Series I 

September 1, 2017 

September 29, 2017 

$0.28125

Series L 

September 1, 2017 

September 29, 2017 

$0.353125

Series M 

September 1, 2017 

September 29, 2017 

$0.3625

Series N 

September 1, 2017 

September 29, 2017 

$0.1360

Series O 

September 1, 2017 

September 29, 2017 

$0.115253

Series P 

September 1, 2017 

September 29, 2017 

$0.3375

Series Q 

September 1, 2017 

September 29, 2017 

$0.321875

Series R 

September 1, 2017 

September 29, 2017 

$0.3000

Series S 

September 1, 2017 

September 29, 2017 

$0.328125

Series T 

September 1, 2017 

September 29, 2017 

$0.476200

 

For purposes of the Income Tax Act (Canada), and any similar provincial legislation, the dividends referred to above are eligible dividends.

Selected financial information is attached.

GREAT-WEST LIFECO

Great-West Lifeco Inc. (TSX:GWO) is an international financial services holding company with interests in life insurance, health insurance, retirement and investment services, asset management and reinsurance businesses.  Lifeco has operations in Canada, the United States, Europe and Asia through The Great-West Life Assurance Company (Great-West Life) and its operating subsidiaries, London Life Insurance Company (London Life) and The Canada Life Assurance Company (Canada Life); Great-West Life & Annuity Insurance Company (Great-West Financial) and Putnam Investments, LLC (Putnam).  Lifeco and its companies have over $1.3 trillion in consolidated assets under administration and are members of the Power Financial Corporation group of companies.  To learn more, visit www.greatwestlifeco.com.

Basis of presentation
The consolidated financial statements of Lifeco have been prepared in accordance with International Financial Reporting Standards (IFRS) and are the basis for the figures presented in this release, unless otherwise noted.

Cautionary note regarding Forward-Looking Information
This release may contain forward-looking statements.  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", "intends", "plans", "believes", "estimates" and other similar expressions or negative versions thereof.  These statements may include, without limitation, statements about the Company's operations, business, financial condition, expected financial performance (including revenues, earnings or growth rates), ongoing business strategies or prospects, and possible future actions by the Company, including statements made with respect to the expected benefits of acquisitions and divestitures.  Forward-looking statements are based on expectations, forecasts, predictions, projections and conclusions about future events that were current at the time of the statements and are inherently subject to, among other things, risks, uncertainties and assumptions about the Company, economic factors and the financial services industry generally, including the insurance and mutual fund industries.  They are not guarantees of future performance, and the reader is cautioned that actual events and results could differ materially from those expressed or implied by forward-looking statements.  Material factors and assumptions that were applied in formulating the forward-looking information contained herein include the assumption that the business and economic conditions affecting the Company's operations will continue substantially in their current state, including, without limitation, with respect to customer behaviour, the Company's reputation, market prices for products provided, sales levels, premium income, fee income, expense levels, mortality experience, morbidity experience, policy lapse rates, reinsurance arrangements, liquidity requirements, capital requirements, credit ratings, taxes, inflation, interest and foreign exchange rates, investment values, hedging activities, global equity and capital markets, business competition and other general economic, political and market factors in North America and internationally.  Many of these assumptions are based on factors and events that are not within the control of the Company and there is no assurance that they will prove to be correct.  Other important factors and assumptions that could cause actual results to differ materially from those contained in forward-looking statements include, customer responses to new products, impairments of goodwill and other intangible assets, the Company's ability to execute strategic plans and changes to strategic plans, technological changes, breaches or failure of information systems and security (including cyber attacks), payments required under investment products, changes in local and international laws and regulations, changes in accounting policies and the effect of applying future accounting policy changes, unexpected judicial or regulatory proceedings, catastrophic events, continuity and availability of personnel and third party service providers, the Company's ability to complete strategic transactions and integrate acquisitions and unplanned material changes to the Company's facilities, customer and employee relations or credit arrangements.  The reader is cautioned that the foregoing list of assumptions and factors is not exhaustive, and there may be other factors listed in other filings with securities regulators, including factors set out in the Company's 2016 Annual MD&A under "Risk Management and Control Practices" and "Summary of Critical Accounting Estimates", which, along with other filings, is available for review at www.sedar.com.  The reader is also cautioned to consider these and other factors, uncertainties and potential events carefully and not to place undue reliance on forward-looking statements.  Other than as specifically required by applicable law, the Company does not intend to update any forward-looking statements whether as a result of new information, future events or otherwise.

Cautionary note regarding Non-IFRS Financial Measures
This release contains some non-IFRS financial measures.  Terms by which non-IFRS financial measures are identified include, but are not limited to, "operating earnings", "constant currency basis", "premiums and deposits", "sales", "assets under management", "assets under administration" and other similar expressions.  Non-IFRS financial measures are used to provide management and investors with additional measures of performance to help assess results where no comparable IFRS measure exists.  However, non-IFRS financial measures do not have standard meanings prescribed by IFRS and are not directly comparable to similar measures used by other companies.  Refer to the appropriate reconciliations of these non-IFRS financial measures to measures prescribed by IFRS.

Second Quarter Conference Call

Lifeco's second quarter conference call and audio webcast will be held August 3, 2017 at 10:00 a.m. (ET).  The call and webcast can be accessed through www.greatwestlifeco.com or by phone at:

A replay of the call will be available from August 3, 2017 to August 10, 2017, and can be accessed by calling 1-800-408-3053 or 905-694-9451 in Toronto (passcode: 7905788#).  The archived webcast will be available on http://www.greatwestlifeco.com from August 3, 2017 to August 2, 2018.

Additional information relating to Lifeco, including the most recent interim unaudited consolidated financial statements, interim Management's Discussion and Analysis (MD&A) and CEO/CFO certification will be filed on SEDAR at www.sedar.com.


FINANCIAL HIGHLIGHTS (unaudited)


(in Canadian $ millions except per share amounts)






As at or for the three months ended


For the six months ended


June 30
2017

March 31
2017

June 30
2016


June 30
2017

June 30
2016

Premiums and deposits:








Net premium income (Life insurance, guaranteed














annuities and insured health products)

$

7,772

$

9,365

$

6,871


$

17,137

$

13,886


Policyholder deposits (segregated funds):









Individual products

4,142

3,897

3,213


8,039

6,902



Group products

2,020

2,185

1,858


4,205

4,096


Self-funded premium equivalents (Administrative









services only contracts)(1)

720

716

707


1,436

1,405


Proprietary mutual funds and institutional deposits(1)

13,767

17,386

15,522


31,153

31,876

Total premiums and deposits(1)

28,421

33,549

28,171


61,970

58,165








Fee and other income

1,381

1,305

1,231


2,686

2,485

Net policyholder benefits, dividends and experience








refunds

7,377

8,543

6,023


15,920

12,562








Earnings







Net earnings - common shareholders

$

585

$

591

$

671


$

1,176

$

1,291

Adjusted net earnings, excluding restructuring costs -







common shareholders(6)

712

619

671


1,331

1,291


Per common share









Basic earnings

0.591

0.598

0.675


1.189

1.300



Adjusted basic earnings, excluding restructuring










costs(6)                                                     

0.719

0.627

0.675


1.345

1.300



Dividends paid

0.367

0.367

0.346


0.734

0.692



Book value(2)

19.95

19.99

19.02











Return on common shareholders' equity(3)








Net earnings

13.0%

13.6%

14.0%





Adjusted net earnings, excluding restructuring costs(6)

13.9%

13.9%

14.0%











Total assets

$

409,773

$

405,632

$

390,251





Proprietary mutual funds and institutional net assets(4)

271,686

270,121

243,688




Total assets under management(4)

681,459

675,753

633,939





Other assets under administration(5)

627,633

620,064

549,878




Total assets under administration

$

1,309,092

$

1,295,817

$

1,183,817




Total equity

$

25,428

$

25,372

$

24,201












(1)

In addition to premiums and deposits reported in the financial statements, the Company includes premium equivalents on self-funded group insurance administrative services only (ASO) contracts and deposits on proprietary mutual funds and institutional accounts to calculate total premiums and deposits (a non-IFRS financial measure).  This measure provides useful information as it is an indicator of top line growth.

(2)

Certain comparative figures have been adjusted as described in note 33 to the Company's December 31, 2016 financial statements.

(3)

Return on common shareholders' equity is detailed within the "Capital Allocation Methodology" section of the Company's June 30, 2017 Management's Discussion and Analysis.

(4)

Total assets under management (a non-IFRS financial measure) provides an indicator of the size and volume of the overall business of the Company.  Services provided in respect of assets under management include the selection of investments, the provision of investment advice and discretionary portfolio management on behalf of clients.  This includes internally and externally managed funds where the Company has oversight of the investment policies.

(5)

Other assets under administration (a non-IFRS financial measure) includes assets where the Company only provides administration services for which the Company earns fee and other income.  These assets are beneficially owned by clients and the Company does not direct the investing activities.  Services provided relating to assets under administration includes recordkeeping, safekeeping, collecting investment income, settling of transactions or other administrative services.  Administrative services are an important aspect of the overall business of the Company and should be considered when comparing volume, size and trends.

(6)

Net earnings attributable to common shareholders include the impact of restructuring costs. The second quarter of 2017 included restructuring costs of $127, $126 related to the Canada segment and $1 related to the Europe segment. The first quarter of 2017 included restructuring costs of $28, $17 relating to the Europe segment and $11 relating to the United States segment.


 

 

CONSOLIDATED STATEMENTS OF EARNINGS (unaudited)

(in Canadian $ millions except per share amounts)






For the three months ended


For the six months ended


June 30

March 31

June 30


June 30

June 30


2017

2017

2016


2017

2016








Income








Premium income









Gross premiums written

$

8,792

$

10,484

$

7,834


$

19,276

$

15,760



Ceded premiums

(1,020)

(1,119)

(963)


(2,139)

(1,874)


Total net premiums

7,772

9,365

6,871


17,137

13,886


Net investment income









Regular net investment income

1,591

1,469

1,576


3,060

3,249



Changes in fair value through profit or loss

304

735

3,129


1,039

5,539


Total net investment income

1,895

2,204

4,705


4,099

8,788


Fee and other income

1,381

1,305

1,231


2,686

2,485


11,048

12,874

12,807


23,922

25,159

Benefits and expenses








Policyholder benefits









Gross

7,415

8,595

6,143


16,010

12,785



Ceded

(500)

(610)

(501)


(1,110)

(973)


Total net policyholder benefits

6,915

7,985

5,642


14,900

11,812


Policyholder dividends and experience refunds

462

558

381


1,020

750


Changes in insurance and investment contract









liabilities

850

1,319

4,012


2,169

7,151


Total paid or credited to policyholders

8,227

9,862

10,035


18,089

19,713


Commissions

549

753

599


1,302

1,165


Operating and administrative expenses

1,185

1,233

1,161


2,418

2,369


Premium taxes

107

123

98


230

190


Financing charges

79

76

75


155

153


Amortization of finite life intangible assets

47

45

44


92

90


Restructuring expenses

216

37

5


253

9

Earnings before income taxes

638

745

790


1,383

1,470

Income taxes

51

96

76


147

100

Net earnings before non-controlling interests

587

649

714


1,236

1,370

Attributable to non-controlling interests

(28)

27

13


(1)

18

Net earnings

615

622

701


1,237

1,352

Preferred share dividends

30

31

30


61

61

Net earnings - common shareholders

$

585

$

591

$

671


$

1,176

$

1,291








Earnings per common share








Basic

$

0.591

$

0.598

$

0.675


$

1.189

$

1.300


Diluted

$

0.590

$

0.597

$

0.674


$

1.187

$

1.298


 

CONSOLIDATED BALANCE SHEETS (unaudited)

(in Canadian $ millions)





June 30

December 31


2017

2016

Assets



Cash and cash equivalents

$

3,398

$

3,259

Bonds

118,215

116,773

Mortgage loans

22,301

21,651

Stocks

8,435

8,665

Investment properties

4,708

4,340

Loans to policyholders

8,394

8,467


165,451

163,155

Funds held by ceding insurers

10,317

10,781

Goodwill

5,992

5,977

Intangible assets

3,900

3,972

Derivative financial instruments

463

528

Owner occupied properties

653

649

Fixed assets

293

304

Other assets   

2,359

2,263

Premiums in course of collection, accounts and interest receivable

4,550

4,311

Reinsurance assets

5,416

5,627

Current income taxes

168

97

Deferred tax assets

1,675

1,845

Investments on account of segregated fund policyholders

208,536

200,403

Total assets

$

409,773

$

399,912




Liabilities



Insurance contract liabilities

$

157,797

$

155,940

Investment contract liabilities

1,953

2,009

Debentures and other debt instruments

5,531

5,980

Capital trust securities

160

161

Funds held under reinsurance contracts

336

320

Derivative financial instruments

1,519

2,012

Accounts payable

2,443

2,049

Other liabilities                             

3,924

3,836

Current income taxes

603

549

Deferred tax liabilities

1,543

1,645

Investment and insurance contracts on account of segregated fund policyholders

208,536

200,403

Total liabilities

384,345

374,904




Equity



Non-controlling interests




Participating account surplus in subsidiaries

2,753

2,782


Non-controlling interests in subsidiaries

212

224

Shareholders' equity




Share capital





Preferred shares                                                                                     

2,714

2,514



Common shares

7,261

7,130


Accumulated surplus

11,889

11,465


Accumulated other comprehensive income

478

746


Contributed surplus

121

147

Total equity

25,428

25,008

Total liabilities and equity

$

409,773

$

399,912

 

Segmented Information (unaudited)

Consolidated Net Earnings


For the three months ended June 30, 2017


Canada

United

States

Europe

Lifeco

Corporate

Total

Income







Total net premiums

$

3,189

$

942

$

3,641

$

$

7,772


Net investment income   








Regular net investment income

642

451

496

2

1,591



Changes in fair value through profit or loss

282

274

(252)

304


Total net investment income

924

725

244

2

1,895


Fee and other income

399

636

346

1,381


4,512

2,303

4,231

2

11,048







Benefits and expenses







Paid or credited to policyholders

3,333

1,476

3,418

8,227


Other (1)

783

651

405

2

1,841


Financing charges

31

37

10

1

79


Amortization of finite life intangible assets

17

22

8

47


Restructuring expenses

215

1

216

Earnings (loss) before income taxes

133

117

389

(1)

638

Income taxes (recovery)

(22)

28

45

51

Net earnings (loss) before non-controlling







interests

155

89

344

(1)

587

Non-controlling interests

(31)

3

(28)

Net earnings (loss)

186

86

344

(1)

615

Preferred share dividends

26

4

30

Net earnings (loss) before capital allocation

160

86

340

(1)

585

Impact of capital allocation

25

(4)

(19)

(2)

Net earnings (loss) - common shareholders

$

185

$

82

$

321

$

(3)

$

585

(1)  Includes commissions, operating and administrative expenses and premium taxes.




For the three months ended June 30, 2016


Canada

United

States

Europe

Lifeco

Corporate

Total

Income







Total net premiums

$

2,896

$

1,267

$

2,708

$

$

6,871


Net investment income








Regular net investment income

665

420

487

4

1,576



Changes in fair value through profit or loss

940

526

1,663

3,129


Total net investment income

1,605

946

2,150

4

4,705


Fee and other income

369

555

307

1,231


4,870

2,768

5,165

4

12,807







Benefits and expenses







Paid or credited to policyholders

3,632

1,996

4,407

10,035


Other (1)

833

645

374

6

1,858


Financing charges

26

35

11

3

75


Amortization of finite life intangible assets

17

20

7

44


Restructuring expenses

4

1

5

Earnings (loss) before income taxes

362

68

365

(5)

790

Income taxes (recovery)

23

12

46

(5)

76

Net earnings (loss) before non-controlling







interests

339

56

319

714

Non-controlling interests

11

1

1

13

Net earnings (loss)

328

55

318

701

Preferred share dividends

26

4

30

Net earnings (loss) before capital allocation

302

55

314

671

Impact of capital allocation

25

(2)

(21)

(2)

Net earnings (loss) - common shareholders

$

327

$

53

$

293

$

(2)

$

671

(1)  Includes commissions, operating and administrative expenses and premium taxes.




For the six months ended June 30, 2017


Canada

United

States

Europe

Lifeco

Corporate

Total

Income







Total net premiums

$

6,484

$

2,171

$

8,482

$

$

17,137


Net investment income








Regular net investment income

1,255

906

898

1

3,060



Changes in fair value through profit or loss

657

376

6

1,039


Total net investment income

1,912

1,282

904

1

4,099


Fee and other income

786

1,230

670

2,686


9,182

4,683

10,056

1

23,922







Benefits and expenses







Paid or credited to policyholders

6,578

3,028

8,483

18,089


Other (1)

1,811

1,337

791

11

3,950


Financing charges

61

71

22

1

155


Amortization of finite life intangible assets

34

43

15

92


Restructuring expenses

215

17

21

253

Earnings (loss) before income taxes

483

187

724

(11)

1,383

Income taxes (recovery)

43

39

68

(3)

147

Net earnings (loss) before non-controlling







interests

440

148

656

(8)

1,236

Non-controlling interests

(2)

2

(1)

(1)

Net earnings (loss)

442

146

657

(8)

1,237

Preferred share dividends

52

9

61

Net earnings (loss) before capital allocation

390

146

648

(8)

1,176

Impact of capital allocation

50

(8)

(38)

(4)

Net earnings (loss) - common shareholders

$

440

$

138

$

610

$

(12)

$

1,176

(1)  Includes commissions, operating and administrative expenses and premium taxes.




For the six months ended June 30, 2016


Canada

United

States

Europe

Lifeco

Corporate

Total

Income







Total net premiums

$

5,757

$

2,647

$

5,482

$

$

13,886


Net investment income








Regular net investment income

1,401

874

970

4

3,249



Changes in fair value through profit or loss

1,477

1,007

3,055

5,539


Total net investment income

2,878

1,881

4,025

4

8,788


Fee and other income

731

1,126

628

2,485


9,366

5,654

10,135

4

25,159







Benefits and expenses







Paid or credited to policyholders

6,933

4,108

8,672

19,713


Other (1)

1,650

1,331

733

10

3,724


Financing charges

55

72

23

3

153


Amortization of finite life intangible assets

33

42

15

90


Restructuring expenses

7

2

9

Earnings (loss) before income taxes

695

94

690

(9)

1,470

Income taxes (recovery)

74

(28)

59

(5)

100

Net earnings (loss) before non-controlling







interests

621

122

631

(4)

1,370

Non-controlling interests

16

2

18

Net earnings (loss)

605

120

631

(4)

1,352

Preferred share dividends

52

9

61

Net earnings (loss) before capital allocation

553

120

622

(4)

1,291

Impact of capital allocation

50

(4)

(42)

(4)

Net earnings (loss) - common shareholders

$

603

$

116

$

580

$

(8)

$

1,291

(1)  Includes commissions, operating and administrative expenses and premium taxes.

 

SOURCE Great-West Lifeco Inc.

For further information: Media Contact: Marlene Klassen, APR, 204-946-7705, Email: marlene.klassen@gwl.ca; Investor Relations Contact: Deirdre Neary, 416-552-3208, Email: deirdre.neary@gwl.ca

RELATED LINKS
www.greatwestlifeco.com

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