UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-03364
EMPOWER FUNDS, INC.
(Exact name of registrant as specified in charter)
8515 E. Orchard Road, Greenwood Village, Colorado 80111
(Address of principal executive offices)
(Address of principal executive offices)
Jonathan D. Kreider
President & Chief Executive Officer
Empower Funds, Inc.
Empower Funds, Inc.
8515 E. Orchard Road
Greenwood Village, Colorado 80111
(Name and address of agent for service)
Registrant's telephone number, including area code: (866) 831-7129
Date of fiscal year end: December 31
Date of reporting period: December 31, 2023
ITEM 1. REPORTS TO STOCKHOLDERS
EMPOWER FUNDS, INC.
Empower Profile Funds
(Institutional Class, Investor Class and Class L)
Annual Report
December 31, 2023
This report and the financial statements attached are submitted for general information and are not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. Nothing herein is to be considered an offer of the sale of shares of the Funds. Such offering is made only by the prospectus of the Funds, which includes details as to offering price and other information.
Empower Conservative Profile Fund
The Fund’s investment adviser is Empower Capital Management, LLC (“ECM”)
ECM Commentary
The Empower Profile Funds’ 2023 performance was pressured. ECM has long maintained a slight tilt toward value- and smaller-cap stocks within the equity portion of the portfolios which lagged throughout much of 2023 but started to gain momentum late in the year. These modest biases pressured the equity allocations in the Fund.
For the twelve-month period ended December 31, 2023, the Empower Conservative Profile Fund (Investor Class shares) returned 8.25%, relative to a 26.14% return for the Wilshire 5000 Index, a 5.53% return for the Bloomberg U.S. Aggregate Bond Index and an 10.33% return for its composite benchmark, the Fund’s benchmark indexes.
The views and opinions in this report were current as of December 31, 2023 and are subject to change at any time. They are not guarantees of performance or investment results and should not be taken as investment advice. Fund holdings are subject to change at any time. Fund returns are net of fees unless otherwise noted.
Growth of $10,000 (unaudited)
This graph compares the value of a hypothetical $10,000 investment in the Fund over the past 10 fiscal year periods or since inception (for funds lacking 10-year records) with the performance of the Fund’s benchmark index. Results include the reinvestment of all dividends and capital gains distributions. Past performance is no guarantee of future results. The graph does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. Performance does not include any fees or expenses of variable insurance contracts, individual retirement accounts (“IRA(s)”), qualified retirement plans or college savings programs. If such fees and expenses were included, returns would be lower.
* The composite index is derived by applying the Fund’s target asset allocation to the following benchmarks: for U.S. stocks, the Wilshire 5000 Index; for international stocks, the MSCI EAFE Index; for bonds, the Bloomberg U.S. Aggregate Bond Index and the Bloomberg 1-3 Year Credit Bond Index; and for real estate, the Dow Jones U.S. Select REIT Index. The composite index in shareholder reports prior to December 31, 2013 and after June 2016 were not rebalanced monthly, and as a result, returns for the composite index would have been different.
Note: Performance for the Class L and Institutional Class shares may vary due to their differing fee structure. See returns table below.
Average Annual Total Returns for the Periods Ended December 31, 2023 (unaudited)
One Year | Five Year | Ten Year / Since Inception(a) | |
Institutional Class | 8.61% | 4.92% | 3.86% |
Investor Class | 8.25% | 4.59% | 3.71% |
Class L | 8.03% | 4.33% | 3.45% |
(a) Institutional Class inception date was May 1, 2015. |
Results include the reinvestment of all dividends and capital gains distributions. Past performance is no guarantee of future results. The table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. Performance does not include any fees or expenses of variable insurance contracts, IRAs, qualified retirement plans or college savings programs. If such fees and expenses were included, returns would be lower.
Summary of Investments by Asset Class as of December 31, 2023 (unaudited)
Asset Class | Percentage of Fund Investments |
Bond | 47.31% |
Fixed Interest Contract | 22.44 |
Large Cap Equity | 8.79 |
International Equity | 8.44 |
Real Estate Equity | 5.02 |
Mid Cap Equity | 4.80 |
Small Cap Equity | 3.20 |
Total | 100.00% |
Shareholder Expense Example (unaudited)
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (July 1, 2023 to December 31, 2023).
Actual Expenses
The first row of the table below provides information about actual account values and actual expenses. You may use the information in this row, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first row under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second row of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5%
per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs. Therefore, the second row of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Empower Conservative Profile Fund | Beginning Account Value | Ending Account Value | Expenses Paid During Period* | ||
(07/01/23) | (12/31/23) | (07/01/23 – 12/31/23) | |||
Institutional Class | |||||
Actual | $1,000.00 | $1,044.45 | $2.22 | ||
Hypothetical (5% return before expenses) | $1,000.00 | $1,023.00 | $2.19 | ||
Investor Class | |||||
Actual | $1,000.00 | $1,042.73 | $4.02 | ||
Hypothetical (5% return before expenses) | $1,000.00 | $1,021.30 | $3.97 | ||
Class L | |||||
Actual | $1,000.00 | $1,041.94 | $5.30 | ||
Hypothetical (5% return before expenses) | $1,000.00 | $1,020.00 | $5.24 |
* Expenses are equal to the Fund's annualized expense ratio of 0.43% for the Institutional Class, 0.78% for the Investor Class and 1.03% for the Class L shares, multiplied by the average account value over the period, multiplied by 184/365 days to reflect the one-half year period. The Fund’s annualized expense ratio includes expenses borne directly by the class plus the Fund’s pro-rata share of the weighted average expense ratio of the underlying funds in which it invests (0.41%). Performance does not include any fees or expenses of variable insurance contracts, IRAs, qualified retirement plans or college savings programs, if applicable. If such fees or expenses were included, returns would be lower. |
Empower Moderately Conservative Profile Fund
The Fund’s investment adviser is Empower Capital Management, LLC (“ECM”)
ECM Commentary
The Empower Profile Funds’ 2023 performance was pressured. ECM has long maintained a slight tilt toward value- and smaller-cap stocks within the equity portion of the portfolios which lagged throughout much of 2023 but started to gain momentum late in the year. These modest biases pressured the equity allocations in the Fund.
For the twelve-month period ended December 31, 2023, the Empower Moderately Conservative Profile Fund (Investor Class shares) returned 9.90%, relative to a 26.14% return for the Wilshire 5000 Index, a 5.53% return for the Bloomberg U.S. Aggregate Bond Index and a 13.04% return for its composite benchmark, the Fund’s benchmark indexes.
The views and opinions in this report were current as of December 31, 2023 and are subject to change at any time. They are not guarantees of performance or investment results and should not be taken as investment advice. Fund holdings are subject to change at any time. Fund returns are net of fees unless otherwise noted.
Growth of $10,000 (unaudited)
This graph compares the value of a hypothetical $10,000 investment in the Fund over the past 10 fiscal year periods or since inception (for funds lacking 10-year records) with the performance of the Fund’s benchmark index. Results include the reinvestment of all dividends and capital gains distributions. Past performance is no guarantee of future results. The graph does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. Performance does not include any fees or expenses of variable insurance contracts, individual retirement accounts (“IRA(s)”), qualified retirement plans or college savings programs. If such fees and expenses were included, returns would be lower.
* The composite index is derived by applying the Fund’s target asset allocation to the following benchmarks: for U.S. stocks, the Wilshire 5000 Index; for international stocks, the MSCI EAFE Index; for bonds, the Bloomberg U.S. Aggregate Bond Index and the Bloomberg 1-3 Year Credit Bond Index; and for real estate, the Dow Jones U.S. Select REIT Index. The composite index in shareholder reports prior to December 31, 2013 and after June 2016 were not rebalanced monthly, and as a result, returns for the composite index would have been different.
Note: Performance for the Class L and Institutional Class shares may vary due to their differing fee structure. See returns table below.
Average Annual Total Returns for the Periods Ended December 31, 2023 (unaudited)
One Year | Five Year | Ten Year / Since Inception(a) | |
Institutional Class | 10.34% | 6.43% | 4.89% |
Investor Class | 9.90% | 6.05% | 4.71% |
Class L | 9.62% | 5.76% | 4.45% |
(a) Institutional Class inception date was May 1, 2015. |
Results include the reinvestment of all dividends and capital gains distributions. Past performance is no guarantee of future results. The table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. Performance does not include any fees or expenses of variable insurance contracts, IRAs, qualified retirement plans or college savings programs. If such fees and expenses were included, returns would be lower.
Summary of Investments by Asset Class as of December 31, 2023 (unaudited)
Asset Class | Percentage of Fund Investments |
Bond | 32.89% |
Fixed Interest Contract | 21.90 |
Large Cap Equity | 14.21 |
International Equity | 13.61 |
Mid Cap Equity | 7.73 |
Small Cap Equity | 5.17 |
Real Estate Equity | 4.49 |
Total | 100.00% |
Shareholder Expense Example (unaudited)
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (July 1, 2023 to December 31, 2023).
Actual Expenses
The first row of the table below provides information about actual account values and actual expenses. You may use the information in this row, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first row under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second row of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5%
per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs. Therefore, the second row of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Empower Moderately Conservative Profile Fund | Beginning Account Value | Ending Account Value | Expenses Paid During Period* | ||
(07/01/23) | (12/31/23) | (07/01/23 – 12/31/23) | |||
Institutional Class | |||||
Actual | $1,000.00 | $1,049.16 | $2.48 | ||
Hypothetical (5% return before expenses) | $1,000.00 | $1,022.80 | $2.45 | ||
Investor Class | |||||
Actual | $1,000.00 | $1,046.16 | $4.28 | ||
Hypothetical (5% return before expenses) | $1,000.00 | $1,021.00 | $4.23 | ||
Class L | |||||
Actual | $1,000.00 | $1,044.91 | $5.57 | ||
Hypothetical (5% return before expenses) | $1,000.00 | $1,019.80 | $5.50 |
* Expenses are equal to the Fund's annualized expense ratio of 0.48% for the Institutional Class, 0.83% for the Investor Class and 1.08% for the Class L shares, multiplied by the average account value over the period, multiplied by 184/365 days to reflect the one-half year period. The Fund’s annualized expense ratio includes expenses borne directly by the class plus the Fund’s pro-rata share of the weighted average expense ratio of the underlying funds in which it invests (0.46%). Performance does not include any fees or expenses of variable insurance contracts, IRAs, qualified retirement plans or college savings programs, if applicable. If such fees or expenses were included, returns would be lower. |
Empower Moderate Profile Fund
The Fund’s investment adviser is Empower Capital Management, LLC (“ECM”)
ECM Commentary
The Empower Profile Funds’ 2023 performance was pressured. ECM has long maintained a slight tilt toward value- and smaller-cap stocks within the equity portion of the portfolios which lagged throughout much of 2023 but started to gain momentum late in the year. These modest biases pressured the equity allocations in the Fund.
For the twelve-month period ended December 31, 2023, the Empower Moderate Profile Fund (Investor Class shares) returned 11.93%, relative to a 26.14% return for the Wilshire 5000 Index, a 5.53% return for the Bloomberg U.S. Aggregate Bond Index and an 15.79% return for its composite benchmark, the Fund’s benchmark indexes.
The views and opinions in this report were current as of December 31, 2023 and are subject to change at any time. They are not guarantees of performance or investment results and should not be taken as investment advice. Fund holdings are subject to change at any time. Fund returns are net of fees unless otherwise noted.
Growth of $10,000 (unaudited)
This graph compares the value of a hypothetical $10,000 investment in the Fund over the past 10 fiscal year periods or since inception (for funds lacking 10-year records) with the performance of the Fund’s benchmark index. Results include the reinvestment of all dividends and capital gains distributions. Past performance is no guarantee of future results. The graph does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. Performance does not include any fees or expenses of variable insurance contracts, individual retirement accounts (“IRA(s)”), qualified retirement plans or college savings programs. If such fees and expenses were included, returns would be lower.
* The composite index is derived by applying the Fund’s target asset allocation to the following benchmarks: for U.S. stocks, the Wilshire 5000 Index; for international stocks, the MSCI EAFE Index; for bonds, the Bloomberg U.S. Aggregate Bond Index and the Bloomberg 1-3 Year Credit Bond Index; and for real estate, the Dow Jones U.S. Select REIT Index. The composite index in shareholder reports prior to December 31, 2013 and after June 2016 were not rebalanced monthly, and as a result, returns for the composite index would have been different.
Note: Performance for the Class L and Institutional Class shares may vary due to their differing fee structure. See returns table below.
Average Annual Total Returns for the Periods Ended December 31, 2023 (unaudited)
One Year | Five Year | Ten Year / Since Inception(a) | |
Institutional Class | 12.20% | 7.95% | 5.93% |
Investor Class | 11.93% | 7.59% | 5.74% |
Class L | 11.64% | 7.32% | 5.49% |
(a) Institutional Class inception date was May 1, 2015. |
Results include the reinvestment of all dividends and capital gains distributions. Past performance is no guarantee of future results. The table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. Performance does not include any fees or expenses of variable insurance contracts, IRAs, qualified retirement plans or college savings programs. If such fees and expenses were included, returns would be lower.
Summary of Investments by Asset Class as of December 31, 2023 (unaudited)
Asset Class | Percentage of Fund Investments |
Bond | 23.85% |
Large Cap Equity | 19.68 |
International Equity | 18.82 |
Fixed Interest Contract | 15.84 |
Mid Cap Equity | 10.69 |
Small Cap Equity | 7.11 |
Real Estate Equity | 4.01 |
Total | 100.00% |
Shareholder Expense Example (unaudited)
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (July 1, 2023 to December 31, 2023).
Actual Expenses
The first row of the table below provides information about actual account values and actual expenses. You may use the information in this row, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first row under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second row of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5%
per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs. Therefore, the second row of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Empower Moderate Profile Fund | Beginning Account Value | Ending Account Value | Expenses Paid During Period* | ||
(07/01/23) | (12/31/23) | (07/01/23 – 12/31/23) | |||
Institutional Class | |||||
Actual | $1,000.00 | $1,054.53 | $2.95 | ||
Hypothetical (5% return before expenses) | $1,000.00 | $1,022.30 | $2.91 | ||
Investor Class | |||||
Actual | $1,000.00 | $1,053.14 | $4.76 | ||
Hypothetical (5% return before expenses) | $1,000.00 | $1,020.60 | $4.69 | ||
Class L | |||||
Actual | $1,000.00 | $1,052.23 | $6.05 | ||
Hypothetical (5% return before expenses) | $1,000.00 | $1,019.30 | $5.95 |
* Expenses are equal to the Fund's annualized expense ratio of 0.57% for the Institutional Class, 0.92% for the Investor Class and 1.17% for the Class L shares, multiplied by the average account value over the period, multiplied by 184/365 days to reflect the one-half year period. The Fund’s annualized expense ratio includes expenses borne directly by the class plus the Fund’s pro-rata share of the weighted average expense ratio of the underlying funds in which it invests (0.53%). Performance does not include any fees or expenses of variable insurance contracts, IRAs, qualified retirement plans or college savings programs, if applicable. If such fees or expenses were included, returns would be lower. |
Empower Moderately Aggressive Profile Fund
The Fund’s investment adviser is Empower Capital Management, LLC (“ECM”)
ECM Commentary
The Empower Profile Funds’ 2023 performance was pressured. ECM has long maintained a slight tilt toward value- and smaller-cap stocks within the equity portion of the portfolios which lagged throughout much of 2023 but started to gain momentum late in the year. These modest biases pressured the equity allocations in the Fund.
For the twelve-month period ended December 31, 2023, the Empower Moderately Aggressive Profile Fund (Investor Class shares) returned 13.60%, relative to a 26.14% return for the Wilshire 5000 Index, a 5.53% return for the Bloomberg U.S. Aggregate Bond Index and a 18.19% return for its composite benchmark, the Fund’s benchmark indexes.
The views and opinions in this report were current as of December 31, 2023 and are subject to change at any time. They are not guarantees of performance or investment results and should not be taken as investment advice. Fund holdings are subject to change at any time. Fund returns are net of fees unless otherwise noted.
Growth of $10,000 (unaudited)
This graph compares the value of a hypothetical $10,000 investment in the Fund over the past 10 fiscal year periods or since inception (for funds lacking 10-year records) with the performance of the Fund’s benchmark index. Results include the reinvestment of all dividends and capital gains distributions. Past performance is no guarantee of future results. The graph does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. Performance does not include any fees or expenses of variable insurance contracts, individual retirement accounts (“IRA(s)”), qualified retirement plans or college savings programs. If such fees and expenses were included, returns would be lower.
* The composite index is derived by applying the Fund’s target asset allocation to the following benchmarks: for U.S. stocks, the Wilshire 5000 Index; for international stocks, the MSCI EAFE Index; for bonds, the Bloomberg U.S. Aggregate Bond Index and the Bloomberg 1-3 Year Credit Bond Index; and for real estate, the Dow Jones U.S. Select REIT Index. The composite index in shareholder reports prior to December 31, 2013 and after June 2016 were not rebalanced monthly, and as a result, returns for the composite index would have been different.
Note: Performance for the Institutional Class shares may vary due to their differing fee structure. See returns table below.
Average Annual Total Returns for the Periods Ended December 31, 2023 (unaudited)
One Year | Five Year | Ten Year / Since Inception(a) | |
Institutional Class | 14.04% | 9.06% | 6.72% |
Investor Class | 13.60% | 8.69% | 6.51% |
(a) Institutional Class inception date was May 1, 2015. |
Results include the reinvestment of all dividends and capital gains distributions. Past performance is no guarantee of future results. The table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. Performance does not include any fees or expenses of variable insurance contracts, IRAs, qualified retirement plans or college savings programs. If such fees and expenses were included, returns would be lower.
Summary of Investments by Asset Class as of December 31, 2023 (unaudited)
Asset Class | Percentage of Fund Investments |
Large Cap Equity | 24.32% |
International Equity | 23.29 |
Bond | 17.91 |
Mid Cap Equity | 13.23 |
Fixed Interest Contract | 8.92 |
Small Cap Equity | 8.83 |
Real Estate Equity | 3.50 |
Total | 100.00% |
Shareholder Expense Example (unaudited)
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (July 1, 2023 to December 31, 2023).
Actual Expenses
The first row of the table below provides information about actual account values and actual expenses. You may use the information in this row, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first row under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second row of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and
expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs. Therefore, the second row of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Empower Moderately Aggressive Profile Fund | Beginning Account Value | Ending Account Value | Expenses Paid During Period* | ||
(07/01/23) | (12/31/23) | (07/01/23 – 12/31/23) | |||
Institutional Class | |||||
Actual | $1,000.00 | $1,060.86 | $3.43 | ||
Hypothetical (5% return before expenses) | $1,000.00 | $1,021.90 | $3.36 | ||
Investor Class | |||||
Actual | $1,000.00 | $1,058.02 | $5.24 | ||
Hypothetical (5% return before expenses) | $1,000.00 | $1,020.10 | $5.14 |
* Expenses are equal to the Fund's annualized expense ratio of 0.66% for the Institutional Class shares and 1.01% for the Investor Class shares, multiplied by the average account value over the period, multiplied by 184/365 days to reflect the one-half year period. The Fund’s annualized expense ratio includes expenses borne directly by the class plus the Fund’s pro-rata share of the weighted average expense ratio of the underlying funds in which it invests (0.59%). Performance does not include any fees or expenses of variable insurance contracts, IRAs, qualified retirement plans or college savings programs, if applicable. If such fees or expenses were included, returns would be lower. |
Empower Aggressive Profile Fund
The Fund’s investment adviser is Empower Capital Management, LLC (“ECM”)
ECM Commentary
The Empower Profile Funds’ 2023 performance was pressured. ECM has long maintained a slight tilt toward value- and smaller-cap stocks within the equity portion of the portfolios which lagged throughout much of 2023 but started to gain momentum late in the year. These modest biases pressured the equity allocations in the Fund.
For the twelve-month period ended December 31, 2023, the Empower Aggressive Profile Fund (Investor Class shares) returned 16.94%, relative to a 26.14% return for the Wilshire 5000 Index, a 5.53% return for the Bloomberg U.S. Aggregate Bond Index and a 23.22% return for its composite benchmark, the Fund’s benchmark indexes.
The views and opinions in this report were current as of December 31, 2023 and are subject to change at any time. They are not guarantees of performance or investment results and should not be taken as investment advice. Fund holdings are subject to change at any time. Fund returns are net of fees unless otherwise noted.
Growth of $10,000 (unaudited)
This graph compares the value of a hypothetical $10,000 investment in the Fund over the past 10 fiscal year periods or since inception (for funds lacking 10-year records) with the performance of the Fund’s benchmark index. Results include the reinvestment of all dividends and capital gains distributions. Past performance is no guarantee of future results. The graph does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. Performance does not include any fees or expenses of variable insurance contracts, individual retirement accounts (“IRA(s)”), qualified retirement plans or college savings programs. If such fees and expenses were included, returns would be lower.
* The composite index is derived by applying the Fund’s target asset allocation to the following benchmarks: for U.S. stocks, the Wilshire 5000 Index; for international stocks, the MSCI EAFE Index; and for real estate, the Dow Jones U.S. Select REIT Index. The composite index in shareholder reports prior to December 31, 2013 and after June 2016 were not rebalanced monthly, and as a result, returns for the composite index would have been different.
Note: Performance for the Institutional Class shares may vary due to their differing fee structure. See returns table below.
Average Annual Total Returns for the Periods Ended December 31, 2023 (unaudited)
One Year | Five Year | Ten Year / Since Inception(a) | |
Institutional Class | 17.23% | 11.24% | 8.23% |
Investor Class | 16.94% | 10.86% | 8.02% |
(a) Institutional Class inception date was May 1, 2015. |
Results include the reinvestment of all dividends and capital gains distributions. Past performance is no guarantee of future results. The table does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. Performance does not include any fees or expenses of variable insurance contracts, IRAs, qualified retirement plans or college savings programs. If such fees and expenses were included, returns would be lower.
Summary of Investments by Asset Class as of December 31, 2023 (unaudited)
Asset Class | Percentage of Fund Investments |
Large Cap Equity | 33.86% |
International Equity | 32.46 |
Mid Cap Equity | 18.40 |
Small Cap Equity | 12.29 |
Real Estate Equity | 2.99 |
Total | 100.00% |
Shareholder Expense Example (unaudited)
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (July 1, 2023 to December 31, 2023).
Actual Expenses
The first row of the table below provides information about actual account values and actual expenses. You may use the information in this row, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first row under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second row of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and
expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs. Therefore, the second row of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Empower Aggressive Profile Fund | Beginning Account Value | Ending Account Value | Expenses Paid During Period* | ||
(07/01/23) | (12/31/23) | (07/01/23 – 12/31/23) | |||
Institutional Class | |||||
Actual | $1,000.00 | $1,069.82 | $4.23 | ||
Hypothetical (5% return before expenses) | $1,000.00 | $1,021.10 | $4.13 | ||
Investor Class | |||||
Actual | $1,000.00 | $1,069.25 | $6.05 | ||
Hypothetical (5% return before expenses) | $1,000.00 | $1,019.40 | $5.90 |
* Expenses are equal to the Fund's annualized expense ratio of 0.81% for the Institutional Class shares and 1.16% for the Investor Class shares, multiplied by the average account value over the period, multiplied by 184/365 days to reflect the one-half year period. The Fund’s annualized expense ratio includes expenses borne directly by the class plus the Fund’s pro-rata share of the weighted average expense ratio of the underlying funds in which it invests (0.71%). Performance does not include any fees or expenses of variable insurance contracts, IRAs, qualified retirement plans or college savings programs, if applicable. If such fees or expenses were included, returns would be lower. |
EMPOWER FUNDS, INC.
EMPOWER CONSERVATIVE PROFILE FUND
Schedule of Investments
As of December 31, 2023
Shares | Fair Value | |
BOND MUTUAL FUNDS | ||
11,089,060 | Empower Core Bond Fund Institutional Class(a) | $ 93,258,993 |
16,077,398 | Empower Global Bond Fund Institutional Class(a) | 124,278,289 |
5,826,167 | Empower High Yield Bond Fund Institutional Class(a) | 55,639,892 |
6,990,310 | Empower Inflation-Protected Securities Fund Institutional Class(a) | 62,004,049 |
14,935,479 | Empower Multi-Sector Bond Fund Institutional Class(a) | 122,172,214 |
13,038,241 | Empower Short Duration Bond Fund Institutional Class(a) | 124,254,440 |
11,345,940 | Empower U.S. Government Mortgage Securities Fund Institutional Class(a) | 93,263,630 |
TOTAL BOND MUTUAL FUNDS — 47.33% (Cost $713,096,964) | $ 674,871,507 | |
EQUITY MUTUAL FUNDS | ||
3,165,137 | Empower Emerging Markets Equity Fund Institutional Class(a) | 26,935,312 |
2,912,315 | Empower International Growth Fund Institutional Class(a) | 26,735,051 |
8,031,549 | Empower International Value Fund Institutional Class(a) | 66,742,173 |
3,502,427 | Empower Large Cap Growth Fund Institutional Class(a) | 35,724,761 |
13,132,437 | Empower Large Cap Value Fund Institutional Class(a) | 89,694,544 |
Shares | Fair Value | |
Equity Mutual Funds — (continued) | ||
5,899,427 | Empower Mid Cap Value Fund Institutional Class(a) | $ 48,729,270 |
8,485,092 | Empower Real Estate Index Fund Institutional Class(a) | 71,614,178 |
1,245,863 | Empower Small Cap Growth Fund Institutional Class(a) | 13,218,606 |
4,796,431 | Empower Small Cap Value Fund Institutional Class(a) | 32,423,874 |
3,216,755 | Empower T. Rowe Price Mid Cap Growth Fund Institutional Class(a) | 19,622,205 |
TOTAL EQUITY MUTUAL FUNDS — 30.25% (Cost $431,478,059) | $ 431,439,974 | |
Account Balance | ||
FIXED INTEREST CONTRACT | ||
320,075,869 (b) | Empower of America Contract(a) 1.75%(c) | 320,075,869 |
TOTAL FIXED INTEREST CONTRACT — 22.45% (Cost $320,075,869) | $ 320,075,869 | |
TOTAL INVESTMENTS — 100.03% (Cost $1,464,650,892) | $1,426,387,350 | |
OTHER ASSETS & LIABILITIES, NET — (0.03)% | $ (423,026) | |
TOTAL NET ASSETS — 100.00% | $1,425,964,324 |
(a) | Issuer is considered an affiliate of the Fund. See Notes to the Financial Statements (Note 2). |
(b) | Account Balance and Cost represent net deposits. |
(c) | Variable rate contract which is not based on a published reference rate and spread, but determined by the issuer and is based on current market conditions. Interest rate shown reflects the rate in effect at December 31, 2023. See Note 2 to the Financial Statements for further information. |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
EMPOWER MODERATELY CONSERVATIVE PROFILE FUND
Schedule of Investments
As of December 31, 2023
Shares | Fair Value | |
BOND MUTUAL FUNDS | ||
4,370,104 | Empower Core Bond Fund Institutional Class(a) | $ 36,752,574 |
6,332,438 | Empower Global Bond Fund Institutional Class(a) | 48,949,750 |
2,289,839 | Empower High Yield Bond Fund Institutional Class(a) | 21,867,964 |
2,756,850 | Empower Inflation-Protected Securities Fund Institutional Class(a) | 24,453,256 |
5,879,258 | Empower Multi-Sector Bond Fund Institutional Class(a) | 48,092,335 |
1,912,615 | Empower Short Duration Bond Fund Institutional Class(a) | 18,227,222 |
4,469,911 | Empower U.S. Government Mortgage Securities Fund Institutional Class(a) | 36,742,669 |
TOTAL BOND MUTUAL FUNDS — 32.91% (Cost $252,761,298) | $235,085,770 | |
EQUITY MUTUAL FUNDS | ||
2,556,934 | Empower Emerging Markets Equity Fund Institutional Class(a) | 21,759,504 |
2,351,185 | Empower International Growth Fund Institutional Class(a) | 21,583,880 |
6,488,773 | Empower International Value Fund Institutional Class(a) | 53,921,705 |
2,830,903 | Empower Large Cap Growth Fund Institutional Class(a) | 28,875,208 |
10,641,823 | Empower Large Cap Value Fund Institutional Class(a) | 72,683,654 |
4,757,432 | Empower Mid Cap Value Fund Institutional Class(a) | 39,296,388 |
Shares | Fair Value | |
Equity Mutual Funds — (continued) | ||
3,805,681 | Empower Real Estate Index Fund Institutional Class(a) | $ 32,119,950 |
1,001,827 | Empower Small Cap Growth Fund Institutional Class(a) | 10,629,385 |
3,890,585 | Empower Small Cap Value Fund Institutional Class(a) | 26,300,355 |
2,610,351 | Empower T. Rowe Price Mid Cap Growth Fund Institutional Class(a) | 15,923,138 |
TOTAL EQUITY MUTUAL FUNDS — 45.22% (Cost $326,628,578) | $323,093,167 | |
Account Balance | ||
FIXED INTEREST CONTRACT | ||
156,477,919 (b) | Empower of America Contract(a) 1.75%(c) | 156,477,919 |
TOTAL FIXED INTEREST CONTRACT — 21.90% (Cost $156,477,919) | $156,477,919 | |
TOTAL INVESTMENTS — 100.03% (Cost $735,867,795) | $714,656,856 | |
OTHER ASSETS & LIABILITIES, NET — (0.03)% | $ (213,888) | |
TOTAL NET ASSETS — 100.00% | $714,442,968 |
(a) | Issuer is considered an affiliate of the Fund. See Notes to the Financial Statements (Note 2). |
(b) | Account Balance and Cost represent net deposits and approximate fair value. |
(c) | Variable rate contract which is not based on a published reference rate and spread, but determined by the issuer and is based on current market conditions. Interest rate shown reflects the rate in effect at December 31, 2023. See Note 2 to the Financial Statements for further information. |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
EMPOWER MODERATE PROFILE FUND
Schedule of Investments
As of December 31, 2023
Shares | Fair Value | |
BOND MUTUAL FUNDS | ||
6,893,978 | Empower Core Bond Fund Institutional Class(a) | $ 57,978,359 |
9,999,268 | Empower Global Bond Fund Institutional Class(a) | 77,294,340 |
3,622,887 | Empower High Yield Bond Fund Institutional Class(a) | 34,598,569 |
4,338,598 | Empower Inflation-Protected Securities Fund Institutional Class(a) | 38,483,358 |
9,293,296 | Empower Multi-Sector Bond Fund Institutional Class(a) | 76,019,157 |
3,012,912 | Empower Short Duration Bond Fund Institutional Class(a) | 28,713,054 |
7,042,880 | Empower U.S. Government Mortgage Securities Fund Institutional Class(a) | 57,892,479 |
TOTAL BOND MUTUAL FUNDS — 23.85% (Cost $415,075,510) | $ 370,979,316 | |
EQUITY MUTUAL FUNDS | ||
7,682,305 | Empower Emerging Markets Equity Fund Institutional Class(a) | 65,376,414 |
7,077,653 | Empower International Growth Fund Institutional Class(a) | 64,972,852 |
19,553,244 | Empower International Value Fund Institutional Class(a) | 162,487,453 |
8,555,044 | Empower Large Cap Growth Fund Institutional Class(a) | 87,261,444 |
32,048,487 | Empower Large Cap Value Fund Institutional Class(a) | 218,891,161 |
Shares | Fair Value | |
Equity Mutual Funds — (continued) | ||
14,364,777 | Empower Mid Cap Value Fund Institutional Class(a) | $ 118,653,060 |
7,387,411 | Empower Real Estate Index Fund Institutional Class(a) | 62,349,750 |
2,995,112 | Empower Small Cap Growth Fund Institutional Class(a) | 31,778,138 |
11,680,991 | Empower Small Cap Value Fund Institutional Class(a) | 78,963,503 |
7,804,925 | Empower T. Rowe Price Mid Cap Growth Fund Institutional Class(a) | 47,610,044 |
TOTAL EQUITY MUTUAL FUNDS — 60.33% (Cost $954,865,334) | $ 938,343,819 | |
Account Balance | ||
FIXED INTEREST CONTRACT | ||
246,462,445 (b) | Empower of America Contract(a) 1.75%(c) | 246,462,445 |
TOTAL FIXED INTEREST CONTRACT — 15.85% (Cost $246,462,445) | $ 246,462,445 | |
TOTAL INVESTMENTS — 100.03% (Cost $1,616,403,289) | $1,555,785,580 | |
OTHER ASSETS & LIABILITIES, NET — (0.03)% | $ (503,326) | |
TOTAL NET ASSETS — 100.00% | $1,555,282,254 |
(a) | Issuer is considered an affiliate of the Fund. See Notes to the Financial Statements (Note 2). |
(b) | Account Balance and Cost represent net deposits. |
(c) | Variable rate contract which is not based on a published reference rate and spread, but determined by the issuer and is based on current market conditions. Interest rate shown reflects the rate in effect at December 31, 2023. See Note 2 to the Financial Statements for further information. |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
EMPOWER MODERATELY AGGRESSIVE PROFILE FUND
Schedule of Investments
As of December 31, 2023
Shares | Fair Value | |
BOND MUTUAL FUNDS | ||
2,823,259 | Empower Core Bond Fund Institutional Class(a) | $ 23,743,608 |
4,101,298 | Empower Global Bond Fund Institutional Class(a) | 31,703,032 |
1,486,750 | Empower High Yield Bond Fund Institutional Class(a) | 14,198,460 |
1,782,389 | Empower Inflation-Protected Securities Fund Institutional Class(a) | 15,809,792 |
3,812,119 | Empower Multi-Sector Bond Fund Institutional Class(a) | 31,183,134 |
3,023,084 | Empower Short Duration Bond Fund Institutional Class(a) | 28,809,995 |
2,888,528 | Empower U.S. Government Mortgage Securities Fund Institutional Class(a) | 23,743,702 |
TOTAL BOND MUTUAL FUNDS — 17.91% (Cost $182,403,521) | $169,191,723 | |
EQUITY MUTUAL FUNDS | ||
5,772,893 | Empower Emerging Markets Equity Fund Institutional Class(a) | 49,127,319 |
5,325,354 | Empower International Growth Fund Institutional Class(a) | 48,886,745 |
14,686,139 | Empower International Value Fund Institutional Class(a) | 122,041,815 |
6,427,313 | Empower Large Cap Growth Fund Institutional Class(a) | 65,558,597 |
24,041,302 | Empower Large Cap Value Fund Institutional Class(a) | 164,202,095 |
10,806,334 | Empower Mid Cap Value Fund Institutional Class(a) | 89,260,315 |
Shares | Fair Value | |
Equity Mutual Funds — (continued) | ||
3,918,436 | Empower Real Estate Index Fund Institutional Class(a) | $ 33,071,597 |
2,260,729 | Empower Small Cap Growth Fund Institutional Class(a) | 23,986,334 |
8,785,719 | Empower Small Cap Value Fund Institutional Class(a) | 59,391,459 |
5,863,003 | Empower T. Rowe Price Mid Cap Growth Fund Institutional Class(a) | 35,764,318 |
TOTAL EQUITY MUTUAL FUNDS — 73.19% (Cost $745,561,764) | $691,290,594 | |
Account Balance | ||
FIXED INTEREST CONTRACT | ||
84,301,114 (b) | Empower of America Contract(a) 1.75%(c) | 84,301,114 |
TOTAL FIXED INTEREST CONTRACT — 8.93% (Cost $84,301,114) | $ 84,301,114 | |
TOTAL INVESTMENTS — 100.03% (Cost $1,012,266,399) | $944,783,431 | |
OTHER ASSETS & LIABILITIES, NET — (0.03)% | $ (309,883) | |
TOTAL NET ASSETS — 100.00% | $944,473,548 |
(a) | Issuer is considered an affiliate of the Fund. See Notes to the Financial Statements (Note 2). |
(b) | Account Balance and Cost represent net deposits. |
(c) | Variable rate contract which is not based on a published reference rate and spread, but determined by the issuer and is based on current market conditions. Interest rate shown reflects the rate in effect at December 31, 2023. See Note 2 to the Financial Statements for further information. |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
EMPOWER AGGRESSIVE PROFILE FUND
Schedule of Investments
As of December 31, 2023
Shares | Fair Value | |
EQUITY MUTUAL FUNDS | ||
6,701,938 | Empower Emerging Markets Equity Fund Institutional Class(a) | $ 57,033,496 |
6,155,955 | Empower International Growth Fund Institutional Class(a) | 56,511,666 |
16,996,062 | Empower International Value Fund Institutional Class(a) | 141,237,280 |
7,420,664 | Empower Large Cap Growth Fund Institutional Class(a) | 75,690,776 |
27,836,831 | Empower Large Cap Value Fund Institutional Class(a) | 190,125,557 |
12,467,253 | Empower Mid Cap Value Fund Institutional Class(a) | 102,979,507 |
2,778,794 | Empower Real Estate Index Fund Institutional Class(a) | 23,453,018 |
2,608,644 | Empower Small Cap Growth Fund Institutional Class(a) | 27,677,711 |
Shares | Fair Value | |
Equity Mutual Funds — (continued) | ||
10,166,586 | Empower Small Cap Value Fund Institutional Class(a) | $ 68,726,123 |
6,796,374 | Empower T. Rowe Price Mid Cap Growth Fund Institutional Class(a) | 41,457,881 |
TOTAL EQUITY MUTUAL FUNDS — 100.03% (Cost $816,462,755) | $784,893,015 | |
TOTAL INVESTMENTS — 100.03% (Cost $816,462,755) | $784,893,015 | |
OTHER ASSETS & LIABILITIES, NET — (0.03)% | $ (259,446) | |
TOTAL NET ASSETS — 100.00% | $784,633,569 |
(a) | Issuer is considered an affiliate of the Fund. See Notes to the Financial Statements (Note 2). |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
Statement of Assets and Liabilities
As of December 31, 2023
Empower Conservative Profile Fund | Empower Moderately Conservative Profile Fund | Empower Moderate Profile Fund | |||
ASSETS: | |||||
Investments at fair value, affiliated(a) | $1,426,387,350 | $714,656,856 | $1,555,785,580 | ||
Subscriptions receivable | 2,575,487 | 1,284,387 | 1,310,438 | ||
Receivable for investments sold | 23,688 | 307,374 | 2,895,155 | ||
Total Assets | 1,428,986,525 | 716,248,617 | 1,559,991,173 | ||
LIABILITIES: | |||||
Payable for distribution fees | 1,409 | 4,091 | 25,810 | ||
Payable for investments purchased | 2,005,257 | 979,078 | 159,657 | ||
Payable for shareholder services fees | 394,913 | 195,539 | 418,581 | ||
Payable to investment adviser | 26,704 | 14,258 | 58,935 | ||
Redemptions payable | 593,918 | 612,683 | 4,045,936 | ||
Total Liabilities | 3,022,201 | 1,805,649 | 4,708,919 | ||
NET ASSETS | $1,425,964,324 | $714,442,968 | $1,555,282,254 | ||
NET ASSETS REPRESENTED BY: | |||||
Capital stock, $0.10 par value | $19,105,225 | $8,921,018 | $23,165,360 | ||
Paid-in capital in excess of par | 1,499,851,566 | 759,506,614 | 1,828,099,402 | ||
Undistributed/accumulated deficit | (92,992,467) | (53,984,664) | (295,982,508) | ||
NET ASSETS | $1,425,964,324 | $714,442,968 | $1,555,282,254 | ||
NET ASSETS BY CLASS | |||||
Investor Class | $1,351,862,880 | $655,355,674 | $1,302,673,229 | ||
Class L | $6,839,839 | $19,802,074 | $125,600,785 | ||
Institutional Class | $67,261,605 | $39,285,220 | $127,008,240 | ||
CAPITAL STOCK: | |||||
Authorized | |||||
Investor Class | 600,000,000 | 380,000,000 | 1,050,000,000 | ||
Class L | 120,000,000 | 70,000,000 | 130,000,000 | ||
Institutional Class | 30,000,000 | 60,000,000 | 85,000,000 | ||
Issued and Outstanding | |||||
Investor Class | 183,247,900 | 82,919,327 | 207,536,818 | ||
Class L | 756,176 | 2,151,462 | 11,602,860 | ||
Institutional Class | 7,048,172 | 4,139,390 | 12,513,920 | ||
NET ASSET VALUE, REDEMPTION PRICE AND OFFERING PRICE PER SHARE: | |||||
Investor Class | $7.38 | $7.90 | $6.28 | ||
Class L | $9.05 | $9.20 | $10.82 | ||
Institutional Class | $9.54 | $9.49 | $10.15 | ||
(a) Cost of investments, affiliated | $1,464,650,892 | $735,867,795 | $1,616,403,289 |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
Statement of Assets and Liabilities
As of December 31, 2023
Empower Moderately Aggressive Profile Fund | Empower Aggressive Profile Fund | ||
ASSETS: | |||
Investments at fair value, affiliated(a) | $944,783,431 | $784,893,015 | |
Subscriptions receivable | 858,286 | 1,288,573 | |
Receivable for investments sold | 1,577,011 | 133,524 | |
Total Assets | 947,218,728 | 786,315,112 | |
LIABILITIES: | |||
Payable for investments purchased | 38,058 | 175,172 | |
Payable for shareholder services fees | 255,106 | 194,542 | |
Payable to investment adviser | 54,777 | 64,904 | |
Redemptions payable | 2,397,239 | 1,246,925 | |
Total Liabilities | 2,745,180 | 1,681,543 | |
NET ASSETS | $944,473,548 | $784,633,569 | |
NET ASSETS REPRESENTED BY: | |||
Capital stock, $0.10 par value | $13,678,633 | $13,470,167 | |
Paid-in capital in excess of par | 1,096,311,507 | 940,552,127 | |
Undistributed/accumulated deficit | (165,516,592) | (169,388,725) | |
NET ASSETS | $944,473,548 | $784,633,569 | |
NET ASSETS BY CLASS | |||
Investor Class | $873,080,622 | $671,880,821 | |
Institutional Class | $71,392,926 | $112,752,748 | |
CAPITAL STOCK: | |||
Authorized | |||
Investor Class | 570,000,000 | 480,000,000 | |
Institutional Class | 75,000,000 | 85,000,000 | |
Issued and Outstanding | |||
Investor Class | 129,286,170 | 123,810,779 | |
Institutional Class | 7,500,156 | 10,890,892 | |
NET ASSET VALUE, REDEMPTION PRICE AND OFFERING PRICE PER SHARE: | |||
Investor Class | $6.75 | $5.43 | |
Institutional Class | $9.52 | $10.35 | |
(a) Cost of investments, affiliated | $1,012,266,399 | $816,462,755 |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
Statement of Operations
For the fiscal year ended December 31, 2023
Empower Conservative Profile Fund | Empower Moderately Conservative Profile Fund | Empower Moderate Profile Fund | |||
INVESTMENT INCOME: | |||||
Interest, affiliated | $3,652,994 | $2,006,584 | $3,939,302 | ||
Dividends, affiliated | 30,097,276 | 15,165,494 | 36,858,624 | ||
Total Income | 33,750,270 | 17,172,078 | 40,797,926 | ||
EXPENSES: | |||||
Management fees | 982,094 | 552,003 | 1,492,992 | ||
Shareholder services fees – Investor Class | 3,260,318 | 1,741,606 | 4,387,001 | ||
Shareholder services fees – Class L | 25,825 | 74,171 | 471,726 | ||
Distribution fees – Class L | 18,397 | 52,833 | 335,965 | ||
Total Expenses | 4,286,634 | 2,420,613 | 6,687,684 | ||
Less management fees waived | 769,610 | 423,395 | 833,078 | ||
Net Expenses | 3,517,024 | 1,997,218 | 5,854,606 | ||
NET INVESTMENT INCOME | 30,233,246 | 15,174,860 | 34,943,320 | ||
NET REALIZED AND UNREALIZED GAIN (LOSS): | |||||
Net realized gain (loss) on investments, affiliated | (1,645,134) | 1,176,616 | (2,785,346) | ||
Realized gain distributions received, affiliated | 15,317,524 | 12,489,528 | 38,816,252 | ||
Net Realized Gain | 13,672,390 | 13,666,144 | 36,030,906 | ||
Net change in unrealized appreciation on investments, affiliated | 58,646,419 | 32,415,574 | 97,613,235 | ||
Net Change in Unrealized Appreciation | 58,646,419 | 32,415,574 | 97,613,235 | ||
Net Realized and Unrealized Gain | 72,318,809 | 46,081,718 | 133,644,141 | ||
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS | $102,552,055 | $61,256,578 | $168,587,461 |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
Statement of Operations
For the fiscal year ended December 31, 2023
Empower Moderately Aggressive Profile Fund | Empower Aggressive Profile Fund | ||
INVESTMENT INCOME: | |||
Interest, affiliated | $1,155,483 | $- | |
Dividends, affiliated | 21,145,487 | 16,720,889 | |
Total Income | 22,300,970 | 16,720,889 | |
EXPENSES: | |||
Management fees | 780,525 | 614,232 | |
Shareholder services fees – Investor Class | 2,510,819 | 1,785,147 | |
Total Expenses | 3,291,344 | 2,399,379 | |
Less management fees waived | 243,963 | - | |
Net Expenses | 3,047,381 | 2,399,379 | |
NET INVESTMENT INCOME | 19,253,589 | 14,321,510 | |
NET REALIZED AND UNREALIZED GAIN (LOSS): | |||
Net realized loss on investments, affiliated | (18,912,854) | (2,040,638) | |
Realized gain distributions received, affiliated | 28,514,127 | 32,708,175 | |
Net Realized Gain | 9,601,273 | 30,667,537 | |
Net change in unrealized appreciation on investments, affiliated | 81,350,508 | 64,437,839 | |
Net Change in Unrealized Appreciation | 81,350,508 | 64,437,839 | |
Net Realized and Unrealized Gain | 90,951,781 | 95,105,376 | |
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS | $110,205,370 | $109,426,886 |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
Statement of Changes in Net Assets
For the fiscal years ended December 31, 2023 and December 31, 2022
Empower Conservative Profile Fund | 2023 | 2022 | |
OPERATIONS: | |||
Net investment income | $30,233,246 | $16,876,521 | |
Net realized gain | 13,672,390 | 20,651,688 | |
Net change in unrealized appreciation (depreciation) | 58,646,419 | (143,618,927) | |
Net Increase (Decrease) in Net Assets Resulting from Operations | 102,552,055 | (106,090,718) | |
DISTRIBUTIONS TO SHAREHOLDERS: | |||
From net investment income and net realized gains | |||
Investor Class | (44,100,867) | (51,483,492) | |
Class L | (212,640) | (365,021) | |
Institutional Class | (1,839,217) | (1,912,797) | |
From Net Investment Income and Net Realized Gains | (46,152,724) | (53,761,310) | |
CAPITAL SHARE TRANSACTIONS: | |||
Shares sold | |||
Investor Class | 795,487,625 | 282,975,400 | |
Class L | 1,328,742 | 1,453,419 | |
Institutional Class | 39,660,744 | 11,633,444 | |
Shares issued in reinvestment of distributions | |||
Investor Class | 44,100,867 | 51,483,492 | |
Class L | 212,640 | 365,021 | |
Institutional Class | 1,839,217 | 1,912,797 | |
Shares redeemed | |||
Investor Class | (369,057,144) | (384,346,512) | |
Class L | (2,572,726) | (2,516,571) | |
Institutional Class | (13,943,373) | (10,543,309) | |
Net Increase (Decrease) in Net Assets Resulting from Capital Share Transactions | 497,056,592 | (47,582,819) | |
Total Increase (Decrease) in Net Assets | 553,455,923 | (207,434,847) | |
NET ASSETS: | |||
Beginning of year | 872,508,401 | 1,079,943,248 | |
End of year | $1,425,964,324 | $872,508,401 | |
CAPITAL SHARE TRANSACTIONS - SHARES: | |||
Shares sold | |||
Investor Class | 111,461,053 | 36,950,487 | |
Class L | 152,082 | 152,540 | |
Institutional Class | 4,323,724 | 1,177,670 | |
Shares issued in reinvestment of distributions | |||
Investor Class | 6,030,954 | 7,085,926 | |
Class L | 23,960 | 41,554 | |
Institutional Class | 194,660 | 206,080 | |
Shares redeemed | |||
Investor Class | (50,815,091) | (50,377,934) | |
Class L | (290,692) | (273,105) | |
Institutional Class | (1,497,939) | (1,065,167) | |
Net Increase (Decrease) | 69,582,711 | (6,101,949) |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
Statement of Changes in Net Assets
For the fiscal years ended December 31, 2023 and December 31, 2022
Empower Moderately Conservative Profile Fund | 2023 | 2022 | |
OPERATIONS: | |||
Net investment income | $15,174,860 | $9,061,136 | |
Net realized gain | 13,666,144 | 13,672,624 | |
Net change in unrealized appreciation (depreciation) | 32,415,574 | (90,059,658) | |
Net Increase (Decrease) in Net Assets Resulting from Operations | 61,256,578 | (67,325,898) | |
DISTRIBUTIONS TO SHAREHOLDERS: | |||
From net investment income and net realized gains | |||
Investor Class | (29,001,630) | (34,163,612) | |
Class L | (858,767) | (1,335,049) | |
Institutional Class | (1,706,527) | (1,692,027) | |
From Net Investment Income and Net Realized Gains | (31,566,924) | (37,190,688) | |
CAPITAL SHARE TRANSACTIONS: | |||
Shares sold | |||
Investor Class | 406,133,933 | 192,242,037 | |
Class L | 497,796 | 235,225 | |
Institutional Class | 15,429,099 | 6,517,698 | |
Shares issued in reinvestment of distributions | |||
Investor Class | 29,001,630 | 34,163,612 | |
Class L | 858,767 | 1,335,049 | |
Institutional Class | 1,706,527 | 1,692,027 | |
Shares redeemed | |||
Investor Class | (267,824,474) | (243,884,286) | |
Class L | (4,429,558) | (1,911,571) | |
Institutional Class | (6,106,537) | (4,566,055) | |
Net Increase (Decrease) in Net Assets Resulting from Capital Share Transactions | 175,267,183 | (14,176,264) | |
Total Increase (Decrease) in Net Assets | 204,956,837 | (118,692,850) | |
NET ASSETS: | |||
Beginning of year | 509,486,131 | 628,178,981 | |
End of year | $714,442,968 | $509,486,131 | |
CAPITAL SHARE TRANSACTIONS - SHARES: | |||
Shares sold | |||
Investor Class | 52,723,750 | 23,408,660 | |
Class L | 55,101 | 23,648 | |
Institutional Class | 1,666,707 | 669,829 | |
Shares issued in reinvestment of distributions | |||
Investor Class | 3,701,495 | 4,411,242 | |
Class L | 94,836 | 149,856 | |
Institutional Class | 181,823 | 183,870 | |
Shares redeemed | |||
Investor Class | (34,329,861) | (29,836,900) | |
Class L | (495,647) | (207,024) | |
Institutional Class | (654,483) | (461,867) | |
Net Increase (Decrease) | 22,943,721 | (1,658,686) |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
Statement of Changes in Net Assets
For the fiscal years ended December 31, 2023 and December 31, 2022
Empower Moderate Profile Fund | 2023 | 2022 | |
OPERATIONS: | |||
Net investment income | $34,943,320 | $24,180,292 | |
Net realized gain | 36,030,906 | 39,020,903 | |
Net change in unrealized appreciation (depreciation) | 97,613,235 | (283,151,606) | |
Net Increase (Decrease) in Net Assets Resulting from Operations | 168,587,461 | (219,950,411) | |
DISTRIBUTIONS TO SHAREHOLDERS: | |||
From net investment income and net realized gains | |||
Investor Class | (61,198,068) | (114,093,871) | |
Class L | (3,501,402) | (8,731,572) | |
Institutional Class | (4,020,475) | (6,109,677) | |
From Net Investment Income and Net Realized Gains | (68,719,945) | (128,935,120) | |
CAPITAL SHARE TRANSACTIONS: | |||
Shares sold | |||
Investor Class | 532,220,958 | 353,359,096 | |
Class L | 996,852 | 2,700,860 | |
Institutional Class | 41,817,822 | 20,142,940 | |
Shares issued in reinvestment of distributions | |||
Investor Class | 61,198,068 | 114,093,871 | |
Class L | 3,501,402 | 8,731,572 | |
Institutional Class | 4,020,475 | 6,109,677 | |
Shares redeemed | |||
Investor Class | (610,095,686) | (509,122,615) | |
Class L | (34,383,926) | (16,074,793) | |
Institutional Class | (22,757,863) | (19,081,457) | |
Net Decrease in Net Assets Resulting from Capital Share Transactions | (23,481,898) | (39,140,849) | |
Total Increase (Decrease) in Net Assets | 76,385,618 | (388,026,380) | |
NET ASSETS: | |||
Beginning of year | 1,478,896,636 | 1,866,923,016 | |
End of year | $1,555,282,254 | $1,478,896,636 | |
CAPITAL SHARE TRANSACTIONS - SHARES: | |||
Shares sold | |||
Investor Class | 87,322,982 | 54,363,543 | |
Class L | 94,980 | 261,260 | |
Institutional Class | 4,336,850 | 1,947,423 | |
Shares issued in reinvestment of distributions | |||
Investor Class | 9,958,540 | 18,949,985 | |
Class L | 336,135 | 864,200 | |
Institutional Class | 405,732 | 642,268 | |
Shares redeemed | |||
Investor Class | (100,155,117) | (78,419,260) | |
Class L | (3,305,558) | (1,525,878) | |
Institutional Class | (2,345,813) | (1,906,646) | |
Net Decrease | (3,351,269) | (4,823,105) |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
Statement of Changes in Net Assets
For the fiscal years ended December 31, 2023 and December 31, 2022
Empower Moderately Aggressive Profile Fund | 2023 | 2022 | |
OPERATIONS: | |||
Net investment income | $19,253,589 | $11,113,377 | |
Net realized gain | 9,601,273 | 29,623,941 | |
Net change in unrealized appreciation (depreciation) | 81,350,508 | (155,081,941) | |
Net Increase (Decrease) in Net Assets Resulting from Operations | 110,205,370 | (114,344,623) | |
DISTRIBUTIONS TO SHAREHOLDERS: | |||
From net investment income and net realized gains | |||
Investor Class | (41,126,313) | (63,147,478) | |
Institutional Class | (2,820,387) | (3,792,766) | |
From Net Investment Income and Net Realized Gains | (43,946,700) | (66,940,244) | |
CAPITAL SHARE TRANSACTIONS: | |||
Shares sold | |||
Investor Class | 446,594,408 | 192,761,861 | |
Institutional Class | 17,760,758 | 17,899,485 | |
Shares issued in reinvestment of distributions | |||
Investor Class | 41,126,313 | 63,147,478 | |
Institutional Class | 2,820,387 | 3,792,766 | |
Shares redeemed | |||
Investor Class | (339,426,462) | (271,069,710) | |
Institutional Class | (10,191,075) | (10,625,619) | |
Net Increase (Decrease) in Net Assets Resulting from Capital Share Transactions | 158,684,329 | (4,093,739) | |
Total Increase (Decrease) in Net Assets | 224,942,999 | (185,378,606) | |
NET ASSETS: | |||
Beginning of year | 719,530,549 | 904,909,155 | |
End of year | $944,473,548 | $719,530,549 | |
CAPITAL SHARE TRANSACTIONS - SHARES: | |||
Shares sold | |||
Investor Class | 69,152,510 | 27,810,869 | |
Institutional Class | 1,948,401 | 1,926,454 | |
Shares issued in reinvestment of distributions | |||
Investor Class | 6,236,944 | 9,843,394 | |
Institutional Class | 304,679 | 428,340 | |
Shares redeemed | |||
Investor Class | (51,805,396) | (38,877,383) | |
Institutional Class | (1,121,993) | (1,125,609) | |
Net Increase | 24,715,145 | 6,065 |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
Statement of Changes in Net Assets
For the fiscal years ended December 31, 2023 and December 31, 2022
Empower Aggressive Profile Fund | 2023 | 2022 | |
OPERATIONS: | |||
Net investment income | $14,321,510 | $7,706,980 | |
Net realized gain | 30,667,537 | 32,762,093 | |
Net change in unrealized appreciation (depreciation) | 64,437,839 | (148,529,643) | |
Net Increase (Decrease) in Net Assets Resulting from Operations | 109,426,886 | (108,060,570) | |
DISTRIBUTIONS TO SHAREHOLDERS: | |||
From net investment income and net realized gains | |||
Investor Class | (31,652,435) | (62,980,718) | |
Institutional Class | (3,942,059) | (8,047,330) | |
From Net Investment Income and Net Realized Gains | (35,594,494) | (71,028,048) | |
CAPITAL SHARE TRANSACTIONS: | |||
Shares sold | |||
Investor Class | 302,498,228 | 112,933,549 | |
Institutional Class | 19,650,057 | 27,509,176 | |
Shares issued in reinvestment of distributions | |||
Investor Class | 31,652,435 | 62,980,718 | |
Institutional Class | 3,942,059 | 8,047,330 | |
Shares redeemed | |||
Investor Class | (186,829,550) | (169,734,958) | |
Institutional Class | (23,792,423) | (21,329,128) | |
Net Increase in Net Assets Resulting from Capital Share Transactions | 147,120,806 | 20,406,687 | |
Total Increase (Decrease) in Net Assets | 220,953,198 | (158,681,931) | |
NET ASSETS: | |||
Beginning of year | 563,680,371 | 722,362,302 | |
End of year | $784,633,569 | $563,680,371 | |
CAPITAL SHARE TRANSACTIONS - SHARES: | |||
Shares sold | |||
Investor Class | 59,539,111 | 19,812,478 | |
Institutional Class | 2,012,362 | 2,690,587 | |
Shares issued in reinvestment of distributions | |||
Investor Class | 5,973,701 | 12,406,817 | |
Institutional Class | 395,322 | 864,005 | |
Shares redeemed | |||
Investor Class | (35,955,516) | (29,844,545) | |
Institutional Class | (2,455,249) | (2,105,893) | |
Net Increase | 29,509,731 | 3,823,449 |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
EMPOWER CONSERVATIVE PROFILE FUND
Financial Highlights
Selected data for a share of capital stock of the Fund throughout the periods indicated.
Income (Loss) from Investment Operations: | Less Distributions: | ||||||||
Net asset value, beginning of year | Net investment income(a) | Net realized and unrealized gain (loss) | Total from investment operations | From net investment income | From net realized gains | Total Distributions | Net asset value, end of year | Total Return (b)(c) | |
Investor Class | |||||||||
12/31/2023 | $ 7.11 | 0.22 | 0.35 | 0.57 | (0.22) | (0.08) | (0.30) | $ 7.38 | 8.25% |
12/31/2022 | $ 8.39 | 0.13 | (0.96) | (0.83) | (0.14) | (0.31) | (0.45) | $ 7.11 | (9.93%) |
12/31/2021 | $ 8.30 | 0.21 | 0.32 | 0.53 | (0.21) | (0.23) | (0.44) | $ 8.39 | 6.35% |
12/31/2020 | $ 7.87 | 0.22 | 0.42 | 0.64 | (0.16) | (0.05) | (0.21) | $ 8.30 | 8.21% |
12/31/2019 | $ 7.49 | 0.15 | 0.71 | 0.86 | (0.18) | (0.30) | (0.48) | $ 7.87 | 11.54% |
Class L | |||||||||
12/31/2023 | $ 8.63 | 0.30 | 0.38 | 0.68 | (0.18) | (0.08) | (0.26) | $ 9.05 | 8.03% |
12/31/2022 | $10.06 | 0.29 | (1.31) | (1.02) | (0.10) | (0.31) | (0.41) | $ 8.63 | (10.15%) |
12/31/2021 | $ 9.85 | 0.41 | 0.19 | 0.60 | (0.16) | (0.23) | (0.39) | $10.06 | 6.08% |
12/31/2020 | $ 9.27 | 0.10 | 0.63 | 0.73 | (0.10) | (0.05) | (0.15) | $ 9.85 | 7.93% |
12/31/2019 | $ 8.74 | 0.17 | 0.80 | 0.97 | (0.14) | (0.30) | (0.44) | $ 9.27 | 11.22% |
Institutional Class | |||||||||
12/31/2023 | $ 9.11 | 0.48 | 0.29 | 0.77 | (0.26) | (0.08) | (0.34) | $ 9.54 | 8.61% |
12/31/2022 | $10.63 | 0.22 | (1.24) | (1.02) | (0.19) | (0.31) | (0.50) | $ 9.11 | (9.65%) |
12/31/2021 | $10.42 | 0.34 | 0.36 | 0.70 | (0.26) | (0.23) | (0.49) | $10.63 | 6.64% |
12/31/2020 | $ 9.83 | 0.24 | 0.59 | 0.83 | (0.19) | (0.05) | (0.24) | $10.42 | 8.63% |
12/31/2019 | $ 9.26 | 0.23 | 0.86 | 1.09 | (0.22) | (0.30) | (0.52) | $ 9.83 | 11.87% |
Net assets, end of year (000) | Ratio of expenses to average net assets (before reimbursement and/or waiver, if applicable)(d) | Ratio of expenses to average net assets (after reimbursement and/or waiver, if applicable)(d) | Ratio of net investment income to average net assets (after reimbursement and/or waiver, if applicable)(d) | Portfolio turnover rate(e) | ||
Supplemental Data and Ratios | ||||||
Investor Class | ||||||
12/31/2023 | $1,351,863 | 0.45% | 0.37% | 2.98% | 14% | |
12/31/2022 | $ 828,305 | 0.45% | 0.37% | 1.74% | 16% | |
12/31/2021 | $1,030,963 | 0.45% | 0.37% | 2.46% | 16% | |
12/31/2020 | $ 895,918 | 0.45% | 0.37% | 2.73% | 30% | |
12/31/2019 | $ 213,762 | 0.45% | 0.37% | 1.95% | 20% | |
Class L | ||||||
12/31/2023 | $ 6,840 | 0.70% | 0.62% | 3.45% | 14% | |
12/31/2022 | $ 7,513 | 0.70% | 0.62% | 3.15% | 16% | |
12/31/2021 | $ 9,557 | 0.70% | 0.62% | 3.99% | 16% | |
12/31/2020 | $ 10,027 | 0.70% | 0.62% | 1.11% | 30% | |
12/31/2019 | $ 605,779 | 0.70% | 0.62% | 1.83% | 20% | |
Institutional Class | ||||||
12/31/2023 | $ 67,262 | 0.10% | 0.02% | 5.17% | 14% | |
12/31/2022 | $ 36,690 | 0.10% | 0.02% | 2.25% | 16% | |
12/31/2021 | $ 39,423 | 0.10% | 0.02% | 3.20% | 16% | |
12/31/2020 | $ 33,198 | 0.10% | 0.02% | 2.48% | 30% | |
12/31/2019 | $ 40,399 | 0.10% | 0.02% | 2.36% | 20% |
(a) | Per share amounts are based upon average shares outstanding. |
(b) | Total return does not include any fees or expenses of variable insurance contracts, if applicable. If such fees or expenses were included, the return shown would have been lower. |
(c) | Total return shown net of expenses reimbursed and/or waived, if applicable. Without the expense reimbursement and/or waiver, the return shown would have been lower. |
(d) | Expense ratio and income ratio do not include expenses of the underlying investments in which the Fund invests. |
(e) | Portfolio turnover is calculated at the Fund level. |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
EMPOWER MODERATELY CONSERVATIVE PROFILE FUND
EMPOWER MODERATELY CONSERVATIVE PROFILE FUND
Financial Highlights
Selected data for a share of capital stock of the Fund throughout the periods indicated.
Income (Loss) from Investment Operations: | Less Distributions: | ||||||||
Net asset value, beginning of year | Net investment income(a) | Net realized and unrealized gain (loss) | Total from investment operations | From net investment income | From net realized gains | Total Distributions | Net asset value, end of year | Total Return (b)(c) | |
Investor Class | |||||||||
12/31/2023 | $ 7.58 | 0.20 | 0.54 | 0.74 | (0.25) | (0.17) | (0.42) | $ 7.90 | 9.90% |
12/31/2022 | $ 9.14 | 0.13 | (1.12) | (0.99) | (0.14) | (0.43) | (0.57) | $ 7.58 | (10.82%) |
12/31/2021 | $ 8.95 | 0.29 | 0.53 | 0.82 | (0.29) | (0.34) | (0.63) | $ 9.14 | 9.13% |
12/31/2020 | $ 8.38 | 0.23 | 0.55 | 0.78 | (0.10) | (0.11) | (0.21) | $ 8.95 | 9.57% |
12/31/2019 | $ 7.88 | 0.15 | 0.97 | 1.12 | (0.16) | (0.46) | (0.62) | $ 8.38 | 14.45% |
Class L | |||||||||
12/31/2023 | $ 8.75 | 0.35 | 0.48 | 0.83 | (0.21) | (0.17) | (0.38) | $ 9.20 | 9.62% |
12/31/2022 | $10.44 | 0.15 | (1.30) | (1.15) | (0.11) | (0.43) | (0.54) | $ 8.75 | (11.01%) |
12/31/2021 | $10.13 | 0.32 | 0.58 | 0.90 | (0.25) | (0.34) | (0.59) | $10.44 | 8.88% |
12/31/2020 | $ 9.45 | 0.09 | 0.76 | 0.85 | (0.06) | (0.11) | (0.17) | $10.13 | 9.16% |
12/31/2019 | $ 8.81 | 0.16 | 1.07 | 1.23 | (0.13) | (0.46) | (0.59) | $ 9.45 | 14.14% |
Institutional Class | |||||||||
12/31/2023 | $ 9.02 | 0.48 | 0.44 | 0.92 | (0.28) | (0.17) | (0.45) | $ 9.49 | 10.34% |
12/31/2022 | $10.77 | 0.22 | (1.35) | (1.13) | (0.19) | (0.43) | (0.62) | $ 9.02 | (10.48%) |
12/31/2021 | $10.45 | 0.44 | 0.55 | 0.99 | (0.33) | (0.34) | (0.67) | $10.77 | 9.48% |
12/31/2020 | $ 9.73 | 0.24 | 0.71 | 0.95 | (0.12) | (0.11) | (0.23) | $10.45 | 10.01% |
12/31/2019 | $ 9.07 | 0.21 | 1.11 | 1.32 | (0.20) | (0.46) | (0.66) | $ 9.73 | 14.80% |
Net assets, end of year (000) | Ratio of expenses to average net assets (before reimbursement and/or waiver, if applicable)(d) | Ratio of expenses to average net assets (after reimbursement and/or waiver, if applicable)(d) | Ratio of net investment income to average net assets (after reimbursement and/or waiver, if applicable)(d) | Portfolio turnover rate(e) | ||
Supplemental Data and Ratios | ||||||
Investor Class | ||||||
12/31/2023 | $655,356 | 0.45% | 0.37% | 2.54% | 20% | |
12/31/2022 | $461,064 | 0.45% | 0.37% | 1.61% | 20% | |
12/31/2021 | $574,251 | 0.45% | 0.37% | 3.10% | 20% | |
12/31/2020 | $521,377 | 0.45% | 0.37% | 2.69% | 34% | |
12/31/2019 | $124,650 | 0.45% | 0.37% | 1.81% | 22% | |
Class L | ||||||
12/31/2023 | $ 19,802 | 0.70% | 0.62% | 3.88% | 20% | |
12/31/2022 | $ 21,850 | 0.70% | 0.62% | 1.59% | 20% | |
12/31/2021 | $ 26,423 | 0.70% | 0.62% | 2.97% | 20% | |
12/31/2020 | $ 26,264 | 0.70% | 0.62% | 0.94% | 34% | |
12/31/2019 | $350,464 | 0.70% | 0.62% | 1.65% | 22% | |
Institutional Class | ||||||
12/31/2023 | $ 39,285 | 0.10% | 0.02% | 5.12% | 20% | |
12/31/2022 | $ 26,572 | 0.10% | 0.02% | 2.26% | 20% | |
12/31/2021 | $ 27,505 | 0.10% | 0.02% | 3.98% | 20% | |
12/31/2020 | $ 21,473 | 0.10% | 0.02% | 2.50% | 34% | |
12/31/2019 | $ 20,093 | 0.10% | 0.02% | 2.17% | 22% |
(a) | Per share amounts are based upon average shares outstanding. |
(b) | Total return does not include any fees or expenses of variable insurance contracts, if applicable. If such fees or expenses were included, the return shown would have been lower. |
(c) | Total return shown net of expenses reimbursed and/or waived, if applicable. Without the expense reimbursement and/or waiver, the return shown would have been lower. |
(d) | Expense ratio and income ratio do not include expenses of the underlying investments in which the Fund invests. |
(e) | Portfolio turnover is calculated at the Fund level. |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
EMPOWER MODERATE PROFILE FUND
EMPOWER MODERATE PROFILE FUND
Financial Highlights
Selected data for a share of capital stock of the Fund throughout the periods indicated.
Income (Loss) from Investment Operations: | Less Distributions: | ||||||||
Net asset value, beginning of year | Net investment income(a) | Net realized and unrealized gain (loss) | Total from investment operations | From net investment income | From net realized gains | Total Distributions | Net asset value, end of year | Total Return (b)(c) | |
Investor Class | |||||||||
12/31/2023 | $ 5.89 | 0.11 | 0.58 | 0.69 | (0.22) | (0.08) | (0.30) | $ 6.28 | 11.93% |
12/31/2022 | $ 7.34 | 0.09 | (0.97) | (0.88) | (0.15) | (0.42) | (0.57) | $ 5.89 | (12.02%) |
12/31/2021 | $ 7.07 | 0.28 | 0.57 | 0.85 | (0.26) | (0.32) | (0.58) | $ 7.34 | 11.98% |
12/31/2020 | $ 6.57 | 0.14 | 0.58 | 0.72 | (0.10) | (0.12) | (0.22) | $ 7.07 | 11.25% |
12/31/2019 | $ 6.21 | 0.11 | 0.94 | 1.05 | (0.13) | (0.56) | (0.69) | $ 6.57 | 17.52% |
Class L | |||||||||
12/31/2023 | $ 9.97 | 0.45 | 0.68 | 1.13 | (0.20) | (0.08) | (0.28) | $10.82 | 11.64% |
12/31/2022 | $12.05 | 0.17 | (1.63) | (1.46) | (0.20) | (0.42) | (0.62) | $ 9.97 | (12.16%) |
12/31/2021 | $11.30 | 0.45 | 0.86 | 1.31 | (0.24) | (0.32) | (0.56) | $12.05 | 11.56% |
12/31/2020 | $10.39 | 0.09 | 1.03 | 1.12 | (0.09) | (0.12) | (0.21) | $11.30 | 11.03% |
12/31/2019 | $ 9.45 | 0.16 | 1.44 | 1.60 | (0.10) | (0.56) | (0.66) | $10.39 | 17.23% |
Institutional Class | |||||||||
12/31/2023 | $ 9.38 | 0.57 | 0.56 | 1.13 | (0.28) | (0.08) | (0.36) | $10.15 | 12.20% |
12/31/2022 | $11.31 | 0.22 | (1.53) | (1.31) | (0.20) | (0.42) | (0.62) | $ 9.38 | (11.56%) |
12/31/2021 | $10.68 | 0.47 | 0.83 | 1.30 | (0.35) | (0.32) | (0.67) | $11.31 | 12.15% |
12/31/2020 | $ 9.81 | 0.21 | 0.90 | 1.11 | (0.12) | (0.12) | (0.24) | $10.68 | 11.64% |
12/31/2019 | $ 8.97 | 0.19 | 1.39 | 1.58 | (0.18) | (0.56) | (0.74) | $ 9.81 | 18.00% |
Net assets, end of year (000) | Ratio of expenses to average net assets (before reimbursement and/or waiver, if applicable)(d) | Ratio of expenses to average net assets (after reimbursement and/or waiver, if applicable)(d) | Ratio of net investment income to average net assets (after reimbursement and/or waiver, if applicable)(d) | Portfolio turnover rate(e) | ||
Supplemental Data and Ratios | ||||||
Investor Class | ||||||
12/31/2023 | $1,302,673 | 0.45% | 0.39% | 1.83% | 18% | |
12/31/2022 | $1,239,661 | 0.45% | 0.39% | 1.46% | 14% | |
12/31/2021 | $1,580,857 | 0.45% | 0.39% | 3.72% | 18% | |
12/31/2020 | $1,398,893 | 0.45% | 0.40% | 2.12% | 34% | |
12/31/2019 | $ 740,432 | 0.45% | 0.39% | 1.63% | 27% | |
Class L | ||||||
12/31/2023 | $ 125,601 | 0.70% | 0.64% | 4.33% | 18% | |
12/31/2022 | $ 144,374 | 0.70% | 0.64% | 1.54% | 14% | |
12/31/2021 | $ 179,322 | 0.70% | 0.64% | 3.69% | 18% | |
12/31/2020 | $ 173,155 | 0.70% | 0.65% | 0.87% | 34% | |
12/31/2019 | $ 797,338 | 0.70% | 0.64% | 1.53% | 27% | |
Institutional Class | ||||||
12/31/2023 | $ 127,008 | 0.10% | 0.04% | 5.85% | 18% | |
12/31/2022 | $ 94,861 | 0.10% | 0.04% | 2.14% | 14% | |
12/31/2021 | $ 106,744 | 0.10% | 0.04% | 4.13% | 18% | |
12/31/2020 | $ 109,001 | 0.10% | 0.05% | 2.15% | 34% | |
12/31/2019 | $ 132,857 | 0.10% | 0.04% | 1.99% | 27% |
(a) | Per share amounts are based upon average shares outstanding. |
(b) | Total return does not include any fees or expenses of variable insurance contracts, if applicable. If such fees or expenses were included, the return shown would have been lower. |
(c) | Total return shown net of expenses reimbursed and/or waived, if applicable. Without the expense reimbursement and/or waiver, the return shown would have been lower. |
(d) | Expense ratio and income ratio do not include expenses of the underlying investments in which the Fund invests. |
(e) | Portfolio turnover is calculated at the Fund level. |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
EMPOWER MODERATELY AGGRESSIVE PROFILE FUND
EMPOWER MODERATELY AGGRESSIVE PROFILE FUND
Financial Highlights
Selected data for a share of capital stock of the Fund throughout the periods indicated.
Income (Loss) from Investment Operations: | Less Distributions: | ||||||||
Net asset value, beginning of year | Net investment income(a) | Net realized and unrealized gain (loss) | Total from investment operations | From net investment income | From net realized gains | Total Distributions | Net asset value, end of year | Total Return(b)(c) | |
Investor Class | |||||||||
12/31/2023 | $ 6.28 | 0.14 | 0.70 | 0.84 | (0.15) | (0.22) | (0.37) | $ 6.75 | 13.60% |
12/31/2022 | $ 7.95 | 0.10 | (1.14) | (1.04) | (0.11) | (0.52) | (0.63) | $ 6.28 | (13.09%) |
12/31/2021 | $ 7.64 | 0.38 | 0.71 | 1.09 | (0.38) | (0.40) | (0.78) | $ 7.95 | 14.25% |
12/31/2020 | $ 7.45 | 0.16 | 0.67 | 0.83 | (0.14) | (0.50) | (0.64) | $ 7.64 | 11.75% |
12/31/2019 | $ 6.94 | 0.12 | 1.25 | 1.37 | (0.13) | (0.73) | (0.86) | $ 7.45 | 20.35% |
Institutional Class | |||||||||
12/31/2023 | $ 8.71 | 0.56 | 0.65 | 1.21 | (0.18) | (0.22) | (0.40) | $ 9.52 | 14.04% |
12/31/2022 | $10.75 | 0.23 | (1.61) | (1.38) | (0.14) | (0.52) | (0.66) | $ 8.71 | (12.77%) |
12/31/2021 | $10.11 | 0.48 | 1.00 | 1.48 | (0.44) | (0.40) | (0.84) | $10.75 | 14.64% |
12/31/2020 | $ 9.65 | 0.20 | 0.93 | 1.13 | (0.17) | (0.50) | (0.67) | $10.11 | 12.16% |
12/31/2019 | $ 8.77 | 0.18 | 1.60 | 1.78 | (0.17) | (0.73) | (0.90) | $ 9.65 | 20.64% |
Net assets, end of year (000) | Ratio of expenses to average net assets (before reimbursement and/or waiver, if applicable)(d) | Ratio of expenses to average net assets (after reimbursement and/or waiver, if applicable)(d) | Ratio of net investment income to average net assets (after reimbursement and/or waiver, if applicable)(d) | Portfolio turnover rate(e) | ||
Investor Class | ||||||
12/31/2023 | $873,081 | 0.45% | 0.42% | 2.14% | 19% | |
12/31/2022 | $664,044 | 0.45% | 0.42% | 1.38% | 19% | |
12/31/2021 | $849,677 | 0.45% | 0.42% | 4.56% | 23% | |
12/31/2020 | $665,158 | 0.45% | 0.42% | 2.19% | 63% | |
12/31/2019 | $336,156 | 0.45% | 0.42% | 1.53% | 34% | |
Institutional Class | ||||||
12/31/2023 | $ 71,393 | 0.10% | 0.07% | 6.18% | 19% | |
12/31/2022 | $ 55,487 | 0.10% | 0.07% | 2.41% | 19% | |
12/31/2021 | $ 55,232 | 0.10% | 0.07% | 4.36% | 23% | |
12/31/2020 | $ 60,144 | 0.10% | 0.07% | 2.12% | 63% | |
12/31/2019 | $ 61,262 | 0.10% | 0.07% | 1.88% | 34% |
(a) | Per share amounts are based upon average shares outstanding. |
(b) | Total return does not include any fees or expenses of variable insurance contracts, if applicable. If such fees or expenses were included, the return shown would have been lower. |
(c) | Total return shown net of expenses reimbursed and/or waived, if applicable. Without the expense reimbursement and/or waiver, the return shown would have been lower. |
(d) | Expense ratio and income ratio do not include expenses of the underlying investments in which the Fund invests. |
(e) | Portfolio turnover is calculated at the Fund level. |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
EMPOWER AGGRESSIVE PROFILE FUND
EMPOWER AGGRESSIVE PROFILE FUND
Financial Highlights
Selected data for a share of capital stock of the Fund throughout the periods indicated.
Income (Loss) from Investment Operations: | Less Distributions: | ||||||||
Net asset value, beginning of year | Net investment income(a) | Net realized and unrealized gain (loss) | Total from investment operations | From net investment income | From net realized gains | Total Distributions | Net asset value, end of year | Total Return(b)(c) | |
Investor Class | |||||||||
12/31/2023 | $ 4.92 | 0.07 | 0.75 | 0.82 | (0.17) | (0.14) | (0.31) | $ 5.43 | 16.94% |
12/31/2022 | $ 6.66 | 0.07 | (1.08) | (1.01) | (0.09) | (0.64) | (0.73) | $ 4.92 | (15.17%) |
12/31/2021 | $ 6.35 | 0.38 | 0.85 | 1.23 | (0.40) | (0.52) | (0.92) | $ 6.66 | 19.49% |
12/31/2020 | $ 5.96 | 0.09 | 0.57 | 0.66 | (0.09) | (0.18) | (0.27) | $ 6.35 | 11.99% |
12/31/2019 | $ 5.54 | 0.08 | 1.31 | 1.39 | (0.13) | (0.84) | (0.97) | $ 5.96 | 26.10% |
Institutional Class | |||||||||
12/31/2023 | $ 9.16 | 0.68 | 0.88 | 1.56 | (0.23) | (0.14) | (0.37) | $10.35 | 17.23% |
12/31/2022 | $11.67 | 0.19 | (1.92) | (1.73) | (0.14) | (0.64) | (0.78) | $ 9.16 | (14.81%) |
12/31/2021 | $10.58 | 0.63 | 1.46 | 2.09 | (0.48) | (0.52) | (1.00) | $11.67 | 19.82% |
12/31/2020 | $ 9.73 | 0.18 | 0.98 | 1.16 | (0.13) | (0.18) | (0.31) | $10.58 | 12.53% |
12/31/2019 | $ 8.55 | 0.16 | 2.03 | 2.19 | (0.17) | (0.84) | (1.01) | $ 9.73 | 26.52% |
Net assets, end of year (000) | Ratio of expenses to average net assets (before reimbursement and/or waiver, if applicable)(d) | Ratio of expenses to average net assets (after reimbursement and/or waiver, if applicable)(d) | Ratio of net investment income to average net assets (after reimbursement and/or waiver, if applicable)(d) | Portfolio turnover rate(e) | ||
Investor Class | ||||||
12/31/2023 | $671,881 | 0.45% | 0.45% | 1.38% | 17% | |
12/31/2022 | $463,528 | 0.45% | 0.45% | 1.16% | 19% | |
12/31/2021 | $611,597 | 0.45% | 0.45% | 5.31% | 26% | |
12/31/2020 | $548,648 | 0.45% | 0.45% | 1.71% | 35% | |
12/31/2019 | $427,424 | 0.45% | 0.45% | 1.26% | 33% | |
Institutional Class | ||||||
12/31/2023 | $112,753 | 0.10% | 0.10% | 6.96% | 17% | |
12/31/2022 | $100,152 | 0.10% | 0.10% | 1.85% | 19% | |
12/31/2021 | $110,765 | 0.10% | 0.10% | 5.31% | 26% | |
12/31/2020 | $106,944 | 0.10% | 0.10% | 1.96% | 35% | |
12/31/2019 | $115,496 | 0.10% | 0.10% | 1.67% | 33% |
(a) | Per share amounts are based upon average shares outstanding. |
(b) | Total return does not include any fees or expenses of variable insurance contracts, if applicable. If such fees or expenses were included, the return shown would have been lower. |
(c) | Total return shown net of expenses reimbursed and/or waived, if applicable. Without the expense reimbursement and/or waiver, the return shown would have been lower. |
(d) | Expense ratio and income ratio do not include expenses of the underlying investments in which the Fund invests. |
(e) | Portfolio turnover is calculated at the Fund level. |
See Notes to Financial Statements.
Annual Report - December 31, 2023
EMPOWER FUNDS, INC.
Notes to Financial Statements
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Empower Funds, Inc. (Empower Funds), a Maryland corporation, was organized on December 7, 1981 and is registered under the Investment Company Act of 1940 (the 1940 Act) as an open-end management investment company. Empower Funds presently consists of forty-five funds. Interests in the Empower Conservative Profile Fund, Empower Moderately Conservative Profile Fund, Empower Moderate Profile Fund, Empower Moderately Aggressive Profile Fund and Empower Aggressive Profile Fund (each a Fund, collectively the Funds) are included herein. The investment objective of each Fund is to seek long-term capital appreciation primarily through investments in underlying funds of the Empower Funds that emphasize fixed income investments for the Empower Conservative Profile Fund; to seek capital appreciation primarily through investments in underlying funds of the Empower Funds that emphasize fixed income investments, and to a lesser degree, in those that emphasize equity investments for the Empower Moderately Conservative Profile Fund; to seek long-term capital appreciation primarily through investments in underlying funds of the Empower Funds with a relatively equal emphasis on equity and fixed income investments for the Empower Moderate Profile Fund; to seek long-term capital appreciation primarily through investments in underlying funds of the Empower Funds that emphasize equity investments, and to a lesser degree, in those that emphasize fixed income investments for the Empower Moderately Aggressive Profile Fund and to seek long-term capital appreciation primarily through investments in underlying funds of the Empower Funds that emphasize equity investments for the Empower Aggressive Profile Fund. Each Fund is non-diversified as defined in the 1940 Act. The Funds are available as an investment option to insurance company separate accounts for certain variable annuity contracts and variable life insurance policies, to individual retirement account custodians or trustees, to plan sponsors of qualified retirement plans, and to college savings programs.
The Empower Conservative Profile Fund, Empower Moderately Conservative Profile Fund, Empower Moderate Profile Fund each offer three share classes, referred to as Investor Class, Class L and Institutional Class shares. The Empower Moderately Aggressive Profile Fund and Empower Aggressive Profile Fund each offer two share classes, referred to as Investor Class shares and Institutional Class shares. All shares of each Fund represent an equal pro rata interest in the net assets of the class to which such shares belong, and have identical voting, dividend, liquidation and other rights and the same terms and conditions, except for class specific expenses and exclusive rights to vote on matters affecting only individual classes. Income, expenses (other than those attributable to a specific class) and realized and unrealized gains and losses are allocated daily to each class of shares based on the relative proportion of net assets represented by such class. Operating expenses directly attributable to a specific class are charged against operations of that class.
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Each Fund is also an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board ("FASB") Accounting Standards Codification Topic 946, Financial Services - Investment Companies. The following is a summary of the significant accounting policies of the Funds.
Security Valuation
The Board of Directors of the Funds has adopted policies and procedures for the valuation of each Fund’s securities and assets, and has appointed the Fair Value Pricing Committee of the investment adviser, Empower Capital Management, LLC (ECM or the Adviser), to complete valuation determinations under those policies and procedures. Pursuant to Rule 2a-5 under the 1940 Act, the Board of Directors approved the Adviser as the Funds' valuation designee to make all fair value determinations with respect to the Funds' investments, subject to oversight by the Board of Directors.
Annual Report - December 31, 2023
Investments in shares of the underlying mutual funds are valued at the net asset value as reported by the underlying mutual fund, which may be obtained from pricing services or other pricing sources. The inputs used by the pricing services are reviewed quarterly or when the pricing vendor issues updates to its pricing methodologies. The net asset value of each class of the Fund's shares is determined by dividing the net assets attributable to each class of shares of the Fund by the number of issued and outstanding shares of each class of the Fund on each valuation date.
Investments in fixed interest contracts issued by Empower Annuity Insurance Company of America (Empower of America Contract) are valued at the amount of net deposits plus accrued interest, determined on a daily basis. The Empower of America Contract is backed by the general account of Empower Annuity Insurance Company of America (Empower of America).
The Funds classify valuations into three levels based upon the observability of inputs to the valuation of each Fund’s investments. The valuation levels are not necessarily an indication of the risk or liquidity associated with the underlying investment. Classification is based on the lowest level of input significant to the fair value measurement. The three levels are defined as follows:
Level 1 – Unadjusted quoted prices for identical securities in active markets.
Level 2 – Inputs other than quoted prices included in Level 1 that are observable either directly or indirectly. These may include quoted prices for similar assets in active markets.
Level 3 – Unobservable inputs to the extent observable inputs are not available. Unobservable inputs reflect the Fund’s own assumptions and would be based on the best information available under the circumstances.
As of December 31, 2023, each Fund’s investments in the underlying mutual funds are valued using Level 1 inputs. Each Fund’s investment in the Empower of America Contract is valued using Level 2 inputs. More information regarding each Fund’s sector classifications are included in the Schedule of Investments.
Fund-of-Funds Structure Risk
Since each Fund invests directly in underlying funds, all risks associated with the eligible underlying funds apply to each Fund. To the extent each Fund invests more of its assets in one underlying fund than another, each Fund will have greater exposure to the risks of that underlying fund.
Security Transactions
Security transactions are accounted for on the date the security is purchased or sold (trade date). Realized gains and losses from investments sold are determined on a specific lot selection. Dividend income and realized gain distributions from underlying funds are accrued as of the ex-dividend date. Interest on the Empower of America Contract is accrued daily.
Federal Income Taxes and Distributions to Shareholders
Each Fund intends to comply with provisions under Subchapter M of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its net taxable income, including any net realized gain on investments not offset by capital loss carryforwards, if any, to shareholders. Therefore, no federal income or excise tax provision is required. Each Fund files income tax returns in U.S. federal and applicable state jurisdictions. The statute of limitations on each Fund tax return filings generally remains open for the three preceding fiscal reporting period ends. State tax returns may remain open for an additional fiscal year.
Distributions to shareholders from net investment income of the Funds, if any, are declared and paid semi-annually. Capital gain distributions of the Funds, if any, are declared and paid at least annually. Distributions are reinvested in additional shares of the Funds at net asset value and are declared separately for each class. Distributions are determined in accordance with income tax regulations, which may differ from U.S. generally accepted accounting principles.
Annual Report - December 31, 2023
The tax character of distributions paid during the years ended December 31, 2023 and 2022 were as follows:
Empower Conservative Profile Fund | |||
2023 | 2022 | ||
Ordinary income | $33,790,925 | $16,871,993 | |
Long-term capital gain | 12,361,799 | 36,889,317 | |
$46,152,724 | $53,761,310 |
Empower Moderately Conservative Profile Fund | |||
2023 | 2022 | ||
Ordinary income | $18,208,706 | $9,323,391 | |
Long-term capital gain | 13,358,218 | 27,867,297 | |
$31,566,924 | $37,190,688 |
Empower Moderate Profile Fund | |||
2023 | 2022 | ||
Ordinary income | $47,771,473 | $34,169,705 | |
Long-term capital gain | 20,948,472 | 94,765,415 | |
$68,719,945 | $128,935,120 |
Empower Moderately Aggressive Profile Fund | |||
2023 | 2022 | ||
Ordinary income | $18,080,744 | $11,475,424 | |
Long-term capital gain | 25,865,956 | 55,464,820 | |
$43,946,700 | $66,940,244 |
Empower Aggressive Profile Fund | |||
2023 | 2022 | ||
Ordinary income | $19,186,108 | $9,131,846 | |
Long-term capital gain | 16,408,386 | 61,896,202 | |
$35,594,494 | $71,028,048 |
Net investment income (loss) and net realized gain (loss) for federal income tax purposes may differ from those reported on the financial statements because of temporary and permanent book-tax basis differences. Book-tax differences may include but are not limited to the following: disallowed losses and distribution adjustments.
The tax components of capital shown in the following tables represent distribution requirements each Fund must satisfy under the income tax regulations, losses each Fund may be able to offset against income and gains realized in future years and unrealized appreciation or depreciation for federal income tax purposes. At December 31, 2023, the components of distributable earnings on a tax basis were as follows:
Empower Conservative Profile Fund | |
Undistributed net investment income | $— |
Undistributed long-term capital gains | 14,632,615 |
Capital loss carryforwards | — |
Post-October losses | — |
Net unrealized depreciation | (107,625,082) |
Tax composition of capital | $(92,992,467) |
Annual Report - December 31, 2023
Empower Moderately Conservative Profile Fund | |
Undistributed net investment income | $— |
Undistributed long-term capital gains | 12,323,367 |
Capital loss carryforwards | — |
Post-October losses | — |
Net unrealized depreciation | (66,308,031) |
Tax composition of capital | $(53,984,664) |
Empower Moderate Profile Fund | |
Undistributed net investment income | $— |
Undistributed long-term capital gains | 44,029,924 |
Capital loss carryforwards | — |
Post-October losses | — |
Net unrealized depreciation | (340,012,432) |
Tax composition of capital | $(295,982,508) |
Empower Moderately Aggressive Profile Fund | |
Undistributed net investment income | $— |
Undistributed long-term capital gains | 27,357,790 |
Capital loss carryforwards | — |
Post-October losses | — |
Net unrealized depreciation | (192,874,382) |
Tax composition of capital | $(165,516,592) |
Empower Aggressive Profile Fund | |
Undistributed net investment income | $— |
Undistributed long-term capital gains | 29,965,522 |
Capital loss carryforwards | — |
Post-October losses | — |
Net unrealized depreciation | (199,354,247) |
Tax composition of capital | $(169,388,725) |
The aggregate cost of investments and the composition of unrealized appreciation and depreciation for federal income tax purposes as of December 31, 2023 were as follows:
Federal Tax Cost of Investments | Gross Unrealized Appreciation on Investments | Gross Unrealized Depreciation on Investments | Net Unrealized Depreciation on Investments | ||||
Empower Conservative Profile Fund | $1,534,012,432 | $12,038,414 | $(119,663,496) | $(107,625,082) | |||
Empower Moderately Conservative Profile Fund | 780,964,887 | 4,508,480 | (70,816,511) | (66,308,031) | |||
Empower Moderate Profile Fund | 1,895,798,012 | — | (340,012,432) | (340,012,432) | |||
Empower Moderately Aggressive Profile Fund | 1,137,657,813 | — | (192,874,382) | (192,874,382) | |||
Empower Aggressive Profile Fund | 984,247,262 | — | (199,354,247) | (199,354,247) |
2. INVESTMENT ADVISORY AGREEMENT & OTHER TRANSACTIONS WITH AFFILIATES
Empower Funds entered into an investment advisory agreement with ECM, a wholly-owned subsidiary of Empower Annuity Company of America (Empower of America). As compensation for its services to Empower Funds, the Adviser receives monthly compensation at the annual rate of 0.10% of the average daily net assets of each Fund. The management fee encompasses fund operation expenses except for shareholder services fees and distribution fees. Each Fund will also bear the indirect expense of the underlying investments. Because the underlying funds have varied expense and fee levels and the Funds may own different proportions of underlying funds at different times, the amount of fees and expenses incurred indirectly by the Funds will vary. The Adviser has contractually agreed to reduce its management fee by 0.35% of the amount each Fund has allocated to the Empower of America Contract. The amount waived, if any, is reflected in the Statement of Operations.
Annual Report - December 31, 2023
Empower Funds has entered into a shareholder services agreement with Empower Retirement, LLC (Empower), an affiliate of ECM and subsidiary of Empower of America. Pursuant to the shareholder services agreement, Empower provides various recordkeeping, administrative and shareholder services to shareholders and receives from the Investor Class and Class L shares of each Fund a fee equal to 0.35% of the average daily net asset value of the applicable share class.
Empower Financial Services, Inc. (the Distributor), is a wholly-owned subsidiary of Empower of America and the principal underwriter to distribute and market the Funds. The Funds have entered into a plan of distribution which provides for compensation for distribution of Class L shares and for providing or arranging for the provision of services to Class L shareholders. The distribution plan provides for a maximum 12b-1 fee equal to an annual rate of 0.25% of the average daily net assets of the Class L shares.
Certain officers of Empower Funds are also directors and/or officers of Empower of America or its subsidiaries. No officer or interested director of Empower Funds receives any compensation directly from Empower Funds. The total compensation paid to the independent directors with respect to all forty-five funds for which they serve as directors was $1,223,500 for the year ended December 31, 2023.
Transactions with Affiliates
Each Fund may invest in the Empower of America Contract pursuant to exemptive relief issued by the U.S. Securities and Exchange Commission. The Empower of America Contract has a stable principal value and accrues a fixed rate of interest, which is reflected in the daily valuation of the Funds. Empower of America calculates the interest rate in the same way it calculates guaranteed interest rates for similar contracts (on a calendar quarter or other periodic basis). As a result of Empower of America being an affiliated entity, the Funds are exposed to the risk of unanticipated industry conditions as well as risks specific to a single corporation. If Empower of America were to become insolvent, the Empower of America Contract would be settled commensurate with other policy holder obligations.
The amounts deposited will accrue interest at a declared rate of interest, adjustable on a calendar quarter or other periodic basis, guaranteed to be no less than 1.00%. The investment in the Empower of America Contract may be terminated by Empower of America or the Funds upon 7 days prior written notice. The guaranteed interest rate paid will be at least as favorable as the guaranteed interest rate paid on other similar products issued by Empower of America.
The following tables are a summary of the transactions for each underlying investment during the year ended December 31, 2023, in which the issuer was an affiliate of a Fund, as defined in the 1940 Act.
Empower Conservative Profile Fund | |||||||||||||
Affiliate | Shares Held/ Account Balance 12/31/2023 | Value 12/31/2022 | Purchase Cost | Sales Cost | Net Realized Gain (Loss) | Net Change Unrealized Appreciation (Depreciation) | Dividends and Interest Received | Distributions Received | Value 12/31/2023 | ||||
BOND MUTUAL FUNDS 47.33% | |||||||||||||
Empower Core Bond Fund Institutional Class | 11,089,060 | $ 56,879,489 | $ 40,274,561 | $ 6,232,491 | $ (801,113) | $ 2,337,434 | $ 4,593,754 | $ - | $ 93,258,993 | ||||
Empower Global Bond Fund Institutional Class | 16,077,398 | 76,011,538 | 48,062,701 | 8,464,317 | (1,634,828) | 8,668,367 | 685,925 | - | 124,278,289 | ||||
Empower High Yield Bond Fund Institutional Class | 5,826,167 | 33,962,801 | 22,139,776 | 3,740,857 | (220,067) | 3,278,172 | 2,102,829 | - | 55,639,892 | ||||
Empower Inflation-Protected Securities Fund Institutional Class | 6,990,310 | 38,083,261 | 26,907,934 | 3,858,413 | (382,695) | 871,267 | 2,290,022 | - | 62,004,049 | ||||
Empower Multi-Sector Bond Fund Institutional Class | 14,935,479 | 74,654,012 | 50,276,112 | 7,015,040 | (1,106,566) | 4,257,130 | 5,705,847 | - | 122,172,214 | ||||
Empower Short Duration Bond Fund Institutional Class | 13,038,241 | 76,318,707 | 53,185,910 | 8,318,544 | (303,194) | 3,068,367 | 2,819,702 | - | 124,254,440 | ||||
Empower U.S. Government Mortgage Securities Fund Institutional Class | 11,345,940 | 56,779,554 | 39,632,817 | 5,755,237 | (647,959) | 2,606,496 | 2,955,968 | - | 93,263,630 | ||||
(5,096,422) | 25,087,233 | 21,154,047 | 0 | 674,871,507 |
Annual Report - December 31, 2023
Empower Conservative Profile Fund | |||||||||||||
Affiliate | Shares Held/ Account Balance 12/31/2023 | Value 12/31/2022 | Purchase Cost | Sales Cost | Net Realized Gain (Loss) | Net Change Unrealized Appreciation (Depreciation) | Dividends and Interest Received | Distributions Received | Value 12/31/2023 | ||||
EQUITY MUTUAL FUNDS 30.25% | |||||||||||||
Empower Emerging Markets Equity Fund Institutional Class | 3,165,137 | $ 16,119,948 | $ 12,910,702 | $ 4,142,251 | $ (50,839) | $ 2,046,913 | $ 362,337 | $ - | $ 26,935,312 | ||||
Empower International Growth Fund Institutional Class | 2,912,315 | 16,180,272 | 12,112,697 | 5,638,152 | (258,119) | 4,080,234 | 200,984 | - | 26,735,051 | ||||
Empower International Value Fund Institutional Class | 8,031,549 | 40,559,128 | 31,083,452 | 9,341,300 | 839,964 | 4,440,893 | 2,513,207 | 1,504,698 | 66,742,173 | ||||
Empower Large Cap Growth Fund Institutional Class | 3,502,427 | 21,890,694 | 14,479,369 | 9,662,459 | (2,023,076) | 9,017,157 | 65,761 | 914,341 | 35,724,761 | ||||
Empower Large Cap Value Fund Institutional Class | 13,132,437 | 54,834,722 | 45,554,430 | 8,054,026 | 3,632,522 | (2,640,582) | 2,045,437 | 6,979,681 | 89,694,544 | ||||
Empower Mid Cap Value Fund Institutional Class | 5,899,427 | 29,736,401 | 23,128,336 | 8,805,687 | 885,477 | 4,670,220 | 1,101,618 | 19,934 | 48,729,270 | ||||
Empower Real Estate Index Fund Institutional Class | 8,485,092 | 43,837,040 | 37,087,912 | 14,776,702 | 3,240,512 | 5,465,928 | 1,715,549 | 173,849 | 71,614,178 | ||||
Empower Small Cap Growth Fund Institutional Class | 1,245,863 | 8,014,582 | 6,481,031 | 4,339,702 | (1,102,404) | 3,062,695 | - | 2,051 | 13,218,606 | ||||
Empower Small Cap Value Fund Institutional Class | 4,796,431 | 19,912,844 | 19,643,120 | 9,092,521 | (785,924) | 1,960,431 | 869,057 | 3,160,478 | 32,423,874 | ||||
Empower T. Rowe Price Mid Cap Growth Fund Institutional Class | 3,216,755 | 11,923,844 | 11,191,531 | 4,948,466 | (926,825) | 1,455,296 | 69,279 | 2,562,492 | 19,622,205 | ||||
3,451,288 | 33,559,185 | 8,943,229 | 15,317,524 | 431,439,974 | |||||||||
FIXED INTEREST CONTRACT 22.45% | |||||||||||||
Empower of America Contract | 320,075,869 | 197,079,969 | 139,267,491 | 19,924,585 | - | - | 3,652,994 | - | 320,075,869 | ||||
0 | 0 | 3,652,994 | 0 | 320,075,869 | |||||||||
Total | $(1,645,134) | $58,646,418 | $33,750,270 | $15,317,524 | $1,426,387,350 |
Empower Moderately Conservative Profile Fund | |||||||||
Affiliate | Shares Held/ Account Balance 12/31/2023 | Value 12/31/2022 | Purchase Cost | Sales Cost | Net Realized Gain (Loss) | Net Change Unrealized Appreciation (Depreciation) | Dividends and Interest Received | Distributions Received | Value 12/31/2023 |
BOND MUTUAL FUNDS 32.91% | |||||||||
Empower Core Bond Fund Institutional Class | 4,370,104 | $ 26,142,591 | $14,143,354 | $ 4,453,792 | $ (498,032) | $ 920,421 | $ 1,919,700 | $ - | $ 36,752,574 |
Empower Global Bond Fund Institutional Class | 6,332,438 | 35,007,090 | 16,887,745 | 6,639,535 | (1,198,029) | 3,694,450 | 320,870 | - | 48,949,750 |
Empower High Yield Bond Fund Institutional Class | 2,289,839 | 15,573,071 | 7,109,763 | 2,077,361 | (55,797) | 1,262,491 | 891,630 | - | 21,867,964 |
Empower Inflation-Protected Securities Fund Institutional Class | 2,756,850 | 17,527,241 | 9,237,021 | 2,629,016 | (187,221) | 318,010 | 977,906 | - | 24,453,256 |
Empower Multi-Sector Bond Fund Institutional Class | 5,879,258 | 34,288,794 | 17,292,098 | 5,300,108 | (692,689) | 1,811,551 | 2,382,453 | - | 48,092,335 |
Empower Short Duration Bond Fund Institutional Class | 1,912,615 | 13,051,780 | 6,650,429 | 2,007,611 | (119,610) | 532,624 | 463,847 | - | 18,227,222 |
Annual Report - December 31, 2023
Empower Moderately Conservative Profile Fund | |||||||||||||
Affiliate | Shares Held/ Account Balance 12/31/2023 | Value 12/31/2022 | Purchase Cost | Sales Cost | Net Realized Gain (Loss) | Net Change Unrealized Appreciation (Depreciation) | Dividends and Interest Received | Distributions Received | Value 12/31/2023 | ||||
Empower U.S. Government Mortgage Securities Fund Institutional Class | 4,469,911 | $ 26,130,676 | $13,949,894 | $ 4,459,917 | $ (590,902) | $ 1,122,016 | $ 1,289,323 | $ - | $ 36,742,669 | ||||
(3,342,280) | 9,661,563 | 8,245,729 | 0 | 235,085,770 | |||||||||
EQUITY MUTUAL FUNDS 45.22% | |||||||||||||
Empower Emerging Markets Equity Fund Institutional Class | 2,556,934 | 15,248,148 | 9,424,549 | 4,833,288 | (276,438) | 1,920,095 | 314,532 | - | 21,759,504 | ||||
Empower International Growth Fund Institutional Class | 2,351,185 | 15,293,985 | 7,940,921 | 4,601,373 | 108,483 | 2,950,347 | 162,428 | - | 21,583,880 | ||||
Empower International Value Fund Institutional Class | 6,488,773 | 38,264,470 | 20,498,737 | 9,099,447 | 322,074 | 4,257,945 | 2,041,718 | 1,264,560 | 53,921,705 | ||||
Empower Large Cap Growth Fund Institutional Class | 2,830,903 | 20,678,524 | 10,016,135 | 9,369,466 | (1,354,558) | 7,550,015 | 59,261 | 738,600 | 28,875,208 | ||||
Empower Large Cap Value Fund Institutional Class | 10,641,823 | 51,718,524 | 32,343,083 | 11,079,180 | 1,022,370 | (298,773) | 1,797,420 | 5,673,769 | 72,683,654 | ||||
Empower Mid Cap Value Fund Institutional Class | 4,757,432 | 28,045,997 | 15,275,626 | 5,996,187 | 2,525,354 | 1,970,952 | 921,327 | 19,232 | 39,296,388 | ||||
Empower Real Estate Index Fund Institutional Class | 3,805,681 | 22,968,981 | 15,016,333 | 7,398,568 | 2,064,550 | 1,533,204 | 844,991 | 77,969 | 32,119,950 | ||||
Empower Small Cap Growth Fund Institutional Class | 1,001,827 | 7,516,796 | 4,386,057 | 2,882,806 | (37,171) | 1,609,338 | - | 1,975 | 10,629,385 | ||||
Empower Small Cap Value Fund Institutional Class | 3,890,585 | 18,725,611 | 14,097,596 | 6,939,198 | 509,060 | 416,346 | 722,236 | 2,616,377 | 26,300,355 | ||||
Empower T. Rowe Price Mid Cap Growth Fund Institutional Class | 2,610,351 | 11,231,567 | 7,637,192 | 3,790,161 | (364,828) | 844,540 | 55,852 | 2,097,046 | 15,923,138 | ||||
4,518,896 | 22,754,009 | 6,919,765 | 12,489,528 | 323,093,167 | |||||||||
FIXED INTEREST CONTRACT 21.90% | |||||||||||||
Empower of America Contract | 156,477,919 | 112,232,803 | 58,091,662 | 15,853,130 | - | - | 2,006,584 | - | 156,477,919 | ||||
0 | 0 | 2,006,584 | 0 | 156,477,919 | |||||||||
Total | $ 1,176,616 | $32,415,572 | $17,172,078 | $12,489,528 | $714,656,856 |
Empower Moderate Profile Fund | |||||||||
Affiliate | Shares Held/ Account Balance 12/31/2023 | Value 12/31/2022 | Purchase Cost | Sales Cost | Net Realized Gain (Loss) | Net Change Unrealized Appreciation (Depreciation) | Dividends and Interest Received | Distributions Received | Value 12/31/2023 |
BOND MUTUAL FUNDS 23.85% | |||||||||
Empower Core Bond Fund Institutional Class | 6,893,978 | $ 55,152,052 | $10,943,461 | $10,090,235 | $(1,778,630) | $ 1,973,081 | $ 3,407,844 | $ - | $ 57,978,359 |
Empower Global Bond Fund Institutional Class | 9,999,268 | 73,765,752 | 9,936,024 | 11,917,672 | (2,242,072) | 5,510,236 | 675,542 | - | 77,294,340 |
Empower High Yield Bond Fund Institutional Class | 3,622,887 | 32,845,594 | 4,208,423 | 4,718,893 | (274,654) | 2,263,445 | 1,633,394 | - | 34,598,569 |
Empower Inflation-Protected Securities Fund Institutional Class | 4,338,598 | 36,948,617 | 7,168,481 | 6,242,410 | (557,101) | 608,670 | 1,790,372 | - | 38,483,358 |
Annual Report - December 31, 2023
Empower Moderate Profile Fund | |||||||||||||
Affiliate | Shares Held/ Account Balance 12/31/2023 | Value 12/31/2022 | Purchase Cost | Sales Cost | Net Realized Gain (Loss) | Net Change Unrealized Appreciation (Depreciation) | Dividends and Interest Received | Distributions Received | Value 12/31/2023 | ||||
Empower Multi-Sector Bond Fund Institutional Class | 9,293,296 | $ 72,415,575 | $12,060,396 | $11,963,842 | $(2,019,571) | $ 3,507,028 | $ 4,241,002 | $ - | $ 76,019,157 | ||||
Empower Short Duration Bond Fund Institutional Class | 3,012,912 | 27,515,440 | 5,392,562 | 5,207,169 | (314,983) | 1,012,221 | 902,214 | - | 28,713,054 | ||||
Empower U.S. Government Mortgage Securities Fund Institutional Class | 7,042,880 | 55,146,379 | 10,618,956 | 9,132,360 | (1,101,771) | 1,259,504 | 2,456,591 | - | 57,892,479 | ||||
(8,288,782) | 16,134,185 | 15,106,959 | 0 | 370,979,316 | |||||||||
EQUITY MUTUAL FUNDS 60.33% | |||||||||||||
Empower Emerging Markets Equity Fund Institutional Class | 7,682,305 | 61,368,228 | 11,288,835 | 12,547,281 | (43,090) | 5,266,632 | 1,070,327 | - | 65,376,414 | ||||
Empower International Growth Fund Institutional Class | 7,077,653 | 61,421,255 | 9,072,281 | 13,099,858 | 2,066,604 | 7,579,174 | 492,305 | - | 64,972,852 | ||||
Empower International Value Fund Institutional Class | 19,553,244 | 153,464,235 | 21,850,441 | 25,064,181 | 4,331,207 | 12,236,958 | 6,255,685 | 4,102,603 | 162,487,453 | ||||
Empower Large Cap Growth Fund Institutional Class | 8,555,044 | 82,897,897 | 8,321,695 | 28,791,799 | (2,445,172) | 24,833,651 | 215,135 | 2,242,802 | 87,261,444 | ||||
Empower Large Cap Value Fund Institutional Class | 32,048,487 | 207,542,196 | 43,256,553 | 33,472,907 | 561,554 | 1,565,319 | 6,331,911 | 17,447,881 | 218,891,161 | ||||
Empower Mid Cap Value Fund Institutional Class | 14,364,777 | 112,516,981 | 17,521,409 | 24,831,735 | 940,848 | 13,446,405 | 2,990,831 | 75,420 | 118,653,060 | ||||
Empower Real Estate Index Fund Institutional Class | 7,387,411 | 59,246,226 | 13,019,195 | 16,222,879 | 95,224 | 6,307,208 | 1,918,596 | 152,143 | 62,349,750 | ||||
Empower Small Cap Growth Fund Institutional Class | 2,995,112 | 30,113,799 | 5,483,592 | 7,914,457 | 876,536 | 4,095,204 | - | 7,729 | 31,778,138 | ||||
Empower Small Cap Value Fund Institutional Class | 11,680,991 | 75,084,157 | 24,383,572 | 23,076,461 | 628,622 | 2,572,235 | 2,307,967 | 8,272,561 | 78,963,503 | ||||
Empower T. Rowe Price Mid Cap Growth Fund Institutional Class | 7,804,925 | 45,031,666 | 10,768,723 | 11,766,608 | (1,508,897) | 3,576,263 | 168,908 | 6,515,113 | 47,610,044 | ||||
5,503,436 | 81,479,049 | 21,751,665 | 38,816,252 | 938,343,819 | |||||||||
FIXED INTEREST CONTRACT 15.85% | |||||||||||||
Empower of America Contract | 246,462,445 | 236,925,843 | 45,885,102 | 40,287,803 | - | - | 3,939,302 | - | 246,462,445 | ||||
0 | 0 | 3,939,302 | 0 | 246,462,445 | |||||||||
Total | $(2,785,346) | $97,613,234 | $40,797,926 | $38,816,252 | $1,555,785,580 |
Empower Moderately Aggressive Profile Fund | |||||||||
Affiliate | Shares Held/ Account Balance 12/31/2023 | Value 12/31/2022 | Purchase Cost | Sales Cost | Net Realized Gain (Loss) | Net Change Unrealized Appreciation (Depreciation) | Dividends and Interest Received | Distributions Received | Value 12/31/2023 |
BOND MUTUAL FUNDS 17.91% | |||||||||
Empower Core Bond Fund Institutional Class | 2,823,259 | $ 18,055,897 | $ 8,383,806 | $ 3,444,387 | $ (552,411) | $ 748,292 | $ 1,286,815 | $ - | $ 23,743,608 |
Empower Global Bond Fund Institutional Class | 4,101,298 | 24,186,783 | 9,203,288 | 3,914,537 | (716,428) | 2,227,498 | 231,188 | - | 31,703,032 |
Empower High Yield Bond Fund Institutional Class | 1,486,750 | 10,772,711 | 4,112,708 | 1,485,975 | (19,906) | 799,016 | 609,583 | - | 14,198,460 |
Annual Report - December 31, 2023
Empower Moderately Aggressive Profile Fund | |||||||||||||
Affiliate | Shares Held/ Account Balance 12/31/2023 | Value 12/31/2022 | Purchase Cost | Sales Cost | Net Realized Gain (Loss) | Net Change Unrealized Appreciation (Depreciation) | Dividends and Interest Received | Distributions Received | Value 12/31/2023 | ||||
Empower Inflation-Protected Securities Fund Institutional Class | 1,782,389 | $ 12,109,685 | $ 5,624,198 | $ 2,198,571 | $ (221,025) | $ 274,480 | $ 666,859 | $ - | $ 15,809,792 | ||||
Empower Multi-Sector Bond Fund Institutional Class | 3,812,119 | 23,738,833 | 10,233,354 | 4,079,102 | (628,162) | 1,290,049 | 1,610,665 | - | 31,183,134 | ||||
Empower Short Duration Bond Fund Institutional Class | 3,023,084 | 22,046,810 | 10,010,581 | 4,119,593 | (212,568) | 872,197 | 781,321 | - | 28,809,995 | ||||
Empower U.S. Government Mortgage Securities Fund Institutional Class | 2,888,528 | 18,034,538 | 8,269,496 | 3,392,242 | (590,162) | 831,910 | 883,831 | - | 23,743,702 | ||||
(2,940,662) | 7,043,442 | 6,070,262 | 0 | 169,191,723 | |||||||||
EQUITY MUTUAL FUNDS 73.19% | |||||||||||||
Empower Emerging Markets Equity Fund Institutional Class | 5,772,893 | 36,824,716 | 16,080,321 | 8,944,502 | (1,543,415) | 5,166,784 | 742,351 | - | 49,127,319 | ||||
Empower International Growth Fund Institutional Class | 5,325,354 | 37,004,102 | 14,253,344 | 7,920,804 | 1,318,000 | 5,550,103 | 369,106 | - | 48,886,745 | ||||
Empower International Value Fund Institutional Class | 14,686,139 | 92,563,794 | 36,305,941 | 15,295,088 | 2,310,850 | 8,467,168 | 4,654,588 | 2,936,971 | 122,041,815 | ||||
Empower Large Cap Growth Fund Institutional Class | 6,427,313 | 50,043,094 | 15,436,579 | 17,549,500 | (2,900,431) | 17,628,424 | 143,093 | 1,678,617 | 65,558,597 | ||||
Empower Large Cap Value Fund Institutional Class | 24,041,302 | 125,445,557 | 56,928,197 | 28,081,177 | (8,414,045) | 9,909,518 | 4,301,777 | 12,938,875 | 164,202,095 | ||||
Empower Mid Cap Value Fund Institutional Class | 10,806,334 | 67,964,112 | 26,759,784 | 14,645,553 | 1,176,215 | 9,181,972 | 2,144,779 | 47,838 | 89,260,315 | ||||
Empower Real Estate Index Fund Institutional Class | 3,918,436 | 25,241,135 | 12,979,591 | 10,929,159 | (2,175,294) | 5,780,030 | 921,276 | 80,321 | 33,071,597 | ||||
Empower Small Cap Growth Fund Institutional Class | 2,260,729 | 18,268,080 | 7,435,740 | 5,286,646 | 4,436 | 3,569,160 | - | 4,900 | 23,986,334 | ||||
Empower Small Cap Value Fund Institutional Class | 8,785,719 | 45,582,164 | 25,973,359 | 16,709,929 | (2,408,868) | 4,545,865 | 1,671,550 | 6,028,161 | 59,391,459 | ||||
Empower T. Rowe Price Mid Cap Growth Fund Institutional Class | 5,863,003 | 27,192,521 | 13,526,510 | 9,462,757 | (3,339,640) | 4,508,044 | 126,705 | 4,798,444 | 35,764,318 | ||||
(15,972,192) | 74,307,068 | 15,075,225 | 28,514,127 | 691,290,594 | |||||||||
FIXED INTEREST CONTRACT 8.93% | |||||||||||||
Empower of America Contract | 84,301,114 | 64,698,534 | 29,873,554 | 11,426,457 | - | - | 1,155,483 | - | 84,301,114 | ||||
0 | 0 | 1,155,483 | 0 | 84,301,114 | |||||||||
Total | $(18,912,854) | $81,350,510 | $22,300,970 | $28,514,127 | $944,783,431 |
Empower Aggressive Profile Fund | |||||||||
Affiliate | Shares Held/ Account Balance 12/31/2023 | Value 12/31/2022 | Purchase Cost | Sales Cost | Net Realized Gain (Loss) | Net Change Unrealized Appreciation (Depreciation) | Dividends and Interest Received | Distributions Received | Value 12/31/2023 |
EQUITY MUTUAL FUNDS 100.03% | |||||||||
Empower Emerging Markets Equity Fund Institutional Class | 6,701,938 | $ 40,342,746 | $20,104,207 | $ 7,872,360 | $ (355,234) | $ 4,458,904 | $ 832,976 | $ - | $ 57,033,496 |
Annual Report - December 31, 2023
Empower Aggressive Profile Fund | |||||||||||||
Affiliate | Shares Held/ Account Balance 12/31/2023 | Value 12/31/2022 | Purchase Cost | Sales Cost | Net Realized Gain (Loss) | Net Change Unrealized Appreciation (Depreciation) | Dividends and Interest Received | Distributions Received | Value 12/31/2023 | ||||
Empower International Growth Fund Institutional Class | 6,155,955 | $ 40,372,543 | $16,582,540 | $ 6,616,507 | $ 1,527,798 | $ 6,173,090 | $ 426,191 | $ - | $ 56,511,666 | ||||
Empower International Value Fund Institutional Class | 16,996,062 | 101,285,239 | 46,256,238 | 15,554,097 | 2,468,571 | 9,249,900 | 5,358,206 | 3,334,566 | 141,237,280 | ||||
Empower Large Cap Growth Fund Institutional Class | 7,420,664 | 54,675,947 | 20,866,387 | 19,017,127 | (3,025,879) | 19,165,569 | 157,962 | 1,939,700 | 75,690,776 | ||||
Empower Large Cap Value Fund Institutional Class | 27,836,831 | 136,812,012 | 69,267,219 | 18,464,233 | (1,258,582) | 2,510,559 | 4,819,744 | 14,916,422 | 190,125,557 | ||||
Empower Mid Cap Value Fund Institutional Class | 12,467,253 | 74,243,051 | 29,100,776 | 12,665,524 | (766,468) | 12,301,204 | 2,441,139 | 51,690 | 102,979,507 | ||||
Empower Real Estate Index Fund Institutional Class | 2,778,794 | 16,934,706 | 8,410,267 | 4,584,562 | (191,715) | 2,692,607 | 628,694 | 57,037 | 23,453,018 | ||||
Empower Small Cap Growth Fund Institutional Class | 2,608,644 | 19,824,025 | 8,371,345 | 4,345,809 | 202,980 | 3,828,150 | - | 5,283 | 27,677,711 | ||||
Empower Small Cap Value Fund Institutional Class | 10,166,586 | 49,670,835 | 28,781,742 | 11,108,927 | 877,080 | 1,382,473 | 1,909,555 | 6,893,538 | 68,726,123 | ||||
Empower T. Rowe Price Mid Cap Growth Fund Institutional Class | 6,796,374 | 29,707,148 | 15,675,915 | 6,600,564 | (1,519,189) | 2,675,382 | 146,422 | 5,509,939 | 41,457,881 | ||||
(2,040,638) | 64,437,838 | 16,720,889 | 32,708,175 | 784,893,015 | |||||||||
Total | $(2,040,638) | $64,437,838 | $16,720,889 | $32,708,175 | $784,893,015 |
3. PURCHASES & SALES OF INVESTMENTS
For the year ended December 31, 2023, the aggregate cost of purchases and proceeds from sales of investments, excluding all U.S. Government securities and short-term securities, were as follows:
Purchases | Sales | ||
Empower Conservative Profile Fund | $633,419,880 | $140,465,615 | |
Empower Moderately Conservative Profile Fund | 279,998,193 | 110,586,760 | |
Empower Moderate Profile Fund | 271,179,700 | 293,563,203 | |
Empower Moderately Aggressive Profile Fund | 311,390,352 | 149,973,125 | |
Empower Aggressive Profile Fund | 263,416,637 | 104,789,075 |
4. INDEMNIFICATIONS
The Funds' organizational documents provide current and former officers and directors with a limited indemnification against liabilities arising in connection with the performance of their duties to the Funds. In the normal course of business, the Funds may also enter into contracts that provide general indemnifications. The Funds' maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Funds. The risk of material loss from such claims is considered remote.
5. SUBSEQUENT EVENTS
Effective January 12, 2024, the Federal Income Taxes and Distributions to Shareholders section was amended and distributions to shareholders from net investment income of each Fund, if any, are declared and paid annually.
Management has reviewed all events subsequent to December 31, 2023, including the estimates inherent in the process of preparing these financial statements, through the date the financial statements were issued. No subsequent events requiring adjustment or disclosure have occurred other than what is disclosed above.
Annual Report - December 31, 2023
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and the Board of Directors of Empower Funds, Inc.
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statements of assets and liabilities, including the schedules of investments, of the Empower Conservative Profile Fund, Empower Moderately Conservative Profile Fund, Empower Moderate Profile Fund, Empower Moderately Aggressive Profile Fund, and Empower Aggressive Profile Fund (collectively, the “Funds”), five of the funds comprising Empower Funds, Inc., as of December 31, 2023, the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of each of the Funds as of December 31, 2023, and the results of their operations for the year then ended, the changes in their net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on the Funds’ financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Funds in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Funds are not required to have, nor were we engaged to perform, an audit of their internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as of December 31, 2023, by correspondence with the transfer agent. We believe that our audits provide a reasonable basis for our opinion.
DELOITTE & TOUCHE LLP
Denver, Colorado
February 23, 2024
February 23, 2024
We have served as the auditor of one or more Empower investment companies since 1982.
TAX INFORMATION (unaudited)
Each Fund intends to pass through foreign tax credits and have derived gross income from sources within foreign countries amounting to the following:
Foreign Tax Credits | Gross Income from Foreign Countries | ||
Empower Conservative Profile Fund | $363,779 | $3,855,166 | |
Empower Moderately Conservative Profile Fund | 293,880 | 3,114,362 | |
Empower Moderate Profile Fund | 885,007 | 9,379,771 | |
Empower Moderately Aggressive Profile Fund | 664,866 | 7,046,774 | |
Empower Aggressive Profile Fund | 769,837 | 8,157,929 |
Dividends paid by each Fund from net investment income and distributions of net realized short-term capital gains are, for federal income tax purposes, taxable as ordinary income to shareholders. Of the ordinary income distributions declared for the year ended December 31, 2023, the following are the percentages that qualify for the dividend received deduction available to each Fund's corporate shareholders.
Percent of Ordinary Income Distributions Qualifying for Dividends Received | |
Empower Conservative Profile Fund | 10% |
Empower Moderately Conservative Profile Fund | 17% |
Empower Moderate Profile Fund | 26% |
Empower Moderately Aggressive Profile Fund | 31% |
Empower Aggressive Profile Fund | 54% |
Fund Directors and Officers
Empower Funds is organized under Maryland law, and is governed by the Board of Directors. The following table provides information about each of the Directors and executive officers of Empower Funds.
Independent Directors* | |||||
Name, Address, and Age | Positions(s) Held with Empower Funds | Term of Office and Length of Time Served** | Principal Occupation(s) During Past 5 Years | Number of Funds in Fund Complex Overseen by Director | Other Directorships Held by Director |
Gail H. Klapper 8515 East Orchard Road, Greenwood Village, CO 80111 80 | Chair & Independent Director | Since 2016 (as Chair) Since 2007 (as Independent Director) | Managing Attorney, Klapper Law Firm; Member/Director, The Colorado Forum; Manager, 6K Ranch, LLC; and former Director, Guaranty Bancorp | 45 | Director, Gold, Inc. |
James A. Hillary*** 8515 East Orchard Road, Greenwood Village, CO 80111 60 | Independent Director | Since 2017 | Principal and Founding Partner, Fios Capital, LLC; Member, Fios Partners LLC, Fios Holdings LLC; Sole Member, Fios Companies LLC, Resolute Capital Asset Partners; Manager, Applejack Holdings, LLC; and Manager and Member, Prestige Land Holdings, LLC | 45 | N/A |
R. Timothy Hudner**** 8515 East Orchard Road, Greenwood Village, CO 80111 64 | Independent Director | Since 2017 | Director, Colorado State Housing Board; and former Director, Grand Junction Housing Authority; Counseling and Education Center | 45 | N/A |
Steven A. Lake 8515 East Orchard Road, Greenwood Village, CO 80111 69 | Independent Director | Since 2017 | Managing Member, Lake Advisors, LLC; Member, Gart Capital Partners, LLC; and Executive Member, Sage Enterprise Holdings, LLC | 45 | N/A |
Stephen G. McConahey 8515 East Orchard Road, Greenwood Village, CO 80111 80 | Independent Director & Audit Committee Chair | Since 2011 (as Independent Director) Since 2015 (as Audit Committee Chair) | Chairman, SGM Capital, LLC; Partner, Iron Gate Capital, LLC; Director, The IMA Financial Group, Inc.; and former Director, Guaranty Bancorp | 45 | N/A |
Interested Director***** | |||||
Name, Address, and Age | Positions(s) Held with Empower Funds | Term of Office and Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of Funds in Fund Complex Overseen by Director | Other Directorships Held by Director |
Jonathan D. Kreider 8515 East Orchard Road, Greenwood Village, CO 80111 40 | Director, President & Chief Executive Officer | Since 2020 | Executive Vice President & Head of Empower Investments, Empower, Empower of America and Empower Life & Annuity Insurance Company of New York (“Empower of NY”); President, Chief Executive Officer & Manager, ECM; formerly, Vice President, Empower Funds Investment Products and Empower Advisory Group, LLC (“EAG”) | 45 | N/A |
Officers | |||||
Name, Address, and Age | Positions(s) Held with Empower Funds | Term of Office and Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of Fund in Fund Complex Overseen by Director | Other Directorships Held by Director |
Jonathan D. Kreider 8515 East Orchard Road, Greenwood Village, CO 80111 40 | Director, President & Chief Executive Officer | Since 2020 | Executive Vice President & Head of Empower Investments, Empower, Empower of America and Empower of NY; President, Chief Executive Officer & Manager, ECM; formerly, Vice President, Empower Funds Investment Products and EAG | 45 | N/A |
Katherine Stoner 8515 East Orchard Road, Greenwood Village, CO 80111 67 | Chief Compliance Officer | Since 2016 | Vice President, Compliance Empower Investments, Empower; Chief Compliance Officer, ECM and EAG | N/A | N/A |
Ryan L. Logsdon 8515 East Orchard Road, Greenwood Village, CO 80111 49 | Chief Legal Officer & Secretary | Since 2010 (as Secretary) Since 2021 (as Chief Legal Officer) | Vice President, Deputy General Counsel & Corporate Secretary, Empower, Empower of America & Empower of NY; Vice President & Counsel, ECM; formerly, Vice President & Counsel, Empower Funds; Vice President, Counsel & Secretary, EAG & EFSI | N/A | N/A |
Kelly B. New 8515 East Orchard Road, Greenwood Village, CO 80111 48 | Chief Financial Officer & Treasurer | Since 2021 | Vice President, Fund Administration, Empower; Chief Financial Officer & Treasurer, ECM; Vice President & Treasurer, CITs, Empower Trust Company, LLC (“ETC”); formerly, Assistant Treasurer Empower Funds, ECM & ETC | N/A | N/A |
Officers | |||||
Name, Address, and Age | Positions(s) Held with Empower Funds | Term of Office and Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of Fund in Fund Complex Overseen by Director | Other Directorships Held by Director |
John A. Clouthier 8515 East Orchard Road, Greenwood Village, CO 80111 56 | Assistant Treasurer | Since 2007 | Vice President, Fund Administration, Empower; Assistant Treasurer, ECM; Assistant Vice President and Assistant Treasurer, ETC | N/A | N/A |
Abhijit Dande 8515 East Orchard Road, Greenwood Village, CO 80111 43 | Derivatives Risk Manager | Since 2022 | Vice President, Financial Risk Management, Empower; Derivatives Risk Manager, ECM | N/A | N/A |
* A Director who is not an “interested person” of Empower Funds (as defined in Section 2(a)(19) of the 1940 Act, as amended) is referred to as an “Independent Director.”
** Each Director serves until the next shareholders’ meeting (and until the election and qualification of a successor), or until death, resignation, removal or retirement which takes effect no later than May 1 following his or her 75th birthday unless otherwise determined by the remaining directors. The remaining Independent Directors determined that Ms. Klapper and Mr. McConahey should continue on the Board until at least May 1, 2024. Officers are elected by the Board on an annual basis to serve until their successors have been elected and qualified.
*** Mr. Hillary is the sole member of Resolute Capital Asset Partners LLC, which is the general partner for Resolute Capital Asset Partners Fund I LP. Goldman Sachs & Co. LLC, the clearing agent and custodian for Resolute Capital Asset Partners Fund I LP, is the parent company of Goldman Sachs Asset Management, LP, the Sub-Adviser of the Empower Inflation-Protected Securities Fund, Empower Mid Cap Value Fund and other series of Empower Funds; and a Sub-Adviser of the Empower Core Bond Fund. Mr. Hillary has personal banking accounts with an affiliate of J.P. Morgan Investment Management Inc., a Sub-Adviser of the Empower International Growth Fund, Empower Large Cap Growth Fund and other series of Empower Funds. Mr. Hillary receives no special treatment due to the relationship.
**** Mr. Hudner’s daughter is employed by JP Morgan Chase, N.A., an affiliate of J.P. Morgan Investment Management Inc., a Sub-Adviser of the Empower International Growth Fund, Empower Large Cap Growth Fund and other series of Empower Funds. Mr. Hudner has personal investments in the following: (1) a mutual fund advised by Lazard Asset Management LLC, a Sub-Adviser of the Empower Emerging Markets Equity Fund, (2) a mutual fund advised by Massachusetts Financial Services Company, a Sub-Adviser of the Empower International Value Fund, and (3) a mutual fund advised by Virtus Investment Advisers, Inc., an affiliate of Virtus Fixed Income Advisers, LLC, a Sub-Adviser of the Empower Multi-Sector Bond Fund. Mr. Hudner receives no special treatment due to his ownership of such mutual funds.
***** An “Interested Director” refers to a Director who is an “interested person” of Empower Funds (as defined in Section 2(a)(19) of the 1940 Act, as amended) by virtue of their affiliation with ECM.
There are no arrangements or understandings between any Director or officer and any other person(s) pursuant to which s/he was elected as Director or officer.
Additional information about Empower Funds and its Directors is available in the Empower Funds’ Statement of Additional Information (“SAI”), which can be obtained free of charge upon request to: Secretary, Empower Funds, Inc., 8525 East Orchard Road, Greenwood Village, Colorado 80111; (866) 831-7129. The SAI is also available on the Fund’s web site at https://www.empower.com.
Availability of Quarterly Portfolio Schedule
Empower Funds files its complete schedule of portfolio holdings with the Securities and Exchange Commission for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. Empower Funds’ Form N-PORT reports are available on the Commission’s website at http://www.sec.gov.
Availability of Proxy Voting Policies and Procedures
A description of the policies and procedures that Empower Funds uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, by calling (866) 831-7129, and on the Securities and Exchange Commission’s website at http://www.sec.gov.
Availability of Proxy Voting Record
Information regarding how Empower Funds voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available without charge, upon request, by calling (866) 831-7129, and on the Securities and Exchange Commission’s website at http://www.sec.gov.
ITEM 2. CODE OF ETHICS.
(a) As of the end of the period covered by this report, the registrant has adopted a Code of Ethics (the “Code of Ethics”) that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party.
(b) For purposes of this Item, "code of ethics" means written standards that are reasonably designed to deter wrongdoing and to promote:
(1) Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;
(2) Full, fair, accurate, timely, and understandable disclosure in reports and documents that a registrant files with, or submits to, the Commission and in other public communications made by the registrant;
(3) Compliance with applicable governmental laws, rules, and regulations;
(4) The prompt internal reporting of violations of the code to an appropriate person or persons identified in the code; and
(5) Accountability for adherence to the code.
(c) During the period covered by this report, there have been no amendments to the registrant’s Code of Ethics.
(d) During the period covered by this report, the registrant has not granted any express or implicit waivers from the provisions of the Code of Ethics.
(e) Registrant’s Code of Ethics is attached hereto.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Mr. Stephen A. Lake is the audit committee financial expert and is "independent," pursuant to general instructions on Form N-CSR, Item 3.
An “audit committee financial expert” is not an “expert” for any purpose, including for purposes of Section 11 of the Securities Act of 1933, as a result of being designated as an “audit committee financial expert.” Further, the designation of a person as an “audit committee financial expert” does not mean that the person has any greater duties, obligations, or liability than those imposed on the person without the “audit committee financial expert” designation. Similarly, the designation of a person as an “audit committee financial expert” does not affect the duties, obligations, or liability of any other member of the Audit Committee or Board of Directors.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Audit Fees. The aggregate fees billed for each of the last two fiscal years for professional services rendered by the principal accountant for the audit of the registrant’s annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years were: $1,031,500 for fiscal year 2022 and $1,050,700 for fiscal year 2023.
(b) Audit-Related Fees. The aggregate fees billed in each of the last two fiscal years for assurance and related services by the principal accountant that are reasonably related to the performance of the audit of the registrant’s financial statements and are not reported under paragraph (a) of this Item were: $42,000 for fiscal year 2022 and $44,680 for fiscal year 2023. The nature of the services comprising the fees disclosed under this category involved performance of 17f-2 (self-custody) audits and administrative services related to the audit.
(c) Tax Fees. The aggregate fees billed in each of the last two fiscal years for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning were: $0 for fiscal year 2022 and $0 for fiscal year 2023.
(d) All Other Fees. There were no fees billed in each of the last two fiscal years for products and services provided by the principal accountant, other than the services reported in paragraphs ((a) through (c) of this Item).
(e) (1) Audit Committee’s Pre-Approval Policies and Procedures.
Pre-Approval of Audit Services. The Audit Committee must approve prior to retention all audit, review or attest engagements required under the securities laws that are provided to Empower Funds by its independent auditors. The Audit Committee will not grant such approval to any auditors that are proposed to perform an audit for Empower Funds if a chief executive officer, controller, chief financial officer, chief accounting officer or any person serving in an equivalent position for Empower Funds that is responsible for the financial reporting or operations of Empower Funds was employed by those auditors and participated in any capacity in an audit of Empower Funds during the year period (or such other period proscribed under Securities Exchange Commission rules) preceding the date of initiation of such audit.
Pre-Approval of Non-Audit Services. The Audit Committee must pre-approve any non-audit services, including tax services, to be provided to Empower Funds by its independent auditors (except those within applicable de minimis statutory or regulatory exceptions)1 provided that Empower Funds’ auditors will not provide the following non-audit services to Empower Funds: (a) bookkeeping or other services related to the accounting records or financial statements of Empower Funds; (b) financial information systems design and implementation; (c) appraisal or valuation services, fairness opinions, or contribution-in-kind reports; (d) actuarial services; (e) internal audit outsourcing services; (f) management functions or human resources; (g) broker-dealer, investment adviser, or investment banking services; (h) legal services; (i) expert services unrelated to the audit; and (j) any other service that the Public Company Accounting Oversight Board determines, by regulation, is impermissible. 2
Pre-approval with respect to Non-Empower Funds Entities. The Audit Committee must pre-approve any non-audit services that relate directly to the operations and financial reporting of Empower Funds (except those within applicable de minimis statutory or regulatory exceptions)3 to be provided by Empower Funds’ auditors to (a) Empower Funds’ investment adviser; and (b) any entity controlling, controlled by, or under common control with the investment adviser if that entity provides ongoing services to Empower Funds.4 The Audit Committee may approve audit and non-audit services on a case-by-case basis or adopt pre-approval policies and procedures that are detailed as to a particular service, provided that the Audit Committee is informed promptly of each service, or use a combination of these approaches.
Delegation . The Audit Committee may delegate pre-approval authority to one or more of the Audit Committee's members. Any member or members to whom such pre-approval authority is delegated
must report any pre-approval decisions to the Audit Committee at its next scheduled meeting.
(f) (2) 100% of the services described pursuant to paragraphs (b) through (d) of this Item 4 of Form N-CSR were approved by the Audit Committee, and no such services were approved by the Audit Committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
(g) Not Applicable.
(h) The aggregate non-audit fees billed by the registrant’s accountant for services rendered to the registrant, and rendered to the registrant’s investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant for fiscal year 2022 equaled $1,022,840 and for fiscal year 2023 equaled $1,795,449.
(i) The registrant’s Audit Committee of the Board of Directors has considered whether the provision of non-audit services that were rendered to the registrant’s investment adviser (not including any subadviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountant’s independence.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. INVESTMENTS.
(a) The schedule is included as part of the report to shareholders filed under Item 1 of this Form.
(b) Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASE OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which shareholders may recommend nominees to the registrant’s board of directors that were implemented after the registrant last provided disclosure in response to this Item.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive officer and principal financial officer have concluded, based upon their evaluation of the registrant's disclosure controls and procedures as conducted within 90 days of the filing date of this report, that these disclosure controls and procedures provide reasonable assurance that material information required to be disclosed by the registrant in the report it files or submits on Form N-CSR is recorded, processed, summarized and reported, within the time periods specified in the commission's rules and forms and that such material information is accumulated and communicated to the registrant's management, including its principal executive officer and principal financial officer, as appropriate, in order to allow timely decisions regarding required disclosure.
(b) The registrant's principal executive officer and principal financial officer are aware of no changes in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
ITEM 12. DISCLOSURE OF LENDING ACTIVITES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
(a) Not applicable.
ITEM 13. EXHIBITS.
(3) Not applicable.
(4) Not applicable.
1No pre-approval is required as to non-audit services provided to Empower Funds if: (a) the aggregate amount of all non-audit services provided to Empower Funds constitute not more than 5% of the total amount of revenues paid by Empower Funds to the independent auditors during the fiscal year in which the services are provided; (b) these services were not recognized by Empower Funds at the time of the engagement to be non-audit services; and (c) the services are promptly brought to the attention of the Audit Committee and approved by the Audit Committee prior to the completion of the audit.
2With respect to the prohibitions on (a) bookkeeping; (b) financial information systems design and implementation; (c) appraisal, valuation, fairness opinions, or contribution-in-kind reports; (d) actuarial; and (e) internal audit outsourcing, such services are permitted to be provided if it is reasonable to conclude that the results of these services will not be subject to audit procedures during an audit of the audit client's financial statements.
3For non-audit services provided to the adviser and entities in a control relationship with the adviser, no pre-approval is required if: (a) the aggregate amount of all non-audit services provided constitute not more than 5% of the total amount of revenues paid to the independent auditors during the fiscal year in which the services are provided to Empower Funds, Empower Funds’ investment adviser, and any entity controlling, controlled by, or under common control with the investment adviser if that entity provides ongoing services to Empower Funds; (b) these services were not recognized by Empower Funds at the time of the engagement to be non-audit services; and (c) the services are promptly brought to the attention of the Audit Committee and approved by the Audit Committee prior to the completion of the audit.
4No pre-approval is required by the Audit Committee as to non-audit services provided to any Empower Funds sub-adviser that primarily provides portfolio management services and is under the direction of another investment adviser and is not affiliated with Empower Funds’ primary investment adviser.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
EMPOWER FUNDS, INC.
By: | /s/ Jonathan D. Kreider |
Jonathan D. Kreider
Director, President & Chief Executive Officer
Director, President & Chief Executive Officer
Date:February 23, 2024
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By: | /s/ Jonathan D. Kreider |
Jonathan D. Kreider
Director, President & Chief Executive Officer
Director, President & Chief Executive Officer
Date:February 23, 2024
By: | /s/ Kelly B. New |
Kelly B. New
Chief Financial Officer & Treasurer
Chief Financial Officer & Treasurer
Date:February 23, 2024