Ia Financial Corporation Inc. · TSX:IAG
Ia Financial — Non-Deal Roadshow (November 2021)
30 slides from Ia Financial's roadshow presentation, Nov 9, 2021
Slide 1: Guiding to solid growth
Guiding to solid growth Investor presentation November 9, 2021 PRESENT AND STRONG. More than ever.
Slide 2: iA Financial Group at a glance: purpose and mission
iA Financial Group Foundation $8.2B market is one of the largest insurance 1892 cap. and wealth management groups in Canada, with operations in the United States IAG on TSX $74.27 IPO in 2000 stock price OUR PURPOSE To assure that our clients feel confident and secure about their future 4M+ $76.87 a
Slide 3: Table of contents
4 Solid growth targets Appendices TABLE 5 Capital allocation 18 Share price growth OF 19 Book value vs. peers 6 Dividend CONTENTS 7 9M/2021 key results 20 Earnings targets 8 9M/2021 results vs. guidance 21 Long-term business growth 9 Road to reach earnings targets 22 Ecosystem of the future 10 Growt
Slide 4: Staying on course with our long-term vision
Staying on course with our long-term vision • Vision based on four strategic axes Solid growth • Diversified business mix and strategic investment in digital targets STRATEGY • Strong core results in 2020: EPS up 9% YoY and ROE of 13.3% Committed to 10%+ core EPS EARNINGS • Impressive 9M/2021: Core
Slide 5: Capital allocation
CAPITAL ALLOCATION Focused on growth Organic growth Investing in digital evolution to propel growth Acquisitions Ready to conclude bolt-on acquisitions to strengthen strategic positioning Dividends Periodical increases within our target range, which is now on a core basis NCIB $ To resume under favo
Slide 6: 29% dividend increase payable in Q4 2021
29% dividend increase payable in Q4 2021 Dividend payout ratio target range of 25% to 35% now based on core earnings Dividend of 62.5¢ per share payable in Q4/21 Steady increases every 3 quarters First lifeco in Canada to resume dividend increases after the financial crisis 6
Slide 7: 9M/2021 key results
9M/2021 Sustained growth momentum Earnings above expectations, continued very strong sales KEY RESULTS momentum and robust financial position Core ROE P&D Core EPS $6.31 14.0% At top of $12.5B +17% YoY +23% YoY guidance AUM/AUA Solvency ratio Book value $214.5B 131% $60.82 +15% YoY Above target +12%
Slide 8: 9M/2021 results vs. guidance
9M/2021 results vs. guidance Results compare favourably with guidance 2021 guidance 9M/2021 results Core EPS $5.65 to $6.10 for 9M $6.31 Core ROE (trailing 12 months) 12.5% to 14.0% 14.0% Impact of new business (strain) -5% to 10% 2% Solvency ratio 110% to 116% 131%1 Capital generation $275M to $325
Slide 9: The road to reach earnings targets
THE ROAD TO REACH EARNINGS TARGETS Organic growth 6% A strong base from expected profit on in-force and business diversification + 2%+ Organic growth initiatives Supported by digital initiatives1 ≥ 10%+ + Distribution Core EPS growth on average 1%+ Supported by digital initiatives1 per year + Capita
Slide 10: Main growth drivers
MAIN GROWTH DRIVERS Our key actions for success SALES Leverage full Build on our Optimize Remain at the range of products extensive synergies leading edge of to meet relationships between digital tools clients’ needs with distributors business units EARNINGS Continue growing Digital and Lean Acceler
Slide 11: Diversified business mix
Diversified business mix driven by Shared purpose / Strong vision / High ambition Businesses at the Businesses targeted foundation for strong of i!’s operations Individual Retail expansion Insurance distribution (Canada) ▪ iA is already a leader and seeks ▪ iA is seeking to become a leader to streng
Slide 12: Becoming a leader in businesses targeted for strong expansion
Already a leader in foundation businesses Expansion businesses Becoming a leader in businesses targeted Individual • Individual Insurance #1 in number of policies sold for strong expansion Insurance (Canada) • Targeting mid/mass market (US) • #1 in gross and net seg fund sales Individual Wealth • On
Slide 13: Business mix diversification
Business mix diversification Growing contribution of Expansion business units Operating profit1 $755M +10% 19% SUPPORT 10-year CAGR 21% EXPANSION $283M 23% FOUNDATION 60% 4% 73% 2010 2020 13 1 Operating profit includes iA Auto and Home and is before assumption changes and management actions.
Slide 14: Acquisition of Surex.com
Acquisition of Surex.com Adding P&C expertise, growth synergies and digital capabilities for further growth HIGH STRATEGIC VALUE FOR iA AS A SUPPORT BUSINESS ◦ Acquiring digital and distribution P&C expertise and capabilities ◦ Expanding distribution capabilities ◦ Investing in businesses with ROE h
Slide 15: Strong and flexible balance sheet
Strong and flexible balance sheet Solvency ratio of 131%1, comfortably above i!’s target level of 110% to 116% Ratios Leverage ratio of 23.1%, providing financial flexibility (Sept 30, 2021) Coverage ratio of 15.0x Distinctive Embedded in reserving process, i!’s distinctive market protection decreas
Slide 16: Strong, improved and ongoing organic capital generation
Strong, improved and ongoing organic capital generation resulting from our reduced risk profile 325 Organic capital generation ($M) 9M/2021: ~$340M = Core net income to common shareholders ~ 280 − Dividends paid to common shareholders 2021 annual target range − Required capital increase in normal co
Slide 17: Appendices
Appendices Financial
Slide 18: Industry leader for share price growth
Industry leader for share price growth +1,517% Total return Nov. 4, (Share price growth 2021 with dividend reinvested, at year-end) Best performance of Canadian lifecos 0% IPO1 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 18 1 Feb. 3, 2000,
Slide 19: Strong and steady record of value creation
Strong and steady record of value creation IAG Book value per share IAG book value +455% and dividends paid per share CAGR1 (at year-end) 1-year +12% 5-year +10% 10-year +9% Best performance Since 2000 +10% Peers of Canadian lifecos +250% 0% Sept. 30, June 30, 2004 2005 2006 2007 2008 2009 2010 2011
Slide 20: Strong earnings targets built on solid track record
Strong earnings targets built on solid track record Core EPS Core ROE (diluted) (diluted) 2023 target 10%+ 13%-15% growth on 2021 target average 12.5%-14% per year 13,6% 13,1% 13,3% MID- GUIDANCE $7,90 MID- $7,12 GUIDANCE $6,55 TRACK RECORD TRACK RECORD 10.4% 12.8% 2015-2020 2015 -2020 2016-2020 201
Slide 21: Solid long-term business growth
Solid long-term business growth Net premiums, premium AUM/AUA equivalents and deposits (Assets under management and administration, end of period, $B) ($B) +13% 14,1 +11% 197,5 +8% 5-year +11% 5-year 10-year CAGR CAGR 10-year CAGR CAGR 6,8 69,3 21
Slide 22: Shaping the iA ecosystem of the future
Shaping the iA ecosystem of the future Digital initiatives to contribute Continuity of digital strategy goes beyond IT: Growth to 1%+ of annual core EPS growth An integrated approach based on our four strategic axes Deepening a 360 client view Client • Provide a high-level client/advisor experience
Slide 23: ESG ambition
ESG ambition ENVI To contribute to sustainable growth and wellbeing for Reduction of our GHG emissions RON our clients, employees, partners, investors and communities MENT by 20% per employee by 2025 Now and in the future, achieve gender equity of SO CIAL between 40% and 60% in iA Financial Group se
Slide 24: ESG — A cohesive, mobilizing vision
ESG — A cohesive, mobilizing vision • Carbon neutral since the beginning of 2020 ENVI • Focused on initiatives aimed at reducing our GHG emissions RON • $80.5 million of new investments in renewable energy in 2020 MENT • Majority of our 40+ properties in Canada are BOMA BEST or LEED certified • Part
Slide 25: Credit ratings
Credit ratings iA Financial Industrial Alliance Insurance Corporation Inc. and Financial Services Inc. Credit rating agency Outlook Issuer rating Financial strength Standard & Poor’s A AA- Stable DBRS Morningstar A AA (low) Stable A.M. Best N/A A+ (Superior) Stable 25
Slide 26: Investor Relations
Investor Relations Contact Marie-Annick Bonneau Tel.: 418-684-5000, ext. 104287 Marie-Annick.Bonneau@ia.ca Next Reporting Dates Q4/2021 - February 16, 2022 Q1/2022 - May 12, 2022 Q2/2022 - July 28, 2022 Q3/2022 - November 9, 2022 For information on our earnings releases, conference calls and related
Slide 27: Non-IFRS financial information
Non-IFRS financial information iA Financial Corporation reports its financial results and statements in accordance with International Financial Reporting Standards (IFRS). It also publishes certain financial measures that are not based on IFRS (non-IFRS). A financial measure is considered a non-IFRS
Slide 28: Non-IFRS financial information (cont.)
Non-IFRS financial information (cont.) Core earnings (loss) and financial measures based on core earnings (loss), including core EPS and core ROE, are non-IFRS financial measures used to better understand the capacity of the Company to generate sustainable earnings. Core earnings (loss) remove from
Slide 29: Forward-looking statements
Forward-looking statements This presentation may contain statements relating to strategies used by iA Financial Corporation or statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as “may,” “could,” “should,” “would,” “suspect
Slide 30: Financial Group
Financial Group
iA Financial Group — Non-Deal Roadshow (November 2021) on 6ix