An anonymous director reports

POWER CORPORATION REPORTS THIRD QUARTER 2023 FINANCIAL RESULTS

Power Corp. of Canada today released its results for the three and nine months ended Sept. 30, 2023.

Power Corp.

Consolidated results for the period ended Sept. 30, 2023

Highlights

Power Corp.

• Net earnings from continuing operations were $997-million or $1.50 per share for the third quarter, compared with $642-million or 96 cents per share in the third quarter of 2022.
• Adjusted net earnings from continuing operations were $1,007-million or $1.52 per share, compared with $520-million or 78 cents per share in the third quarter of 2022.
• Adjusted net asset value per share was $48.26 at Sept. 30, 2023, compared with $41.91 at Dec. 31, 2022, an increase of 15.2 per cent. The corporation's book value per participating share was $32.40 at Sept. 30, 2023, compared with $31.37 at Dec. 31, 2022, an increase of 3.3 per cent.
• In 2023, the corporation purchased for cancellation 9.3 million subordinate voting shares for a total of $340-million at Sept. 30, 2023. Subsequent to quarter-end, the corporation has purchased an additional 3.3 million subordinate voting shares for a total of $112-million.
• Contribution to net earnings from continuing operations from the publicly traded operating companies was $1,086-million in the third quarter, compared with $755-million in the third quarter of 2022. Contribution to adjusted net earnings from continuing operations from the publicly traded operating companies was $1,096-million in the third quarter, compared with $633-million in the third quarter of 2022.

Great-West Lifeco Inc. (Lifeco)

• Third quarter net earnings from continuing operations were $936-million, compared with $986-million in the third quarter of 2022.
• Adjusted net earnings from continuing operations were $950-million, compared with $809-million in the third quarter of 2022.
• Lifeco remains on track to deliver value from its previously announced strategic transactions which will add new capabilities and drive scale.

IGM Financial Inc. (IGM or IGM Financial)

• Third quarter net earnings were $209.8-million, compared with $216.1-million in the third quarter of 2022.
• Assets under management and advisement including strategic investments were $400.0-billion at Sept. 30, 2023, compared with $402.8-billion at June 30, 2023, and $302.1 billion at Sept. 30, 2022.

Groupe Bruxelles Lambert (GBL)

• GBL reported a net asset value of 16.0 billion euros at Sept. 30, 2023, or 109.19 euros per share, compared with 17.8 billion euros or 116.18 euros per share at Dec. 31, 2022.
• In the third quarter of 2023, GBL completed 310 million euros of share buybacks and a total of 589 million euros of share buybacks in the nine months ended Sept. 30, 2023. GBL's board of directors approved an additional buyback envelope of 500 million euros on Nov. 2, 2023.

Sagard Holdings Inc. (Sagard) and Power Sustainable Capital Inc. (Power Sustainable)

• In the third quarter of 2023, Sagard Holdings Management Inc. (SHMI) completed the previously announced strategic partnerships with Abu Dhabi Developmental Holding Co. (ADQ), and Bank of Montreal. SHMI also expanded its existing partnership with Lifeco.
• The alternative asset investment platforms raised $1.2-billion in new commitments in the third quarter, including:
  • Sagard's initial close of Series II of Sagard Healthcare Partners, raising commitments of up to $300-million (U.S.);
  • Power Sustainable's announcement of a $600-million (U.S.) commitment to its global high-yield infrastructure credit strategy.

Third quarter

Net earnings from continuing operations attributable to participating shareholders were $997-million or $1.50 per share, compared with $642-million or 96 cents per share in 2022.

Adjusted net earnings from continuing operations attributable to participating shareholders were $1,007-million or $1.52 per share, compared with $520-million or 78 cents per share in 2022.

Net earnings attributable to participating shareholders were $975-million or $1.47 per share, compared with $643-million or 96 cents per share in 2022.

Publicly traded operating companies: Contribution to net earnings from continuing operations was $1,086-million and to adjusted net earnings from continuing operations was $1,096-million, representing an increase of 43.8 per cent and 73.1 per cent, respectively, from the third quarter of 2022:

• Lifeco: Contribution to net and adjusted net earnings from continuing operations decreased by 2.6 per cent and increased by 20.4 per cent, respectively. The results of Putnam have been classified as discontinued operations, representing a negative contribution to net earnings of $22-million.
• IGM: Contribution to net and adjusted net earnings decreased by 3.0 per cent.
• GBL: Contribution to net earnings of $315-million. In the third quarter, Webhelp Group (Webhelp) completed the previously announced combination transaction with Concentrix corporation. Results include the corporation's share of a gain on deconsolidation of Webhelp of $323-million, which includes the reversal of the put right liability of the non-controlling interests in Webhelp. GBL's liability to non-controlling interests was extinguished without any cash impact for GBL.

Sagard and Power Sustainable: Net earnings include a negative contribution of $7-million from Power Sustainable and a negative contribution of $4-million from Sagard.

Adjustments in the third quarter of 2023, excluded from adjusted net earnings from continuing operations, were a negative net impact to earnings of $10-million or two cents per share, related to the corporation's share of Lifeco's adjustments. In the third quarter of 2022, adjustments were a positive net impact to earnings of $122-million or 18 cents per share, mainly related to the corporation's share of Lifeco's adjustments.

Nine months

Net earnings from continuing operations attributable to participating shareholders were $1,873-million or $2.82 per share, compared with $2,110-million or $3.14 per share in 2022.

Adjusted net earnings from continuing operations attributable to participating shareholders were $2,380-million or $3.58 per share, compared with $1,609-million or $2.40 per share in 2022.

Net earnings attributable to participating shareholders were $1,789-million or $2.69 per share, compared with $2,106-million or $3.13 per share in 2022.

Great-West Lifeco, IGM Financial and Groupe Bruxelles Lambert

Results for the quarter ended Sept. 30, 2023

The information herein is derived from Lifeco and IGM's third quarter MD&As (management's discussion and analysis), as prepared and disclosed by the respective companies in accordance with applicable securities legislation, and which are also available either directly from SEDAR+ or from their websites. The information herein related to GBL is derived from publicly disclosed information, as issued by GBL in its third quarter press release and its half-year report at June 30, 2023. Further information on GBL's results is available on its website.

Great-West Lifeco Inc.

Third quarter

Net earnings from continuing operations attributable to common shareholders were $936-million or $1.01 per share, compared with $986-million or $1.06 per share in 2022.

Adjusted net earnings from continuing operations attributable to common shareholders were $950-million or $1.02 per share, compared with $809-million or 87 cents per share in 2022.

Net earnings attributable to common shareholders were $905-million or 97 cents per share, compared with $987-million or $1.06 per share in 2022.

Adjustments in the third quarter of 2023, excluded from adjusted net earnings, were a net negative impact of $14-million, compared with a net positive impact of $177-million in 2022. Lifeco's adjustments consisted of:

• Negative earnings impact from assumption changes and management actions of $106-million;
• Acquisition and divestiture costs of $3-million;
• Restructuring and integration costs of $22-million primarily in the United States and Europe segments;
• Amortization of acquisition-related finite life intangible assets of $36-million;
• Partially offset by market experience relative to expectations of positive $153-million.

IGM Financial Inc.

Third quarter

Net earnings available to common shareholders were $209.8-million or 88 cents per share, compared with $216.1-million or 91 cents per share in 2022.

Assets under management and advisement at Sept. 30, 2023, were $253.4-billion, a decrease of 3.0 per cent from June 30, 2023, and an increase of 6.4 per cent from the third quarter of 2022.

Groupe Bruxelles Lambert

Third quarter

GBL reported net earnings of 1,276 million euros, compared with a net loss of 143 million euros in 2022. Net earnings in the third quarter include a gain on deconsolidation of Webhelp of approximately 1.3 billion euros, including the reversal of the liability to Webhelp's minority shareholders. Since the acquisition of Webhelp in 2019, GBL has recognized cumulative net increases in value of the liability to Webhelp's minority shareholders of 1.2 billion euros.

GBL reported a net asset value of 16,018 million euros at Sept. 30, 2023, or 109.19 euros per share, compared with 17,775 million euros or 116.18 euros per share at Dec. 31, 2022.

Sagard and Power Sustainable

Results for the quarter ended Sept. 30, 2023

Sagard and Power Sustainable comprise the results of the corporation's alternative asset investment platforms, which includes income earned from asset management and investing activities. Asset management activities includes fee-related earnings (a non-IFRS (international financial reporting standards) financial measure), which comprises management fees less investment platform expenses. Asset management activities also includes carried interest and income from other management activities. Investing activities comprises income earned on the capital invested by the corporation (proprietary capital) in the investment funds managed by each platform and the share of earnings (losses) of controlled and consolidated subsidiaries held within the alternative asset investment platforms.

Third quarter

Net loss of the alternative asset investment platforms was $11-million, compared with net loss of $45-million in 2022.

The net loss of $11-million comprises:

• A negative contribution of $21-million from the asset management activities of Sagard and Power Sustainable;
• A positive contribution of $10-million from investing activities, including a positive contribution of $2-million from Sagard and $8-million from Power Sustainable.

Other investments and stand-alone Businesses

Results for the quarter ended Sept. 30, 2023

Other investments and standalone businesses includes the corporation's investments in investment and hedge funds and the share of earnings (losses) of standalone businesses.

Third quarter

Net earnings of the other investments and standalone businesses were $34-million, compared with net earnings of $14-million in 2022.

Stand-alone businesses

Net earnings of the standalone businesses were $2-million, compared with net earnings of $3-million in 2022.

At Sept. 30, 2023, the fair value of standalone businesses was $900-million, same as at Sept. 30, 2022.

Adjusted net asset value and participating shareholders' equity

At Sept. 30, 2023

Adjusted net asset value

Adjusted net asset value is presented for Power Corp. and represents management's estimate of the fair value of the participating shareholders' equity of the corporation. Adjusted net asset value is calculated as the fair value of the assets of the combined Power Corp. and Power Financial holding company (the gross asset value) less their net debt and preferred shares.

The corporation's adjusted net asset value per share was $48.26 at Sept. 30, 2023, compared with $41.91 at Dec. 31, 2022, representing an increase of 15.2 per cent.

Participating shareholders' equity

Book value per participating share represents Power Corp.'s participating shareholders' equity divided by the number of participating shares outstanding at the end of the reporting period. Participating shareholders' equity is calculated as the total assets of the combined Power Corp. and Power Financial holding company, including investments in subsidiaries presented using the equity method, less their net debt and preferred shares.

The corporation's book value per participating share was $32.40 at Sept. 30, 2023, compared with $31.37 at Dec. 31, 2022, representing an increase of 3.3 per cent.

Dividend on Power Corp. participating shares

The board of directors declared a quarterly dividend of 52.50 cents per share on the participating preferred shares and the subordinate voting shares of the corporation, payable Feb. 1, 2024, to shareholders of record Dec. 29, 2023.

Dividends on Power Corp. non-participating preferred shares

The board of directors also declared quarterly dividends on the corporation's preferred shares, payable Jan. 15, 2024, to shareholders of record Dec. 22, 2023.

About Power Corp. of Canada

Power Corp. is an international management and holding company that focuses on financial services in North America, Europe and Asia. Its core holdings are leading insurance, retirement, wealth management and investment businesses, including a portfolio of alternative asset investment platforms.

We seek Safe Harbor.