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Great-West Lifeco reports second quarter 2018 net earnings of $831 million, up 17% from adjusted net earnings in the second quarter of 2017

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Great-West Lifeco reports second quarter 2018 net earnings of $831 million, up 17% from adjusted net earnings in the second quarter of 2017

Canada NewsWire

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. 1, 2018 /CNW/ - Great-West Lifeco Inc. (Lifeco or the Company) today announced net earnings attributable to common shareholders (net earnings) of $831 million or $0.839 per common share for the second quarter of 2018 compared to $585 million or $0.591 per common share for the same quarter last year. Excluding 2017 restructuring costs, Lifeco's adjusted net earnings in the second quarter of 2017 were $712 million.  Net earnings in the second quarter of 2018 increased $119 million or 17% compared to adjusted net earnings of $712 million reflecting earnings growth in each segment. Lifeco's net earnings for the second quarter of 2018 included a net positive impact of $60 million after-tax, or $0.061 per common share, from the restructuring of U.S. financing as a consequence of U.S. tax reform and the refinancing of certain debt instruments.

For the six months ended June 30, 2018, Lifeco's net earnings were $1,562 million or $1.579 per common share compared to adjusted net earnings of $1,331 million or $1.345 per common share for the same period last year.

"The Company saw solid operating performances and strong earnings growth in the second quarter", said Paul Mahon, President and Chief Executive Officer, Great-West Lifeco. "We are accelerating investments in digital to drive customer experience and operational effectiveness and taking strategic actions across our businesses to bolster growth in core markets."

Highlights – In Quarter

Sales of $33.1 billion up 32%

  • Sales for the second quarter of 2018 were $33.1 billion, up 32% from the second quarter of 2017, driven by a 45% increase in the U.S. and a 14% increase in Europe.

Fee and other income of $1.5 billion up 4%

  • Fee and other income was $1.5 billion, up 4% from the second quarter of 2017, driven by business growth in all segments and market performance.

Capital strength and financial flexibility maintained

  • The Great-West Life Assurance Company reported a Life Insurance Capital Adequacy Test (LICAT) ratio of 133% at June 30, 2018.
  • Lifeco declared a quarterly common dividend of $0.3890 per common share payable September 28, 2018.
  • During the second quarter of 2018, the Company, through its subsidiaries, issued $1,024 million (US$800 million) of senior notes and redeemed two tranches of subordinated debentures totaling $899 million.
  • Adjusted return on equity (ROE) for the second quarter of 2018 was 14.2%. The adjusted ROE excludes the impact of U.S. tax reform, a net charge on the sale of an equity investment and restructuring costs included in the prior year results.
  • Consolidated assets under administration at June 30, 2018 were over $1.4 trillion, a 5% increase from December 31, 2017.

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 Company.  For more information, please refer to the Company's 2018 second quarter Management's Discussion and Analysis (MD&A).

CANADA

  • Q2 Canada segment net earnings up 7% – Net earnings attributable to common shareholders for the second quarter of 2018 were $334 million compared to adjusted net earnings of $311 million in the second quarter of 2017, an increase of 7%, primarily reflecting strong Group Customer morbidity results and positive contributions from insurance contract liability basis changes. For the six months ended June 30, 2018, net earnings were $650 million compared to adjusted net earnings of $566 million for the same period last year. Adjusted net earnings in 2017 exclude restructuring costs of $126 million.
  • Canada advances business transformation – The Canadian operations made progress on the previously announced targeted annual expense reductions of $200 million pre-tax. As of June 30, 2018, the Company has achieved approximately $170 million pre-tax in annualized expense reductions; approximately $131 million related to the common shareholders' account and $39 million related to the participating accounts.

UNITED STATES

  • Q2 U.S. segment net earnings up 6% excluding impact of U.S. debt refinancing – Net earnings attributable to common shareholders for the second quarter of 2018, excluding the net positive impact of US$39 million related to U.S. debt refinancing activity, were US$66 million, up 6%, compared to US$62 million in the second quarter of 2017. The increase was primarily due to net growth in the business and the benefit of a lower U.S. corporate tax rate. For the six months ended June 30, 2018, net earnings were US$164 million, or US$125 million excluding the refinancing impact, compared to US$104 million for the same period last year.
  • Q2 U.S. segment fee and other income up 3% – Fee and other income for the three months ended June 30, 2018 was US$508 million compared to US$491 million for the same quarter last year, an increase of 3%, due to growth in Empower Retirement participants and assets.
  • Putnam average assets up 7% Putnam average assets under management for the three months ended June 30, 2018 were US$172.8 billion compared to US$161.8 billion for the same quarter last year, an increase of 7%, primarily due to the cumulative impact of positive markets over the twelve month period. Putnam ending assets under management at June 30, 2018 were US$172.4 billion.
  • Strong net asset inflows at Putnam Putnam's net asset inflows for the three months ended June 30, 2018 were US$1.6 billion, which were the highest since the second quarter of 2011. Included in the net asset inflows for the three months ended June 30, 2018 of US$1.6 billion, were mutual fund net inflows of US$0.6 billion, which were the highest since the fourth quarter of 2014. 

EUROPE

  • Q2 Europe segment net earnings up 11% – Net earnings attributable to common shareholders for the second quarter of 2018 were $355 million, up 11%, compared to $321 million in the second quarter of 2017, primarily driven by a higher impact from insurance contract liability basis changes mainly reflecting longevity assumption updates, partially offset by lower contributions from investment experience. For the six months ended June 30, 2018, net earnings were $699 million compared to $610 million for the same period last year.
  • Q2 Europe segment sales up 14% – Sales for the second quarter of 2018 were $5.5 billion, an increase of 14% compared to the same quarter last year reflecting the inclusion of Retirement Advantage sales and strong growth across most products.
  • Acquisition of strategic holding in financial consultancy Invesco Ltd (Ireland) announced – On April 20, 2018, the Company announced that its subsidiary, Irish Life Group Limited, reached an agreement to acquire a strategic holding in Invesco Ltd (Ireland), Ireland's largest Irish-owned independent financial consultancy firm. The acquisition is subject to regulatory approval and customary closing conditions, and is expected to be completed in the third quarter of 2018.
  • Sale of heritage policies to Scottish Friendly announced – Canada Life Limited, a U.K. subsidiary of the Company, agreed to sell a block of 155,000 heritage policies with assets and liabilities of £2.7 billion to Scottish Friendly. Canada Life Investments, a U.K. subsidiary of the Company, will continue to manage a substantial portion of the transferring unit-linked assets. The block has largely been closed to new business since 2003 and comprises individual life savings policies, individual pensions saving policies and individual protection policies. The transfer of these policies to Scottish Friendly is subject to regulatory approval and the satisfactory completion of certain closing conditions, and is expected to occur in late 2019. This sale, together with the integration of the Retirement Advantage business, will act as an enabler to help move forward in transforming the U.K. business to increase focus on the retirement market to serve the evolving needs of customers and support future growth.

QUARTERLY DIVIDENDS
At its meeting today, the Board of Directors approved a quarterly dividend of $0.3890 per share on the common shares of Lifeco payable September 28, 2018 to shareholders of record at the close of business August 31, 2018.

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

August 31, 2018

September 28, 2018

$0.36875

Series G

August 31, 2018

September 28, 2018

$0.3250

Series H

August 31, 2018

September 28, 2018

$0.30313

Series I

August 31, 2018

September 28, 2018

$0.28125

Series L

August 31, 2018

September 28, 2018

$0.353125

Series M

August 31, 2018

September 28, 2018

$0.3625

Series N

August 31, 2018

September 28, 2018

$0.1360

Series O

August 31, 2018

September 28, 2018

$0.163835

Series P

August 31, 2018

September 28, 2018

$0.3375

Series Q

August 31, 2018

September 28, 2018

$0.321875

Series R

August 31, 2018

September 28, 2018

$0.3000

Series S

August 31, 2018

September 28, 2018

$0.328125

Series T

August 31, 2018

September 28, 2018

$0.321875

 

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 and Europe 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 $1.4 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 condensed consolidated interim unaudited 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, estimates, 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 2017 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", "adjusted net earnings", "adjusted return on equity", "core net 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 1, 2018 at 2:30 p.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 1, 2018 to August 8, 2018, and can be accessed by calling 1-800-408-3053 or 905-694-9451 in Toronto (passcode: 3123659#).  The archived webcast will be available on www.greatwestlifeco.com from August 1, 2018 to July 31, 2019.

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
2018

March 31
2018

June 30
2017


June 30
2018

June 30
2017

Premiums and deposits:













Net premium income (Life insurance, guaranteed annuities














and insured health products)

$

7,905

$

8,174

$

7,761


$

16,079

$

17,115


Policyholder deposits (segregated funds):














Individual products

4,142

3,988

4,142


8,130

8,039



Group products

1,954

2,422

2,020


4,376

4,205


Self-funded premium equivalents









(Administrative services only contracts)(1)

774

748

720


1,522

1,436


Proprietary mutual funds and institutional deposits(1)

19,196

17,794

13,767


36,990

31,153

Total premiums and deposits(1)(2)

33,971

33,126

28,410


67,097

61,948












Fee and other income(2)

1,483

1,433

1,421


2,916

2,769

Net policyholder benefits, dividends and








experience refunds

7,588

7,829

7,377


15,417

15,920









Earnings












Net earnings - common shareholders

$

831

$

731

$

585


$

1,562

$

1,176

Adjustments(7)

127


155

Adjusted net earnings - common shareholders(7)

831

731

712


1,562

1,331


Per common share













Basic earnings

0.839

0.740

0.591


1.579

1.189



Adjusted basic earnings(7)                                                   

0.839

0.740

0.719


1.579

1.345



Dividends paid

0.389

0.389

0.367


0.778

0.734



Book value

21.22

21.01

19.95











Return on common shareholders' equity(3)










Net earnings

12.5%

11.4%

13.0%




Adjusted net earnings(7)

14.2%

13.8%

13.9%








Total assets(4)

$

430,695

$

432,651

$

409,511




Proprietary mutual funds and institutional








net assets(5)


294,890


285,843


271,686



Total assets under management(5)

725,585

718,494

681,197




Other assets under administration(6)

697,680

673,597

627,633



Total assets under administration

$

1,423,265

$

1,392,091

$

1,308,830



Total equity

$

26,620

$

26,435

$

25,428














(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)

Comparative figures have been reclassified to reflect presentation adjustments relating to the adoption of IFRS 15, Revenue from Contracts with Customers, as described in the "International Financial Reporting Standards" section of the Company's June 30, 2018 Management's Discussion and Analysis and in note 2 to the Company's condensed consolidated interim unaudited financial statements for the period ended June 30, 2018.

(3)

Return on common shareholders' equity is detailed within the "Capital Allocation Methodology" section of the Company's June 30, 2018 Management's Discussion and Analysis.

(4)

Comparative figures have been reclassified as described in note 2 and note 34 to the Company's December 31, 2017 annual consolidated financial statements.

(5)

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.

(6)

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.

(7)

Adjusted net earnings attributable to common shareholders and adjusted net earnings per common share (EPS) are non-IFRS measures of earnings performance.  For the second quarter of 2018, adjustments were nil (nil for the first quarter of 2018).  The following adjustments were made for the six months ending June 30, 2017:

 


Segment









2017 Adjustments:

Canada


United
States


Europe


Total


EPS Impact



Q1 Restructuring expenses

$


$

11


$

17


$

28


$

0.029



Q2 Restructuring expenses

126



1


127


0.128



Total Adjustments

$

126


$

11


$

18


$

155


$

0.156

 

CONSOLIDATED STATEMENTS OF EARNINGS (unaudited)


(in Canadian $ millions except per share amounts)





For the three months ended


For the six months ended



June 30

2018

March 31

2018

June 30

2017(1)


June 30

2018

June 30

2017(1)

















Income













Premium income














Gross premiums written

$

9,012

$

9,293

$

8,781


$

18,305

$

19,254




Ceded premiums

(1,107)

(1,119)

(1,020)


(2,226)

(2,139)



Total net premiums

7,905

8,174

7,761


16,079

17,115



Net investment income















Regular net investment income

1,575

1,573

1,591


3,148

3,060




Changes in fair value through profit or loss

(350)

(1,487)

304


(1,837)

1,039



Total net investment income

1,225

86

1,895


1,311

4,099



Fee and other income

1,483

1,433

1,421


2,916

2,769



10,613

9,693

11,077


20,306

23,983


Benefits and expenses














Policyholder benefits















Gross

7,742

7,996

7,415


15,738

16,010




Ceded

(596)

(625)

(500)


(1,221)

(1,110)



Total net policyholder benefits

7,146

7,371

6,915


14,517

14,900



Policyholder dividends and experience refunds

442

458

462


900

1,020



Changes in insurance and investment contract










liabilities

(32)

(1,049)

850


(1,081)

2,169



Total paid or credited to policyholders

7,556

6,780

8,227


14,336

18,089
















Commissions

596

594

609


1,190

1,422



Operating and administrative expenses

1,241

1,237

1,154


2,478

2,359



Premium taxes

124

121

107


245

230



Financing charges

11

71

79


82

155



Amortization of finite life intangible assets

50

49

47


99

92



Restructuring expenses

216


253


Earnings before income taxes

1,035

841

638


1,876

1,383


Income taxes

153

77

51


230

147


Net earnings before non-controlling interests

882

764

587


1,646

1,236


Attributable to non-controlling interests

18

(28)


18

(1)


Net earnings

864

764

615


1,628

1,237


Preferred share dividends

33

33

30


66

61


Net earnings - common shareholders

$

831

$

731

$

585


$

1,562

$

1,176















Earnings per common share














Basic

$

0.839

$

0.740

$

0.591


$

1.579

$

1.189



Diluted

$

0.839

$

0.739

$

0.590


$

1.578

$

1.187




(1)

Certain comparative figures have been reclassified as described in note 2 to the Company's June 30, 2018 condensed consolidated interim unaudited financial statements.

 

CONSOLIDATED BALANCE SHEETS (unaudited)


(in Canadian $ millions)






June 30

2018

December 31

2017




Assets




Cash and cash equivalents

$

3,794

$

3,551


Bonds

122,437

120,204


Mortgage loans

24,206

22,185


Stocks

9,226

8,864


Investment properties

5,098

4,851


Loans to policyholders

8,611

8,280



173,372

167,935


Assets held for sale

169


Funds held by ceding insurers

9,581

9,893


Goodwill

6,480

6,179


Intangible assets

3,821

3,732


Derivative financial instruments

382

384


Owner occupied properties

720

706


Fixed assets

372

303


Other assets   

2,604

2,424


Premiums in course of collection, accounts and interest receivable

4,990

4,647


Reinsurance assets

6,095

5,045


Current income taxes

224

134


Deferred tax assets

937

930


Investments on account of segregated fund policyholders

221,117

217,357


Total assets

$

430,695

$

419,838






Liabilities




Insurance contract liabilities

$

163,898

$

159,524


Investment contract liabilities

1,769

1,841


Debentures and other debt instruments

6,031

5,617


Capital trust securities

160

160


Funds held under reinsurance contracts

1,383

373


Derivative financial instruments

1,250

1,336


Accounts payable

3,314

2,684


Other liabilities                             

3,445

3,752


Current income taxes

495

464


Deferred tax liabilities

1,213

1,194


Investment and insurance contracts on account of segregated fund policyholders

221,117

217,357


Total liabilities

404,075

394,302






Equity




Non-controlling interests





Participating account surplus in subsidiaries

2,782

2,771



Non-controlling interests in subsidiaries

135

164


Shareholders' equity





Share capital






Preferred shares

2,714

2,714




Common shares                                                                                         

7,291

7,260



Accumulated surplus

12,742

12,098



Accumulated other comprehensive income

828

386



Contributed surplus

128

143


Total equity

26,620

25,536


Total liabilities and equity

$

430,695

$

419,838


 

Segmented Information (unaudited)




Consolidated Net Earnings




For the three months ended June 30, 2018



Canada

United
States

Europe

Lifeco
Corporate

Total


Income







Total net premiums

$

3,141

$

894

$

3,870

$

$

7,905



Net investment income








Regular net investment income

666

462

445

2

1,575




Changes in fair value through profit or loss

249

(260)

(339)

(350)



Total net investment income

915

202

106

2

1,225



Fee and other income

433

655

395

1,483



4,489

1,751

4,371

2

10,613








Benefits and expenses







Paid or credited to policyholders

3,184

894

3,478

7,556



Other (1)

812

686

458

5

1,961



Financing charges

32

(31)

10

11



Amortization of finite life intangible assets

20

22

8

50



Restructuring expenses


Earnings (loss) before income taxes

441

180

417

(3)

1,035


Income taxes (recovery)

92

31

31

(1)

153


Net earnings (loss) before non-controlling








 interests

349

149

386

(2)

882


Non-controlling interests

17

1

18


Net earnings (loss)

332

148

386

(2)

864


Preferred share dividends

29

4

33


Net earnings (loss) before capital allocation

303

148

382

(2)

831


Impact of capital allocation

31

(3)

(27)

(1)


Net earnings (loss) - common shareholders

$

334

$

145

$

355

$

(3)

$

831




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






For the three months ended June 30, 2017



Canada(2)

United
States(2)

Europe

Lifeco
Corporate

Total(2)


Income







Total net premiums

$

3,178

$

942

$

3,641

$

$

7,761



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

417

658

346

1,421



4,519

2,325

4,231

2

11,077








Benefits and expenses







Paid or credited to policyholders

3,333

1,476

3,418

8,227



Other (1)

790

673

405

2

1,870



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.

(2)

Certain comparative figures have been reclassified as described in note 2 to the Company's June 30, 2018 condensed consolidated interim unaudited financial statements.

 

For the six months ended June 30, 2018



Canada

United
States

Europe

Lifeco
Corporate

Total


Income







Total net premiums

$

6,292

$

1,968

$

7,819

$

$

16,079



Net investment income








Regular net investment income

1,278

903

962

5

3,148




Changes in fair value through profit or loss

(85)

(840)

(912)

(1,837)



Total net investment income

1,193

63

50

5

1,311



Fee and other income

871

1,286

759

2,916



8,356

3,317

8,628

5

20,306








Benefits and expenses







Paid or credited to policyholders

5,823

1,646

6,867

14,336



Other (1)

1,628

1,360

915

10

3,913



Financing charges

64

(2)

20

82



Amortization of finite life intangible assets

40

43

16

99



Restructuring expenses


Earnings (loss) before income taxes

801

270

810

(5)

1,876


Income taxes (recovery)

138

44

49

(1)

230


Net earnings (loss) before non-controlling








 interests

663

226

761

(4)

1,646


Non-controlling interests

17

1

18


Net earnings (loss)

646

225

761

(4)

1,628


Preferred share dividends

57

9

66


Net earnings (loss) before capital allocation

589

225

752

(4)

1,562


Impact of capital allocation

61

(5)

(53)

(3)


Net earnings (loss) - common shareholders

$

650

$

220

$

699

$

(7)

$

1,562




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






For the six months ended June 30, 2017



Canada(2)

United
States(2)

Europe

Lifeco
Corporate

Total(2)


Income







Total net premiums

$

6,462

$

2,171

$

8,482

$

$

17,115



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

822

1,277

670

2,769



9,196

4,730

10,056

1

23,983








Benefits and expenses







Paid or credited to policyholders

6,578

3,028

8,483

18,089



Other (1)

1,825

1,384

791

11

4,011



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.

(2)

Certain comparative figures have been reclassified as described in note 2 to the Company's June 30, 2018 condensed consolidated interim unaudited financial statements.

 

SOURCE Great-West Lifeco Inc.

View original content: http://www.newswire.ca/en/releases/archive/August2018/01/c4208.html

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