(Adds board changes, updates stock price)
TORONTO, May 8 (Reuters) - Power Financial Corp PWF.TO said on Thursday first-quarter earnings rose more than 20 percent, even as the strong Canadian dollar ate into results.
The financial services company, which owns Canada’s second biggest life insurer and its largest independent mutual fund company, reported net income of C$586 million ($580.2 million), or 80 Canadian cents a diluted share, for the three months ended March 31.
That compared with C$482 million, or 65 Canadian cents a share, in the same 2007 period.
The company also said that Executive Chairman Robert Gratton has retired as chairman, but would remain a director.
Andre Desmarais and Paul Desmarais Jr. have been appointed co-chairmen of the board.
Power Financial said its operating earnings rose 1.8 percent on a per-share basis to 67 Canadian cents, hurt by the rise in the value of the Canadian dollar against the major operating currencies of insurance unit Great-West Lifeco GWO.TO.
“Based upon Lifeco’s growth in earnings on a constant currency basis, Power Financial’s operating earnings on a per share basis for the quarter would have increased by 9.0 percent,” the company said.
Analysts had expected Power Financial, which owns majority stakes in insurer Great-West and mutual fund firm IGM Financial IGM.TO, to earn 69 Canadian cents a share in the quarter.
Power Financial also owns half of Parjointco NV, which controls Swiss holding company Pargesa Holding PARG.S.
Total revenues at Power Financial, which is itself controlled by Montreal-based Power Corp POW.TO, rose to C$18.7 billion in the quarter from C$7.6 billion a year earlier, due to a spike in premium income.
Expenses moved in tandem, jumping to C$17.9 billion from C$6.7 billion a year ago.
Shares of Power Financial were down 26 Canadian cents at C$35.87 on the Toronto Stock Exchange on Thursday afternoon. They are down about 12 percent so far in 2008, outpacing the decline in the S&P/TSX financials index.
$1=$1.01 Canadian Reporting by Wojtek Dabrowski and Lynne Olver; Editing by Peter Galloway