Readers are referred to the sections "Non-IFRS Financial Measures and Presentation" and "Forward-Looking Statements" at the end of this release.

MONTRÉAL, Nov. 8, 2018 /CNW Telbec/ - Power Corporation of Canada (TSX: POW) today reported earnings results for the three and nine months ended September 30, 2018.

Consolidated Results of Power Corporation
For the period ended September 30

Highlights

• The Corporation completed the disposal of assets of La Presse, ltée (La Presse) to a not-for-profit organization.
• Early redemption of 7.57% debentures due April 22, 2019, refinanced with 4.455% debentures due in 2048, reducing annual financing expense by $8 million.

Third Quarter
Net earnings attributable to participating shareholders were $186 million or $0.40 per share, compared with $470 million or $1.02 per share in 2017. Power Financial Corporation's (Power Financial) contribution to earnings was $72 million higher than the corresponding period, however, net earnings were adversely impacted by lower income from investments and the loss resulting from the La Presse transaction. The prior year included a gain of $174 million on the Corporation's investment in China Asset Management Co., Ltd. (China AMC).

Adjusted net earnings attributable to participating shareholders (a non-IFRS financial measure) were $283 million or $0.61 per share, compared with $471 million or $1.02 per share in 2017.

Other items, not included in adjusted net earnings, resulted in a charge of $97 million in the third quarter of 2018 consisting of:

• the Corporation's share of Great-West Lifeco's (Lifeco) restructuring charges related to the integration of U.K. financial services provider Retirement Advantage as well as the pending sale of a heritage block of policies;
• the Corporation's share of IGM Financial Inc.'s (IGM) restructuring and other charges resulting from the re-engineering of North American equity offerings as well as a premium on the early redemption of IGM's debentures; and
• the loss realized by Power Corporation as a result of the disposal of assets of La Presse and the premium paid on the early redemption of its debentures.

Contributions to Power Corporation's net earnings and adjusted net earnings were:

Nine Months
Net earnings attributable to participating shareholders were $1,058 million or $2.28 per share, compared with $1,078 million or $2.33 per share in 2017.

Adjusted net earnings attributable to participating shareholders were $1,155 million or $2.49 per share, compared with $1,141 million or $2.46 per share in 2017.

Contributions to Power Corporation's net earnings and adjusted net earnings were:

Power Financial Corporation
For the period ended September 30

Third Quarter
Net earnings attributable to common shareholders were $523 million or $0.74 per share, compared with $463 million or $0.65 per share in 2017.

Adjusted net earnings attributable to common shareholders were $578 million or $0.81 per share, compared with $465 million or $0.65 per share in 2017.

Other items, not included in adjusted net earnings, resulted in a charge of $55 million and consisted of Power Financial's share of Lifeco and IGM's other items as indicated above.

Nine Months
Net earnings attributable to common shareholders were $1,767 million or $2.48 per share, compared with $1,492 million or $2.09 per share in 2017.

Adjusted net earnings attributable to common shareholders were $1,822 million or $2.55 per share, compared with $1,588 million or $2.22 per share in 2017.

Sagard Investment Funds, China AMC and Other Investments
For the period ended September 30
(For additional information, refer to the table further in this release)

Third Quarter
Loss from investments was $28 million, compared with income of $219 million in 2017. Third quarter income from investments in 2018 includes a loss from Sagard China related to Chinese equity market declines. Income from investments in the third quarter of 2017 included a gain of $174 million on China AMC.

Nine Months
Income from investments was $184 million, compared with $306 million in 2017. Income from investments in the nine-month period ended September 30, 2018 also included gains on the disposal by Sagard Europe of two investments in the first quarter of 2018. Income from investments in 2017 also included a gain on the disposal of the Corporation's interest in an investment fund in the second quarter of 2017.

Dividends on Power Corporation Participating Shares

The Board of Directors today declared a quarterly dividend of 38.20 cents per share on the Participating Preferred Shares and the Subordinate Voting Shares of the Corporation, payable December 31, 2018 to shareholders of record December 10, 2018.

Dividends on Power Corporation Non-Participating Preferred Shares

The Board of Directors also declared quarterly dividends on the Corporation's preferred shares, payable January 15, 2019 to shareholders of record December 24, 2018:

About Power Corporation

Power Corporation of Canada is a diversified international management and holding company with interests in companies in the financial services, asset management, sustainable and renewable energy, and other business sectors in North America, Europe and Asia. To learn more, visit www.PowerCorporation.com.

At September 30, 2018, Power Corporation held the following economic interests:

Non-IFRS Financial Measures and Presentation

Net earnings attributable to participating shareholders are comprised of:

• Adjusted net earnings attributable to participating shareholders; and
• Other items, 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 include the Corporation's share of items presented as Other items by a subsidiary or a jointly controlled corporation.

Management uses these financial measures in its presentation and analysis of the financial performance of Power Corporation, and believes that they provide additional meaningful information to readers in their analysis of the results of the Corporation. Adjusted net 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 considered to be part of ongoing activities are excluded from this non-IFRS measure.

Adjusted net earnings attributable to participating shareholders and adjusted net 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 whereby the Corporation's interests in Power Financial and other subsidiaries 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 holding company's (parent) results separately from the results of its operating subsidiaries.

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 shares (including the Participating Preferred Shares) and Subordinate Voting Shares are eligible dividends.

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, fluctuations in interest rates, inflation and foreign exchange rates, monetary policies, business investment and the health of local and global equity and capital markets, management of market liquidity and funding risks, risks related to investments in private companies and illiquid securities, risks associated with financial instruments, changes in accounting policies and methods used to report financial condition (including uncertainties associated with significant judgments, estimates and assumptions), the effect of applying future accounting changes, business competition, operational and reputational risks, technological changes, cybersecurity risks, 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 Corporation of Canada

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