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Operator: Good morning, ladies and gentlemen, and welcome to the Power Corporation Third Quarter 2025 Earnings Conference Call. [Operator Instructions]. I would now like to remind that this call is being recorded on Thursday, November 13, 2025. I would now like to turn the conference over to Steven Hung, Head of Investor Relations for Power Corporation. Please go ahead, sir.
Steven Hung: Thank you, operator. Good morning, everyone, and thank you for joining our third quarter financial results call. Before we start, please note that a link to our live webcast and materials for this call have been posted to our website at powercorporation.com under the shareholder report tab. Also, Power Corporation released a new financial supplementary package that can be found on our website as well. Please turn to Slide 2. 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 3 for a note on the use of non-IFRS financial measures and clarifications on adjusted net asset value. To discuss our results today, joining us are President and CEO, Jeffrey Orr; and our EVP and CFO, Jake Lawrence. We will begin with opening remarks followed by Q&A. With that, I'll turn the call over to Jeff.
Robert Orr: Okay. Thank you, Steve, and welcome, everyone. Thanks for joining us this morning to discuss the results from the latest quarter. Very strong quarter for Power and the whole group with 3 components really on display here, strong earnings growth from the company's value creation on evidence from our strategic investments both at Power and at IGM and then very strong cash flow and buildup of our cash positions. So all elements of what we're doing, I think, on clear display this quarter. From an earnings point of view, it was a very clean quarter. Obviously, it was good conditions, markets were strong, very, very positive environment in which we operate. But notwithstanding that, I think it demonstrated the earnings power of both the Great-West Life and IGM's earnings-driven businesses. And fundamentally, those businesses are growing. They're in good shape. They continue to build their businesses, but they also earn in a clean quarter, it was really demonstrating what kind of earnings power has been created there. On the value creation from the strategic investment side, as I said, both Power and IGM have portfolios of companies that are much higher growth and that are basically valued more on NAV than earnings. And in this quarter, 2 of those companies announced transactions, the Wealthsimple and Rockefeller transactions that demonstrated not just the quality, but the magnitude of the value creation that can be created in that part of the portfolio. And finally, from a cash flow point of view, a strong -- we've returned a lot of capital. That's an element of our strategy as well, and we stepped up our share repurchases on the back of a strong cash flow coming into the company, including from the Great-West Life buyback, which we started to participate in and notwithstanding the pickup in the buyback activity, the cash position of Power Corp had quite a material jump over the quarter. So then I'll just flip forward to Page 7 and just talk a little bit about the 2 transactions that were announced this fall. So Rockefeller, as I think you're well aware, it was an investment that was made. I think it was in the spring of 2023, some 9 quarters or so ago. In U.S. dollars, IGM invested $620 million or $835 million, as you see at the bottom of the left-hand page there in Canadian dollars. So Rockefeller welcomed a group of new shareholders into the capital stack, and those are all kind of prominent family investors, Mousse is in effect of the Chanel family, it is their -- the Chanel company, basically, the Wertheimer family and the Heilbronn run Mousse that's their family office. Progeny is the Hemingway family for the West Coast of the U.S. at Abrams Capital, sort of Boston. So they joined Viking and the Rockefeller family and in effective with IGM, the Desmarais family, if you want to put it from an ultimate control here. So you've got a group of prominent wealthy families that are in behind what's going on at Rockefeller, but a very significant jump in value is the main point here I want to make, as you can see on the bottom of the page for IGM. And then Wealthsimple continues to experience tremendous growth that crossed recently $100 billion in assets and continue to really grow their franchise, grow the number of clients. You're just succeeding on all fronts at this point. They had announced a very successful financing round that was led by GIC and Dragoneer. Two, obviously, very credible investors, but also included some very other prominent investors that you can see at the bottom of the right-hand side there. And our group participated for $200 million, $100 million each for Power and IGM of the $550 treasury. And then once again, at the bottom right, you see the value creation. Power has got its own investment and across the group, including IGM, principally, you can see the value pickup from just the last quarter. We had marked it up last quarter, but then the financing was done at an even higher mark. So nice to see those 2 transactions validating the value creation that we see in our portfolio of strategic investments. Page 8, I won't really go through with just kind of a summary of financially how we've done. And with that, I'm going to pass the microphone over to Jake. Jake?
Jake Lawrence: Great. Thanks, Jeff, and good morning to everyone joining us. I'm going to begin my remarks on Slide 10. And -- as Jeff just commented, we're pleased to report strong results for the third quarter of 2025. Our adjusted net earnings from continuing operations were $863 million, and that's an increase of 25% year-over-year. When we look at the results on a per share basis, Q3 adjusted net earnings were $1.35, up 26% from last year and the slight uptick versus the overall earnings reflects our buyback activity. Before turning to the operating company results, I just want to remind everyone that our ownership in Wealthsimple across the Power, Complex is consolidated at Power's Corporation level. And therefore, the fair value increase in Wealthsimple will not appear in our P&L results. Now moving to our operating company results and beginning with Great-West, whose contribution to Power's adjusted net earnings was up 16% year-over-year. The positive results were supported by Great-West sixth consecutive quarter of base earnings in excess of $1 billion, and including double-digit growth in our U.S. business, Europe and really notably a strong quarter in the Capital and Risk Solutions business. IGM's contribution to Power's adjusted earnings were up 23% year-over-year, as we saw strong growth in IG Wealth and Mackenzie net flows. The quarter ended with record high AUM and AUA, which were up 14% year-over-year and increased 7% quarter-over-quarter. The results also saw a strong earnings contribution from China AMC, while Rockefeller, which Jeff just spoke to, their earnings in the quarter were positive. Slightly offsetting these results this quarter was GBL's contribution of Power's adjusted net earnings, which was a loss of $11 million. The lower contribution in the quarter was due to a fair value loss of GBL Capital as well as higher operating expenses and lower gains on disposals of investments. Last week, GBL also announced a significant divestment of the GBL cattle portfolio, and the net earnings of the quarter reflect the estimated transaction value on their assets. Moving to our alternative investment platform. Sagard's’ contribution this quarter with a loss of $11 million. It was down from positive earnings of $106 million last quarter. The decrease was primarily driven by higher carried interest expense associated with the fair value increase at Wealthsimple as well as the impact of acquiring the remaining economic interest in Performance Equity Management, which they increased up to 100%. Power Sustainable reported an improved contribution driven by lower net carried interest expense as well as lower acquisition costs. Looking at our corporate operations and other segments, we reported an improved contribution, and that was driven primarily by the positive impact of FX gains relating to foreign currency translation on cash balances. Meanwhile, operating expenses were higher due to an increase in long-term compensation expenses and some increased advisory fees. Overall, we are pleased with our group's strong third quarter results and expect continued momentum to end the fiscal year in Q4. Turning to the next page, Slide 11, looking at our net asset value. we reported net asset value per share of $72.24 as of September 30, 2025. I want to remind the group that 83% of our Power's gross asset value continues to be driven by our earnings-based businesses, specifically Great-West and IGM. Second, during the quarter, we experienced strong adjusted NAV growth, which was up 25% compared to the same period last year and up 12% to the prior quarter. Driving that change were increases at all of our publicly reported operating companies with IGM up 25%, followed by Great-West 22%, while GBL rose 18%. The net asset value of Sagard increased 40% year-over-year, and that was driven by the fair value increase in Wealthsimple I've mentioned. Meanwhile, Power Sustainable saw a slight reduction in NAV, and that's related to some asset sales that we announced earlier this year that generated cash for the corporation. On our cash balance, we ended the quarter at $1.9 billion. We see about $1.5 billion available when we factor in dividends to be paid and dividends we've yet to receive. And as many will have seen, we remained active in our NCIB program. During the quarter, we repurchased 3 million shares worth about $170 million. And to date, we purchased 7.4 million shares. We continue to be well positioned to deliver a strong return of capital, as Jeff noted upfront, and year-to-date to October 31, we've returned over $2 billion to shareholders through a combination of share buybacks and dividends. And with that, Jeff, I'll turn it back to you.
Robert Orr: Okay, Jake. Thank you. So I will move us forward to Page 13. Just a couple of comments about Great-West Life. They continue to meet or exceed the medium-term objectives that they announced -- objectives that they announced several years ago and continue to have strong earnings growth. I thought it was really pleased to see, and Jake mentioned, it was across virtually all the geographies. And as well, if you look at it from a business segment point of view, retirement wealth asset management, insurance, et cetera, as you look through the different components of it, it was strong across the board. And it was also coupled with very high cash generation. I mentioned before that Great-West Lifeco is doing -- being very clear as to how the earnings in each of those areas turn into cash generation. And then you're seeing that at the top of the house as the cash continues to build up the Great-West Lifeco level. The company announced, again, a buyback earlier this year and then came up with recent announcement that they're increasing and extending the buyback programs. And as you know, Power Corp has decided to participate pro rata in those buybacks now. So just all good news across the Great-West, really great momentum in the businesses. IGM as well, then turning to Page 14. Jake mentioned strong AUA and AUM growth, its markets, but it's also flows. It was really nice to see that both IG Wealth and Mackenzie had very strong flows. And those earnings are also turning into strong cash positions, financial position of IGM, cash position continues to grow and they have increased their buyback activity as well as a consequence. So the earnings businesses here really, really doing well. I'll just turn you to Page 15 and just use this slide to focus on the strategic investment portfolio of IG, it is -- there are 4 businesses there. They're very high quality businesses, and they're growing very strongly. I talked about Wealthsimple and Rockefeller earlier, you see just there the year-over-year growth in AUA and in client assets at the 2 franchises. But on the asset management side as well, China AMC is growing its assets strongly. They're growing their market share. The company is doing extremely well. That's been against the backdrop of mandated fee decreases. So the earnings haven't kept pace, but the earnings have been growing in spite of those fee drops. And so, but the health of the business, the growth of the business and the position of the business continues to be extremely strong. And then Northleaf, in a very difficult fund raising environment for alt managers, doing a really nice job in building up their AUM with some very strong fundraising and performance year-over-year. So very high-quality portfolio, not currently contributing a lot to IGM's, net earnings. But over time, as these businesses continue to grow and mature, we have 4 very strong quality businesses that we hope and expect will start to contribute earnings in the years ahead as they get to being in a more mature state. A couple of comments on GBL then on Page 16. We did have mentioned that a new CEO was announced in the spring Johannes Huth and he has come in and got a very strong track record in his time with KKR, where he was there for I think it was 25 years. The basic strategy is the same, which is ultimately to rotate out of the public portfolio over time. And then with the proceeds that would come from that, combined with an increased focus on private investments and coupled with a return on capital, the return on capital being evidenced through the strong increase in the dividend that they announced earlier this year as well as strong buyback activities. There has been a significant transaction that Jake mentioned. As Johannes and the team have focused on the private capital, there is in GBL Capital, a portfolio of investments in other people's funds that was part of the previous strategy and decision was made that was not strategic. So the transaction that Jake mentioned was a $1 trillion -- that would be nice, EUR 1.7 billion that was disposed of at about a 9% discount when you do secondaries in this -- in private alts, you're typically discounting them. That was actually a pretty good price, 9% discount was not a big discount. They went out and announced a series of transactions with different buyers and disposed of a big chunk of that GBL portfolio of other people's funds. So good move and more capital coming into GBL. So good lots of activity there. We continue to watch GBL with interest as under the new leadership. And then a couple of words on the alternative platforms at Power, ongoing fundraising on Page 17 of $2 billion since we last spoke. So continued good progress there. And you've got on this page the overall AUM in Canadian dollars. We've got $49 billion committed capital, of which $39 billion is funded. And what I really want to do then is turn Page 18 and talk about Sagard continue to use in addition to fundraising strategic transactions, acquisitions, partnerships to build their franchise. And they announced in September the Unigestion acquisition as well as what Jake mentioned buying in the minority interest of Performance Equity Management. So what they've done here is they've created under one umbrella, a solutions business, if I can put it that way. It's alternative private equities that are focused on primary equity positions, secondaries, co-investments effectively mix all that come up with asset solutions for different client bases, be they retail, family offices, institutional investors that are looking for portfolios. So this part of the business is really thinking of it as putting together packages of alternative assets for different parts of the market. And I guess somewhat analogous, if you want, in the public space to multi-asset type products versus individual fund sleeves, think of it that way, and they've combined this under one business, which has got USD 23 billion of investments. It's focused primarily in the mid-market as opposed to in the larger market, and they now have capabilities, both investment and distribution across North America and Europe. And so it's a whole new area for Sagard and quite an exciting development that they have done. In addition, they did announce as well a strategic partnership with Baird. May not be known to all of you, but Baird is a significant U.S. wealth manager over $500 billion in U.S. in client assets, and they're looking for more alts. And so they entered into a partnership, took a 5% interest in Sagard and they're going to work on products with Sagard to bring into their retail and wealth channels. So a lot's happening at our platform. Page 19, continue to -- I mentioned earlier, you just see here our return of capital to shareholders over the last several years. And I think on the right-hand side, you see the increased buyback activity up to the end of October. Pleased to see the discount narrowing. We can always get into a good discussion. I suspect we will continue to have a discussion about the discount. We're just very pleased to see that there's, I think, increased recognition on behalf of investors as to what we have across the portfolio and how we can drive value from all the different components of our portfolio as well. I suspect some of that. But who knows, you'll maybe tell me some of that is also a reflection of strong cash flow we have in some of the buyback activity that we are doing. You've got on Page 21, the returns that we've generated over various periods, going back to the last year, 3 years, 5 years and roughly since we announced the reorganization a couple of weeks after that at the end of 2009. So we're pleased to see strong performance. I would not expect to see 55% TSRs every year that's a reflection of a number of factors in the last year, but we do think we can create if we execute on our strategy, mid-teen type returns over time, that would be our objective. And then finally, as a roll up on the last slide around 22. Just again, to summarize, a really strong quarter, everything working well, very clean. There wasn't a lot of noise in the quarter, but also good markets, interest rates cooperating. It was just a good quarter where everything worked well. Not every quarter is going to be as clean as that markets go up and go down, and that's fine. From our perspective, it's fun to enjoy a quarter where everything is working well, but it doesn't change anything that we're doing. We're just executing the same strategy we have been for the last several years. I take quick -- frankly, more satisfaction and just seeing the continued progress of the businesses across Great-West Life at IGM, the progress they're making and that steady progress, not up 1 quarter, down 1 quarter. It's just pleased with the steady strengthening of our franchises. The management teams are in great shape. And then I look to the rest of the portfolio, the strategic portfolio, the NAV portfolio, we sometimes call it, and continued strong progress. So great quarter. We'll enjoy it when everything is working, but everybody just got their heads down here and continue to execute on what we've been telling you for the last several years. So with that, I will end my comments. And operator, you can open up the mics or the call to questions.
Operator: [Operator Instructions] Our first question is from Graham Ryding with TD Securities.
Graham Ryding: Can you just confirm the Alt AUM growth $2 billion in the quarter, was that fundraising? Or is that market performance?
Robert Orr: That is fundraising, and that is committed. Wealthsimple as well. Thank you. Okay. I was about to say it was all fundraising, Graham, and I've got a hook here from Jake. So that includes some of the market increase in the Wealthsimple position as well. It's a combination of both, Graham. The Wealthsimple increase we've obviously shown and then the net position would be from fundraising primarily.
Graham Ryding: Okay. So half and half roughly?
Jake Lawrence: Probably a bit more towards Wealthsimple and then the rest towards fundraising.
Graham Ryding: The 5% stake from Baird into Sagard, I think you've done something similar in the past. Did they put in actual capital here? Or is this a commitment for a certain level of AUM? How does that sort of structure look?
Robert Orr: They put capital in. And I won't go into all the details, but there are some adjustments to what the ultimate position can be based on distribution performance on themselves, but they put capital in at the full value -- the current value 4.5%.
Graham Ryding: And then maybe what's your ownership stake going forward in Sagard? And then can you give an update on the AUM growth and the flows that you've seen from other wealth channel partnerships that you've done in the past. I think you did something similar with BMO last year, just maybe an update on any traction from flows from those sort of wealth partnerships.
Robert Orr: Our equity position in Sagard at about 45% right now following these transactions. And I don't have in front of me here a summary of the flows that have come through retail channels. We can try and pull that information together, but I'd be misleading you or I don't have numbers in front of me. I think what you we'll see though, because it's not just a Sagard. I'm going to broaden your question out, Graham. We've got activity going on, for example, at IGM, where IGM has got Northleaf and they're also working with other parts of the all platforms across Power and other suppliers. And the Mackenzie is doing retail funds. And IGM is putting alts into their different shelf programs. You've obviously got empower looking at it. Like across the group, you've got the phenomenon that's happening in the industry where you're taking alts and putting them into retail products and high-net-worth products. And they tend to go through a long period where not a lot of flows happen. You're putting structures together, you're educating advisers, you're getting on shelves, you're going through the different control mechanisms on different wealth platforms to get on. So it's kind of a long lead time and then the sales start to pick up and then at a certain point, the hope is they take off. And we're starting to see that. So the meaning -- the numbers -- I think if you added it all up, I'm just foretelling because I've seen the numbers all in pieces, I haven't kind of seen them all together in one spot. I don't think they're hugely material at this point, but the growth of them is really starting to accelerate. So I'm foretelling what I think the story is, but we'll try and figure out whether we can pull together some numbers for you and for others, obviously, we'll disclose it to everyone.
Jake Lawrence: [indiscernible] the only thing I'd add on is we expect that trend to continue. We're seeing good coordination across the group with Sagard credit product and Wealthsimple. We've also seen access to the Empower shelf or at least announcement that Sagard will ultimately be going on that. So we do think retail funds will be a big component of growth moving forward.
Operator: The next question is from Jaeme Gloyn with National Bank Capital Markets.
Jaeme Gloyn: First question, just a refresh on the dividend strategy. Obviously, a great year this year from an earnings growth perspective and cash flows. How should we be thinking about that dividend, I guess, maybe in the next quarter and obviously, how does share repurchases factor into that capital allocation decision as well?
Robert Orr: Thank you. Good question, Jaeme. So what we do typically the fall is where Great-West Life and IGM would go through their 2026 budgeting process, get a good handle on where they think they're going. They will then come and come to the Board in early February or mid-February, when we have the Q4 results and would recommend dividends levels for 2026. Power then takes that looks at those 2 dividends as the 2 kind of steady sources of cash flow, and we then look at our expenses, what our net cash flow will be from those dividends and set our dividend as a consequence of having that information. Other sources of cash that we might get from either disposing of an alt position or getting returns or cash flow from our alts positions or participating in buybacks that Great-West Life may be having or other sources of cash Occasionally, we do some fundraising. We recently did some preferred shares that market opened. Those, what I would call more episodic sources of cash are what fund our buyback programs. And then we look at that cash in the context of investments we might have committed to or other opportunities, and we set our buybacks in the context of that cash position. I don't know if that explained it. We look to the dividends from IGM and Great-West Life as lesser expenses as the main driver of our dividends and other cash flows go into a bucket, which we then use to source the buybacks. Does that answer your question?
Jaeme Gloyn: Yes. And then maybe quite a different question just in terms of the capital allocation outlook for the business, obviously, Empower and funding the organic and inorganic growth of the operating companies is something that's top priority, but seen some dislocations in other financial services. I'm just wondering if there's any updated or refreshed view on, let's say, the verticals that you have in place today versus maybe where you might want to take that in the future.
Robert Orr: Well, let me go to what I think our capital allocation priorities are and then try and tease out what the last part of that question is because I'm not totally clear on what it was you were asking there, Graham. But from Great-West Life's perspective, I think the U.S. continues to be at the top of the list of capital priorities. Empower continues to grow its franchise. It continues to grow its market share in the DC business and then the rollover opportunity into the wealth management business is really even an even stronger growth, and I didn't mention, but Great-West did point out that their wealth management Empower personal wealth across the USD 100 billion mark in the last quarter. If I bring you back to 4.5 years ago, it was $20 billion. it jumped to $40 billion when they bought Personal Capital, which was combined with Empower Personal Wealth, but that's grown from that level up to $100 billion here. So that's a tremendous. We're very pleased with the progress that, that business is making. And if there were further opportunities to make acquisitions, that would be capital priority, number one, we would look to grow across the Great-West Life portfolio. If we had synergistic transactions in any of the markets, we like the balance currently. But if there were synergistic transactions, we would do so and there's some capital needed to grow the business, but most of their businesses are pretty capital light. So the position they find themselves in is those earnings are generating a lot of cash and a lot of capital, and that's growing at the top of the house and notwithstanding the desire for acquisitions, they're not going to sit on a big, big chunk of cash earning whatever it's earning in current rates. So that's why the buybacks are there. So that's a little bit -- I just tried to share with you how Great-West life thinks about capital allocation, IGM. From MacKenzie and IG Wealth, not necessarily acquisition opportunities there, but they do have their strategic portfolio, and they've got some high-growth businesses. So one could see over time some of those businesses requiring more capital. So that will be something that they would monitor in the strategic portfolio, but they also are building up strong cash now and have stepped up their buyback activity. So that's what -- those 2 companies, those are the capital priorities. And now if you could be a little more clarity on the last part of your question there, when you talked about other verticals, I wasn't sure what you meant.
Jaeme Gloyn: Yes, from like an OpCo perspective with Great-West and IGM life, life insurance asset management, it's a financial services business. Is that still the focus? Or would you entertain other verticals perhaps outside of those 2?
Robert Orr: We're in the financial services business here. And those -- I think I've explained what they would do. I think the priority would be in-market transactions, occasionally to get into new markets we have made investments. So Rockefeller was not a business that we were in. China Asset Management was not a business we were in. Those are brand-new areas in financial services that in the past years we've made. And we've done those on a, I would say, on a disciplined step-by-step basis as opposed to jumping in with a lot of capital. So it's -- would we ever entertain other areas? The answer would be sure, we would. But our priority is building around the franchises that we have, that would be the priority. But it would be financial services. Just very, very clear. Jake wants to add something here, Graham.
Jake Lawrence: Sorry, Jaeme. My apologies. Jaeme. Just even -- I don't know if the question is triggered by where our cash balance sit at $1.9 billion and available at $1.5 billion. I'd say one of our unique characteristics or a competitive advantage of Power is just the willingness to take a long-term view and approach to building the company. And so we won't -- I don't think Jeff or myself feel cash burning in our pocket that has to be deployed. And it's not as obvious. But even during this year, we've had opportunities to deploy within the existing platform. So as part of the Unigestion transaction to maintain our ownership position, we'll be allocating some capital towards that, Jeff obviously mentioned earlier in his remarks, we're going to be participating in the Wealthsimple. We did participate in the Wealthsimple primary. So there are places where we can allocate our capital towards at the end of the day, within the existing footprint and not needing to go into necessarily new operating companies.
Robert Orr: But we are -- the last point, we are in the business of looking at opportunities. So we have what our priorities are, but we get shown a lot of opportunities. So we'll continue to look at them, of course.
Operator: The next question is from Bart Dziarski with RBC Capital Markets.
Bart Dziarski: Jeff, I wanted to follow up on the NCIB question in terms of how you guys are thinking about that from a pacing perspective going forward. So $2.1 billion year-to-date, that includes dividend, but very healthy capital return. And you obviously have some kind of intrinsic value model internally that you keep buying back stock because there's value embedded there. So should we expect that pacing to continue? Do you think it will ramp up or...
Robert Orr: Yes. Just in terms of our buyback activity, we do look to -- the -- we are driving earnings and cash flow off the alternative asset management platforms over time. It's not kind of steady on some of those distributions, but we create earnings there. We have some positive net cash flow from our dividends received less our expenses. So there's different sources of cash. We like to sit on some liquidity, but we also don't want all that cash just to build up on an indefinite basis. So we jump into the market, and we have been for the last 4 years in effect, turning what are non-earning assets from a steady earnings point of view into contributing to EPS growth and dividend growth by shrinking the capital base. So if you think about that as a tool, it's a tool to take some of the earnings -- from the non -- some from the distribution -- I should say from the non-earnings part of the portfolio. The NAV and by shrinking the capital base and buying it back. We are increasing our earnings per share and increasing our ability to pay dividends per share. I think I mentioned might have been before you picked up coverage somewhere in the last year, I mentioned that we had -- because of the buybacks up until about a year ago, I don't can't remember 3 quarters or 4 quarters ago, we had calculated we had about $72 million, $73 million of extra cash flow available to pay in dividends that we wouldn't have otherwise had, had we not done the buybacks. So there's -- that's one way of thinking about our buybacks. Now the second part of your question, there's not a formula, maybe Jake, I'll ask you to comment on your own thoughts. But we don't have a formula. We like to be in the market on a steady basis. We might ramp it up, sometimes ramp it down, but our cash doesn't come in on a steady basis. It might come in. All of a sudden, we get a bunch of cash. And we're not going to go out and kind of blow it all just because we just had a quarter where we had a bunch of cash come in, we like to be in the market on a steady basis. Jake, anything you would add to my comments?
Jake Lawrence: Yes. Bart, tactically, how -- one way to think about it, and we gave a bit of this guidance heading into 2025. There's probably right now about 3 layers to the buyback program. The first layer is, as Jeff alluded to, we've been active for about 4 years now and roughly the same balance in the past few years of around $400 million of buyback activity. We obviously want to offset option dilution as well. So that would be the second layer. And then with Great-West announcing additional NCIB volumes, both with their Q2 and Q3 results and our intention or communication around Q2 of participating in that, that produces extra cash. And so that last piece is the one that we'll want to be thoughtful about how much of the buying we are any given day in the market. But we obviously have that core $400 million plus offsetting dilution and then doing some additional activity on top of that with the proceeds from the NCIB for Great-West.
Bart Dziarski: And -- then on Sagard. So we saw the nice tick up in the Wealthsimple valuation Q-on-Q, I think up 50% on your -- on your LP. Would that drive a fair value increase at Sagard? I think it was flat, if I'm not mistaken. And then Sagard also announced [indiscernible], so another positive transaction. Like would the -- should the mark have increased? And if not, what would drive maybe factors going the other way?
Robert Orr: You take that, Jack?
Jake Lawrence: Yes, we don't -- as I know upfront, Wealthsimple, you may have missed it, Bart. We don't take it through the P&L. It has increased our NAV in the quarter, and that's been reflected. In terms of Unigestion, that's scheduled to close in the first half of 2026. Obviously, we announced it during the quarter and wanted to raise it on the call. We expect once it closes, it will obviously -- we'll look at what that means for the valuation of Sagard in due course and where the business has traveled between now and closing and make an assessment of its value at that point.
Robert Orr: And just to underline the Wealthsimple position, again, we consolidate it. We do own more than 50%. Across the group, we own more than 50% of the outstanding shares at Wealthsimple, principally at IGM and at Power Corp. We consolidated. So we don't mark it up when there's an increase in the value. What we do get, though, as a present is there's some carry that the Sagard team has on overseeing that position. So we flow through the negative impact of the compensation carry in our P&L, but not the markup. So the more Wealthsimple goes up in value, the more losses we report. And you can -- I'm not going to make a comment about the accounting industry at all because that wouldn't be fair, but it is a bit ironic here. Is the more the thing goes up, the more we report losses, but that's just the way it is. Economically, obviously, we're very, very pleased with the NAV growth.
Bart Dziarski: Okay, because that's what I was asking because there's an expense that goes through and you would think the GP, Sagard gets a benefit from the higher value, which ultimately drives higher future carry. So is it a wash on the valuation of the GPU? Or am I missing something?
Jake Lawrence: We don't value the GP every quarter, Bart. But you're right, their accrued carried interest has increased, but it's not a -- it's not like Great-West or IGM, where we're marking it every quarter.
Robert Orr: We don't mark it up, but there is a liability that goes through the compensation because there's a share of that carry that obviously goes to the Sagard management team. So that we show through a liability, but all the increase in the carry and the increase in the capital that we have in Wealthsimple does not get marked up. All that gets marked up is the employees' share -- managers at Sagard's share of the carry.
Bart Dziarski: Yes. It's a positive from those [indiscernible]. All right. And then just on the GBL transaction, they -- looks like they did a secondary with Carlyle, and I think it's like a 9% discount to NAV. So GBL earlier this year announced they took a stake in Sagard plus they committed to future funds. And then I think as part of this transaction with Carlyle, they exited some of the Sagard positions. So is that a change in strategy by GBL with regards to its commitment to Sagard? Or obviously is something else driving that?
Robert Orr: Two comments, they did not dispose of their position in Sagard, so -- and nor have they -- and they continue to be committed to the product. So that has not changed. I'm not sure. So just correct you on that one. And second, the transaction to dispose of the positions in the GBL Capital was through various transactions to different buyers. I'm not going to comment on who they are, but it was not you may have become aware of one piece of it, but there were multiple transactions to multiple buyers that they announced.
Operator: We have a follow-up from Graham Ryding with TD Securities.
Graham Ryding: The follow-up question just on the buybacks at Great-West. So is it reasonable to assume that if there's no sort of obvious inorganic opportunity for Great-West that they will continue to be active on buybacks? And should we also then assume that you're going to continue to look to participate in future NCIBs to sort of maintain your ownership position?
Robert Orr: That would be my expectation. With the current business mix that they have as they grow, they're creating more cash than they're putting capital back in or put another way, the earnings are turning into a lot of cash generation. And I think just building up that cash is not a very attractive alternative. And so if there weren't inorganic opportunities, I think it's reasonable to assume that we continue to do buybacks. I mean those are decisions we'll make in the future, but that would be a reasonable assumption. The background on our participating, I'll just restate it, you probably know it. Initially, we didn't -- we said we're not interested in selling Great-West Life shares. They came to us and said, look, we would be great rather than us going out and trying to buy all of this from the market and also shrinking our outstanding. We'd like to grow our float, not -- the market value of our float, not shrink it. And so would you participate pro rata? When you think about it, you're still -- basically, you're getting cash back and you're still taking in 68% or roughly 68% of the earnings in the dividend. So it doesn't really change anything, and it will help grow our earnings per share. And given a constant payout ratio, that will translate into higher dividends, higher earnings. So it would be great if you could support us in this with our objectives. So we took that back. And after considering it, we decided all right, that makes sense. We'll participate pro rata. So I don't see that changing at this point, Graham. So I think your -- the answer to your question is, yes, that's a reasonable assumption, both on continued buybacks and our participation, but that's -- obviously, we'll make those decisions through time.
Operator: The next question is from Doug Young with Jarden Capital Markets.
Doug Young: Sorry, I got on the call late, so these are repeated. I apologize. But I want to kind of continue with the buyback question that Graham just asked, a bit differently. Like what are the limits on the amount that Great-West can buyback and Power can buyback, like what are the constraints given -- I mean, you own 70% of power -- sorry, 70% of Great-West, there's limited float and that becomes a challenge for some people when they look at the structure. So I'm just -- like how do you think about that?
Robert Orr: So the last part of my question, if you picked it up in terms of our participation went to the issue of float. And it's a trade-off because if you sit on -- as Great-West Life, if you sit on too much cash earning 2% or whatever you're earning, you're not going to have your earnings grow as quickly. You're not going to have your ROE go up as quickly. You've got too much lazy capital. So all things being equal, your share price is going to drop or not grow as fast. It's a better way to put it, all things being equal, if you're growing the business. So the number of shares is one part of the float, but times the share price is how you get to the size of the float. And so as they're shrinking their share base, they're increasing their earnings per share, which all things being equal, is increasing their share price might even get reflected in a higher multiple over time. When you do that math, I think you get to saying we keep doing buybacks, and that's the page you're on. But that's the equation. It doesn't mean that you're buying shares back, you're going to have a lower value of your float. In fact, probably is going to be the opposite.
Doug Young: So it doesn't sound like you see any limitations on either the power level because I mean Great-West is sitting on over $4 billion, $5 billion of excess cash that we can see plus what's in the U.S. and then debt capacity. So there's a lot of capacity there left to continue.
Robert Orr: That was their assessment and our assessment as well when they decided to jump into the buybacks. But obviously, we'd love to do -- if we could get an opportunity to do an acquisition, we'd love to do that and slow the buybacks down. That would be a good thing to announce if we could -- if we got that opportunity.
Doug Young: And the second, just obviously, an impressive list of value creation changes last 6 years. There's a laundry list. Some of it maybe was lower-hanging fruit. Some of it was tougher to get at. And as you look out going forward, like there's obviously -- Wealthsimple is creating value. Sagard is becoming more topical. Like what are you and the management team focused on? Like what's that next 5 years look like in terms of like the buybacks are here, but what are some of the other items that you're kind of looking at?
Robert Orr: I won't get into specifics on what else we might look at. I would tell you, I'll just restate what we -- how we think about it. We have -- the bulk of our assets are in businesses that are currently leading franchises that are at a more mature stage, but growing nicely and producing a lot of earnings and cash flow. That would be Great-West portfolio, IG Wealth, Mackenzie. But we also are very long-term focused. And so we have through our fintech strategy that we launched in 2015 that gave rise to the position in Wealthsimple through IGM, ultimately taking a position in Personal Capital, which ended up getting acquired by Great-West through acquisition of China Asset Management, the Wealthsimple itself through the opportunity to buy in Rockefeller and then turning and saying we want to be part of the alternative asset management space through Sagard, Power Sustainable, Northleaf came to IGM. There's 7 or 8 examples in the last 10 years of the group putting in a limited amount of capital, but meaningfully, it's still like 15%, 20% of the portfolio into investments that are going to not create earnings in the short term, but looking 5, 7, 10 years out, could be really meaningful contributors to value creation and ultimately, to earnings. So we try and do a balance between supporting and investing and growing our current leading franchises, but also seeding a portfolio of investments that, as you look 5, 10 years down the road are going to be really meaningful contributors. And they won't all turn out that way, and they won't all work, right? I mean when you're doing it, you're buying in the businesses at earlier stages, higher risk, there's higher potential. Some of them will decide to take control positions in. Others we may not. I'm not going to get into what we're going to do. I couldn't do that even if I wanted to, Doug. But I think that philosophy is important to understand. And what's great right now is that I think for a period of time, people were just kind of ignoring it and saying, well, come talk to me when you've got some evidence that, that's working. But as some of these things have been held for a number of years, they're coming to fruition, and I think it's creating evidence of how much value that they can create and will create. And ultimately, these businesses, every business goes through a phase where if it grows quickly, it's investing, investing, investing. And at some point, they turn into cash flow and earnings. And so I would expect that some of the assets that we have in these businesses right now and turn into a reflection of what our earnings power will be 5 years down the road or 7 years down the road as they get to more mature phases. So I don't know if I answered your question. That's a bit to told you what the approach to investment is, and that won't change. I don't think.
Operator: There are no further questions. I'd like to turn the conference back over to Mr. Steven Hung for any closing remarks.
Steven Hung: Thank you for joining us today. Following the call, a telephone replay will be available later this morning, and the webcast will be archived on our website for 1 year. We look forward to our next update on Q4 results. This concludes the call, and have a great day.
Operator: Ladies and gentlemen, this concludes your conference call for today. Thank you for participating. You may now disconnect your lines.