Readers are referred to the sections "Non-IFRS Financial Measures and Presentation" and "Forward-Looking Statements" at the end of this release. |
Consolidated results for the period ended
HIGHLIGHTS
- The Corporation's net asset value (NAV) per share [1] was
$41.27 atDecember 31, 2020 , compared with$34.94 atSeptember 30, 2020 , an increase of 18.1%. - The Corporation was one of only three Canadian companies, along with
Great-West Lifeco Inc. (Lifeco), to earn an A ("Leadership") rating on CDP's 2020 Climate Change Questionnaire, a rating which identifies the global leaders in the management of carbon, climate change risks and low-carbon opportunities. - The Corporation announced its notice of intention to make a normal course issuer bid on
February 23, 2021 . - On
December 31, 2020 , Empower Retirement, a subsidiary of Lifeco, completed the acquisition of the retirement services business ofMassachusetts Mutual Life Insurance Company (MassMutual) forUS$2.3 billion , strengthening Empower Retirement's position as the second-largest retirement services provider in theU.S. based on assets under administration and number of retirement plan participants. - Lifeco's assets under administration were
$2.0 trillion atDecember 31, 2020 , an increase of 21% fromDecember 31, 2019 primarily due to the MassMutual transaction. IGM Financial Inc. (IGM) reported record-high assets under management and advisement of$240.0 billion , up 6.7% in the quarter and 10.3% in the year (excluding$30.3 billion in net business acquisitions).- On
December 31, 2020 , Mackenzie Financial Corporation (Mackenzie) acquiredGLC Asset Management Group Ltd. (GLC), a wholly owned subsidiary of Lifeco. This transaction allows Mackenzie to become one ofCanada's largest asset managers and expands its distribution reach. - The merger between Pargesa Holding SA (Pargesa) and
Parjointco Switzerland SA , a wholly owned subsidiary ofParjointco SA , was completed onNovember 20, 2020 . Accordingly, Pargesa was delisted from theSwiss Stock Exchange . Sagard Holdings Inc. (Sagard Holdings ) has recently announced:- First closing of its second credit fund, Sagard Credit II, with commitments of
US$650 million . Fundraising efforts will continue in 2021. - Launch of its Canadian Private Equity platform, a strategy which will focus on the middle market in
Canada . - Final closing of
Sagard Healthcare Royalty Partners, LP (SHRP) with commitments totalling approximatelyUS$725 million . Power Sustainable Capital Inc. (Power Sustainable) announced the launch of thePower Sustainable Energy Infrastructure Partnership , a$1 billion investment platform dedicated to the North American renewable energy sector, onJanuary 19, 2021 .The Lion Electric Co. (Lion) announced it intends to combine with Northern Genesis Acquisition Corp. (Northern Genesis), a public corporation, onNovember 30, 2020 .
[1] | NAV, NAV per share, adjusted net earnings and adjusted net earnings per share are non-IFRS measures. See the Non-IFRS Financial Measures and Presentation section later in this news release. |
Net Asset Value
Net asset value per share represents management's estimate of the fair value of participating equity. Net asset value is the fair value of the combined
The Corporation's net asset value per share was
(in millions of Canadian dollars, | Variation % | |||
Publicly Traded | Lifeco | 18,825 | 16,139 | 17 |
IGM | 5,105 | 4,516 | 13 | |
GBL | 2,870 | 2,678 | 7 | |
26,800 | 23,333 | 15 | ||
Alternative Asset | ||||
Investments | 1,298 | 1,292 | − | |
Power Sustainable [1] | ||||
Power Pacific | 1,142 | 977 | 17 | |
730 | 735 | (1) | ||
3,170 | 3,004 | 6 | ||
Other | China AMC [2] | 715 | 709 | 1 |
Standalone businesses [3] | 1,351 | 625 | 116 | |
Other assets and investments | 548 | 624 | (12) | |
Cash and cash equivalents | 1,226 | 1,216 | 1 | |
Gross asset value | 33,810 | 29,511 | 15 | |
Liabilities and preferred shares | (5,859) | (5,884) | − | |
Net asset value | 27,951 | 23,627 | 18 | |
Shares outstanding (millions) | 677.2 | 676.3 | ||
Net asset value per share | 41.27 | 34.94 | 18 |
[1] | The management companies of the investment funds are included at their carrying value. |
[2] | |
[3] |
Power Corporation's Ownership in Publicly Traded Operating Companies
Shares held [1] | Share price | ||||
Ownership [1] | |||||
Lifeco | 66.8 | 620.3 | |||
IGM | 62.1 | 147.9 | |||
GBL [2] | 14.1 | 22.8 | €82.52 | €76.98 |
[1] As at December 31, 2020. | [2] Held through |
FOURTH QUARTER
Net earnings attributable to participating shareholders were
Adjusted net earnings attributable to participating shareholders [1] were
Contributions to
2020 [2] | 2019 | |||
(in dollars per | Net Earnings | Adjusted Net Earnings | Net Earnings | Adjusted Net Earnings |
Lifeco [3] | 0.73 | 0.73 | 0.51 | 0.84 |
IGM [3] | 0.19 | 0.19 | 0.17 | 0.18 |
GBL [4] | 0.02 | 0.02 | 0.05 | 0.08 |
Effect of consolidation | (0.05) | (0.05) | − | − |
0.89 | 0.89 | 0.73 | 1.10 | |
Alternative asset investment platforms [5][6] | 0.05 | 0.05 | (0.03) | (0.03) |
China AMC | 0.02 | 0.02 | 0.02 | 0.02 |
Standalone businesses [6] | 0.07 | 0.07 | (0.09) | (0.05) |
1.03 | 1.03 | 0.63 | 1.04 | |
Corporate operations and Other [7] | (0.11) | (0.10) | (0.21) | (0.20) |
0.92 | 0.93 | 0.42 | 0.84 | |
Average shares outstanding (in millions) | 676.7 | 426.3 |
Lifeco: contribution to net earnings per share increased by 43%; contribution to adjusted net earnings per share decreased by 13%.
IGM: contribution to net earnings per share increased by 12%; contribution to adjusted net earnings per share increased by 6%.
GBL: results include a charge of
Alternative asset investment platforms: results of the fourth quarter include a gain of
Standalone businesses: results include a positive impact of
As part of the Reorganization completed in
Adjustments in the fourth quarter of 2020, excluded from adjusted net earnings, were a net negative impact to earnings of
[1] | A non-IFRS financial measure; see Non-IFRS Financial Measures and Presentation later in this news release. |
[2] | The Corporation completed a reorganization transaction on |
[3] | The Corporation eliminated the gain recognized by Lifeco on the sale of GLC, and the gain recognized by IGM on the sale of the |
[4] | Adjustments in 2019 are as previously reported by Pargesa. |
[5] | Alternative asset investment platforms includes earnings (losses) from investment platforms including controlled and consolidated subsidiaries and other investments. |
[6] | Presented in Alternative and other investments in the Non-Consolidated Statements of Earnings of the Corporation's most recent MD&A. |
[7] | Includes operating and other expenses, dividends on non-participating shares of the Corporation and its share of Power Financial's corporate operations; refer to the Earnings Summary below. |
TWELVE MONTHS
Net earnings attributable to participating shareholders were
Adjusted net earnings attributable to participating shareholders were
Contributions to
2020 [1] | 2019 | |||
(in dollars per | Net Earnings | Adjusted Net Earnings | Net Earnings | Adjusted Net Earnings |
Lifeco [2][3] | 2.76 | 2.65 | 2.33 | 2.67 |
IGM [3] | 0.66 | 0.71 | 0.68 | 0.70 |
GBL | 0.13 | 0.14 | 0.22 | 0.27 |
Effect of consolidation | (0.16) | (0.16) | 0.05 | 0.05 |
3.39 | 3.34 | 3.28 | 3.69 | |
Alternative asset investment platforms [4][5] | 0.09 | 0.09 | 0.14 | 0.14 |
China AMC | 0.06 | 0.06 | 0.07 | 0.07 |
Standalone businesses [5] | 0.09 | 0.05 | (0.21) | (0.17) |
3.63 | 3.54 | 3.28 | 3.73 | |
Corporate operations and Other [6] | (0.55) | (0.54) | (0.75) | (0.81) |
3.08 | 3.00 | 2.53 | 2.92 | |
Average shares outstanding (in millions) | 647.5 | 437.5 |
Adjustments in the twelve-month period of 2020, excluded from adjusted net earnings, were a net positive impact to earnings of $51 million or
[1] | The Corporation completed the Reorganization on |
[2] | Power Financial participated in Lifeco's substantial issuer bid in the second quarter of 2019; the number of shares held by Power Financial decreased by 7.4%. |
[3] | The Corporation eliminated the gain recognized by Lifeco on the sale of GLC, and the gain recognized by IGM on the sale of the |
[4] | Alternative asset investment platforms includes earnings (losses) from investment platforms including controlled and consolidated subsidiaries and other investments. |
[5] | Presented in Alternative and other investments in the Non-Consolidated Statements of Earnings of the Corporation's most recent MD&A. |
[6] | Includes operating and other expenses, dividends on non-participating shares of the Corporation and its share of Power Financial's corporate operations; refer to the Earnings Summary below. |
Results for the quarter ended
The information below is derived from Lifeco and IGM's annual MD&As, as prepared and disclosed by the respective companies in accordance with applicable securities legislation, and which are also available either directly from SEDAR (www.sedar.com) or from their websites, www.greatwestlifeco.com and www.igmfinancial.com. The information below related to GBL is derived from publicly disclosed information, as issued by GBL in its fourth quarter press release. Further information on GBL's results is available on its website at www.gbl.be.
FOURTH QUARTER
Net earnings attributable to common shareholders were
Adjusted net earnings [1] attributable to common shareholders were
Adjustments in the fourth quarter of 2020, excluded from adjusted net earnings, were a net positive impact to earnings of
FOURTH QUARTER
Net earnings available to common shareholders were
Adjusted net earnings available to common shareholders were
Adjustments, not included in adjusted net earnings, in the fourth quarter of 2020 were a net positive impact of
Assets under management and advisement at
FOURTH QUARTER
GBL reported net earnings of €68 million, compared with net earnings of €134 million in 2019.
GBL reported a net asset value at
GBL adopted IFRS 9 in 2018.
[1] | Described as "base earnings" by Lifeco. For additional information, please refer to the Non-IFRS Financial Measures and Presentation section later in this news release. |
[2] | The Corporation eliminated the gain recognized by Lifeco on the sale of GLC, and the gain recognized by IGM on the sale of QGOF, from reported net earnings. |
Alternative and Other Investments
Results for the quarter ended
Alternative and other investments are comprised of the results of the Corporation's alternative asset investment platforms,
FOURTH QUARTER
Income from the Corporation's alternative and other investments, including standalone businesses, was
Income in the fourth quarter includes the Corporation's share of a gain recognized on the deconsolidation of Koho of
COVID-19
The outbreak of the novel strain of coronavirus, specifically identified as "COVID-19", has resulted in governments worldwide enacting emergency measures to combat the spread of the virus. These measures, which include the implementation of travel bans, self-imposed quarantine periods and social distancing, have caused material disruption to businesses globally resulting in an economic slowdown. Governments and central banks have responded with significant monetary and fiscal interventions designed to stabilize economic conditions. Equity markets in particular have been volatile, experiencing material and rapid declines in the first quarter of 2020; however, during the remainder of 2020, the markets have experienced recoveries.
The Corporation is managing the risks associated with the COVID-19 pandemic utilizing its existing risk management framework. At
The duration and impact of the COVID-19 pandemic is unknown at this time. While the conditions have become more stable, governments and central banks in the jurisdictions in which the Corporation and its operating subsidiaries operate have implemented and extended many of the measures introduced earlier in 2020 to deal with the economic impacts of the COVID-19 pandemic; however, the depth and length of the recession, rollout and efficacy of vaccines, and durability and effectiveness of government and central bank interventions are unknown. It is not possible to reliably estimate the length and severity of these developments and the impact on the financial results and condition of the Corporation and its operating subsidiaries in future periods.
Dividend on Power Corporation Participating Shares
The Board of Directors declared a quarterly dividend of 44.75 cents per share on the Participating Preferred Shares and the Subordinate Voting Shares of the Corporation, payable
Dividends on Power Corporation Non-Participating Preferred Shares
The Board of Directors also declared quarterly dividends on the Corporation's preferred shares, payable
Series | Stock Symbol | Amount | Series | Stock Symbol | Amount |
1986 Series | POW.PR.F | 21.44¢ [1] | Series C | POW.PR.C | 36.25¢ |
Series A | POW.PR.A | 35¢ | Series D | POW.PR.D | 31.25¢ |
Series B | POW.PR.B | 33.4375¢ | Series G | POW.PR.G | 35¢ |
[1] | Equal to one quarter of 70% of the average prime rate of two major Canadian chartered banks for the period |
Investor Information
Access to Quarterly | Quarterly Earnings Conference Call: | |
Interested investors, the media and others may view the fourth quarter earnings news release and shareholder report on the |
The live audio webcast and presentation materials will be available at: www.powercorporation.com/en/investors/events-presentations
To listen via telephone, please dial 1-833-979-2697 toll-free in
A replay of the conference call will be available from | |
Investor Relations Contact: | ||
About
At
100% – Power Financial | www.powerfinancial.com | |
66.8% | www.greatwestlifeco.com | |
62.1% | www.igmfinancial.com | |
14.1% | GBL [1] (Euronext: GBLB) | www.gbl.be |
74.9% | Wealthsimple Financial Corp. [2] | www.wealthsimple.com |
Investment Platforms | ||
100% | www.sagardholdings.com | |
100% | Power Sustainable | www.powersustainable.com |
Power Pacific Investment Management | www.powerpacificim.com | |
13.9% – China AMC [3] | www.chinaamc.com |
[1] | Held through | |
[2] | Undiluted equity interest held by Portag3 I, Power Financial and IGM, representing a fully diluted equity interest of 61.7%. | |
[3] | IGM also holds a 13.9% interest in |
Earnings Summary
Contribution to net and adjusted net earnings
| Three months | Twelve months ended | ||
2020 | 2019 | 2020 | 2019 | |
Adjusted net earnings [1] | ||||
Lifeco [2] | 495 | 556 | 1,784 | 1,814 |
IGM [2] | 127 | 125 | 474 | 473 |
GBL [2] | 16 | 51 | 89 | 181 |
Effect of consolidation [3] | (34) | (3) | (67) | 33 |
604 | 729 | 2,280 | 2,501 | |
Alternative asset investment platforms and other [4][5] | 31 | (11) | 59 | 58 |
China AMC | 12 | 7 | 42 | 30 |
Standalone businesses [4][6] | 47 | (24) | 31 | (76) |
Corporate operating and other expenses | (20) | (61) | (164) | (246) |
Dividends on non-participating | (47) | (48) | (189) | (191) |
Non-controlling interests of Power Financial | − | (235) | (116) | (801) |
Adjusted net earnings [7] | 627 | 357 | 1,943 | 1,275 |
Adjustments – see below | (4) | (178) | 51 | (167) |
Net earnings [7] | 623 | 179 | 1,994 | 1,108 |
[1] | Effective the first quarter of 2020, the Corporation introduced a modified definition of its non-IFRS earnings measures, Adjusted net earnings. The comparative figures have been restated. For additional information, please refer to the Non-IFRS Financial Measures and Presentation section later in this news release. |
[2] | As reported by Lifeco, IGM and GBL. |
[3] | Effect of consolidation includes the elimination of intercompany transactions, as well as the application of the Corporation's accounting treatment of commonly held investments to the reported net earnings of the publicly traded operating companies, which include an allocation of the results of the fintech portfolio including Wealthsimple, Koho, Portag3 I and Portag3 II, to the contributions from Lifeco and IGM based on their respective interest and reflects adjustments in accordance with IAS 39 for IGM and GBL. Refer to the detailed table in the Non-Consolidated Statements of Earnings section of the Corporation's most recent MD&A. |
[4] | Presented in Alternative and other investments in the Non-Consolidated Statements of Earnings of the Corporation's most recent MD&A. |
[5] | Includes earnings of the Corporation's alternative asset investment platforms including investments held through Power Financial and earnings (losses) from |
[6] | Includes the results of Peak, GP Strategies, Lumenpulse, Lion and |
[7] | Attributable to participating shareholders. |
Contribution to net and adjusted net earnings per share
| Three months | Twelve months ended | ||
2020 | 2019 | 2020 | 2019 | |
Adjusted net earnings per share – basic [1] | ||||
Lifeco [2] | 0.73 | 0.84 | 2.65 | 2.67 |
IGM [2] | 0.19 | 0.18 | 0.71 | 0.70 |
GBL [2] | 0.02 | 0.08 | 0.14 | 0.27 |
Effect of consolidation [3] | (0.05) | − | (0.16) | 0.05 |
0.89 | 1.10 | 3.34 | 3.69 | |
Alternative asset investment platforms and other [4][5] | 0.05 | (0.03) | 0.09 | 0.14 |
China AMC | 0.02 | 0.02 | 0.06 | 0.07 |
Standalone businesses [4][6] | 0.07 | (0.05) | 0.05 | (0.17) |
Corporate operating and other expenses and dividends on non‑participating and perpetual preferred shares | (0.10) | (0.20) | (0.54) | (0.81) |
Adjusted net earnings per share [7] | 0.93 | 0.84 | 3.00 | 2.92 |
Adjustments – see below | (0.01) | (0.42) | 0.08 | (0.39) |
Net earnings per share [7] | 0.92 | 0.42 | 3.08 | 2.53 |
[1] | Effective the first quarter of 2020, the Corporation introduced a modified definition of its non-IFRS earnings measures, Adjusted net earnings. The comparative figures have been restated. For additional information, please refer to the Non-IFRS Financial Measures and Presentation section later in this news release. |
[2] | As reported by Lifeco, IGM and GBL. |
[3] | Effect of consolidation includes the elimination of intercompany transactions, as well as the application of the Corporation's accounting treatment of commonly held investments to the reported net earnings of the publicly traded operating companies, which include an allocation of the results of the fintech portfolio including Wealthsimple, Koho, Portag3 I and Portag3 II, to the contributions from Lifeco and IGM based on their respective interest and reflects adjustments in accordance with IAS 39 for IGM and GBL. Refer to the detailed table in the Non-Consolidated Statements of Earnings section of the Corporation's most recent MD&A. |
[4] | Presented in Alternative and other investments in the Non-Consolidated Statements of Earnings of the Corporation's most recent MD&A. |
[5] | Includes earnings of the Corporation's alternative asset investment platforms including investments held through Power Financial and earnings (losses) from |
[6] | Includes the results of Peak, GP Strategies, Lumenpulse, Lion and |
[7] | Attributable to participating shareholders. |
Alternative and Other Investments – Earnings
| Three months | Twelve months ended | ||
2020 | 2019 | 2020 | 2019 | |
Asset management activities [1] | (3) | (7) | (3) | (31) |
Investing activities (proprietary capital) | 40 | (8) | 28 | (20) |
Power Sustainable | ||||
Investing activities (proprietary capital) | (21) | (5) | 17 | 61 |
Standalone businesses [2] | 47 | (24) | 31 | (76) |
Investment and hedge funds and other [3] | 15 | 9 | 17 | 48 |
78 | (35) | 90 | (18) |
[1] | Includes management fees charged by the investment platform on proprietary capital. Management fees paid by the Corporation are deducted from income from investing activities. |
[2] | Includes the increase in fair value of Power Sustainable's call rights on Lion shares of |
[3] | Other consists mainly of foreign exchange gains or losses and interest on cash and cash equivalents. |
Adjustments (not included in adjusted net earnings)
| Three months | Twelve months ended | ||
2020 | 2019 | 2020 | 2019 | |
Share of Lifeco's adjustments [1]: | ||||
Actuarial assumption changes | (15) | (52) | 76 | 115 |
Market-related impacts on liabilities | (21) | (9) | (85) | (60) |
Net gain (charge) on business dispositions | − | 6 | 63 | (128) |
Transaction costs related to the acquisitions | (31) | − | (52) | − |
Revaluation of a deferred tax asset | 131 | (133) | 131 | (133) |
Restructuring and integration charges | (56) | (24) | (56) | (24) |
Share of IGM's adjustments | (1) | − | (1) | − |
7 | (212) | 76 | (230) | |
Share of IGM's adjustments [1]: | ||||
Restructuring and other charges | − | − | (34) | − |
Transaction costs related to acquisition of GLC | (3) | − | (3) | − |
Share of Lifeco's adjustments | − | (8) | 3 | (9) |
(3) | (8) | (34) | (9) | |
Share of GBL's adjustments [2]: | ||||
Imerys – Impairments, restructuring charges and other | − | (11) | (3) | (18) |
Parques and other charges | − | (13) | (3) | (19) |
− | (24) | (6) | (37) | |
Alternative and other investments: | ||||
Recovery on deconsolidation of | − | − | 27 | − |
Share of | − | (16) | − | (16) |
− | (16) | 27 | (16) | |
Corporate operations: | ||||
Reduction of income tax estimates | − | − | − | 31 |
Reorganization charges | (8) | (9) | (8) | (9) |
(8) | (9) | (8) | 22 | |
Non-controlling interest of Power Financial | − | 91 | (4) | 103 |
(4) | (178) | 51 | (167) |
[1] | Includes IGM's share of Lifeco's Adjustments for the impact of actuarial assumption changes and management actions and market impact on insurance contract liabilities, in accordance with the Corporation's definition of Adjusted net earnings. In the fourth quarter, excludes the gain of |
[2] | As previously reported by Pargesa; GBL does not identify Adjustments. |
Net Asset Value
Net asset value represents management's estimate of the fair value of the participating shareholders' equity of the Corporation. Net asset value is the fair value of the assets of the combined
The Corporation's net asset value per share was
December 31, 2020 (in millions of Canadian dollars, except per share amounts) | Combined non-consolidated balance sheet | Fair value | Net asset value |
Assets | |||
Investments | |||
Power Financial | |||
Lifeco | 14,451 | 4,374 | 18,825 |
IGM | 2,853 | 2,252 | 5,105 |
GBL | 4,216 | (1,346) | 2,870 |
Alternative and other investments | |||
Investments [2] | 988 | 310 | 1,298 |
Power Sustainable [1] | |||
Power Pacific | 1,142 | − | 1,142 |
427 | 303 | 730 | |
Other | |||
Standalone businesses [3] | 563 | 788 | 1,351 |
Other | 247 | 19 | 266 |
China AMC [4] | 715 | − | 715 |
Cash and cash equivalents | 1,226 | − | 1,226 |
Other assets | 282 | − | 282 |
Total assets | 27,110 | 6,700 | 33,810 |
Liabilities and non-participating shares | |||
Debentures and other debt instruments | 1,006 | − | 1,006 |
Other liabilities [5] | 1,067 | − | 1,067 |
Non-participating shares and perpetual preferred shares | 3,786 | − | 3,786 |
Total liabilities and non-participating shares | 5,859 | − | 5,859 |
Net value | |||
Participating shareholders' equity / Net asset value | 21,251 | 6,700 | 27,951 |
Per share | 31.38 | 41.27 |
[1] | The management companies of the investment funds are included at their carrying value. |
[2] | Includes the Corporation's investments in Portag3 I, Portag3 II, Wealthsimple and Koho, held by Power Financial. |
[3] | At |
[4] | Valued at carrying value in accordance with IFRS. |
[5] | In accordance with IAS 12, Income Taxes, no deferred tax liability is recognized with respect to temporary differences associated with investments in subsidiaries and jointly controlled corporations as the Corporation is able to control the timing of the reversal of the temporary differences and it is probable that the temporary differences will not reverse in the foreseeable future. If the Corporation were to dispose of an investment in a subsidiary or a jointly controlled corporation, income taxes payable on such disposition would be minimized through careful and prudent tax planning and structuring, as well as with the use of available tax attributes not otherwise recognized on the balance sheet, including tax losses, tax basis, safe income and foreign tax surplus associated with the subsidiary or jointly controlled corporation. |
NON-IFRS FINANCIAL MEASURES AND PRESENTATION
The Corporation announced a Reorganization and its strategy in early 2020. The Corporation has modified the presentation of the activities held through Power Financial. Previously, Power Financial's results including its corporate operations were presented separately by the Corporation. Subsequent to the Reorganization, the corporate operations of both the Corporation and Power Financial are being managed together and have been presented on a combined basis throughout the "Results of the Corporation" section of the Corporation's 2020 Annual MD&A. The investment activities of Power Financial are primarily interests held in fintech investments, all of which are managed by
As well, in the second quarter of 2020, the Corporation modified the presentation of the asset management companies held by the investment platforms. Previously, the asset management activities were consolidated and included as corporate activities within the non-consolidated balance sheet of the Corporation. The activities of each asset management company are now presented within their operations. The comparatives in the non-consolidated balance sheets and non-consolidated statements of cash flows have been restated to reflect this change.
Effective the first quarter of 2020, the Corporation introduced a modified definition of its non-IFRS earnings measure, Adjusted net earnings. This change is consistent with the introduction of base earnings (loss) by Lifeco which was introduced in the first quarter of 2020 to reflect management's view of the operating performance of Lifeco. Lifeco defines base earnings (loss) as net earnings excluding the impact of actuarial assumption changes and management actions, direct equity and interest rate market impacts on insurance contract liabilities net of hedging, and items that management believes are not indicative of the company's underlying business results. The definition of Adjustments includes what the Corporation previously presented as other items and also includes Lifeco's impact of actuarial assumption changes and management actions, and direct equity and interest rate market impacts on insurance contract liabilities net of hedging. The definition of Adjustments used in Adjusted net earnings is being adopted to enhance comparability of results between reporting periods and in anticipation of Lifeco's implementation of accounting changes related to IFRS 17, Insurance Contracts, on
Net earnings attributable to participating shareholders are comprised of:
- Adjusted net earnings attributable to participating shareholders; and
- Adjustments, which include the after-tax impact of any item that in management's judgment, including those identified by management of its publicly traded operating companies, would make the period-over-period comparison of results from operations less meaningful. Adjustments includes the Corporation's share of Lifeco's impact of actuarial assumption changes and management actions, direct equity and interest rate market impacts on insurance contract liabilities net of hedging, as well as items that management believes are not indicative of the underlying business results which include those identified by a subsidiary or a jointly controlled corporation.
Management uses these financial measures in its presentation and analysis of the financial performance of
Adjusted net earnings attributable to participating shareholders and adjusted net earnings per share are non-IFRS financial measures that do not have a standard meaning and may not be comparable to similar measures used by other entities.
The Corporation also uses a non-consolidated basis of presentation to present and analyze its results whereby the Corporation's controlling interests held through Power Financial in Lifeco, IGM, Portag3 I, Portag3 II, and Wealthsimple, as well as other subsidiaries consolidated by
Net asset value is commonly used by holding companies to assess their value. Net asset value is the fair value of
This news release may also contain other non-IFRS financial measures which are publicly disclosed by the Corporation's subsidiaries such as sales, assets under management and assets under administration. Refer to the "Non-IFRS Financial Measures and Presentation" section of the Corporation's most recent Management's Discussion and Analysis for the definition of non-IFRS financial measures and their reconciliation with IFRS financial measures.
ELIGIBLE DIVIDENDS
For purposes of the Income Tax Act (
FORWARD-LOOKING STATEMENTS
Certain statements in this news release, other than statements of historical fact, are forward-looking statements based on certain assumptions and reflect the Corporation's current expectations, or with respect to disclosure regarding the Corporation's public subsidiaries, reflect such subsidiaries' disclosed current expectations. Forward-looking statements are provided for the purposes of assisting the reader in understanding the Corporation's financial performance, financial position and cash flows as at and for the periods ended on certain dates and to present information about management's current expectations and plans relating to the future and the reader is cautioned that such statements may not be appropriate for other purposes. These statements may include, without limitation, statements regarding the operations, business, financial condition, expected financial results, performance, prospects, opportunities, priorities, targets, goals, ongoing objectives, strategies and outlook of the Corporation and its subsidiaries, the expected impact of the COVID-19 pandemic on the Corporation and its subsidiaries' operations, results and dividends, as well as the outlook for North American and international economies for the current fiscal year and subsequent periods, the intended effects of the Reorganization, the Corporation's normal course issuer bid, the completion of the Lion merger transaction and the timing thereof, and the Corporation's subsidiaries' disclosed expectations, including as a result of the acquisition of the retirement services business of MassMutual,
By its nature, this information is subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct and that objectives, strategic goals and priorities will not be achieved. A variety of factors, many of which are beyond the Corporation's and its subsidiaries' control, affect the operations, performance and results of the Corporation and its subsidiaries and their businesses, and could cause actual results to differ materially from current expectations of estimated or anticipated events or results. These factors include, but are not limited to: the impact or unanticipated impact of general economic, political and market factors in
The reader is cautioned to consider these and other factors, uncertainties and potential events carefully and not to put undue reliance on forward-looking statements. Information contained in forward-looking statements is based upon certain material assumptions that were applied in drawing a conclusion or making a forecast or projection, including management's perceptions of historical trends, current conditions and expected future developments, as well as other considerations that are believed to be appropriate in the circumstances, including the availability of cash to complete purchases under the Corporation's normal course issuer bid, that the list of factors in the previous paragraph, collectively, are not expected to have a material impact on the Corporation and its subsidiaries and with respect to forward-looking statements of the Corporation's subsidiaries disclosed in this news release, the risks identified by such subsidiaries in their respective MD&A and annual information form most recently filed with the securities regulatory authorities in
Other than as specifically required by applicable Canadian law, the Corporation undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made, or to reflect the occurrence of unanticipated events, whether as a result of new information, future events or results, or otherwise.
Additional information about the risks and uncertainties of the Corporation's business and material factors or assumptions on which information contained in forward-looking statements is based is provided in its disclosure materials, including its most recent Management's Discussion and Analysis and Annual Information Form, filed with the securities regulatory authorities in
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