The Great West Lifeco Inc. says profits rose in the fourth quarter from a year earlier as its diversified portfolio performed well despite challenging market conditions.
The Winnipeg-based insurer said its underlying profit was $892 million, or 96 cents a share, compared with profit of $825 million, or 89 cents a share, last year.
Earnings reflected higher growth in new capital and risk solutions (reinsurance) business, acquisition of Prudential Financial Inc.’s retirement services business. and favorable investment experience in the UK and Ireland (Great-West owns Irish Life), a Winnipeg-based company, the insurer said.
Net income was $1.03 billion, or $1.10, compared with $765 million, or 82 cents a share, a year earlier.
In a statement, Paul Mahon, president and CEO of Great-West Lifeco, said the financial results were “strong in a context of continued macroeconomic instability.”
Scotiabank analyst Meny Grauman says results beat expectations by 9%, thanks in part to improved policyholder profitability as well as overall solid results.
Following the results, the company increased its dividend to common shareholders by 6% to 52 cents per share.
In the insurer’s Canadian segment, core profit for the quarter was $295 million, down 7% year-over-year, reflecting lower fee income (due to lower assets) and a less favorable individual insurance and investment experience, the insurer said .
Net income in the Canadian segment was $380 million, up 24% from $307 million in the prior year, due in part to the favorable impact of the $84 million revaluation of net deferred tax assets (deferred tax assets income tax increased by USD 95 million to USD 1.15 billion). and actuarial liabilities arising from increases in the Canadian federal corporate income tax rate.
Individual insurance sales in Canada increased 8% year-over-year to $130 million, while individual wealth sales declined 20% to approximately $2.6 billion, reflecting lower sales of mutual funds and segregated funds.
Great-West said it had $701 billion in consolidated assets and $2.5 trillion in assets under management at the end of 2022, up 11% and 9% from the previous year.
