In its most recent quarterly financial statements, insurance company Great-West Lifeco reported net earnings attributable to shareholders of $740 million in the fourth quarter of 2023. This represents a 64 per cent increase compared to the $452 million reported a year earlier. 

For the entire year, net earnings were $2.7 billion. For the fiscal year 2023, this is a decrease of $858 million, or 24 per cent, compared to net earnings of $3.6 billion reported on Dec. 31, 2022. 

The company announced base earnings of $971 million in the fourth quarter of 2023. Paul Mahon, President and CEO of Great-West, said this performance "is supported by a solid foundation of diversified businesses and the disciplined actions we've taken to reposition our portfolio."

In his statement, Mahon also took the opportunity to highlight executive appointments, including Jon Nielsen as Chief Financial Officer and Fabrice Morin as President and Chief Operating Officer in Canada. 

The company stated that the sale of Putnam Investments to Franklin Templeton, announced at the end of May and concluded on Jan. 1, 2024, furthers Lifeco's strategy “of building and extending strategic partnerships with best-in-class asset managers to support clients' retirement, group benefits, and personal wealth management needs.” 

Another major transaction completed in 2023, mentioned in the annual highlights, is the acquisition of Investment Planning Counsel by subsidiary Canada Life in April 2023. 

Net Profit from Insurance and Investment Activities 

Net earnings from insurance operations across all divisions reached $890 million in the fourth quarter of 2023, compared to $698 million in the same quarter of 2022, according to adjusted amounts. This represents a 28 per cent increase. 

For the entire fiscal year 2023, net earnings from insurance operations were $3.1 billion, up nine per cent compared to the $2.8 billion reported in 2022, according to adjusted amounts. 

In its report to shareholders, the company attributes this increase to favourable group benefits results and the non-recurring nature of unfavourable morbidity results in the previous year in European operations, as well as to earnings from group life and health products in Canadian operations. 

The net result from investment activities across all divisions reached $265 million in the fourth quarter of 2023, compared to $63 million in the same quarter of 2022, according to adjusted amounts. 

For the entire fiscal year 2023, this net result from investment activities was $1.5 billion, down $1.1 billion or 41 per cent compared to the result reported on Dec. 31, 2022. 

In Canada 

For the Canadian operation, which includes insurer Canada Life, net earnings were $166 million in the fourth quarter of 2023, compared to $352 million in the same quarter of 2022, according to adjusted amounts. This is a 53 per cent decrease. 

For the entire fiscal year 2023, net earnings attributable to common shareholders of the Canadian operation totaled $961 million, down 33 per cent compared to net earnings of $1.4 billion reported on Dec. 31, 2022, according to adjusted amounts. 

In the United States 

In the United States, net earnings were $194 million in the fourth quarter of 2023, compared to $168 million in the same quarter of 2022, according to adjusted amounts. 

For the entire fiscal year 2023, net earnings for the American operation reached $749 million, up $186 million or 33 per cent over adjusted earnings recorded in 2022. 

In Europe 

For the European operation, net earnings were $217 million in the fourth quarter of 2023, compared to a loss of $25 million in the same quarter of 2022, according to adjusted amounts. 

For the entire fiscal year 2023, net earnings in Europe were $384 million, compared to $1.2 billion in 2022, according to adjusted amounts. This represents a 68 per cent decrease. 

In its statement, the company declared having implemented several measures to improve the outlook of this European sector, including the sale of an existing policy portfolio to AIB Life, the closure to new business of wealth management activities in Great Britain, and the cession of a block of annuity business in the UK in reinsurance. 

Capital Management 

Finally, for the Capital and Risk Solutions sector, net earnings were $215 million in the fourth quarter of 2023, compared to $179 million in the same quarter of the previous year, according to adjusted amounts. 

For the whole fiscal year 2023, net earnings for this sector amounted to $833 million. This is a 54 per cent increase compared to the $542 million reported on Dec. 31, 2022, according to adjusted amounts. 

Real Estate 

In the investor presentation, Lifeco outlined its exposure to mortgage risk. The company indicated that its real estate portfolio represents $38.4 billion, accounting for 17 per cent of its investments. 

The residential real estate sector, including single-family homes or apartments, accounts for 6.7 per cent of the company's investment portfolio, while commercial real estate represents 10.3 per cent of the insurer's investments. 

Office buildings are valued at just over $5 billion, or 2.2 per cent of the portfolio. Nearly 49 per cent of these office spaces are located in the United States. "Office loans maturing offer strong coverage, good leverage, and longer average lease durations than the loan durations," the company noted. 

In the single-family residence sector, where the company reports a value of $1.5 billion, 0.2 per cent of mortgage loans are in arrears.