After announcing the reduction of 1,500 jobs in the spring of 2017, Great-West Lifeco's goal was to achieve $200 million in annual cost savings by the end of the first quarter of 2019 in Canada. This target is about to be reached.
Every quarter, Great-West Lifeco provides an update on this objective. The company did so again when disclosing its results for the third quarter of 2018 on Oct. 31. As at September 30, 2018, the company estimates that it has achieved $180 million in annual savings since making that announcement.
For its Q3 2018 results, Great-West Lifeco reported net income of $689 million, up from $581 million in Q3 2017. This profit would have been higher had it not been for a charge of $56 million related to restructuring costs in the United Kingdom.
"The Company's operating performance was solid in the third quarter with strong sales growth, particularly in Europe," said Paul Mahon, President and Chief Executive Officer, Great-West Lifeco. "Our investments in customer experience and operational efficiency are yielding meaningful results and our strong capital position allows us to act on opportunities that support our strategic objectives."
Great-West Lifeco disclosed net earnings of $315 million in the third quarter of 2018 for its Canadian operations, an increase of $19 million over the same quarter in 2017. The insurer attributes this increase of 6 per cent primarily to "continued strong Group Customer morbidity results and higher contributions from insurance contract liability basis changes.”
For the first three quarters of 2018, Great-West Lifeco reported net earnings in Canada of $965 million, which is $229 million higher than in the first three quarters of 2017.
Overall, for the first three-quarters, the combined net earnings of the company were $2.25 billion. This is $494 million higher than the first nine months of 2017.