Great-West Lifeco reports third quarter 2013 results

News provided by

Great-West Lifeco Inc.

Nov 07, 2013, 12:44 ET

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.

TSX:GWO

WINNIPEG, Nov. 7, 2013 /CNW/ - Great-West Lifeco Inc. (Lifeco) has reported net earnings attributable to common shareholders of $523 million or $0.527 per common share for the three months ended September 30, 2013. Excluding the impact of acquisition and restructuring costs associated with the Irish Life Group Limited (Irish Life) acquisition, net earnings were $583 million or $0.588 per common share for the three months ended September 30, 2013, up 12.5% from $518 million or $0.546 per common share for the same period in 2012.

For the nine months ended September 30, 2013, Lifeco's net earnings attributable to common shareholders were $1,561 million or $1.618 per common share, compared to $1,455 million or $1.532 per common share for the same period in 2012.

Consolidated assets under administration at September 30, 2013 were $705 billion, up $159 billion from December 31, 2012 including $94 billion of assets related to Irish Life.

Highlights - In Quarter

  • Irish Life contributed $41 million of earnings to Lifeco for the period July 19 to September 30, 2013.  Excluding the Irish Life contribution and related acquisition and restructuring costs, Lifeco's net earnings were $542 million or $0.546 per common share.
  • Total Company premiums and deposits during the quarter were $19.7 billion, up 27% from a year ago including $2.6 billion from Irish Life.
  • Total Company sales in the third quarter of 2013 were up 41% from the same period in 2012, reflecting  strong momentum and growth across all geographies:
    • Canada sales were $2.4 billion, up 14% compared to the third quarter of 2012.
    • Europe Insurance & Annuities sales were $3.3 billion, up 281% compared to the third quarter of 2012 including a contribution of $2.4 billion from Irish Life.
    • Putnam sales were US$8.3 billion, up 26% compared to the third quarter of 2012. Net asset inflows for the third quarter of 2013 were US$1.1 billion compared to US$0.6 billion in the same quarter last year, reflecting an increase in mutual fund net asset flows to US$1.5 billion. Mutual fund sales were the highest since the third quarter of 2003.
    • Great-West Financial sales were US$2.2 billion, consistent with the third quarter of 2012.
  • The Company maintained a strong ROE of 16.0% based on operating earnings and 14.9% based on net earnings.
  • The Company's capital position remained very strong.  The Great-West Life Assurance Company reported a Minimum Continuing Capital and Surplus Requirements (MCCSR) ratio of 221% at September 30, 2013.
  • The Company declared a quarterly common dividend of $0.3075 per common share payable December 31, 2013.

Series J Preferred Shares

Great-West Lifeco Inc. today approved the redemption of all of its issued and outstanding Series J Preferred Shares on December 31, 2013. A formal notice and instructions for the redemption will be sent to shareholders in accordance with the rights, privileges, restrictions and conditions attached to the Series J Preferred Shares. The redemption price will be $25.00 per share, plus an amount equal to all declared and unpaid dividends thereon, less any tax required to be deducted and withheld by the Corporation.

OPERATING RESULTS

Consolidated net earnings for Lifeco comprise the net earnings of The Great-West Life Assurance Company (Great-West Life), Canada Life Financial Corporation (CLFC), London Life Insurance Company (London Life), Great-West Life & Annuity Insurance Company (Great-West Financial), Putnam Investments, LLC (Putnam), and Irish Life Group Limited (Irish Life) together with Lifeco's corporate results.

CANADA

The Canada segment of Lifeco includes the operating results of the Canadian businesses operated by Great-West Life, London Life and Canada Life.  There are three primary business units included in this segment.  Through its Individual Insurance business unit, the Company provides life, disability and critical illness insurance products to individual clients.  Through its Wealth Management business unit, the Company provides accumulation products and annuity products for both group and individual clients in Canada.  Through its Group Insurance business unit, the Company provides life, health, critical illness, disability and creditor insurance products to group clients in Canada.

Net earnings attributable to common shareholders for the third quarter of 2013 were $332 million compared to $280 million in the third quarter of 2012.  For the nine months ended September 30, 2013 net earnings attributable to common shareholders were $878 million compared to $775 million for the same period in 2012.

Total sales in the third quarter of 2013 were $2.4 billion, an increase of 14% compared to the third quarter of 2012.   This increase was due to very strong Group insurance sales which were up 65% compared to the third quarter of 2012. Wealth Management sales were up 12% and Individual Insurance sales were up 10% compared to the third quarter of 2012. Total sales for the nine months ended September 30, 2013 were $7.9 billion compared to $7.0 billion in 2012.

Total Canada segment assets under administration at September 30, 2013 were $144 billion, compared to $138 billion at December 31, 2012.

UNITED STATES

The United States operating results for Lifeco include the results of Great-West Financial, Putnam and the results of the insurance businesses in the United States branches of Great-West Life and Canada Life, together with an allocation of a portion of Lifeco's corporate results.

Great-West Financial provides an array of financial security products, including employer-sponsored defined contribution plans, administrative and record-keeping services, fund management and investment and advisory services.  It also provides individual retirement accounts, life insurance and annuity products, and business-owned life insurance and executive benefits products.  Putnam provides investment management, certain administrative functions, distributions and related services through a broad range of investment products.

Net earnings attributable to common shareholders for the third quarter of 2013 were $76 million compared to $86 million in the third quarter of 2012.  Great-West Financial reported net earnings of $86 million in the third quarter compared to $90 million for the same period last year.  Putnam reported a net loss of $10 million in the third quarter compared to a net loss of $4 million a year ago.  For the nine months ended September 30, 2013 net earnings attributable to common shareholders were $220 million compared to $245 million in 2012.

Great-West Financial sales in the third quarter of 2013 were US$2.2 billion, consistent with the third quarter of 2012. Sales for the nine months ended September 30, 2013 were US$7.2 billion compared to US$6.3 billion in 2012 reflecting strong sales results in both the public/non-profit and 401(k) markets.

Putnam assets under management as at September 30, 2013 were US$141 billion compared to US$127 billion a year ago.  Sales in the third quarter were US$8.3 billion, up 26% from a year ago. In-quarter redemptions of US$7.3 billion resulted in net asset inflows of US$1.1 billion compared to net asset inflows of US$0.6 billion for the same period in 2012.

Total United States segment assets under administration at September 30, 2013 were $389 billion compared to $333 billion at December 31, 2012.

EUROPE

The Europe segment comprises two distinct business units: Insurance & Annuities and Reinsurance, together with an allocation of Lifeco's corporate results.  Insurance & Annuities consists of operations in the U.K., the Isle of Man, Ireland and Germany, which offer protection and wealth management products including payout annuities, conducted through Canada Life and its subsidiaries.  Reinsurance operates primarily in the U.S., Barbados and Ireland, and is conducted through Canada Life, London Life and their subsidiaries.

Net earnings attributable to common shareholders for the third quarter of 2013 were $129 million, which include the impact of $60 million of restructuring and acquisition costs related to the Irish Life acquisition.  Excluding these costs net earnings were $189 million for the quarter, compared to $165 million in the third quarter of 2012.  Irish Life contributed $41 million of earnings for the period July 19 to September 30, 2013.  For the nine months ended September 30, 2013 net earnings attributable to common shareholders were $499 million compared to $464 million for the same period in 2012.

Sales in Insurance & Annuities for the third quarter of 2013 were $3.3 billion, including $2.4 billion related to Irish Life, up 281% as compared to $0.9 billion a year ago.  Total sales for the nine months ended September 30, 2013, including Irish Life, were $5.1 billion compared to $2.4 billion in 2012.

Total Europe segment assets under administration at September 30, 2013 were $172 billion, up from $75 billion at December 31, 2012. Assets under administration include $94 billion of Irish Life assets.

CORPORATE

The Lifeco Corporate segment includes operating results for activities of Lifeco that are not associated with the major business units of the Company.

Net earnings in the Lifeco corporate segment attributable to common shareholders were a net loss of $14 million in the third quarter of 2013 compared to a net loss of $13 million in the third quarter of 2012.  For the nine months ended September 30, 2013 net earnings attributable to common shareholders were a net loss of $36 million compared to a net loss of $29 million for the same period in 2012.

QUARTERLY DIVIDENDS

At its meeting today, the Board of Directors approved a quarterly dividend of $0.3075 per share on the common shares of the Company payable December 31, 2013 to shareholders of record at the close of business December 3, 2013.

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

In addition, the Directors approved quarterly dividends on:

  • Series F First Preferred Shares of $0.36875 per share;
  • Series G First Preferred Shares of $0.3250 per share;
  • Series H First Preferred Shares of $0.30313 per share;
  • Series I First Preferred Shares of $0.28125 per share;
  • Series J First Preferred Shares of $0.3750 per share;
  • Series L First Preferred Shares of $0.353125 per share;
  • Series M First Preferred Shares of $0.36250 per share;
  • Series N First Preferred Shares of $0.228125 per share;
  • Series P First Preferred Shares of $0.3375 per share;
  • Series Q First Preferred Shares of $0.321875 per share; and
  • Series R First Preferred Shares of $0.3000 per share

all payable December 31, 2013 to shareholders of record at the close of business December 3, 2013.

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. Great-West Lifeco has operations in Canada, the United States, Europe and Asia through Great-West Life, London Life, Canada Life, Irish Life, Great-West Financial and Putnam Investments. Great-West Lifeco and its companies have $705 billion in assets under administration and are members of the Power Financial Corporation group of companies.

Cautionary note regarding Forward-Looking Information

This release contains some forward-looking statements about the Company, including its business operations, strategy and expected financial performance and condition. 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 similar expressions or negative versions thereof.  In addition, any statement that may be made concerning future 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, are also forward-looking statements.  Forward-looking statements are based on expectations and projections 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 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 market prices for products provided, sales levels, premium income, fee income, expense levels, mortality experience, morbidity experience, policy lapse rates, taxes, inflation, information systems, general economic, political and market factors in North America and internationally, interest and foreign exchange rates, global equity and capital markets, business competition, and the Company's ability to complete strategic transactions and integrate acquisitions, and that there will be no unplanned material changes to the Company's facilities, customer and employee relations or credit arrangements.  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 that could cause actual results to differ materially from those contained in forward-looking statements include technological change, 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 and catastrophic events.  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 2012 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 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", and other similar expressions.  Non-IFRS financial measures are used to provide management and investors with additional measures of performance.  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.  Please refer to the appropriate reconciliations of these non-IFRS financial measures to measures prescribed by IFRS.

Further information

Selected financial information is attached.

Great-West Lifeco's third quarter conference call and audio webcast will be held November 7, 2013 at 3:30 p.m. (ET).  The call and webcast can be accessed through www.greatwestlifeco.com or by phone at:

  • Participants in the Toronto area:  416-340-8061
  • Participants from North America: 1-866-225-0198
  • Participants from Overseas:  Dial international access code first, then 800-6578-9898

A replay of the call will be available from November 7, 2013, and can be accessed by calling 1-800-408-3053 or 905-694-9451 in Toronto (passcode: 8898149#). The archived webcast will be available on www.greatwestlifeco.com from November 7, 2013 until November 6, 2014.

Additional information relating to Lifeco, including the most recent interim unaudited condensed consolidated financial statements, interim Management's Discussion and Analysis (MD&A), and CEO/CFO certificates 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 nine months ended
    September 30   June 30   September 30   September 30   September 30
    2013   2013   2012(2)   2013   2012(2)
Premiums and deposits:                    
Life insurance, guaranteed annuities and insured health products $  4,598  $  4,332  $  4,940  $  13,510  $  13,993 
Self-funded premium equivalents (Administrative services only contracts)     620     654       631        1,918       1,989 
Segregated funds deposits:                    
  Individual products     2,352      1,431      1,490       5,551         4,485 
  Group products    1,838       1,900    1,681      5,744         5,046 
Proprietary mutual funds and institutional deposits     10,309      6,677       6,779     24,628      17,616 
Total premiums and deposits    19,717      14,994       15,521      51,351       43,129 
                     
Fee and other income      933        811      720      2,522        2,178 
Paid or credited to policyholders(1)    4,770        1,321      6,607     11,306      17,329 
Operating earnings - common shareholders      523         521          518       1,561       1,455 
Net earnings - common shareholders(2)(3)     523        521          518        1,561        1,455 
Per common share                    
  Basic earnings(2) $  0.527  $  0.548  $  0.546  $  1.618  $  1.532 
  Dividends paid    0.3075     0.3075     0.3075         0.9225      0.9225 
  Book value(2)     14.39       13.48       12.41         
Return on common shareholders' equity:            
  Net operating earnings(2)     16.0%     16.8%    16.6%        
  Net earnings(2)    14.9%     15.6%    17.6%        
  Total assets(2) $  311,789  $  264,158  $  249,043         
  Proprietary mutual funds and institutional net assets    169,980      149,273      131,604         
  Total assets under management(2)     481,769     413,431      380,647         
  Other assets under administration     223,342     182,305      151,604         
  Total assets under administration(2) $  705,111  $  595,736  $  532,251         
Total equity(2) $  19,435  $  17,843  $  16,370         
                     
The Company uses operating earnings, a non-International Financial Reporting Standards financial measure, which excludes the impact of certain litigation provisions described in note 30 to the Company's December 31, 2012 consolidated financial statements.
(1)  Paid or credited to policyholders includes the impact of changes in fair values of assets supporting liabilities.
(2)  Comparative figures, where impacted, have been restated for the retrospective impact of new and revised International
Financial Reporting Standards effective during 2013 most notably IAS 19R, Employee Benefits.
(3)  Impact of Irish Life on Lifeco net earnings - common shareholders
    Reported net earnings - 3 months ending September 30, 2013 $ 523 ($0.527 per common share)
    Add:  Irish Life restructuring and acquisition costs 60  
    Sub-total 583 ($0.588 per common share)
    Less:  Irish Life earnings (July 19 to September 30, 2013) (41)  
    Net earnings excluding Irish Life impacts $ 542 ($0.546 per common share)
         
         
CONSOLIDATED STATEMENTS OF EARNINGS (unaudited)
(in Canadian $ millions except per share amounts)
 
  For the three months ended For the nine months ended
    September 30   June 30   September 30   September 30   September 30
    2013   2013   2012   2013   2012
                     
Income                    
  Premium income                    
    Gross premiums written $  5,394  $  5,113  $  5,645  $  15,826  $  16,076 
    Ceded premiums     (796)          (781)         (705)          (2,316)         (2,083) 
  Total net premiums      4,598          4,332         4,940          13,510          13,993 
  Net investment income                    
    Regular net investment income    1,411          1,401         1,427          4,174          4,303 
    Changes in fair value through profit or loss       (19)         (3,200)         1,551          (2,754)          2,461 
  Total net investment income (loss)      1,392         (1,799)         2,978          1,420          6,764 
  Fee and other income       933          811          720          2,522          2,178 
      6,923         3,344         8,638          17,452         22,935 
Benefits and expenses                    
  Policyholder benefits                    
    Insurance and investment contracts                                       
       Gross    4,135          3,967         4,137         12,857         13,054 
       Ceded      (411)          (362)         (304)          (1,147)         (1,058) 
  Total net policyholder benefits   3,724          3,605         3,833          11,710         11,996 
  Policyholder dividends and experience refunds         317          363          414          1,047          1,145 
  Changes in insurance and investment contract liabilities         729         (2,647)         2,360         (1,451)          4,188 
  Total paid or credited to policyholders        4,770         1,321         6,607          11,306         17,329 
                     
  Commissions         463          443         441          1,338         1,266 
  Operating and administrative expenses        786         694         656          2,150          1,941 
  Premium taxes         84          72          74          230          218 
  Financing charges         75          74          72          216          225 
  Amortization of finite life intangible assets         28         29          25          84          79 
  Restructuring and acquisition expenses         63          10          -          77          - 
Earnings before income taxes       654         701         763          2,051          1,877 
Income taxes         79         128         141          335          267 
Net earnings before non-controlling interests       575         573         622          1,716          1,610 
Attributable to non-controlling interests         20         20          74          58          72 
Net earnings         555         553         548          1,658          1,538 
Preferred share dividends         32          32          30          97          83 
Net earnings - common shareholders $  523  $  521  $  518  $  1,561  $  1,455 
Earnings per common share                
  Basic $  0.527  $  0.548  $  0.546  $  1.618  $  1.532 
  Diluted $  0.522  $  0.547  $  0.542  $  1.580  $  1.522 
                       
                       
 
CONSOLIDATED BALANCE SHEETS (unaudited)
(in Canadian $ millions)
             
    September 30   December 31   January 1
    2013   2012   2012
             
Assets            
Cash and cash equivalents $  2,796  $  1,895  $  2,056 
Bonds         89,720          82,581          78,355 
Mortgage loans         18,549          17,875          17,432 
Stocks         8,032          7,051          6,656 
Investment properties         3,948          3,572          3,249 
Loans to policyholders         7,150          7,082          7,162 
       130,195         120,056          114,910 
Funds held by ceding insurers          9,810          10,537          9,923 
Goodwill         5,967          5,397          5,401 
Intangible assets         3,174          3,115          3,154 
Derivative financial instruments         674          997          968 
Owner occupied properties         577          514          491 
Fixed assets         189          154          137 
Reinsurance assets         4,934          2,064          2,061 
Other assets         5,425          4,688          4,062 
Deferred tax assets         1,158          1,142          1,163 
Investments on account of segregated fund policyholders         149,686          104,948          96,582 
Total assets $  311,789  $  253,612  $  238,852 
             
Liabilities            
Insurance contract liabilities $  126,662  $  119,919  $  114,730 
Investment contract liabilities         880          739          782 
Debentures and other debt instruments         5,503          4,283          4,313 
Funds held under reinsurance contracts         371          335          169 
Derivative financial instruments         607          342          316 
Other liabilities        5,793          5,163          4,600 
Deferred tax liabilities         682          708          810 
Repurchase agreements         2,007          -          23 
Capital trust debentures         163          164          815 
Investment and insurance contracts on account of segregated fund policyholders        149,686         104,948          96,582 
Total liabilities        292,354         236,601         223,140 
             
Equity            
Non-controlling interests            
  Participating account surplus in subsidiaries        2,495          2,451          2,187 
  Non-controlling interests in subsidiaries         7          5          3 
Shareholders' equity            
  Share capital            
    Preferred shares         2,544          2,544          1,894 
    Common shares         7,096          5,848          5,828 
  Accumulated surplus         7,693          7,035          6,417 
  Accumulated other comprehensive loss         (460)          (932)          (675) 
  Contributed surplus         60          60          58 
Total equity        19,435          17,011          15,712 
Total liabilities and equity $  311,789  $  253,612  $  238,852 
             
                     
                     
Segmented Information (unaudited)                    
Consolidated Net Earnings                    
For the three months ended September 30, 2013                
        United       Lifeco    
    Canada   States   Europe (1)   Corporate   Total
Income:                    
  Premium income $  2,516  $  927  $  1,155  $  -  $  4,598 
  Net investment income                    
    Regular net investment income         638          344          429          -          1,411 
    Changes in fair value through profit or loss         (129)          (82)          192          -          (19) 
  Total net investment income         509          262          621          -         1,392 
  Fee and other income         300          358          275          -          933 
Total income         3,325         1,547          2,051          -         6,923 
                     
Benefits and expenses:                    
  Paid or credited to policyholders      2,207         1,014         1,549          -          4,770 
  Other         663          398          263          9         1,333 
  Financing charges         29          35          6          5          75 
  Amortization of finite life intangible assets         12          12          4          -          28 
  Restructuring and acquisition expenses         -          -          63          -          63 
                     
Earnings before income taxes         414          88          166          (14)         654 
                     
Income taxes         62          8          12          (3)          79 
                     
Net earnings before non-controlling                    
interests         352          80          154          (11)          575 
                     
Non-controlling interests         19          1          -          -          20 
                     
Net earnings        333          79          154          (11)         555 
                     
Preferred share dividends         26          -          6          -          32 
                     
Net earnings before capital allocation         307          79          148          (11)          523 
Impact of capital allocation         25          (3)          (19)         (3)          - 
Net earnings - common shareholders $  332  $  76  $  129  $  (14)  $  523 
(1)  The Company completed the acquisition of Irish Life on July 18, 2013, the Europe segment includes the results of Irish Life from July 19, 2013 to September 30, 2013.
   
                 
For the three months ended September 30, 2012                
        United       Lifeco    
    Canada   States   Europe   Corporate   Total
Income:                    
  Premium income $  2,397  $  879  $  1,664  $  -  $  4,940 
  Net investment income                    
    Regular net investment income        666          332          433          (4)          1,427 
    Changes in fair value through profit or loss         493          244          814          -          1,551 
  Total net investment income (loss)     1,159          576          1,247          (4)          2,978 
  Fee and other income        271          304          145          -          720 
Total income         3,827          1,759         3,056          (4)         8,638 
                     
Benefits and expenses:                    
  Paid or credited to policyholders      2,733          1,246         2,628          -          6,607 
  Other      630          341         193          7         1,171 
  Financing charges         33          34          5          -          72 
  Amortization of finite life intangible assets         11          11          3          -          25 
                     
Earnings before income taxes         420          127         227         (11)         763 
                     
Income taxes         67          38          39          (3)         141 
                     
Net earnings before non-controlling                    
  interests        353          89          188          (8)          622 
                     
Non-controlling interests         72          (1)          3          -          74 
                     
Net earnings        281          90          185          (8)          548 
                     
Preferred share dividends         21          -          6          3          30 
                     
Net earnings before capital allocation        260         90          179         (11)         518 
Impact of capital allocation        20          (4)         (14)         (2)          - 
Net earnings - common shareholders $  280  $  86  $  165  $  (13)  $  518 
                     
                     
                 
For the nine months ended September 30, 2013                
        United       Lifeco    
    Canada   States   Europe (1)   Corporate   Total
Income:                    
  Premium income $  7,500  $  2,256  $  3,754  $  -  $  13,510 
  Net investment income                    
    Regular net investment income        1,877          1,009          1,292          (4)          4,174 
    Changes in fair value through profit or loss        (1,349)          (589)          (816)          -         (2,754) 
  Total net investment income (loss)         528          420          476          (4)          1,420 
  Fee and other income         884          1,032          606          -          2,522 
Total income        8,912         3,708          4,836          (4)          17,452 
                     
Benefits and expenses:                    
  Paid or credited to policyholders         5,716          2,140          3,450          -         11,306 
  Other        1,941          1,143         615          19          3,718 
  Financing charges         86          103          15          12          216 
  Amortization of finite life intangible assets         37          38          9          -          84 
  Restructuring and acquisition expenses         -          -          77          -          77 
                     
Earnings before income taxes         1,132          284          670          (35)          2,051 
                     
Income taxes         196          48          99          (8)          335 
                     
Net earnings before non-controlling                    
interests         936          236         571         (27)         1,716 
                     
Non-controlling interests         53          5          -          -          58 
                     
Net earnings         883          231         571         (27)         1,658 
                     
Preferred share dividends         80          -          17          -          97 
                     
Net earnings before capital allocation         803          231          554          (27)         1,561 
Impact of capital allocation         75          (11)          (55)         (9)          - 
Net earnings - common shareholders $  878  $  220  $  499  $  (36)  $  1,561 
(1)  The Company completed the acquisition of Irish Life on July 18, 2013, the Europe segment includes the results of Irish Life from July 19, 2013 to September 30, 2013.
   
   
                 
For the nine months ended September 30, 2012                
        United       Lifeco    
    Canada   States   Europe   Corporate   Total
Income:                    
  Premium income $  7,113  $  2,406  $  4,474  $  -  $  13,993 
  Net investment income                    
    Regular net investment income         1,950          983          1,373          (3)          4,303 
    Changes in fair value through profit or loss         755          442         1,264          -          2,461 
  Total net investment income (loss)         2,705         1,425         2,637          (3)          6,764 
  Fee and other income         818          912          448          -          2,178 
Total income        10,636         4,743         7,559          (3)         22,935 
                     
Benefits and expenses:                    
  Paid or credited to policyholders        7,599         3,274         6,456          -         17,329 
  Other        1,916         1,007          485          17         3,425 
  Financing charges        110          101          14          -          225 
  Amortization of finite life intangible assets         33          38          8          -          79 
                     
Earnings before income taxes        978          323         596         (20)         1,877 
                     
Income taxes        142          68          62          (5)          267 
                     
Net earnings before non-controlling                    
interests         836          255         534         (15)         1,610 
                     
Non-controlling interests         62          (1)          11          -          72 
                     
Net earnings         774         256         523          (15)          1,538 
                     
Preferred share dividends         58          -          17          8          83 
                     
Net earnings before capital allocation         716          256          506          (23)         1,455 
Impact of capital allocation        59         (11)          (42)          (6)          - 
Net earnings - common shareholders $  775  $  245  $  464  $  (29)  $  1,455 

SOURCE: Great-West Lifeco Inc.

Marlene Klassen, APR
Assistant Vice-President, Communication Services
204-946-7705

Organization Profile

Great-West Lifeco Inc.