Power Corporation of Canada

Good morning ladies and gentlemen and welcome to the Power Corporation second quarter 2026 earnings conference call. At this time all lines are in listen-only mode. Following the presentation we will conduct a question and answer session. Analysts who wish to join the question queue may press star then 1 at any point throughout the call. If anyone has difficulties hearing the conference Please press star then zero for operator assistance at any time. I would like to remind everyone that this call is being recorded on Friday, July 31st, 2026. I would now like to turn the conference over to Mr. Stephen Hung, Head of Investor Relations for Power Corporation. Please go ahead, sir.

Thank you, operator. Good morning, everyone, and thank you for joining us for Power Corporation's second quarter 2026 results call. Before we begin, A link to the audio webcast and materials for this call have been posted to our website at powercorporation.com under the Investors tab. Please turn to slide two. I would like to draw your attention to the cautionary note regarding the use of forward-looking statements which form part of today's remarks. Please also refer to slide three for a note on the use of non-IFRS measures and clarifications on adjusted net asset value. To discuss our results today are James O'Sullivan, who is appointed President and CEO of Power Corporation on July 1st, 2026, and Jake Lawrence, our EVP and CFO. We will begin with opening remarks, followed by a question and answer session. With that, I'll turn the call over to James.

All right. Well, thank you, Steve. Good morning, everyone, and thank you for joining us today. Before turning to the results, I want to share some high-level thoughts. Power has an exceptional culture and team, working with its partners right across the group. Having formerly led one of the public operating companies, I understand how Power creates value through active ownership and enables strong collaboration across leadership, capital allocation, strategy, and risk. The strong partnership across the Power Group of companies will continue to drive strong shareholder returns. Second, power has made strong progress against its value creation strategy and investors have benefited from strong total shareholder returns. Power will maintain continuity in strategy and no major changes are anticipated. Transparency and communication remain a top priority and we look forward to engaging with you directly. Thirdly, in terms of capital allocation, Power will remain focused on investing organically in existing businesses while being strategic in M&A. Return of capital through dividends and share buybacks will remain a key priority. Power is a patient investor with a longer term time horizon and decisions are made thoughtfully. Building on the strong execution of the value creation strategy under Jeff Orr's tenure, Power will maintain ongoing momentum. I look forward to your continued support, engagement, and dialogue over time. Now, turning to the results, Power reported a strong quarter with record adjusted EPS of $1.55. The results reflected strong earnings growth from Great West and IGM, continued value creation from our NAV-based businesses, as well as a decreasing share count. Power's net asset value grew 74% year over year, led by our publicly traded operating companies. Great West and IGM continue to track well against their respective medium-term financial objectives. Great West surpassed 19% base ROE for the second straight quarter and both companies demonstrated strong double-digit adjusted EPS growth. On the NAV-based investments in our portfolio, Wealthsimple posted strong AUA and client growth and the business momentum supported a 15% fair value increase in Wealthsimple. At Cigar, Power also recognized an 11% increase in fair value. Great West announced the acquisition of Milliman through its Empower subsidiary.