Great-West Lifeco Inc. · TSX:GWO
Great-West Lifeco — Q2 2001 Earnings Presentation
34 slides from Great-West Lifeco's earnings presentation, 2001
Slide 1: Quarterly Information Q2 2001 For Analysts & Investors
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors 1
Slide 2: Highlights
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Highlights • Net Income attributable to Common Shareholders for YTD 2001 was $366 million, up 20% over 2000. • 2001 results are before a non-recurring charge of $132 million and operating losses of $32 million, both associated with Alta Health &
Slide 3: Consolidated Earnings (2001 Results Exclude Alta)
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Consolidated Earnings (2001 Results Exclude Alta) ($ CDN millions) For the six months ended June 30 2000 2001 Change Total Net Income 321 382 19% Net Income - Common Shareholders 305 366 20% ROE 17.9% 19.3% 3
Slide 4: Consolidated Earnings (2001 Results Include Alta)
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Consolidated Earnings (2001 Results Include Alta) ($ CDN millions) For the six months ended June 30 2000 2001 Change Total Net Income 321 218 -32% Net Income - Common Shareholders 305 202 -34% ROE 17.9% 15.2% 4
Slide 5: Net Income to Common Shareholders by Region (Exclude Alta)
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Net Income to Common Shareholders by Region (2001 Results Exclude Alta) ($ millions) For the six months ended June 30 2000 2001 Change Canadian Segment Great-West Shareholder operating earnings 129 159 23% Portion of Lifeco Earnings (5) (4) Tota
Slide 6: Net Income to Common Shareholders by Region (Include Alta)
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Net Income to Common Shareholders by Region (2001 Results Include Alta) ($ millions) For the six months ended June 30 2000 2001 Change Canadian Segment Great-West Shareholder operating earnings 129 159 23% Portion of Lifeco Earnings (5) (4) Tota
Slide 7: Consolidated Assets
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Consolidated Assets ($ CDN millions) At June 30 2000 2001 Change General Fund Assets Canada 32,324 33,542 4% U.S. 22,220 22,911 3% Total 54,544 56,453 3% Segregated Fund Assets Canada 18,347 18,464 1% U.S. 19,370 18,473 -5% Total 37,717 36,937 -
Slide 8: Sales: New Annualized Premium
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Sales New Annualized Premium ($ CDN millions) For the six months ended June 30 2000 2001 Change Canada 4,062 62% 3,306 61% -19% U.S. 2,509 38% 2,135 39% -15% Total Sales 6,571 5,441 -17% 8
Slide 9: Revenue Premium Incl. Seg. Funds and ASO
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Revenue Premium Incl. Seg. Funds and ASO ($ CDN millions) For the six months ended June 30 2000 2001 Change Canada 5,805 43% 5,547 39% -4% U.S. 7,682 57% 8,682 61% 13% Total 13,487 14,229 6% 9
Slide 10: Fee Income
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Fee Income ($ CDN millions) For the six months ended June 30 2000 2001 Change Canada 170 188 11% U.S. 623 741 19% Total Fee Income 793 929 17% 10
Slide 11: Expenses
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Expenses ($ CDN millions) For the six months ended June 30 2000 2001 Change Operating Expenses GWL (Canada) 313 357 14% GWL&A (U.S.) 578 641 11% Lifeco Entity 0 2 Total Operating Expenses 891 1,000 12% Investment Expenses GWL (Canada) 8 7 -13% G
Slide 12: Alta Health and Life Insurance Company
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Alta Health and Life Insurance Company • Alta acquired by GWL&A on July 8, 1998. • During 1999 and 2000, Alta business was converted to GWL&A systems and business and accounting processes. • Conversion resulted in significant issues related to a
Slide 13: Canadian Operations
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors CANADIAN OPERATIONS 13
Slide 14: Sales: New Annualized Premium
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Sales New Annualized Premium ($ millions) For the six months ended June 30 2000 2001 Change Individual Ins. & Investment Life & Living Benefits 29 29 0% R & IS 2,676 1,606 -40% Sub-Total 2,705 1,635 Group 122 173 42% Reinsurance & Specialty 1,20
Slide 15: Revenue Premium Incl. Seg. Funds and ASO
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Revenue Premium Incl. Seg. Funds and ASO ($ millions) For the six months ended June 30 2000 2001 Change Individual Ins. & Investment Life & Living Benefits 187 190 2% R & IS 2,289 1,598 -30% Sub-Total 2,476 1,788 Group 1,473 1,610 9% Reinsurance
Slide 16: Fee Income
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Fee Income ($ millions) For the six months ended June 30 2000 2001 Change Segregated Funds 132 145 10% Administrative Services Only 26 30 15% Assets Under Administration 12 13 8% Total Fee Income 170 188 11% 16
Slide 17: Expenses
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Expenses ($ millions) For the six months ended June 30 2000 2001 Change Individual Ins. & Investment Life & Living Benefits 37 33 -11% R & IS 78 81 4% Sub-Total 115 114 Group 108 114 6% Reinsurance, Specialty & Other 22 38 73% 245 266 9% Par 68
Slide 18: Net Income
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Net Income ($ millions) June 30 YTD 2000 2001 Change Individual Life & Living Benefits 27 31 15% R & IS 37 41 11% Group Life & Health 32 38 19% Reinsurance & Specialty 27 35 30% Corporate 6 14 133% Net Income - Common Shareholders 129 159 23% 18
Slide 19: Invested Assets
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Invested Assets ($ millions) At June 30 2000 2001 ($) (%) ($) (%) Bonds 15,505 57.9% 15,652 57.6% Cash and CD's 325 1.2% 268 1.0% Mortgages 7,526 28.1% 7,504 27.6% Stocks 1,116 4.2% 1,297 4.8% Real Estate 994 3.7% 1,056 3.9% Policy Loans 1,322 4
Slide 20: Asset Quality: Non-Performing Loans
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Asset Quality Non-Performing Loans ($ millions) At June 30 2000 2001 Asset Class Bonds 22 32 Mortgages 24 11 Foreclosed Real Estate 6 4 Total 52 47 In-Year Charge for Credit Losses (0.4) 1.2 20
Slide 21: U.S. Operations (US$)
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors U.S. OPERATIONS (US$) Note: FX Translation rate is as follows: 2000 2001 Income Statement 1.4670 1.5340 Balance Sheet 1.4790 1.5180 21
Slide 22: Sales: New Annualized Premium
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Sales New Annualized Premium ($ US millions) For the six months ended June 30 2000 2001 Change Employee Benefits 1,136 913 -20% Financial Services 738 479 -35% Total U.S. 1,874 1,392 -26% 22
Slide 23: Revenue Premium Incl. Seg. Funds and ASO
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Revenue Premium Incl. Seg. Funds and ASO ($ US millions) For the six months ended June 30 2000 2001 Change Employee Benefits 4,081 4,564 12% Financial Services 1,017 953 -6% 5,098 5,517 8% Par 139 143 Total U.S. 5,237 5,660 8% 23
Slide 24: Fee Income
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Fee Income ($ US millions) For the six months ended June 30 2000 2001 Change Segregated Funds 86 86 0% Administrative Services Only 313 364 16% Assets Under Administration 26 33 27% Total Fee Income 425 483 14% 24
Slide 25: Expenses
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Expenses ($ US millions) For the six months ended June 30 2000 2001 Change Employee Benefits 334 354 6% Financial Services 56 60 7% Corporate 2 3 392 417 6% Par 2 1 Operating Expenses 394 418 6% Investment Expenses 5 5 0% Total Expenses 399 423
Slide 26: Net Income (2001 Results Exclude Alta)
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Net Income (2001 Results Exclude Alta) ($ US millions) For the six months ended June 30 2000 2001 Change Employee Benefits 61 73 20% Financial Services 58 69 19% Corporate 0 1 Net Income - Common Shareholders 119 143 20% 26
Slide 27: Net Income (2001 Results Include Alta)
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Net Income (2001 Results Include Alta) ($ US millions) For the six months ended June 30 2000 2001 Change Employee Benefits 61 73 20% Financial Services 58 69 19% Corporate 0 1 Alta charge - (107) Net Income - Common Shareholders 119 36 -70% 27
Slide 28: Employee Benefits Life & Health Sales
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Employee Benefits Life & Health Sales ($ US millions) June June June 2001 2001 2000 In-Qtr YTD YTD Case Sales 476 1,046 1,292 Terminations 646 1,501 1,109 Net (170) (455) 183 Sales Premium 144 433 618 Net Premium (277) (789) 31 * Members (thousa
Slide 29: Employee Benefits 401(k)
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Employee Benefits 401 (k) ($ US millions) June June June 2001 2001 2000 In-Qtr YTD YTD Case Sales 95 230 407 Terminations 148 336 211 Net (53) (106) 196 Net Cash Flow 62 262 203 Ending Assets 7,765 7,765 8,785 Participants (thousands) 563 563 52
Slide 30: Financial Services Sales Placed Premium
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Financial Services Sales Placed Premium ($ US millions) June June June 2001 2001 2000 In-Qtr YTD YTD BOLI 41 104 411 (incl. variable/sep. accounts) Individual Annuity - fixed 5 11 14 - variable 51 103 155 56 114 169 Individual Life (excl. BOLI)
Slide 31: Financial Services Participants
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Financial Services Participants June June Change 2001 2000 In Quarter YTD YTD P/NP 86,536 1,222,240 919,057 FASCorp 5,959 383,799 315,736 31
Slide 32: Financial Services Assets
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Financial Services Assets ($ US millions) June June Change 2001 2000 In Quarter YTD YTD P/NP - General Acct. 19 3,888 3,998 - Variable 315 4,325 4,248 - Unwrapped 2,079 21,263 20,351 FASCorp - Unwrapped 481 6,184 5,823 32
Slide 33: Invested Assets (US$ millions)
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Invested Assets ($ US millions) At June 30 2000 2001 ($) (%) ($) (%) Bonds 9,656 69.2% 9,934 71.0% Cash and CD's 385 2.8% 184 1.3% Mortgages 909 6.5% 765 5.5% Stocks & Real Estate 189 1.4% 199 1.4% Policy Loans 2,809 20.1% 2,906 20.8% Total 13,9
Slide 34: Asset Quality: Non-Performing Loans
QUARTERLY INFORMATION Q2 2001 For Analysts & Investors Asset Quality Non-Performing Loans ($ US millions) At June 30 2000 2001 Asset Class Bonds 13 68 Mortgages 7 19 Foreclosed Real Estate 9 4 Total 29 91 In-Year Charge for Credit Losses (4.7) 0 34