Power Financial Corporation Reports First Quarter 2015 Financial Results and Dividends

May 14, 2015, 11:12 ET from Power Financial Corporation

All figures are in Canadian dollars unless otherwise noted. Readers are referred to the sections entitled "Non-IFRS Financial Measures" and "Forward-Looking Statements" at the end of this release.  

TORONTO, May 14, 2015 /CNW Telbec/ - Power Financial Corporation (TSX: PWF) today reported earnings results for the three months ended March 31, 2015.

FIRST QUARTER RESULTS
Operating earnings attributable to common shareholders (a non-IFRS financial measure) for the quarter ended March 31, 2015 were $565 million or $0.79 per share, compared with $440 million or $0.62 per share in 2014.

Other items, not included in operating earnings, were a contribution of $8 million mainly comprised of the Corporation's share of the gain realized by Groupe Bruxelles Lambert (GBL) on the sale of part of its interest in Total SA (Total). In the corresponding period of 2014, other items represented a contribution of $27 million. Additional details can be found in the table entitled "Other Items" below.

Net earnings attributable to common shareholders were $573 million or $0.80 per share, compared with $467 million or $0.66 per share in 2014.

RESULTS OF GREAT-WEST LIFECO, IGM FINANCIAL AND PARGESA HOLDING

GREAT-WEST LIFECO INC.
For the quarter ended March 31, 2015, Great-West Lifeco Inc. (Lifeco) reported operating and net earnings attributable to common shareholders of $700 million or $0.702 per share, compared with $587 million or $0.587 per share in 2014.

At March 31, 2015, Power Financial and IGM Financial Inc. (IGM) held 67.1% and 4.0%, respectively, of Lifeco's common shares. Lifeco's contribution to Power Financial's operating earnings was $473 million for the quarter ended March 31, 2015, compared with $393 million in 2014.

IGM FINANCIAL INC.
For the quarter ended March 31, 2015, IGM reported operating and net earnings available to common shareholders of $200 million or $0.80 per share, compared with $194 million or $0.77 per share in 2014.

At March 31, 2015, Power Financial and The Great-West Life Assurance Company, a subsidiary of Lifeco, held 59.1% and 3.7%, respectively, of IGM's common shares. IGM contributed $119 million to Power Financial's operating earnings for the quarter ended March 31, 2015, compared with $116 million in 2014.

PARGESA HOLDING SA
For the quarter ended March 31, 2015, Pargesa reported operating earnings of SF54 million, compared with an operating loss of SF50 million in 2014. Other items were a contribution of SF33 million, mainly comprised of Pargesa's share of the gain recorded by GBL on the partial disposal of Total shares for an amount of SF35 million. In the corresponding period of 2014, other items represented a contribution of SF98 million. Net earnings for the first quarter of 2015 were SF87 million, compared with SF48 million in 2014.

Power Financial holds a 50% interest in Parjointco N.V., which in turn held a 55.5% equity interest in Pargesa at March 31, 2015. Pargesa's contribution to Power Financial's operating earnings was $19 million for the quarter ended March 31, 2015, compared with a loss of $17 million in 2014.


DIVIDENDS ON PREFERRED SHARES
The Board of Directors today declared quartely dividends on the Corporation's preferred shares, as follows:


SERIES – STOCK SYMBOL

RECORD DATE

PAYMENT DATE

AMOUNT

Series A – PWF.PR.A

July 24, 2015

August 15, 2015

At a floating rate equal to one quarter of 70% of the average prime rate of two major Canadian chartered banks [1]

Series D – PWF.PR.E

July 10, 2015

July 31, 2015

34.375¢

Series E – PWF.PR.F

July 10, 2015

July 31, 2015

32.8125¢

Series F – PWF.PR.G

July 10, 2015

July 31, 2015

36.875¢

Series H – PWF.PR.H

July 10, 2015

July 31, 2015

35.9375¢

Series I – PWF.PR.I

July 10, 2015

July 31, 2015

37.50¢

Series K – PWF.PR.K

July 10, 2015

July 31, 2015

30.9375¢

Series L – PWF.PR.L

July 10, 2015

July 31, 2015

31.875¢

Series O – PWF.PR.O

July 10, 2015

July 31, 2015

36.25¢

Series P – PWF.PR.P

July 10, 2015

July 31, 2015

27.50¢

Series R – PWF.PR.R

July 10, 2015

July 31, 2015

34.375¢

Series S – PWF.PR.S

July 10, 2015

July 31, 2015

30¢

Series T – PWF.PR.T

July 10, 2015

July 31, 2015

26.25¢

[1] In accordance with the articles of the Corporation

 

DIVIDEND ON COMMON SHARES
The Board of Directors also declared a quarterly dividend of 37.25 cents per share on the Corporation's common shares payable July 31, 2015 to shareholders of record June 30, 2015.

ABOUT POWER FINANCIAL
Power Financial Corporation is a diversified management and holding company that has interests, directly or indirectly, in companies in the financial services sector in Canada, the United States, Europe and Asia. It also has diversified investments in industrial companies based in Europe. Power Financial Corporation is a member of the Power Corporation Group of Companies. To learn more, visit www.powerfinancial.com.

 


EARNINGS SUMMARY

(unaudited)

(in millions of Canadian dollars, except per share amounts)

 

Three months ended


March 31,

2015


March 31,

2014

Operating earnings




Contribution to operating earnings from:





Lifeco

473


393


IGM

119


116


Pargesa

19


(17)


611


492

Corporate operations

(13)


(18)

Dividends on perpetual preferred shares

(33)


(34)

Operating earnings (attributable to common shareholders)

565


440

Other items (non-operating) – see below

8


27

Net earnings (attributable to common shareholders)

573


467

Earnings per share (attributable to common shareholders)





Operating earnings

0.79


0.62


Non-operating earnings

0.01


0.04


Net earnings

0.80


0.66


OTHER ITEMS (Non-Operating)

(unaudited)

(in millions of Canadian dollars)

Three months ended


March 31,

2015


March 31,

2014

Share of Pargesa's other items:





Gain on partial disposal of Total

9


26


Gain on partial exchange of Suez Environnement

2



Other (charge) income

(3)


1


8


27

 

Eligible Dividends
For purposes of the Income Tax Act (Canada) and any similar provincial legislation, all of the above dividends on the Corporation's preferred and common shares are eligible dividends.

Non-IFRS Financial Measures and Presentation
In analyzing the financial results of the Corporation and consistent with the presentation in previous years, net earnings attributable to common shareholders are comprised of:

  • operating earnings attributable to common shareholders; and
  • other items or non-operating earnings, which include the after-tax impact of any item that in management's judgment would make the period-over-period comparison of results from operations less meaningful. Other items also include the Corporation's share of any such item presented in a comparable manner by a subsidiary or a jointly controlled corporation or associate.

Management uses these financial measures in its presentation and analysis of the financial performance of Power Financial, and believes that they provide additional meaningful information to readers in their analysis of the results of the Corporation. Operating earnings, as defined by the Corporation, assist the reader in comparing the current period's results to those of previous periods as items that are not part of ongoing activities are excluded from this non-IFRS measure.

Operating earnings attributable to common 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.

The Corporation also uses a non-consolidated basis of presentation to present and analyze its results, financial position and cash flows. In this basis of presentation, Power Financial's interests in Lifeco and IGM are accounted for using the equity method. Presentation on a non-consolidated basis is a non-IFRS presentation. However, it is useful to the reader as it presents the parent's corporate operations apart from those of its operating subsidiaries thereby reflecting the individual respective contributions of each subsidiary to the consolidated results of the parent.

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 Financial Corporation



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