Great-West Lifeco Inc. · TSX:GWO
Great-West Lifeco — Q3 2023 Earnings Presentation
28 slides from Great-West Lifeco's earnings presentation, 2023
Slide 1: Investor Presentation Q3 2023
1 Investor Presentation Q3 2023 GREAT-WEST LIFECO Note: All dollar amounts are expressed in Canadian dollars and references to “dollars” or “$” are to Canadian dollars, unless otherwise stated.
Slide 2: Cautionary Note Regarding Forward-Looking Information
CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION INVESTOR OVERVIEW This document contains forward-looking information. Forward-looking information includes statements that are predictive in nature, depend upon or refer to future events or conditions, or include words such as "will", "may", "exp
Slide 3: A global financial services company
A global financial services company INVESTOR OVERVIEW Capital & Risk Solutions 15% Canada $3.6B 175+ Years 6th Net Earnings from 39% Largest Life Insurer Of History Continuing in North America1 Operations4 Europe 33% 3 $2.6T $1.0T US 13% Capital & Assets Under Administration2,3 Assets Under Manageme
Slide 4: Great-West Lifeco at-a-glance
Great-West Lifeco at-a-glance INVESTOR OVERVIEW A global financial services holding company with interests in life insurance, health insurance, retirement and investment services, asset management and reinsurance businesses. Key Metrics Financial Strength Ratings3, Regulatory Capital In $B, unless o
Slide 5: Diversified, market-leading franchises
Diversified, market-leading franchises INVESTOR OVERVIEW Canada U.S. Europe Capital & Risk Solutions A leader in workplace and A U.S. financial services Ireland: Leading financial services Top-4 global reinsurer9 wealth management serving challenger brand serving company; #1 in workplace over 18m Am
Slide 6: Value drivers: portfolio strategies across operating segments
INVESTOR OVERVIEW Value drivers Portfolio strategies that extend across operating segments Operating Segments1 Canada U.S. Europe CRS Workplace Solutions Group Life & Health Empower Defined Group Life & Health 6 Broad reach Contribution Group Retirement Group Retirement Wealth & Asset Individual Wea
Slide 7: Value drivers: complementary roles and diversification
INVESTOR OVERVIEW Value drivers Play complementary roles and highlight the benefits of diversification Higher Lower Workplace Wealth & Asset Insurance & Risk Solutions Management Solutions 7 Cash generation Steady, stable returns “Capital-light” GREAT-WEST LIFECO Organic growth potential
Slide 8: Medium-term objectives
INVESTOR OVERVIEW Medium-term1 objectives Supported by our repositioned portfolio with significant organic and extension growth potential 8-10% 16-17% 45-55% base EPS2 growth p.a. base ROE2 target dividend payout ratio, base earnings2 • Organic earnings growth from market- • Diversified businesses d
Slide 9: Our Impact
INVESTOR OVERVIEW Our Impact Better Financial Futures $127 Billion $6.35+ Billion $16.3 Million Managed in ESG-related strategies Invested in wind, solar, and hydroelectric Invested by Great-West Lifeco in 2022 renewable energy projects1 companies to build community capacity in 2022 Inclusive Commun
Slide 10: Successful Portfolio Repositioning and Consistent Shareholder Returns
10 Successful Portfolio Repositioning and Consistent Shareholder Returns GREAT-WEST LIFECO
Slide 11: Repositioning the portfolio in recent years
INVESTOR OVERVIEW Repositioning the portfolio in recent years Focused on acquisitions to create scale and reach, acquisitions to add strategic capabilities, and dispositions and organic actions that unlock value and enable focus Lifeco base earnings ($M) Lifeco net earnings ($M) and % by segment1,2,
Slide 12: Value-creating acquisitions and divestitures
INVESTOR OVERVIEW Value-creating acquisitions and divestitures ACQUISITIONS DIVESTITURES 2018 - 2019 2020 2021 2022 2023 2019 2020 2023 1 Canada 12 Retirement Services U.S. individual life 1 Business & annuity business US Full-Service Retirement Business GREAT-WEST LIFECO Europe U.K. block of herita
Slide 13: Repositioned portfolio driving a shift in earnings mix
INVESTOR OVERVIEW Repositioned portfolio driving a shift in earnings mix Toward capital-light growth in workplace and wealth businesses 2022 2027 Base Earnings Mix Targeted Base Earnings Mix2 Workplace Solutions 45% $1.6B 50% Higher growth targeted 13 $3.3B1 16% Wealth & Asset Management 20% Base Ea
Slide 14: Long history of consistent and growing dividends
INVESTOR OVERVIEW Long history of consistent and growing dividends Annual dividends per common share1 ‘15 – ‘22 CAGR 6.0% 6.3% 2022 dividend yield2 14 Quarterly dividends per share increased 6% from $0.49 to $0.52 in Q1 2023 1.23 1.23 1.30 1.38 1.47 1.56 1.65 1.75 1.80 1.96 GREAT-WEST LIFECO 2013 20
Slide 15: Strong Balance Sheet and Capital Position
15 Strong Balance Sheet and Capital Position GREAT-WEST LIFECO
Slide 16: Diversified, high-quality asset mix
Diversified, high-quality asset mix INVESTOR OVERVIEW Conservative investment portfolio, predominantly comprised of fixed income instruments – 99% of which are investment-grade • Invested assets of ~$217B Invested Asset Distribution Bond Portfolio Quality • Bonds represent 69% – 99% are investment g
Slide 17: Robust capital and liquidity
Robust capital and liquidity INVESTOR OVERVIEW • Liquidity requirements are largely self-funded – Short-term obligations 31% 128% met by internal funds and Financial Leverage Ratio1,2 LICAT Ratio3 maintaining levels of liquid investments adequate to meet anticipated liquidity needs 17 – Committed li
Slide 18: Strong credit ratings
Strong credit ratings INVESTOR OVERVIEW Canada Life Lifeco (Opco) 1 (Holdco) 2 Outlook A+ Stable AA A (High) Stable 18 AA A Stable Aa3 Stable A+ Stable GREAT-WEST LIFECO AA Footnotes 1 - 2: Refer to slide 27
Slide 19: Efficient capital structure
Efficient capital structure INVESTOR OVERVIEW Carrying values as at September 30, 2023, unless otherwise noted, C$m Lifeco Finance (Delaware) LP U.S. Senior Notes $937m Lifeco Finance 2018, LP U.S. Senior Notes $1,080m Senior Debentures $2.5b Lifeco U.S. Finance 2020, LP Preferred Shares $2.7b U.S.
Slide 20: Appendix
20 GREAT-WEST LIFECO Appendix
Slide 21: Canada
Canada CANADA Our Business 2022 Key Metrics base earnings1 / We are strengthening our relationship with 1 in 3 Canadians $1.2B/$1.4B net earnings More employers are turning to Canada Life base ROE1 / than any other2 We offer a preeminent platform for 17%/21% net ROE workplace, wealth and insurance a
Slide 22: U.S.
US U.S. Our Business 2022 Key Metrics Empower is the second-largest retirement base earnings1,2 / services provider in the U.S.3, serving over 18m4 individuals with AUA1 of US$1.4T4 $0.7B/$0.5B net earnings2 base ROE1,2 / Empower Personal Wealth is a fast- growing wealth business with AUA of US$65B4
Slide 23: Europe
Europe EUROPE Our Business 2022 Key Metrics Operations in the U.K., Ireland and Germany base earnings1 / Market leader in group risk, a leading player in $0.8B/$1.2B net earnings payout annuities and a strong competitor in base ROE1 / the equity release mortgage market in the U.K. Irish Life has lea
Slide 24: Capital and Risk Solutions
Capital and Risk Solutions CRS Our Business 2022 Key Metrics Operations in the U.S., Ireland, Barbados and base earnings1 / Bermuda and includes both reinsurance and retrocession business transacted directly with $0.6B/$0.5B net earnings clients or through reinsurance brokers base ROE1 / Products in
Slide 25: Non-GAAP Financial Measures and Ratios
NON-GAAP FINANCIAL MEASURES AND RATIOS This document contains some non-Generally Accepted Accounting Principles (GAAP) financial measures and non-GAAP ratios as defined in National Instrument 52-112 “Non-GAAP and Other Financial Measures Disclosure”. Non-GAAP financial measures and ratios are used t
Slide 26: Footnotes
Footnotes All references to the Company’s Q3 2023 MD&A in the below footnotes are to the Company’s management’s discussion and analysis for the three and nine months ended September 30, 2023, which is available on SEDAR+ at www.sedarplus.com. Slide 3 1. By market capitalization; Source: S&P CapIQ, S
Slide 27: Footnotes
Footnotes Slide 9 1. As of December 31, 2022. This figure also includes environmentally-minded private equity investments such as a sustainable food and agriculture fund. 2. CDP’s (formerly known as Carbon Disclosure Project) annual environmental disclosure and scoring process is a widely recognized
Slide 28: Great-West Lifeco
28 Investor Presentation Q3 2023 GREAT-WEST LIFECO Note: All dollar amounts are expressed in Canadian dollars and references to “dollars” or “$” are to Canadian dollars, unless otherwise stated.