Power Corporation Of Canada · TSX:POW
Power Corporation Of Canada — CIBC Conference 2023
38 slides from Power Corporation Of Canada's conference presentation, Sep 28, 2023
Slide 1: Introduction to Power Corporation
Introduction to Power Corporation September 2023
Slide 2: Forward looking statements, disclosures concerning public investees and basis of presentation
Forward looking statements, disclosures concerning public investees and basis of presentation For definitions of capitalized terms used herein, see the "Abbreviations“ page. Forward Looking Statements In the course of today’s meeting, representatives of the Corporation may make, in their remarks or
Slide 3: Non-IFRS financial measures and other measures
Non-IFRS financial measures and other measures Non-IFRS Financial Measures Management uses these financial measures in its presentation and analysis of the financial performance of Power Corporation and believes that they provide additional meaningful information to listeners/readers in their analys
Slide 4: Abbreviations
Abbreviations The following abbreviations are used throughout this presentation: Ark Life Ark Life Assurance Company dac M&A Mergers and acquisitions AUM Assets under management Mackenzie Mackenzie Financial Corporation Bellus Bellus Health Inc. MassMutual Massachusetts Mutual Life Insurance Company
Slide 5: Reference information
Reference information Websites Recent Events Q2 2023 Conference Call August 11, 2023 www.powercorporation.com Q2 2023 Earnings Release August 10, 2023 Scotiabank Financials Summit September 7, 2023 Q2 2023 Conference Call August 9, 2023 www.greatwestlifeco.com Q2 2023 Earnings Release Augu
Slide 6: Table of contents
Table of contents Power Corporation Overview Value Creation Strategy Appendix 1: Recent Transaction Activity Appendix 2: ESG and Community P O W E R C O R PO RA T ION O F C A N A D A S E P T E M B E R 2 0 2 3 6
Slide 7: Power Corporation Overview
Power Corporation Overview
Slide 8: Power Corporation is an international management company focused on financial services
Power Corporation is an international management company focused on financial services MARKET DIVIDEND 2022 NET CAPITALIZATION YIELD1 EARNINGS2 $24.3B 5.7% $2.2B 68.2%3 62.1%3 15.5%4 78.5%5 100% ALTERNATIVE ASSET INVESTMENT PLATFORMS $36.1B MARKET CAPITALIZATION 6 $9.2B MARKET CAPITALIZATION $16.0B
Slide 9: Adjusted net asset value ("NAV" or "Net asset value")
Adjusted net asset value (“NAV” or “Net asset value”) NAV per share1 was $48.86 at June 30, 2023 Publicly traded operating companies represent 85.9% of gross asset value Jun. 30, % of Gross ($ billions, except per share amounts) 2023 Asset Value Publicly Great-West $24.4 64.2% Traded IGM 6.0 15.
Slide 10: Net and adjusted net earnings
Net and adjusted net earnings Power’s earnings underscored by stable recurring earnings contribution from Great-West and IGM, with other investment businesses and investments focused on value appreciation IFRS 17 / IFRS 9 IFRS 4 / IAS 39 IFRS 17 / IFRS 9 ($ in millions) 2022 2021 Q2 2023 Q2 2022 Adj
Slide 11: Great-West Lifeco overview
Great-West Lifeco overview 2022 Net 2022 Return Q2 2023 Total Assets Earnings1 on Equity1,2 Under Administration3 Great-West Lifeco is an international financial services holding company with $3.6 17.2% $2.6 interests in life insurance, health insurance, BILLION TRILLION retirement and investment se
Slide 12: IGM Financial overview
IGM Financial overview The company creates value for shareholders through three key areas IGM Financial is a leading wealth and asset Wealth Asset Strategic management company supporting Management Management Investments3 advisors and the clients they serve in 52% of 2022 adjusted net 25% of 2022 ad
Slide 13: GBL overview
GBL overview GBL is a leading and active investor in Europe, focused on long-term value creation with a diversified high-quality portfolio of listed and private investments, as well as of alternative investments through GBL Capital. Power holds its interest in GBL through a 50% interest in Parjointc
Slide 14: Alternative asset investment platforms
Alternative asset investment platforms Asset Management Activities Investing Activities + + = Recurring Carried Proprietary Value Fee-Related Interest Capital to Power Earnings Asset Management - Building investment platforms to deliver recurring asset management earnings Through ownership in the
Slide 15: Value Creation Strategy
Value Creation Strategy
Slide 16: Power has been pursuing a new value creation strategy since the reorganization announced in late 2019
Power has been pursuing a new value creation strategy since the reorganization announced in late 2019 Focused upon financial services, not diversification Publicly traded companies investing organically and through active M&A to position for higher growth At the Power level, adding additional
Slide 17: Power group of companies' value creation strategy is focused on three key levers
Power group of companies’ value creation strategy is focused on three key levers Organic growth strategies at each of our 1 OpCo Organic Levers publicly traded operating companies (OpCos): Great-West Lifeco, IGM & GBL 2 OpCo M&A Levers Deployment and redeployment of capital Power Company Actions we
Slide 18: Power's key principles did not change with the launch of the value creation strategy
Power’s key principles did not change with the launch of the value creation strategy Our key principles reflect the long-term orientation of the Desmarais family, controlling shareholders of Power since 1968 Long-term perspective & investment horizon Build industry leaders with attractive growth
Slide 19: Simplification of Power's group structure
Simplification of Power’s group structure Pre-December 2019 Reorganization Present 64% 68%1 62%1 16%2 Power Power Non-Public Non-Public Investments Investments 67% 62% 28% 50% 1 As of June 30, 2023. Power held 68.2% of Great-West; IGM held an additional 2.4% of Great-West. Power held 62.1% of IGM; G
Slide 20: Great-West has repositioned its U.S. business and built the 2nd largest retirement provider
Great-West has repositioned its U.S. business and built the 2nd largest retirement provider1 with a growing wealth management presence 2019 Sale of individual life and annuity business to Protective Life U.S. Individual Life Insurance & Annuity Business Insurance Company 2020 Purchase added retail s
Slide 21: In Canada, Great-West combined its three franchises in 2020
In Canada, Great-West combined its three franchises in 2020 into Canada Life and has been investing to enhance product, distribution and efficiency 2020 Amalgamation to simplify the business, unite its employees and better serve its client base Leading provider of insurance, wealth management, and h
Slide 22: IGM owns leading wealth and asset management franchises in Canada and has high growth plays in the U.S. and China
IGM owns leading wealth and asset management franchises in Canada and has high growth plays in the U.S. and China Wealth Management IG Wealth has strengthened its advisor force, product suite and technology platform for the benefit of its clients and to cater to the high-net-worth market In Apri
Slide 23: GBL has embarked on an asset rotation strategy focusing on private and alternative assets
GBL has embarked on an asset rotation strategy focusing on private and alternative assets €19.1 billion portfolio value as of Q2 20231 Over €30 billion in asset rotation from 2012 to H1 2023 €14.9 billion of cumulative investments2 €12.3 billion (64%) • • €15.5 billion of cumulative divestments Li
Slide 24: Development of Power's investment platforms
Development of Power’s investment platforms Operate in asset classes where we can create competitive advantage Platforms’ growth strategy is focused on raising 3rd party capital Power invests proprietary capital in the strategies of Sagard and Power Sustainable to support their growth and deve
Slide 25: Significant fundraising at alternative asset investment platforms driven by non-Power capital
Significant fundraising at alternative asset investment platforms driven by non-Power capital $21.8 billion of funded and unfunded AUM1 at June 30, 2023 $2.4 billion of fundraising in 2022 and an additional $1.0 billion in the first half of 2023 AUM Since Reorganization Driven Primarily by Non-P
Slide 26: Returning capital to shareholders
Returning capital to shareholders $1.7 billion of capital returned in 2022, with an additional $1.0 billion in 2023 to date $1.3 billion of dividends paid to participating shareholders in 2022 • In 2023, $680 million was paid as at June 30, 2023 $415 million of shares repurchased under the NCIB
Slide 27: Standalone businesses are an additional source of value creation
Standalone businesses are an additional source of value creation The standalone businesses, representing $813 million1 of NAV and $683 million of carrying value in aggregate, will be managed by Power to realize value over time Business Progress in Surfacing and Realizing Value In Q2 2023, Lion del
Slide 28: Power Corporation and its OpCos have elevated their communication programs with the investment community
Power Corporation and its OpCos have elevated their communication programs with the investment community Launched quarterly earnings call in Q1’20 Enhanced investment platform disclosure aligned with business model in Q2’20 Increased communication with stakeholders Base earnings metric, new
Slide 29: Power's shareholder returns
Power’s shareholder returns Power’s shareholder returns have compared favourably to the S&P TSX and S&P TSX Financials indices in recent periods Total Shareholder Return As at August 31, 2023 Years Last 12 Months Last 3 Years Last 5 Years Annualized Annualized Power Corporation 16.1% 18.8% 11.3% S&P
Slide 30: Power discount to NAV
Power discount to NAV1 Power’s discount to NAV narrowed throughout the execution of its value creation strategy and continues to represent an additional potential source of shareholder value Great-West sale of 40% U.S. life business announced PCC / PFC reorganization announced 35% WHO declares globa
Slide 31: Opportunities for further value creation
Opportunities for further value creation Power will continue to exercise its three levers for value creation, with concrete actions and opportunities available in the short to medium-term Targeting earnings growth at OpCos, building on significant business momentum OpCo • Diversified, broad-based
Slide 32: Appendix 1: Recent Transaction Activity
Appendix 1: Recent Transaction Activity
Slide 33: A significant number of value-enhancing transactions have been announced since the reorganization
A significant number of value-enhancing transactions have been announced since the reorganization Date Event Size Overview Reorganization of Completed the reorganization of PFC and Power to eliminate dual holding company Feb’20 $8.7 billion Power and PFC structure Reorganization of Announced reo
Slide 34: A significant number of value-enhancing transactions have been announced since the reorganization (cont'd)
A significant number of value-enhancing transactions have been announced since the reorganization (cont’d) Date Event Size Overview $750 million Valued Power group’s interest at $2.6 billion as of the transaction date, including Wealthsimple $250 million primary, $500 million returned as part of a
Slide 35: A significant number of value-enhancing transactions have been announced since the reorganization (cont'd)
A significant number of value-enhancing transactions have been announced since the reorganization (cont’d) Date Event Size Overview Combination creates a prominent global player in customer experience Webhelp GBL to be paid with a combination of Concentrix shares, earn-out shares and a seller no
Slide 36: Appendix 2: ESG and Community
Appendix 2: ESG and Community
Slide 37: ESG highlights
ESG highlights Our deeply rooted tradition of responsible management underpins our approach to ESG and how we are building a resilient business focused on driving sustainable long-term value CDP Leadership Commitments to global initiatives level ranking for climate disclosure Say-on-pay annual execu
Slide 38: Investing in our communities
Investing in our communities We believe in the power of the voluntary sector and social entrepreneurs, working in partnership with governments and businesses, to build a better, more inclusive society with improved opportunities for all. 2022 Highlights Initiatives funded by the Power group in 2022