Great-west Lifeco Inc. · TSX:GWO
Great-west Lifeco — Q1 2002 Earnings Presentation
35 slides from Great-west Lifeco's earnings presentation
Slide 1: Quarterly Information Q1 2002 For Analysts & Investors
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors 1
Slide 2: Forward-Looking Statements
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Forward-Looking Statements This conference call may contain forward-looking statements about future operations, financial results, objectives and strategies of the Company. Forward- looking statements are typically identified by the words ”belie
Slide 3: Highlights
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Highlights • Prior year’s comparative earnings have been adjusted to exclude the amortization of goodwill. • Net Income attributable to Common Shareholders • $222 million, up 22% over 2001; before goodwill amortization charges. • EPS • $0.602 pe
Slide 4: Consolidated Earnings
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Consolidated Earnings ($ CDN millions) For the three months ended March 31 2001 2002 Change Total Net Income 189 229 21% Net Income - Common Shareholders 182 222 22% ROE * 20.3% 21.2% * ROE excludes the impact of goodwill amortization and non-re
Slide 5: Net Income to Common Shareholders by Region
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Net Income to Common Shareholders by Region ($ millions) For the three months ended March 31 2001 2002 Change Canadian Segment Great-West Shareholder operating earnings 92 107 16% Portion of Lifeco Earnings (2) (4) Total Canadian segment 90 103
Slide 6: Consolidated Assets
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Consolidated Assets ($ CDN millions) At March 31 2001 2002 Change General Fund Assets Canada 33,737 34,613 3% U.S. 23,722 23,948 1% Total 57,459 58,561 2% Segregated Fund Assets Canada 18,083 19,708 9% U.S. 17,976 20,152 12% Total 36,059 39,860
Slide 7: Sales New Annualized Premium
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Sales New Annualized Premium ($ CDN millions) For the three months ended March 31 2001 2002 Change Canada 1,609 53% 2,245 65% 40% U.S. 1,429 47% 1,186 35% -17% Total Sales 3,038 3,431 13% 7
Slide 8: Revenue Premium Incl. Seg. Funds and ASO
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Revenue Premium Incl. Seg. Funds and ASO ($ CDN millions) For the three months ended March 31 2001 2002 Change Canada 2,696 37% 3,361 45% 25% U.S. 4,664 63% 4,174 55% -11% Total 7,360 7,535 2% 8
Slide 9: Fee Income
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Fee Income ($ CDN millions) For the three months ended March 31 2001 2002 Change Canada 95 102 7% U.S. 384 361 -6% Total Fee Income 479 463 -3% 9
Slide 10: Expenses
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Expenses ($ CDN millions) For the three months ended March 31 2001 2002 Change Operating Expenses GWL (Canada) 165 154 -7% GWL&A (U.S.) 314 315 - Lifeco Entity 1 1 Total Operating Expenses 480 470 -2% Investment Expenses GWL (Canada) 4 4 - GWL&A
Slide 11: Canadian Operations
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors CANADIAN OPERATIONS 11
Slide 12: Sales New Annualized Premium
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Sales New Annualized Premium ($ millions) For the three months ended March 31 2001 2002 Change Individual Ins. & Investment Life & Living Benefits 12 15 25% R & IS 877 1,006 15% Sub-Total 889 1,021 Group 109 85 -22% Reinsurance & Specialty 600 1
Slide 13: Revenue Premium Incl. Seg. Funds and ASO
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Revenue Premium Incl. Seg. Funds and ASO ($ millions) For the three months ended March 31 2001 2002 Change Individual Ins. & Investment Life & Living Benefits 95 98 3% R & IS 886 947 7% Sub-Total 981 1,045 Group 790 856 8% Reinsurance, Specialty
Slide 14: Fee Income
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Fee Income ($ millions) For the three months ended March 31 2001 2002 Change Segregated Funds 73 77 5% Administrative Services Only 15 16 10% Assets Under Administration 7 9 22% Total Fee Income 95 102 7% 14
Slide 15: R&IS Investment Funds - IRIS Net Cash Flow and Asset Change
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors R&IS Inv e stme nt Funds - IRIS Ne t Cash Flow and Asse t Change 1,000 800 Mutual Funds 600 400 200 $Million - (200) (400) (600) (800) (1,000) 2001A 2002A 2001A 2002A 2001A 2002A 2001A 2002A 2001A 2002A Deposits Withdrawals Net Cash Flow Market
Slide 16: Segregated Fund Assets
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Segregated Fund Assets ($ Millions) Great-West Life and London Life Q1 2001 Q1 2002 12 Month Change $ % of Total $ % of Total $ % Equities 9,729.4 54% 10,608.0 54% 878.6 9% Fixed Income 5,053.0 28% 5,285.0 27% 232.0 5% Balanced 2,065.7 11% 2,366
Slide 17: Individual Segregated Funds Market Share
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Individual Segregated Funds Market Share (Source: Investor Economics *) ($ Millions) Mar.31, 2002 Dec.31, 2001 Mar.31, 2001 % Chg in Net Assets Net Assets Mkt Share Rank Net Assets Mkt Share Rank Net Assets Mkt Share Rank Yr Over Yr From Yr End
Slide 18: Expenses
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Expenses ($ millions) For the three months ended March 31 2001 2002 Change Individual Ins. & Investment Life & Living Benefits 15 14 -7% R & IS 41 38 -7% Sub-Total 56 52 Group 56 61 9% Reinsurance, Specialty & Other 17 12 -29% 129 125 -3% Par 36
Slide 19: Net Income
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Net Income ($ millions) For the three months ended March 31 2001 2002 Change Individual Life & Living Benefits 15 22 47% R & IS 23 32 39% Group Life & Health 23 26 13% Corporate Investments 19 28 47% Corporate 12 (1) Total Shareholders 92 107 16
Slide 20: Invested Assets
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Invested Assets ($ millions) At March 31 2001 2002 ($) (%) ($) (%) Bonds 15,710 57.7% 16,468 59.3% Cash and CD's 323 1.2% 407 1.5% Mortgages 7,623 28.0% 7,183 25.9% Stocks 1,160 4.2% 1,200 4.3% Real Estate 1,046 3.8% 1,054 3.8% Policy Loans 1,38
Slide 21: Asset Quality Non-Performing Loans
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Asset Quality Non-Performing Loans ($ millions) At March 31 2001 2002 Asset Class Bonds 33 35 Mortgages 18 10 Foreclosed Real Estate 4 Total 55 45 In-Year Charge for Credit Losses (0.2) 29 21
Slide 22: Canadian Operations - Summary
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Canadian Operations - Summary • Canadian results, for the first time, exclude goodwill amortization of approximately $15 million in quarter, which represents approximately $0.04 per share on an e.p.s. basis. • Strong operating results, especiall
Slide 23: U.S. Operations (US$)
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors U.S. OPERATIONS (US$) Note: FX Translation rate is as follows: 2001 2002 Income Statement 1.5280 1.5945 Balance Sheet 1.5774 1.5935 23
Slide 24: Sales New Annualized Premium
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Sales New Annualized Premium ($ US millions) For the three months ended March 31 2001 2002 Change Employee Benefits 304 346 14% Financial Services 631 398 -37% Total U.S. 935 744 -20% 24
Slide 25: Revenue Premium Incl. Seg. Funds and ASO
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Revenue Premium Incl. Seg. Funds and ASO ($ US millions) For the three months ended March 31 2001 2002 Change Employee Benefits 1,833 1,610 -12% Financial Services 1,159 951 -18% 2,992 2,562 -14% Par 61 56 Total U.S. 3,053 2,617 -14% 25
Slide 26: Fee Income
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Fee Income ($ US millions) For the three months ended March 31 2001 2002 Change Segregated Funds 46 43 -7% Administrative Services Only 189 170 -10% Assets Under Administration 16 16 - Total Fee Income 251 229 -9% 26
Slide 27: Expenses
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Expenses ($ US millions) For the three months ended March 31 2001 2002 Change Employee Benefits 157 146 -7% Financial Services 46 47 2% Corporate 1 4 204 197 -3% Par 1 1 Operating Expenses 205 198 -3% Investment Expenses 2 2 - Total Expenses 207
Slide 28: Net Income
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Net Income ($ US millions) For the three months ended March 31 2001 2002 Change Employee Benefits 21 37 76% Financial Services 40 39 -3% Corporate 1 2 Net Income - Common Shareholders 62 78 27% 28
Slide 29: Employee Benefits Life & Health Sales
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Employee Benefits Life & Health Sales ($ US millions) March March 2001 2002 YTD YTD Case Sales 570 360 Terminations 855 952 Net (285) (592) Sales Premium 304 346 Net Premium (512) (472) * Members (thousands) 3,000 2,386 * (includes ESP) 29
Slide 30: Financial Services 401(k)
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Financial Services 401 (k) ($ US millions) March March 2001 2002 YTD YTD Case Sales 135 85 Terminations 188 294 Net (53) (209) Net Cash Flow 200 3 Ending Assets 7,329 7,636 Participants (thousands) 571 540 30
Slide 31: Financial Services Sales by Business Line
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Financial Services Sales by Business Line New Annualized Premium ($ US millions) March March 2001 2002 YTD YTD BOLI 63 7 (incl. variable/sep. accounts) Individual Annuity - fixed 6 3 - variable 52 83 58 86 Individual Life (excl. BOLI) 2 2 Group
Slide 32: Financial Services Participants
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Financial Services Participants March March Change 2001 2002 In Quarter YTD YTD P/NP 29,190 1,135,704 1,297,739 FASCorp (6,746) 377,840 395,624 32
Slide 33: Financial Services Assets
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Financial Services Assets ($ US millions) March March Change 2001 2002 In Quarter YTD YTD P/NP - General Acct. (39) 3,870 3,808 - Variable 227 4,010 4,587 - Unwrapped (824) 19,183 21,049 FASCorp - Unwrapped 148 5,704 6,341 33
Slide 34: Invested Assets
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Invested Assets ($ US millions) At March 31 2001 2002 ($) (%) ($) (%) Bonds 9,734 70.1% 10,082 71.8% Cash and CD's 343 2.5% 174 1.3% Mortgages 785 5.7% 581 4.1% Stocks & Real Estate 198 1.4% 198 1.4% Policy Loans 2,822 20.3% 3,005 21.4% Total 13
Slide 35: Asset Quality Non-Performing Loans
QUARTERLY INFORMATION Q1 2002 For Analysts & Investors Asset Quality Non-Performing Loans ($ US millions) At March 31 2001 2002 Asset Class Bonds 58 56 Mortgages 9 14 Foreclosed Real Estate 2 2 Total 69 72 In-Year Charge for 0 0 Normal Credit Losses 35