Power Corporation of Canada Reports First Quarter 2013 Financial Results and Dividends

Readers are referred to the sections entitled "Non-IFRS Financial Measures" and "Forward-Looking Statements" at the end of this release.

WINNIPEG, May 15, 2013 /CNW Telbec/ - Power Corporation of Canada (TSX: POW) today reported earnings results for the three months ended March 31, 2013.

FIRST QUARTER RESULTS

Operating earnings attributable to participating shareholders, a non-IFRS financial measure, for the quarter ended March 31, 2013 were $247 million or $0.54 per share, compared with $205 million or $0.45 per share in the corresponding period in 2012, an increase of 20.2% on a per share basis.

Subsidiaries contributed $259 million to Power Corporation's operating earnings for the quarter ended March 31, 2013, compared with $240 million in the same period in 2012. Results from corporate activities were a contribution of $1 million, compared with a net charge of $23 million in the corresponding period in 2012.

Other items in the quarter, not included in operating earnings, represented a net charge of $22 million. Power Corporation's share of other items at Power Financial Corporation (Power Financial), a subsidiary, was a charge of $9 million. In addition, other items included a restructuring provision totalling $13 million recorded by Square Victoria Communications Group Inc., a subsidiary of the Corporation. In the corresponding quarter of 2012, other items represented a net contribution of $55 million. Additional details on other items can be found in the sections entitled "Results of Power Financial" and "Earnings Summary" below.

Net earnings attributable to participating shareholders for the quarter ended March 31, 2013 were $225 million or $0.49 per share, compared with $260 million or $0.57 per share in the corresponding period in 2012.

RESULTS OF POWER FINANCIAL

Power Financial reported operating earnings attributable to common shareholders for the quarter ended March 31, 2013 of $407 million or $0.57 per share, compared with $371 million or $0.52 per share in the corresponding period in 2012.

Other items, not included in operating earnings, in the first quarter of 2013 were a net charge of $13 million which represented Power Financial's share of an impairment charge recorded by Pargesa Holding SA in connection with an investment in GDF Suez by its subsidiary Groupe Bruxelles Lambert. For the quarter ended March 31, 2012, other items at Power Financial were a contribution of $83 million.

Net earnings attributable to common shareholders for the quarter ended March 31, 2013 were $394 million or $0.55 per share, compared with $454 million or $0.64 per share in the corresponding quarter of 2012.

At March 31, 2013, Power Corporation held a 65.8% economic interest in Power Financial. Power Financial's contribution to Power Corporation's operating earnings was $268 million for the quarter ended March 31, 2013, compared with $245 million in the same period in 2012.

DIVIDENDS ON NON-PARTICIPATING PREFERRED SHARES

The Board of Directors today declared quarterly dividends on the Corporation's preferred shares, as follows:

SERIES - STOCK SYMBOL RECORD DATE PAYMENT DATE AMOUNT
1986 Series - POW.PR.F June 21, 2013 July 15, 2013 At a floating rate equal to one quarter of
70% of the average prime rate of two
major Canadian chartered banks [1]
Series A - POW.PR.A June 21, 2013 July 15, 2013 35¢
Series B - POW.PR.B June 21, 2013 July 15, 2013 33.4375¢
Series C - POW.PR.C June 21, 2013 July 15, 2013 36.25¢
Series D - POW.PR.D June 21, 2013 July 15, 2013 31.25¢
Series G - POW.PR.G June 21, 2013 July 15, 2013 35¢

[1] In accordance with the articles of the Corporation

DIVIDENDS ON PARTICIPATING SHARES

The Board of Directors also declared a quarterly dividend of 29 cents per share on the Participating Preferred Shares and the Subordinate Voting Shares of the Corporation, payable June 28, 2013 to shareholders of record on June 7, 2013.

For purposes of the Income Tax Act (Canada) and any similar provincial legislation, all of the above dividends on the Corporation's preferred shares (including the Participating Preferred Shares) and Subordinate Voting Shares are eligible dividends.

ABOUT POWER CORPORATION

Power Corporation of Canada is a diversified international management and holding company with interests in companies in the financial services, communications and other business sectors in North America, Europe and Asia. To learn more, visit www.powercorporation.com.

EARNINGS SUMMARY

(unaudited) Three months ended  
  March 31,
2013
  March 31,
2012
(1)
Contribution to operating earnings from subsidiaries (2) 259   240  
Results from corporate activities        
  Income from investments 31   8  
  Operating and other expenses (30)   (31)  
Dividends on non-participating shares (13)   (12)  
Operating earnings attributable to participating shareholders 247   205  
Other items (see below) (22)   55  
Net earnings attributable to participating shareholders 225   260  
Earnings per share (attributable to participating shareholders)        
  - operating earnings 0.54   0.45  
  - non-operating earnings (0.05)   0.12  
  - net earnings 0.49   0.57  
   
OTHER ITEMS

 
(unaudited) Three months ended  
  March 31,
2013
  March 31,
2012
 
Pargesa (a Power Financial jointly controlled company) (9)   55  
Square Victoria Communications Group (13)      
  (22)   55  
(1) Effective January 1, 2013, the Corporation adopted revised IAS 19 (IAS 19R),
Employee Benefits. In accordance with the required transitional provisions, the
Corporation retrospectively applied the revised standard. The 2012 comparative
financial information in this report has been restated accordingly.
(2) Includes Power Financial and other subsidiaries of the Corporation.



Non-IFRS Financial Measures
In analyzing the financial results of the Corporation and consistent with the presentation in previous years, net earnings attributable to participating shareholders are classified into the following components:

  • operating earnings attributable to participating shareholders; and
  • other items or non-operating earnings, which include the after-tax impact of any item that management considers to be of a non-recurring nature or that could make the period-over-period comparison of results from operations less meaningful, and also include the Corporation's share of any such item presented in a comparable manner by its subsidiaries and jointly controlled corporations and associates.

However, 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 readers in their analysis of the results of the Corporation.

Operating earnings attributable to participating shareholders and operating 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.

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, as well as the outlook for North American and international economies for the current fiscal year and subsequent periods. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, or include words such as "expects", "anticipates", "plans", "believes", "estimates", "seeks", "intends", "targets", "projects", "forecasts" or negative versions thereof and other similar expressions, or future or conditional verbs such as "may", "will", "should", "would" and "could".

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 North America and internationally, interest and foreign exchange rates, global equity and capital markets, management of market liquidity and funding risks, changes in accounting policies and methods used to report financial condition (including uncertainties associated with critical accounting assumptions and estimates), the effect of applying future accounting changes, business competition, operational and reputational risks, technological change, changes in government regulation and legislation, changes in tax laws, unexpected judicial or regulatory proceedings, catastrophic events, the Corporation's and its subsidiaries' ability to complete strategic transactions, integrate acquisitions and implement other growth strategies, and the Corporation's and its subsidiaries' success in anticipating and managing the foregoing factors.

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 that the list of factors in the previous paragraph, collectively, are not expected to have a material impact on the Corporation and its subsidiaries. While the Corporation considers these assumptions to be reasonable based on information currently available to management, they may prove to be incorrect.

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 Canada and available at www.sedar.com

SOURCE Power Corporation of Canada



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