Alliances spur sales growth at Great-West: financial services firm has impressive growth rates and generates significant cash flow

Great-West Lifeco Inc. (TSE: GWO; Recent price: $37.25) is a financial services holding company. It has interests in the life insurance, health insurance, investment and retirement savings and reinsurance businesses.

The company operates primarily in Canada and the United States. Fifty-five percent of the corporation's revenues comes from its Canadian operations and the remaining 45% are derived from its U.S. operations.

Lifeco's subsidiaries serve the financial security needs of more than 13 million people in Canada and the United States. Lifeco and its companies have more than $98 billion in assets under administration. Lifeco is a member of the Power Financial Corporation group of companies.

Over the past five years, Great-West's revenues grew at a compounded annual rate of 20.1%. A substantial part of this growth can be attributed to its acquisition of London Life. Profits also grew substantially, although the events of 9/11/2001 resulted in increased claims. This resulted in lowered earnings for the company.

During the first quarter of 2002, Great-West's earnings rose 32.4% over the same period last year. Its revenues rose by 13.2%.

Great-West has been generating sales through strategic alliances with large financial institutions such as banks. Last year it formed a strategic alliance with Citibank to distribute term insurance through its retail outlets. This alliance alone is generating about 3,000 customers per month for Great-West.

Great West's stock trades and at less than its annual revenues per share at a price-earnings ratio of about 16. This is a stock suitable for conservative investors. Note: See page 3 for information on Great-West's parent company, Power Corporation.

Great-West Lifeco

                   Current  5yr. growth

Sales            $16.6 Bil        20.3%
Income          $602.0 Mil        13.7%
Earnings/Share        $1.0          N/A
Dividend Rate        $0.86         7.3%
Dividend Yield        2.2%         1.4%
Net Profit Margin           3.60%
Shares Outstanding     368.82 Mil
Market Capitalization  $14.02 Bil
Beta                          0.3