TORONTO--(BUSINESS WIRE)--CI Financial Corp. ("CI") (TSX: CIX) today released financial results for the quarter ended December 31, 2022.
"CI's strong performance during an extended period of financial market volatility reflects the continued successful execution of the three pillars of our corporate strategy," said Kurt MacAlpine, CI Chief Executive Officer.
"In the fourth quarter, robust net flows in our Canadian and U.S. businesses, along with the acquisition of three best-in-class U.S. registered investment advisor firms, drove double-digit asset growth.
"In Canadian asset management, we continue to see the benefits of the transformation of our investment management function from a group of independent boutiques into an integrated, global platform," Mr. MacAlpine said. "In the fourth quarter, our Canadian retail business delivered $1.6 billion in positive net flows, versus net redemptions of more than $10 billion for the Canadian industry overall. Our relative investment results continue to be strong and our investment professionals received extensive industry recognition for their performance, winning 14 Refinitiv Lipper Fund Awards and 39 FundGrade A+ Awards for 2022.
"Our wealth management businesses had total net flows in 2022 of $6.6 billion in the U.S. and $3.8 billion in Canada, a testament to the excellence of our advisor teams and our differentiated approach to wealth management - which offers exceptional value to clients, especially during these uncertain times," Mr. MacAlpine said. "We continue to make significant investments into advancing the technology, support and services of our Canadian wealth platform.
"Meanwhile, our U.S. wealth management business has tremendous momentum going into 2023, having added three high-quality RIAs in the fourth quarter and reaching $181 billion in assets [at December 31, 2022]. We started the process for the IPO of that business with the submission of the Form S-1 with the Securities and Exchange Commission in December. We've also assembled an accomplished leadership team at our U.S. headquarters to foster the continued integration of the business and the growth and development of our advisor teams across the country."
Operating and financial data highlights
[millions of dollars, except share amounts] | As of and for the quarters ended | |||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | ||||||
Total AUM and Client Assets: | ||||||||||
Asset Management AUM | 117,753 | 114,196 | 116,065 | 136,271 | 144,247 | |||||
Canada Wealth Management assets | 77,421 | 73,976 | 74,128 | 78,957 | 80,633 | |||||
U.S. Wealth Management assets | 180,579 | 149,841 | 143,520 | 145,768 | 151,339 | |||||
Total assets | 375,753 | 338,014 | 333,712 | 360,996 | 376,219 | |||||
Asset Management Net Inflows: | ||||||||||
Retail | 1,621 | 640 | (381) | (861) | 142 | |||||
Institutional | (195) | (21) | (3,203) | (264) | (331) | |||||
Australia | 12 | (377) | (122) | (305) | 82 | |||||
Closed Business | (169) | (129) | (160) | (203) | (195) | |||||
U.S. Asset Management | 595 | (38) | (195) | 402 | 260 | |||||
Total | 1,864 | 75 | (4,060) | (1,231) | (42) | |||||
IFRS Results (unaudited) | ||||||||||
Net income attributable to shareholders | (9.5) | 14.9 | 156.2 | 138.1 | 123.7 | |||||
Diluted earnings per share | (0.05) | 0.08 | 0.81 | 0.70 | 0.62 | |||||
Pretax income | 33.6 | 37.8 | 219.0 | 185.8 | 175.1 | |||||
Pretax margin | 5.4% | 7.4% | 38.6% | 29.3% | 28.3% | |||||
Operating cash flow before the change in operating assets and liabilities | 150.9 | 64.8 | 141.2 | 207.7 | 179.2 | |||||
Adjusted Results (unaudited) | ||||||||||
Adjusted net income | 135.9 | 135.9 | 149.1 | 166.8 | 171.0 | |||||
Adjusted diluted earnings per share | 0.74 | 0.73 | 0.78 | 0.85 | 0.86 | |||||
Adjusted EBITDA | 242.7 | 237.5 | 251.0 | 272.9 | 277.2 | |||||
Adjusted EBITDA margin | 42.4% | 43.0% | 44.5% | 46.5% | 47.7% | |||||
Free cash flow | 157.9 | 151.5 | 176.4 | 201.6 | 187.1 | |||||
| ||||||||||
Average shares outstanding | 183,666,579 | 185,601,752 | 191,151,896 | 196,111,771 | 196,816,227 | |||||
Ending shares outstanding | 184,517,832 | 183,526,499 | 189,037,762 | 192,987,082 | 197,422,270 | |||||
Total debt | 4,216 | 3,949 | 3,688 | 3,530 | 3,776 | |||||
Net debt | 4,059 | 3,730 | 3,538 | 3,352 | 3,453 | |||||
Net debt to adjusted EBITDA | 4.2 | 4.0 | 3.5 | 3.0 | 3.1 | |||||
- Free cash flow, net debt, adjusted net income, adjusted earnings per share and adjusted EBITDA are not standardized earnings measures prescribed by IFRS. For further information, see "Non-IFRS Measures" note below.
Financial highlights
The fourth quarter net loss of ($9.5) million in the quarter compared to a net income of $14.9 million in the third quarter. The fourth quarter net loss resulted from a combination of a non-cash charge due to the change in estimated contingent consideration and cumulative purchase price allocation adjustments as well as a higher tax rate in the quarter due to a valuation allowance for certain deferred tax assets and non-deductible transaction related expenses. Excluding non-operating items, adjusted net income of $135.9 million in the quarter was unchanged from the third quarter of 2022.
Fourth quarter total net revenues increased 20.8% to $620.3 million in the quarter from $513.6 million in the third quarter of 2022. Excluding non-operating items, adjusted total net revenue grew 4.7% to $614.9 million, as lower revenues from the Asset Management segment due to lower average AUM were more than offset by the impact of acquisitions in the U.S. Wealth Management segment.
Fourth quarter total expenses increased 23.3% to $586.7 million in the quarter from $475.8 million in the second quarter of 2022. Excluding non-operating items, adjusted total expenses were up 6.1% to $411.7 million, reflecting the impact of acquisitions that closed during the fourth quarter.
Capital allocation
The Board of Directors declared a quarterly dividend of $0.18 per share, payable on July 14, 2023 to shareholders of record on June 30, 2023. The annual dividend rate of $0.72 per share represented a yield of 4.7% on CI's closing share price of $15.30 on February 23, 2023.
Fourth quarter business highlights
- CI completed the acquisitions of three U.S. registered investment advisor ("RIA") firms, adding a combined total of approximately US$18.4 billion in assets to CI Private Wealth US. The firms, which focus on meeting the complex needs of ultra-high-net-worth individuals and families through comprehensive wealth management services, are:
- The Boston-based team and assets of Eaton Vance WaterOak Advisors (formerly Eaton Vance Investment Counsel), which now operates as CI Eaton Private Wealth.
- Inverness Counsel, LLC, a New York City-based RIA that has been rebranded CI Inverness Private Wealth.
- Kore Private Wealth, LLC, of New York City which now operates as CI Kore Private Wealth.
- As announced in December, CI US Holdings Inc. ("CI US") confidentially submitted a draft registration statement on Form S-1 with the Securities and Exchange Commission (the "SEC"), relating to a proposed initial public offering of common stock of CI US. The number of shares to be offered and the price range for the proposed offering have not yet been determined. The IPO is expected to take place after the SEC completes its review process, subject to market and other conditions.
- Leonard "Lennie" Gullan joined CI Private Wealth US as Executive Vice President and Chief Operating Officer, effective October 1, 2022. In this role, Mr. Gullan oversees the U.S. business's daily operations, trading and technology, and leads the firm's initiatives to integrate and transform operations, platforms and technologies across the CIPW businesses. He also assists in developing the firm's strategic direction and identifying and evaluating acquisition opportunities. Prior to CIPW, Mr. Gullan was a Managing Director at Citadel, where he held a variety of senior leadership positions.
- CI was named one of Greater Toronto's Top Employers for 2023 in recognition of its exceptional human resources practices and programs. In particular, the awards program noted CI's increased support for employees in response to the pandemic and its commitment to employee career development.
- CI Global Asset Management ("CI GAM") was recognized with 14 Refinitiv Canada Lipper Fund Awards for 2022. The awards recognize mutual funds and exchange-traded funds that have provided consistently strong risk-adjusted performance, relative to peers.
- CI GAM continued to enhance its product lineup with the introduction of three global fixed-income solutions: CI Global Investment Grade ETF, CI Global Investment Grade Fund and CI Global Bond Currency Neutral Fund.
Following quarter-end:
- CI's common shares ceased trading on the New York Stock Exchange as of January 19, 2023, following CI's decision to voluntarily delist its shares from the exchange, which was first announced in November 2022.
- CI GAM started the year with a strong pace of product development, launching three ETFs and five other funds:
- A private markets fund-of-funds solution providing diversified exposure to a variety of asset classes and best-in-class alternative asset managers, through a simple one-ticket solution. This solution builds on CI GAM's leadership in alternative investments in the Canadian market.
- Two ETFs that seek to manage downside volatility for equity investors - CI Global Minimum Downside Volatility Index ETF and CI U.S. Minimum Downside Volatility Index ETF.
- A suite of covered call funds that include a new ETF - CI Utilities Giants Covered Call ETF - and four mutual funds based on CI GAM's existing lineup of covered call ETFs.
- CI GAM was the recipient of 39 FundGrade A+® Awards for 2022, more than any other fund company. The winning CI GAM funds include 16 mutual funds and exchange-traded funds and 23 segregated funds managed by CI GAM. The awards are presented annually by Fundata Canada Inc. to acknowledge Canadian investment funds that have demonstrated consistent, outstanding risk-adjusted performance.
Analysts' conference call
CI will hold a conference call with analysts today at 10:00 a.m. EST, led by Chief Executive Officer Kurt MacAlpine and Chief Financial Officer Amit Muni. A live webcast of the call and slide presentation can be accessed here, or through the Investor Relations section of CI's website.
Alternatively, investors may listen to the discussion through the following numbers (access code: 442598):
- Canada toll-free: 1-833-950-0062
- United States toll-free: 1-844-200-6205
- United States (New York local): 1-646-904-5544
- All other locations: 1-929-526-1599.
A recording of the webcast will be archived on CI's Investor Relations site.
About CI Financial
CI Financial Corp. is a diversified global asset and wealth management company operating primarily in Canada, the United States and Australia. Founded in 1965, CI has developed world-class portfolio management talent, extensive capabilities in all aspects of wealth planning, and a comprehensive product suite.
CI operates in three segments:
- Asset Management, which includes the operations of CI Global Asset Management and Australia-based GSFM Pty Ltd.
- Canadian Wealth Management, which includes the operations of CI Assante Wealth Management, Aligned Capital Partners, CI Private Wealth (Canada), Northwood Family Office, CI Direct Investing and CI Investment Services.
- U.S. Wealth Management, which includes CI Private Wealth US, a national network of best-in-class wealth management teams.
CI is headquartered in Toronto and listed on the Toronto Stock Exchange (TSX: CIX). To learn more, visit CI's website or LinkedIn page.
Commissions, trailing commissions, management fees and expenses all may be associated with an investment in mutual funds and exchange-traded funds (ETFs). Please read the prospectus before investing. Important information about mutual funds and ETFs is contained in their respective prospectus. Mutual funds and ETFs are not guaranteed; their values change frequently, and past performance may not be repeated. You will usually pay brokerage fees to your dealer if you purchase or sell units of an ETF on recognized Canadian exchanges. If the units are purchased or sold on these Canadian exchanges, investors may pay more than the current net asset value when buying units of the ETF and may receive less than the current net asset value when selling them.
FundGrade A+® is used with permission from Fundata Canada Inc., all rights reserved. The annual FundGrade A+® Awards are presented by Fundata Canada Inc. to recognize the "best of the best" among Canadian investment funds. The FundGrade A+® calculation is supplemental to the monthly FundGrade ratings and is calculated at the end of each calendar year. The FundGrade rating system evaluates funds based on their risk-adjusted performance, measured by Sharpe Ratio, Sortino Ratio, and Information Ratio. The score for each ratio is calculated individually, covering all time periods from 2 to 10 years. The scores are then weighted equally in calculating a monthly FundGrade. The top 10% of funds earn an A Grade; the next 20% of funds earn a B Grade; the next 40% of funds earn a C Grade; the next 20% of funds receive a D Grade; and the lowest 10% of funds receive an E Grade. To be eligible, a fund must have received a FundGrade rating every month in the previous year. The FundGrade A+® uses a GPA-style calculation, where each monthly FundGrade from "A" to "E" receives a score from 4 to 0, respectively. A fund's average score for the year determines its GPA. Any fund with a GPA of 3.5 or greater is awarded a FundGrade A+® Award. For more information, see www.FundGradeAwards.com. Although Fundata makes every effort to ensure the accuracy and reliability of the data contained herein, the accuracy is not guaranteed by Fundata.
The Refinitiv Lipper Fund Awards, granted annually, highlight funds and fund companies that have excelled in delivering consistently strong risk-adjusted performance relative to their peers. The Refinitiv Lipper Fund Awards are based on the Lipper Leader for Consistent Return rating, which is a risk-adjusted performance measure calculated over 36, 60 and 120 months. The fund with the highest Lipper Leader for Consistent Return (Effective Return) value in each eligible classification wins the Refinitiv Lipper Fund Award. For more information, see lipperfundawards.com. Although Refinitiv Lipper makes reasonable efforts to ensure the accuracy and reliability of the data contained herein, the accuracy is not guaranteed by Refinitiv Lipper.
This press release contains forward-looking statements concerning anticipated future events, results, circumstances, performance or expectations with respect to CI Financial Corp. ("CI") and its products and services, including its business operations, strategy and financial performance and condition and its intention to conduct an IPO of its US wealth management business. Forward-looking statements are typically identified by words such as "believe", "expect", "foresee", "forecast", "anticipate", "intend", "estimate", "goal", "plan" and "project" and similar references to future periods, or conditional verbs such as "will", "may", "should", "could" or "would". These statements are not historical facts but instead represent management beliefs regarding future events, many of which by their nature are inherently uncertain and beyond management's control. Although management believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, such statements involve risks and uncertainties. The material factors and assumptions applied in reaching the conclusions contained in these forward-looking statements include that CI will proceed with the IPO, that all outstanding acquisitions will be completed and their asset levels will remain stable, that the investment fund industry will remain stable and that interest rates will remain relatively stable. Factors that could cause actual results to differ materially from expectations include, among other things, general economic and market conditions, including interest and foreign exchange rates, global financial markets, the risk that the IPO may not occur in its expected timeframe or at all, changes in government regulations or in tax laws, industry competition, technological developments and other factors described or discussed in CI's disclosure materials filed with applicable securities regulatory authorities from time to time. The foregoing list is not exhaustive and the reader is cautioned to consider these and other factors carefully and not to place undue reliance on forward-looking statements. Other than as specifically required by applicable law, CI undertakes no obligation to update or alter any forward-looking statement after the date on which it is made, whether to reflect new information, future events or otherwise.
This communication is provided as a general source of information and should not be considered personal, legal, accounting, tax or investment advice, or construed as an endorsement or recommendation of any entity or security discussed. Individuals should seek the advice of professionals, as appropriate, regarding any particular investment. Investors should consult their professional advisors prior to implementing any changes to their investment strategies.
CI Global Asset Management is a registered business name of CI Investments Inc.
| CONSOLIDATED STATEMENT OF INCOME | |||||||||||||||||||||||
| Quarter Ended | Year Ended | ||||||||||||||||||||||
| Quarters Ended | 31-Dec-22 | 30-Sep-22 | 30-Jun-22 | 31-Mar-22 | 31-Dec-21 | 31-Dec-22 | 31-Dec-21 | ||||||||||||||||
| Revenues | |||||||||||||||||||||||
| Asset management fees | 378.2 | 386.7 | 404.3 | 437.6 | 464.9 | 1,606.8 | 1,792.1 | ||||||||||||||||
| Trailer fees and deferred sales commissions | (116.0 | ) | (119.2 | ) | (124.0 | ) | (135.3 | ) | (143.6 | ) | (494.5 | ) | (557.4 | ) | |||||||||
| Net asset management fees | 262.2 | 267.5 | 280.3 | 302.3 | 321.3 | 1,112.3 | 1,234.7 | ||||||||||||||||
| Canada wealth management fees | 133.1 | 129.2 | 130.1 | 138.2 | 134.9 | 530.7 | 506.8 | ||||||||||||||||
| U.S. wealth management fees | 190.1 | 164.1 | 168.9 | 164.5 | 120.9 | 687.6 | 345.0 | ||||||||||||||||
| Other revenues | 26.2 | 26.6 | 21.2 | 21.6 | 27.3 | 95.7 | 83.1 | ||||||||||||||||
| FX (gains)/losses | 15.2 | (73.9 | ) | (32.9 | ) | 11.5 | 3.1 | (80.1 | ) | (18.8 | ) | ||||||||||||
| Other gains/(losses) | (6.5 | ) | 0.1 | (1.1 | ) | (4.4 | ) | 11.9 | (11.9 | ) | 18.7 | ||||||||||||
| Total net revenues | 620.3 | 513.6 | 566.7 | 633.8 | 619.3 | 2,334.3 | 2,169.6 | ||||||||||||||||
| Expenses | |||||||||||||||||||||||
| Selling, general & administrative | 277.2 | 245.6 | 238.0 | 259.3 | 214.6 | 1,020.0 | 742.3 | ||||||||||||||||
| Advisor and dealer fees | 101.1 | 98.3 | 99.7 | 106.9 | 104.8 | 406.0 | 396.7 | ||||||||||||||||
| Other | 9.2 | 17.1 | 4.7 | 3.6 | 5.7 | 34.6 | 52.0 | ||||||||||||||||
| Interest and lease finance expense | 41.4 | 38.6 | 36.2 | 35.9 | 32.5 | 152.1 | 109.7 | ||||||||||||||||
| Depreciation and other amortization | 13.1 | 13.0 | 11.9 | 11.4 | 10.9 | 49.4 | 41.0 | ||||||||||||||||
| Amortization of intangible assets from acquisitions | 26.5 | 27.7 | 27.4 | 24.1 | 18.2 | 105.7 | 55.8 | ||||||||||||||||
| Transaction, integration, restructuring and legal | 41.3 | 13.1 | 4.6 | 3.8 | 13.6 | 62.7 | 35.9 | ||||||||||||||||
| Change in fair value of contingent consideration | 76.8 | 22.5 | (75.0 | ) | 3.1 | 43.9 | 27.4 | 149.9 | |||||||||||||||
| Total expenses | 586.7 | 475.8 | 347.7 | 448.0 | 444.2 | 1858.1 | 1583.4 | ||||||||||||||||
| Pretax income | 33.6 | 37.8 | 219.0 | 185.8 | 175.1 | 476.2 | 586.2 | ||||||||||||||||
| Income tax expense | 41.9 | 23.5 | 60.7 | 48.3 | 51.3 | 174.4 | 173.8 | ||||||||||||||||
| Net income | (8.3 | ) | 14.4 | 158.3 | 137.5 | 123.7 | 301.8 | 412.4 | |||||||||||||||
| Non-controlling interest | 1.2 | (0.5 | ) | 2.1 | (0.6 | ) | 0.0 | 2.1 | 3.0 | ||||||||||||||
| Net income attributable to shareholders | (9.5 | ) | 14.9 | 156.2 | 138.1 | 123.7 | 299.8 | 409.3 | |||||||||||||||
| Basic earnings per share | (0.05 | ) | 0.08 | 0.82 | 0.70 | 0.63 | 1.59 | 2.03 | |||||||||||||||
| Diluted earnings per share | (0.05 | ) | 0.08 | 0.81 | 0.70 | 0.62 | 1.58 | 2.02 | |||||||||||||||
| Non-IFRS adjustments | |||||||||||||||||||||||
| Net income | (8.3 | ) | 14.4 | 158.3 | 137.5 | 123.7 | 301.8 | 412.4 | |||||||||||||||
| Amortization of intangible assets from acquisitions | 26.5 | 27.7 | 27.4 | 24.1 | 18.7 | 105.7 | 57.4 | ||||||||||||||||
| Amortization of equity accounted Investments | 2.6 | - | - | - | - | 2.6 | - | ||||||||||||||||
| Change in fair value of contingent consideration | 76.8 | 22.5 | (75.0 | ) | 3.1 | 43.9 | 27.4 | 149.9 | |||||||||||||||
| Contingent consideration recorded as compensation (included in SG&A) | 1.5 | 3.8 | 0.7 | 18.2 | 2.1 | 24.2 | 7.2 | ||||||||||||||||
| NCI Reclassification (included in Other) | 1.2 | 1.0 | 0.9 | 0.9 | - | 4.0 | - | ||||||||||||||||
| CIPW adjustments (included in SG&A) | 27.7 | 11.5 | 3.1 | 13.2 | - | 55.5 | - | ||||||||||||||||
| FX (gains)/losses | (15.2 | ) | 73.9 | 32.9 | (11.5 | ) | (3.1 | ) | 80.1 | 18.8 | |||||||||||||
| Transaction, integration, restructuring and legal | 41.3 | 13.1 | 4.6 | 3.8 | 13.6 | 62.7 | 35.9 | ||||||||||||||||
| Other gains/(losses) | 7.1 | - | (1.2 | ) | - | (16.8 | ) | 5.9 | (11.1 | ) | |||||||||||||
| Bad Debt and trading (included in Other) | - | 8.0 | - | - | - | 8.0 | 24.9 | ||||||||||||||||
| Total adjustments | 169.6 | 161.5 | (6.7 | ) | 51.7 | 58.4 | 376.1 | 283.1 | |||||||||||||||
| Tax effect of adjustments | (9.9 | ) | (27.8 | ) | 5.6 | (11.5 | ) | (11.1 | ) | (43.6 | ) | (57.5 | ) | ||||||||||
| Non-controlling interest | 15.5 | 12.1 | 8.1 | 10.9 | (0.0 | ) | 46.7 | 3.1 | |||||||||||||||
| Adjusted net income | 135.9 | 135.9 | 149.1 | 166.8 | 171.0 | 587.7 | 634.8 | ||||||||||||||||
| Adjusted earnings per share | 0.74 | 0.73 | 0.78 | 0.85 | 0.87 | 3.11 | 3.15 | ||||||||||||||||
| Adjusted diluted earnings per share | 0.74 | 0.73 | 0.78 | 0.85 | 0.86 | 3.10 | 3.14 | ||||||||||||||||
| Average shares outstanding | 183.7 | 185.6 | 191.2 | 196.1 | 196.8 | 189.1 | 201.6 | ||||||||||||||||
| Average diluted shares outstanding | 184.6 | 186.4 | 191.8 | 197.0 | 198.4 | 189.8 | 202.5 | ||||||||||||||||
CONSOLIDATED BALANCE SHEET | As at
| As at
| ||||
[in thousands of Canadian dollars] | $ | $ | ||||
(unaudited) | ||||||
ASSETS | ||||||
Current | ||||||
Cash and cash equivalents | 153,620 | 230,779 | ||||
Client and trust funds on deposit | 1,306,595 | 1,199,904 | ||||
Investments | 40,448 | 131,772 | ||||
Accounts receivable and prepaid expenses | 286,298 | 272,962 | ||||
Income taxes receivable | 33,989 | 3,607 | ||||
Total current assets | 1,820,950 | 1,839,024 | ||||
Capital assets, net | 55,587 | 52,596 | ||||
Right-of-use assets | 139,422 | 142,606 | ||||
Intangibles | 7,227,700 | 6,185,237 | ||||
Deferred income taxes | 54,415 | 56,901 | ||||
Other assets | 397,804 | 383,187 | ||||
Total assets | 9,695,878 | 8,659,551 | ||||
LIABILITIES AND EQUITY | ||||||
Current | ||||||
Accounts payable and accrued liabilities | 293,246 | 369,081 | ||||
Current portion of provisions and other financial liabilities | 502,746 | 197,994 | ||||
CIPW unit liabilities | 765,959 | 374,438 | ||||
Dividends payable | 66,426 | 71,072 | ||||
Client and trust funds payable | 1,312,640 | 1,202,079 | ||||
Income taxes payable | 3,044 | 19,035 | ||||
Current portion of long-term debt | 320,000 | 444,486 | ||||
Current portion of lease liabilities | 23,994 | 20,216 | ||||
Total current liabilities | 3,288,055 | 2,698,401 | ||||
Long-term debt | 3,896,214 | 3,331,552 | ||||
Provisions and other financial liabilities | 270,567 | 379,641 | ||||
Deferred income taxes | 480,500 | 480,777 | ||||
Lease liabilities | 149,360 | 153,540 | ||||
Total liabilities | 8,084,696 | 7,043,911 | ||||
Equity | ||||||
Share capital | 1,706,880 | 1,810,153 | ||||
Contributed surplus | 30,239 | 28,368 | ||||
Deficit | (173,052 | ) | (226,715 | ) | ||
Accumulated other comprehensive income (loss) | 33,224 | (23,289 | ) | |||
Total equity attributable to the shareholders of the Company | 1,597,291 | 1,588,517 | ||||
Non-controlling interests | 13,891 | 27,123 | ||||
Total equity | 1,611,182 | 1,615,640 | ||||
Total liabilities and equity | 9,695,878 | 8,659,551 | ||||
CONSOLIDATED STATEMENT OF CASH FLOWS | ||||||
[in thousands of Canadian dollars] | 2022
| 2021
| ||||
(unaudited) | ||||||
OPERATING ACTIVITIES (*) | ||||||
Net income for the period | 301,829 | 412,374 | ||||
Add (deduct) items not involving cash | ||||||
Other losses (gains) | 11,904 | (20,584 | ) | |||
Change in fair value of contingent consideration | 27,427 | 149,904 | ||||
Contingent consideration recorded as compensation | 24,156 | 7,198 | ||||
Change in fair value of loan guarantees | 10,819 | - | ||||
Recognition of vesting of CIPW unit liabilities | 13,499 | - | ||||
Equity-based compensation | 24,577 | 22,005 | ||||
Amortization and depreciation | 49,368 | 40,973 | ||||
Amortization of intangible assets from acquisitions | 105,744 | 55,848 | ||||
Deferred income taxes | (4,777 | ) | (42,419 | ) | ||
Loss on repurchases of long-term debt | - | 24,920 | ||||
Cash provided by operating activities before net change in operating assets and liabilities | 564,546 | 650,219 | ||||
Net change in operating assets and liabilities | (85,630 | ) | 15,741 | |||
Cash provided by operating activities | 478,916 | 665,960 | ||||
INVESTING ACTIVITIES | ||||||
Purchase of investments | (3,283 | ) | (5,101 | ) | ||
Proceeds on sale of investments | 96,508 | 15,412 | ||||
Additions to capital assets | (17,480 | ) | (7,798 | ) | ||
Decrease (increase) in other assets | 97,751 | (167,378 | ) | |||
Additions to intangibles | (11,361 | ) | (12,420 | ) | ||
Cash paid to settle acquisition liabilities | (198,207 | ) | (290,002 | ) | ||
Acquisitions, net of cash acquired | (472,461 | ) | (934,589 | ) | ||
Cash used in investing activities | (508,533 | ) | (1,401,876 | ) | ||
FINANCING ACTIVITIES | ||||||
Repayment of long-term debt | (455,509 | ) | (640,419 | ) | ||
Issuance of long-term debt | 718,000 | 1,704,795 | ||||
Repurchase of long-term debt | - | (50,732 | ) | |||
Repurchase of share capital | (229,708 | ) | (364,319 | ) | ||
Payment of lease liabilities | (22,965 | ) | (16,667 | ) | ||
Issuance of CIPW unit liabilities | 85,679 | - | ||||
Net distributions to non-controlling interest | (5,664 | ) | (3,114 | ) | ||
Dividends paid to shareholders | (137,375 | ) | (146,447 | ) | ||
Cash provided by (used in) financing activities | (47,542 | ) | 483,097 | |||
Net decrease in cash and cash equivalents during the year | (77,159 | ) | (252,819 | ) | ||
Cash and cash equivalents, beginning of year | 230,779 | 483,598 | ||||
Cash and cash equivalents, end of year | 153,620 | 230,779 | ||||
(*) Included in operating activities are the following: | ||||||
Interest paid | 139,384 | 115,563 | ||||
Income taxes paid | 224,369 | 193,900 | ||||
ASSETS UNDER MANAGEMENT AND NET FLOWS | |||||||||||||||
[billions of dollars] | Quarters ended | ||||||||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | |||||||||||
Beginning AUM | 114.2 | 116.1 | 136.3 | 144.2 | 139.4 | ||||||||||
Gross inflows | 7.3 | 4.9 | 4.8 | 4.9 | 5.2 | ||||||||||
Gross outflows | (6.0 | ) | (4.8 | ) | (8.7 | ) | (6.6 | ) | (5.5 | ) | |||||
Net inflows/(outflows) | 1.3 | 0.1 | (3.9 | ) | (1.6 | ) | (0.3 | ) | |||||||
Acquisitions | - | - | - | - | - | ||||||||||
Market move and FX | 2.3 | (2.0 | ) | (16.3 | ) | (6.3 | ) | 5.2 | |||||||
Ending AUM | 117.8 | 114.2 | 116.1 | 136.3 | 144.2 | ||||||||||
Proprietary AUM | 31.9 | 30.4 | 30.8 | 34.5 | 36.2 | ||||||||||
Non-proprietary AUM | 85.9 | 83.7 | 85.2 | 101.7 | 108.1 | ||||||||||
Average assets under management | 117.7 | 119.1 | 125.4 | 138.2 | 143.0 | ||||||||||
Annualized organic growth | 4.4 | % | 0.4 | % | (11.4 | )% | (4.6 | )% | (0.9 | )% | |||||
Gross management fee/average AUM | 1.29 | % | 1.30 | % | 1.31 | % | 1.30 | % | 1.30 | % | |||||
Net management fee/average AUM | 0.87 | % | 0.88 | % | 0.89 | % | 0.88 | % | 0.88 | % | |||||
Net Inflows | |||||||||||||||
Retail | 1.6 | 0.6 | (0.4 | ) | (0.9 | ) | 0.1 | ||||||||
Institutional | (0.2 | ) | - | (3.2 | ) | (0.3 | ) | (0.3 | ) | ||||||
Closed business | (0.2 | ) | (0.1 | ) | (0.2 | ) | (0.2 | ) | (0.2 | ) | |||||
Total Canada net inflows | 1.3 | 0.5 | (3.7 | ) | (1.3 | ) | (0.4 | ) | |||||||
Australia | - | (0.4 | ) | (0.1 | ) | (0.3 | ) | 0.1 | |||||||
Total net inflows/(outflows) | 1.3 | 0.1 | (3.9 | ) | (1.6 | ) | (0.3 | ) | |||||||
RETAIL (ex Closed Business) | ||||||||||
[billions of dollars] | Quarters ended | |||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | ||||||
Beginning AUM | 94.0 | 95.1 | 108.4 | 114.6 | 110.4 | |||||
Net Flows | 1.6 | 0.6 | (0.4) | (0.9) | 0.1 | |||||
Market Move / FX | 1.5 | (1.7) | (12.9) | (5.3) | 4.1 | |||||
Acquisitions | ___ | ___ | ___ | ___ | ___ | |||||
Ending AUM | 97.1 | 94.0 | 95.1 | 108.4 | 114.6 | |||||
Average AUM | 97.0 | 97.9 | 101.4 | 109.6 | 113.8 | |||||
INSTITUTIONAL | ||||||||||
[billions of dollars] | Quarters ended | |||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | ||||||
Beginning AUM | 8.3 | 8.4 | 12.7 | 13.3 | 13.0 | |||||
Net Flows | (0.2) | 0.0 | (3.2) | (0.3) | 0.3 | |||||
Market Move / FX | 0.2 | (0.1) | (1.1) | (0.3) | 0.6 | |||||
Acquisitions | ___ | ___ | ___ | ___ | ___ | |||||
Ending AUM | 8.3 | 8.3 | 8.4 | 12.7 | 13.3 | |||||
Average AUM | 8.4 | 8.6 | 10.2 | 12.9 | 13.2 | |||||
AUSTRALIA | ||||||||||
[billions of dollars] | Quarters ended | |||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | ||||||
Beginning AUM | 4.7 | 5.1 | 6.6 | 7.3 | 7.0 | |||||
Net Flows | 0.0 | (0.4) | (0.1) | (0.3) | 0.1 | |||||
Market Move / FX | 0.3 | 0.0 | (1.4) | (0.4) | 0.2 | |||||
Acquisitions | ___ | ___ | ___ | ___ | ___ | |||||
Ending AUM | 5.0 | 4.7 | 5.1 | 6.6 | 7.3 | |||||
Average AUM | 4.8 | 4.9 | 5.8 | 7.0 | 7.1 | |||||
CLOSED BUSINESS | ||||||||||
[billions of dollars] | Quarters ended | |||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | ||||||
Beginning AUM | 7.3 | 7.5 | 8.6 | 9.1 | 9.0 | |||||
Net Flows | (0.2) | (0.1) | (0.2) | (0.2) | (0.2) | |||||
Market Move / FX | 0.2 | (0.1) | (0.9) | (0.3) | 0.3 | |||||
Acquisitions | ___ | ___ | ___ | ___ | ___ | |||||
Ending AUM | 7.3 | 7.3 | 7.5 | 8.6 | 9.1 | |||||
Average AUM | 7.4 | 7.6 | 8.0 | 8.7 | 9.0 | |||||
AUM BY ASSET CLASS | ||||||||||
[billions of dollars] | Quarters ended | |||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | ||||||
Balanced | 50.3 | 49.8 | 50.9 | 59.4 | 62.1 | |||||
Equity | 41.6 | 40.2 | 41.4 | 49.3 | 52.3 | |||||
Fixed income | 11.0 | 11.2 | 11.7 | 13.1 | 14.2 | |||||
Alternatives | 3.6 | 3.8 | 3.6 | 4.9 | 5.7 | |||||
Cash/Other | 6.2 | 4.5 | 3.4 | 3 | 2.7 | |||||
Total Canada asset management | 112.8 | 109.5 | 111 | 129.7 | 137 | |||||
Australia | 5.0 | 4.7 | 5.1 | 6.6 | 7.3 | |||||
Total asset management segment | 117.8 | 114.2 | 116.1 | 136.3 | 144.2 | |||||
CANADA WEALTH MANAGEMENT CLIENT ASSETS | ||||||||||
[billions of dollars] | Quarters ended | |||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | ||||||
Beginning client assets | 74.0 | 74.1 | 79.0 | 80.6 | 76.9 | |||||
Acquisitions | - | - | 2.4 | - | - | |||||
Net flows and market move | 3.4 | (0.2) | (7.2) | (1.7) | 3.8 | |||||
Ending client assets | 77.4 | 74.0 | 74.1 | 79.0 | 80.6 | |||||
Average client assets | 77.3 | 76.0 | 77.7 | 79.0 | 78.9 | |||||
Wealth management fees/average client assets | 0.91% | 0.90% | 0.91% | 0.95% | 0.93% | |||||
U.S. WEALTH MANAGEMENT CLIENT ASSETS | ||||||||||
[billions of dollars] | Quarters ended | |||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | ||||||
Beginning billable client assets | 144.9 | 138.8 | 141.2 | 146.4 | 96.1 | |||||
Acquisitions | 24.9 | - | 7.1 | 1.1 | 49.3 | |||||
Net flows and market move | 4.4 | 6.2 | (9.5) | (6.3) | 1.0 | |||||
Ending billable client assets | 174.3 | 144.9 | 138.8 | 141.2 | 146.4 | |||||
Non-billable client assets | 6.3 | 4.9 | 4.8 | 4.6 | 4.9 | |||||
Total client assets | 180.6 | 149.8 | 143.5 | 145.8 | 151.3 | |||||
Fees/beginning billable client assets | 0.52% | 0.47% | 0.48% | 0.46% | 0.50% | |||||
NON-IFRS MEASURES
In an effort to provide additional information regarding our results as determined by IFRS, we also disclose certain non-IFRS information which we believe provides useful and meaningful information. Our management reviews these non-IFRS financial measurements when evaluating our financial performance and results of operations; therefore, we believe it is useful to provide information with respect to these non-IFRS measurements so as to share this perspective of management. Non-IFRS measurements do not have any standardized meaning, do not replace nor are superior to IFRS financial measurements and may not be comparable to similar measures presented by other companies. The non-IFRS financial measurements include:
- Adjusted net income and adjusted basic and diluted earnings per share
- Adjusted EBITDA and adjusted EBITDA margin
- Free cash flow
- Net debt.
These non-IFRS measurements exclude the following revenues and expenses which we believe allows investors a consistent way to analyze our financial performance, allows for better analysis of core operating income and business trends and permits comparisons of companies within the industry, normalizing for different financing methods and levels of taxation:
- gains or losses related to foreign currency fluctuations on our cash balances
- costs related to our acquisitions including:
- amortization of intangible assets
- change in fair value of contingent consideration
- related advisory fees
- contingent consideration classified as compensation per IFRS
- restructuring charges including organizational expenses for the establishment of CIPW
- legal provisions for a class action related to market timing
- certain gains or losses in assets and investments
- costs related to issuing or retiring debt obligations
- expenses associated with CIPW redeemable units.
Further explanations of these Non-IFRS measures can be found in the "Non-IFRS Measures" section of Management's Discussion and Analysis dated November 10, 2022 available on SEDAR at www.sedar.com or at www.cifinancial.com.
| EBITDA, ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN (unaudited) | ||||||||||
| Quarters ended | 31-Dec-22 | 30-Sep-22 | 30-Jun-22 | 31-Mar-22 | 31-Dec-21 | |||||
| Pretax income | 33.6 | 37.8 | 219.0 | 185.8 | 175.1 | |||||
| Amortization of intangible assets from acquisitions | 26.5 | 27.7 | 27.4 | 24.1 | 18.9 | |||||
| Depreciation and other amortization | 13.1 | 13.0 | 11.9 | 11.4 | 10.9 | |||||
| Interest and lease finance expense | 41.4 | 38.6 | 36.2 | 35.9 | 32.5 | |||||
| EBITDA | 117.2 | 117.1 | 294.6 | 257.1 | 237.3 | |||||
| Change in fair value of contingent consideration | 76.8 | 22.5 | (75.0) | 3.1 | 43.9 | |||||
| Contingent consideration recorded as compensation | 1.5 | 3.8 | 0.7 | 18.2 | 2.1 | |||||
| Non-controlling interest reclassification | 1.2 | 1.0 | 0.9 | 0.9 | 0.0 | |||||
| CIPW adjustments | 27.7 | 11.5 | 3.1 | 13.2 | 0.0 | |||||
| FX (gains)/losses | (15.2) | 73.9 | 32.9 | (11.5) | (3.1) | |||||
| Transaction, integration, restructuring and legal | 41.3 | 13.1 | 4.6 | 3.8 | 13.6 | |||||
| Other(gains)/losses | 7.1 | - | (1.2) | - | (16.8) | |||||
| Bond redemption costs | 0.0 | 8.0 | - | - | - | |||||
| Total adjustments | 140.5 | 133.8 | (34.1) | 27.7 | 39.6 | |||||
| Non-controlling interest | 15.0 | 13.4 | 9.5 | 11.9 | (0.2) | |||||
| Adjusted EBITDA | 242.7 | 237.5 | 251.0 | 272.9 | 277.2 | |||||
| Reported net revenue | 620.3 | 513.6 | 566.7 | 633.8 | 619.3 | |||||
| Less: FX gains/(losses) | 15.2 | (73.9) | (32.9) | 11.5 | 3.1 | |||||
| Less: Non-operating Other gains/(losses) | (7.1) | - | 1.2 | - | 16.8 | |||||
| Less: NCI revenues | 40.6 | 35.1 | 34.8 | 35.5 | 17.9 | |||||
| Adjusted net revenue | 571.7 | 552.4 | 563.5 | 586.8 | 581.5 | |||||
| Adjusted EBITDA margin | 42.4% | 43.0% | 44.5% | 46.5% | 47.7% | |||||
| FREE CASH FLOW (unaudited) | ||||||||||
| Quarters ended | 31-Dec-22 | 30-Sep-22 | 30-Jun-22 | 31-Mar-22 | 31-Dec-21 | |||||
| Cash provided by operating activities | 56.7 | 103.3 | 164.1 | 154.8 | 163.7 | |||||
| Net change in operating assets and liabilities | 94.1 | (38.4) | (22.9) | 52.9 | 15.5 | |||||
| Operating cash flow before the change in operating assets and liabilities | 150.9 | 64.8 | 141.2 | 207.7 | 179.2 | |||||
| FX (gains)/losses | -15.2 | 73.9 | 32.9 | (11.5) | (3.1) | |||||
| Transaction, integration, restructuring and legal | 41.3 | 13.1 | 4.6 | 3.8 | 13.6 | |||||
| Other(gains)/losses | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |||||
| Total adjustments | 26.1 | 95.0 | 37.5 | -7.7 | 10.5 | |||||
| Tax effect (recovery) of adjustments | (18.8) | (14.1) | (5.7) | 1.2 | (2.6) | |||||
| Less: Non-controlling interest | 0.3 | (5.8) | (3.4) | (0.4) | (0.0) | |||||
| Free cash flow | 157.9 | 151.5 | 176.4 | 201.6 | 187.1 | |||||
NET DEBT | ||||||||||
Quarters ended | ||||||||||
[millions of dollars] | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | |||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||
Current portion of long-term debt | 320.0 | 400.5 | 314.6 | 225.3 | 444.5 | |||||
Long-term debt | 3,896.2 | 3,548.2 | 3,373.5 | 3,304.7 | 3,331.6 | |||||
4,216.2 | 3,948.7 | 3,688.1 | 3,530.0 | 3,776.0 | ||||||
Less: | ||||||||||
Cash and short-term investments | 153.6 | 220.4 | 154.8 | 186.1 | 230.8 | |||||
Marketable securities | 20.6 | 17.8 | 18.1 | 20.3 | 116.9 | |||||
Add: | ||||||||||
Regulatory capital and non-controlling interests | 16.8 | 19.9 | 22.4 | 28.8 | 25.0 | |||||
Net Debt | 4,058.8 | 3,730.3 | 3,537.5 | 3,352.4 | 3,453.4 | |||||
Adjusted EBITDA | 242.7 | 237.5 | 251.0 | 272.9 | 277.2 | |||||
Adjusted EBITDA, annualized | 962.8 | 942.1 | 1,006.9 | 1,106.6 | 1,099.8 | |||||
Gross leverage (Gross debt/Annualized adjusted EBITDA) | 4.4 | 4.2 | 3.7 | 3.2 | 3.4 | |||||
Net leverage (Net debt/Annualized adjusted EBITDA) | 4.2 | 4.0 | 3.5 | 3.0 | 3.1 | |||||
SUMMARY OF QUARTERLY RESULTS | |||||||||||||||||||||||||||||||
[millions of dollars, except per share amounts] | IFRS Results (unaudited) | Adjusted Results (unaudited) | |||||||||||||||||||||||||||||
For the quarters ended | For the quarters ended | ||||||||||||||||||||||||||||||
Dec.
| Sep.
| Jun.
| Mar.
| Dec.
| Dec.
| Sep.
| Jun.
| Mar.
| Dec.
| ||||||||||||||||||||||
Revenues | |||||||||||||||||||||||||||||||
Asset management fees | 378.2 | 386.7 | 404.3 | 437.6 | 464.9 | 378.2 | 386.7 | 404.3 | 437.6 | 464.9 | |||||||||||||||||||||
Trailer fees and deferred sales commissions | (116.0 | ) | (119.2 | ) | (124.0 | ) | (135.3 | ) | (143.6 | ) | (116.0 | ) | (119.2 | ) | (124.0 | ) | (135.3 | ) | (143.6 | ) | |||||||||||
Net asset management fees | 262.2 | 267.5 | 280.3 | 302.3 | 321.3 | 262.2 | 267.5 | 280.3 | 302.3 | 321.3 | |||||||||||||||||||||
Canada wealth management fees | 133.1 | 129.2 | 130.1 | 138.2 | 134.9 | 133.1 | 129.2 | 130.1 | 138.2 | 134.9 | |||||||||||||||||||||
U.S. wealth management fees | 190.1 | 164.1 | 168.9 | 164.5 | 120.9 | 190.1 | 164.1 | 168.9 | 164.5 | 120.9 | |||||||||||||||||||||
Other revenues | 26.2 | 26.6 | 21.2 | 21.6 | 27.3 | 28.8 | 26.6 | 21.2 | 21.6 | 27.3 | |||||||||||||||||||||
FX gains/(losses) | 15.2 | (73.9 | ) | (32.9 | ) | 11.5 | 3.1 | - | - | - | - | - | |||||||||||||||||||
Other gains/(losses) | (6.5 | ) | 0.1 | (1.1 | ) | (4.4 | ) | 11.9 | 0.6 | 0.1 | (2.3 | ) | (4.4 | ) | (4.9 | ) | |||||||||||||||
Total net revenues | 620.3 | 513.6 | 566.7 | 633.8 | 619.3 | 614.9 | 587.5 | 598.3 | 622.3 | 599.4 | |||||||||||||||||||||
Expenses | |||||||||||||||||||||||||||||||
Selling, general & administrative | 272.7 | 245.6 | 238.0 | 259.3 | 214.6 | 248.0 | 230.3 | 234.2 | 227.9 | 212.5 | |||||||||||||||||||||
Advisor and dealer fees | 101.1 | 98.3 | 99.7 | 106.9 | 104.8 | 101.1 | 98.3 | 99.7 | 106.9 | 104.8 | |||||||||||||||||||||
Other | 9.2 | 17.1 | 4.7 | 3.6 | 5.7 | 8.1 | 8.1 | 3.8 | 2.7 | 5.7 | |||||||||||||||||||||
Interest and lease finance expense | 41.4 | 38.6 | 36.2 | 35.9 | 32.5 | 41.4 | 38.6 | 36.2 | 35.9 | 32.5 | |||||||||||||||||||||
Depreciation and other amortization | 13.1 | 13.0 | 11.9 | 11.4 | 10.9 | 13.1 | 13.0 | 11.9 | 11.4 | 10.4 | |||||||||||||||||||||
Amortization of intangible assets from acquisitions | 26.5 | 27.7 | 27.4 | 24.1 | 18.2 | - | - | - | - | - | |||||||||||||||||||||
Transaction, integration, restructuring and legal | 41.3 | 13.1 | 4.6 | 3.8 | 13.6 | - | - | - | - | - | |||||||||||||||||||||
Change in fair value of contingent consideration | 76.8 | 22.5 | (75.0 | ) | 3.1 | 43.9 | - | - | - | - | - | ||||||||||||||||||||
Total expenses | 586.7 | 475.8 | 347.7 | 448.0 | 444.2 | 411.7 | 388.2 | 386.0 | 384.8 | 365.9 | |||||||||||||||||||||
Pretax income | 33.6 | 37.8 | 219.0 | 185.8 | 175.1 | 203.2 | 199.3 | 212.3 | 237.5 | 233.4 | |||||||||||||||||||||
Income tax expense | 41.9 | 23.5 | 60.7 | 48.3 | 51.3 | 51.8 | 51.3 | 55.1 | 59.7 | 62.5 | |||||||||||||||||||||
Net income | (8.3 | ) | 14.4 | 158.3 | 137.5 | 123.7 | 151.4 | 148.1 | 157.2 | 177.8 | 171.0 | ||||||||||||||||||||
Less: Non-controlling interest | 1.2 | (0.5 | ) | 2.1 | (0.6 | ) | - | 15.5 | 12.1 | 8.1 | 10.9 | - | |||||||||||||||||||
Net income attributable to shareholders | (9.5 | ) | 14.9 | 156.2 | 138.1 | 123.7 | 135.9 | 135.9 | 149.1 | 166.8 | 171.0 | ||||||||||||||||||||
Basic earnings per share | (0.05 | ) | 0.08 | 0.82 | 0.70 | 0.63 | 0.74 | 0.73 | 0.78 | 0.85 | 0.87 | ||||||||||||||||||||
Diluted earnings per share | (0.05 | ) | 0.08 | 0.81 | 0.70 | 0.62 | 0.74 | 0.73 | 0.78 | 0.85 | 0.86 | ||||||||||||||||||||
RESULTS OF OPERATIONS - ASSET MANAGEMENT SEGMENT | |||||||||||||||||||||||||||||
[millions of dollars, except per share amounts] | IFRS Results (unaudited) | Adjusted Results (unaudited) | |||||||||||||||||||||||||||
For the quarters ended | For the quarters ended | ||||||||||||||||||||||||||||
Dec.
| Sep.
| Jun.
| Mar.
| Dec.
| Dec.
| Sep.
| Jun.
| Mar.
| Dec.
| ||||||||||||||||||||
Revenues | |||||||||||||||||||||||||||||
Asset management fees | 382.3 | 390.9 | 408.9 | 442.5 | 469.6 | 382.3 | 390.9 | 408.9 | 442.5 | 469.6 | |||||||||||||||||||
Trailer fees and deferred sales commissions | (123.8 | ) | (126.8 | ) | (131.9 | ) | (143.9 | ) | (152.6 | ) | (123.8 | ) | (126.8 | ) | (131.9 | ) | (143.9 | ) | (152.6 | ) | |||||||||
Net asset management fees | 258.5 | 264.1 | 277.0 | 298.6 | 316.9 | 258.5 | 264.1 | 277.0 | 298.6 | 316.9 | |||||||||||||||||||
Other revenues | 3.6 | 6.6 | 5.6 | 10.2 | 19.9 | 3.6 | 6.6 | 5.6 | 10.2 | 19.9 | |||||||||||||||||||
FX gains/(losses) | 15.5 | (74.4 | ) | (32.8 | ) | 11.4 | (1.4 | ) | - | - | - | - | - | ||||||||||||||||
Other gains/(losses) | (6.5 | ) | 0.1 | (1.1 | ) | (4.4 | ) | 12.0 | 0.6 | 0.1 | (2.3 | ) | (4.4 | ) | (4.8 | ) | |||||||||||||
Total net revenues | 271.2 | 196.4 | 248.7 | 315.8 | 347.5 | 262.8 | 270.7 | 280.2 | 304.4 | 332.1 | |||||||||||||||||||
Expenses | |||||||||||||||||||||||||||||
Selling, general & administrative | 94.3 | 98.7 | 97.3 | 96.8 | 108.7 | 94.3 | 98.7 | 97.3 | 96.8 | 108.7 | |||||||||||||||||||
Other | - | 7.2 | - | - | (0.5 | ) | - | - | - | - | (0.5 | ) | |||||||||||||||||
Interest and lease finance expense | 0.9 | 1.0 | 1.0 | 1.0 | 0.5 | 0.9 | 1.0 | 1.0 | 1.0 | 0.5 | |||||||||||||||||||
Depreciation and other amortization | 4.7 | 5.0 | 5.0 | 5.0 | 5.4 | 4.7 | 5.0 | 5.0 | 5.0 | 5.4 | |||||||||||||||||||
Amortization of intangible assets from acquisitions | 0.6 | 0.6 | 0.6 | 0.6 | 0.6 | - | - | - | - | - | |||||||||||||||||||
Transaction, integration, restructuring and legal | 11.0 | 2.6 | 2.3 | (0.9 | ) | 10.4 | - | - | - | - | - | ||||||||||||||||||
Change in fair value of contingent consideration | 1.6 | 3.2 | (3.9 | ) | 4.0 | 14.2 | - | - | - | - | - | ||||||||||||||||||
Total expenses | 113.2 | 118.2 | 102.3 | 106.5 | 139.3 | 99.9 | 104.6 | 103.3 | 102.8 | 114.1 | |||||||||||||||||||
Pretax income | 158.0 | 78.2 | 146.4 | 209.3 | 208.1 | 162.8 | 166.1 | 176.9 | 201.6 | 218.0 | |||||||||||||||||||
Non-IFRS adjustments | |||||||||||||||||||||||||||||
Pretax income | 158.0 | 78.2 | 146.4 | 209.3 | 208.1 | 162.8 | 166.1 | 176.9 | 201.6 | 218.0 | |||||||||||||||||||
Amortization of intangible assets from acquisitions | 0.6 | 0.6 | 0.6 | 0.6 | 0.6 | - | - | - | - | - | |||||||||||||||||||
Depreciation and other amortization | 4.7 | 5.0 | 5.0 | 5.0 | 5.4 | 4.7 | 5.0 | 5.0 | 5.0 | 5.4 | |||||||||||||||||||
Interest and lease finance expense | 0.9 | 1.0 | 1.0 | 1.0 | 0.5 | 0.9 | 1.0 | 1.0 | 1.0 | 0.5 | |||||||||||||||||||
EBITDA | 164.2 | 84.7 | 153.0 | 215.9 | 214.7 | 168.4 | 172.1 | 183.0 | 207.6 | 223.9 | |||||||||||||||||||
Change in fair value of contingent consideration | 1.6 | 3.2 | (3.9 | ) | 4.0 | 14.2 | - | - | - | - | - | ||||||||||||||||||
FX (gains)/losses | (15.5 | ) | 74.4 | 32.8 | (11.4 | ) | 1.4 | - | - | - | - | - | |||||||||||||||||
Transaction, integration, restructuring and legal | 11.0 | 2.6 | 2.3 | (0.9 | ) | 10.4 | - | - | - | - | - | ||||||||||||||||||
Other (gains)/losses | 7.1 | - | (1.2 | ) | - | (16.8 | ) | - | - | - | - | - | |||||||||||||||||
Trading and bad debt | - | 7.1 | - | - | - | - | - | - | - | - | |||||||||||||||||||
Total adjustments | 4.2 | 87.3 | 30.0 | (8.3 | ) | 9.2 | - | - | - | - | - | ||||||||||||||||||
Less: Non-controlling interest | 0.1 | 0.1 | 0.3 | 0.4 | 0.1 | 0.1 | 0.1 | 0.3 | 0.4 | 0.1 | |||||||||||||||||||
Adjusted EBITDA | 168.3 | 172.0 | 182.7 | 207.2 | 223.8 | 168.3 | 172.0 | 182.7 | 207.2 | 223.8 | |||||||||||||||||||
RESULTS OF OPERATIONS - CANADA WEALTH MANAGEMENT SEGMENT | |||||||||||||||||||||||||||
[millions of dollars, except per share amounts] | IFRS Results (unaudited) | Adjusted Results (unaudited) | |||||||||||||||||||||||||
For the quarters ended | For the quarters ended | ||||||||||||||||||||||||||
Dec.
| Sep.
| Jun.
| Mar.
| Dec.
| Dec.
| Sep.
| Jun.
| Mar.
| Dec.
| ||||||||||||||||||
Revenues | |||||||||||||||||||||||||||
Canada wealth management fees | 176.8 | 171.7 | 175.6 | 185.7 | 184.3 | 176.8 | 171.7 | 175.6 | 185.7 | 184.3 | |||||||||||||||||
Other revenues | 29.1 | 25.5 | 21.3 | 17.1 | 16.0 | 29.2 | 25.5 | 21.3 | 17.1 | 16.0 | |||||||||||||||||
FX gains/(losses) | (0.4 | ) | 0.5 | - | 0.1 | 0.8 | - | - | - | - | - | ||||||||||||||||
Other gains/(losses) | - | - | - | - | (0.1 | ) | - | - | - | - | (0.1 | ) | |||||||||||||||
Total net revenues | 205.5 | 197.7 | 196.9 | 202.9 | 201.1 | 206.0 | 197.2 | 196.9 | 202.8 | 200.3 | |||||||||||||||||
Expenses | |||||||||||||||||||||||||||
Selling, general & administrative | 46.2 | 43.8 | 44.0 | 41.1 | 39.9 | 45.9 | 43.6 | 43.9 | 41.1 | 39.9 | |||||||||||||||||
Advisor and dealer fees | 136.2 | 132.4 | 135.9 | 145.6 | 145.2 | 136.2 | 132.4 | 135.9 | 145.6 | 145.2 | |||||||||||||||||
Other | 9.3 | 8.2 | 4.0 | 3.2 | 3.2 | 8.1 | 6.3 | 3.2 | 2.4 | 3.2 | |||||||||||||||||
Interest and lease finance expense | - | - | (0.1 | ) | 0.2 | 0.2 | - | - | (0.1 | ) | 0.2 | 0.2 | |||||||||||||||
Depreciation and other amortization | 3.2 | 3.2 | 2.8 | 2.5 | 2.3 | 3.2 | 3.2 | 2.8 | 2.5 | 2.3 | |||||||||||||||||
Amortization of intangible assets from acquisitions | 2.1 | 2.1 | 2.1 | 1.6 | 1.5 | - | - | - | - | - | |||||||||||||||||
Transaction, integration, restructuring and legal | 0.2 | 0.3 | 0.4 | 0.8 | 0.1 | - | - | - | - | - | |||||||||||||||||
Change in fair value of contingent consideration | 1.9 | (0.7 | ) | (0.6 | ) | - | - | - | - | - | - | - | |||||||||||||||
Total expenses | 199.1 | 189.3 | 188.5 | 195.0 | 192.6 | 193.4 | 185.6 | 185.6 | 191.7 | 191.0 | |||||||||||||||||
Pretax income | 6.4 | 8.4 | 8.4 | 7.9 | 8.5 | 12.6 | 11.6 | 11.4 | 11.1 | 9.3 | |||||||||||||||||
Non-IFRS adjustments | |||||||||||||||||||||||||||
Pretax income | 6.4 | 8.4 | 8.4 | 7.9 | 8.5 | 12.6 | 11.6 | 11.4 | 11.1 | 9.3 | |||||||||||||||||
Amortization of intangible assets from acquisitions | 2.1 | 2.1 | 2.1 | 1.6 | 1.6 | - | - | - | 0.1 | ||||||||||||||||||
Amortization of equity accounted investments | 0.1 | - | - | - | - | - | - | - | - | - | |||||||||||||||||
Depreciation and other amortization | 3.2 | 3.2 | 2.8 | 2.5 | 2.3 | 3.2 | 3.2 | 2.8 | 2.5 | 2.3 | |||||||||||||||||
Interest and lease finance expense | - | - | (0.1 | ) | 0.2 | 0.2 | - | - | (0.1 | ) | 0.2 | 0.2 | |||||||||||||||
EBITDA | 11.8 | 13.7 | 13.1 | 12.1 | 12.6 | 15.8 | 14.9 | 14.0 | 13.8 | 11.9 | |||||||||||||||||
Change in fair value of contingent consideration | 1.9 | (0.7 | ) | (0.6 | ) | - | - | - | - | - | - | - | |||||||||||||||
Contingent consideration recorded as compensation (included in SG&A) | 0.2 | 0.1 | 0.1 | - | - | - | - | - | - | - | |||||||||||||||||
CIPW adjustments (included in SG&A) | 0.1 | 0.1 | 0.1 | - | - | - | - | - | - | - | |||||||||||||||||
FX (gains)/losses | 0.4 | (0.5 | ) | - | (0.1 | ) | (0.8 | ) | - | - | - | - | - | ||||||||||||||
Transaction, integration, restructuring and legal | 0.2 | 0.3 | 0.4 | 0.8 | 0.1 | - | - | - | - | - | |||||||||||||||||
Non-controlling interest reclassification (included in Other) | 1.2 | 1.0 | 0.9 | 0.9 | - | - | - | - | - | - | |||||||||||||||||
Trading and bad debt | - | 0.8 | - | - | - | - | - | - | - | - | |||||||||||||||||
Total adjustments | 4.0 | 1.2 | 0.8 | 1.6 | (0.7 | ) | - | - | - | - | - | ||||||||||||||||
Less: Non-controlling interest | 1.3 | 1.2 | 1.0 | 0.9 | (1.5 | ) | 1.3 | 1.2 | 1.0 | 0.9 | (1.5 | ) | |||||||||||||||
Adjusted EBITDA | 14.5 | 13.7 | 13.0 | 12.9 | 13.5 | 14.5 | 13.7 | 13.0 | 12.9 | 13.5 | |||||||||||||||||
RESULTS OF OPERATIONS - U.S. WEALTH MANAGEMENT SEGMENT | |||||||||||||||||||||||||||
[millions of dollars, except per share amounts] | IFRS Results (unaudited) | Adjusted Results (unaudited) | |||||||||||||||||||||||||
For the quarters ended | For the quarters ended | ||||||||||||||||||||||||||
Dec.
| Sep.
| Jun.
| Mar.
| Dec.
| Dec.
| Sep.
| Jun.
| Mar.
| Dec.
| ||||||||||||||||||
Revenues | |||||||||||||||||||||||||||
U.S. wealth management fees | 190.1 | 164.1 | 168.9 | 164.5 | 120.9 | 190.1 | 164.1 | 168.9 | 164.5 | 120.9 | |||||||||||||||||
Other revenues | 2.9 | 4.2 | 4.5 | 4.8 | 1.3 | 5.5 | 4.2 | 4.5 | 4.8 | 1.3 | |||||||||||||||||
FX gains/(losses) | - | - | - | - | 3.7 | - | - | - | - | - | |||||||||||||||||
Total net revenues | 193.1 | 168.2 | 173.4 | 169.2 | 125.9 | 195.6 | 168.3 | 173.5 | 169.2 | 122.2 | |||||||||||||||||
Expenses | |||||||||||||||||||||||||||
Selling, general & administrative | 151.1 | 117.7 | 112.8 | 136.9 | 80.8 | 122.2 | 102.6 | 109.2 | 105.5 | 78.7 | |||||||||||||||||
Other | (0.1 | ) | 1.8 | 0.7 | 0.4 | 2.9 | (0.1 | ) | 1.8 | 0.7 | 0.4 | 2.9 | |||||||||||||||
Interest and lease finance expense | 0.8 | 0.7 | 0.6 | 0.5 | 0.4 | 0.8 | 0.7 | 0.6 | 0.5 | 0.4 | |||||||||||||||||
Depreciation and other amortization | 5.2 | 4.8 | 4.1 | 3.9 | 3.1 | 5.2 | 4.8 | 4.1 | 3.9 | 3.1 | |||||||||||||||||
Amortization of intangible assets from acquisitions | 23.8 | 25.0 | 24.7 | 21.9 | 16.1 | - | - | - | - | - | |||||||||||||||||
Transaction, integration, restructuring and legal | 30.0 | 10.2 | 2.0 | 3.9 | 3.1 | - | - | - | - | - | |||||||||||||||||
Change in fair value of contingent consideration | 73.3 | 20.0 | (70.5 | ) | (0.9 | ) | 29.7 | - | - | - | - | - | |||||||||||||||
Total expenses | 284.2 | 180.1 | 74.4 | 166.5 | 136.1 | 128.1 | 109.8 | 114.6 | 110.3 | 85.2 | |||||||||||||||||
Pretax income | (91.1 | ) | (11.9 | ) | 99.0 | 2.7 | (10.2 | ) | 67.5 | 58.4 | 58.9 | 59.0 | 37.0 | ||||||||||||||
Non-IFRS adjustments | |||||||||||||||||||||||||||
Pretax income | (91.1 | ) | (11.9 | ) | 99.0 | 2.7 | (10.2 | ) | 67.5 | 58.4 | 58.9 | 59.0 | 37.0 | ||||||||||||||
Amortization of intangible assets from acquisitions | 23.8 | 25.0 | 24.7 | 21.9 | 16.5 | - | - | - | 0.5 | ||||||||||||||||||
Amortization of equity accounted investments | 2.5 | - | - | - | - | - | - | - | - | - | |||||||||||||||||
Depreciation and other amortization | 5.2 | 4.8 | 4.1 | 3.9 | 3.1 | 5.2 | 4.8 | 4.1 | 3.9 | 3.1 | |||||||||||||||||
Interest and lease finance expense | 0.8 | 0.7 | 0.6 | 0.5 | 0.4 | 0.8 | 0.7 | 0.6 | 0.5 | 0.4 | |||||||||||||||||
EBITDA | (58.8 | ) | 18.6 | 128.4 | 29.1 | 9.9 | 73.5 | 63.9 | 63.5 | 63.4 | 41.0 | ||||||||||||||||
Change in fair value of contingent consideration | 73.3 | 20.0 | (70.5 | ) | (0.9 | ) | 29.7 | - | - | - | - | - | |||||||||||||||
Contingent consideration recorded as compensation (included in SG&A) | 1.3 | 3.7 | 0.6 | 18.2 | 2.1 | - | - | - | - | - | |||||||||||||||||
CIPW adjustments (included in SG&A) | 27.6 | 11.4 | 3.0 | 13.2 | - | - | - | - | - | - | |||||||||||||||||
FX (gains)/losses | - | - | - | - | (3.7 | ) | - | - | - | - | - | ||||||||||||||||
Transaction, integration, restructuring and legal | 30.0 | 10.2 | 2.0 | 3.9 | 3.1 | - | - | - | - | - | |||||||||||||||||
Total adjustments | 132.2 | 45.3 | (64.9 | ) | 34.3 | 31.1 | - | - | - | - | - | ||||||||||||||||
Less: Non-controlling interest | 13.6 | 12.1 | 8.2 | 10.9 | 1.0 | 13.6 | 12.1 | 8.2 | 10.9 | 1.0 | |||||||||||||||||
Adjusted EBITDA | 59.9 | 51.8 | 55.4 | 52.5 | 40.0 | 59.9 | 51.8 | 55.4 | 52.5 | 40.0 | |||||||||||||||||
| Asset Management Adjusted EBITDA (unaudited) | |||||||||||||||
| 31-Dec-22 | 30-Sep-22 | 30-Jun-22 | 31-Mar-22 | 31-Dec-21 | |||||||||||
| Adjusted EBITDA | 168.3 | 172.0 | 182.7 | 207.2 | 223.8 | ||||||||||
| Reported net revenue | 271.2 | 196.4 | 248.7 | 315.8 | 347.5 | ||||||||||
| Less: FX gains/(losses) | 15.5 | (74.4 | ) | (32.8 | ) | 11.4 | (1.4 | ) | |||||||
| Less: Non-Operating Other gains/(losses) | (7.1 | ) | - | 1.2 | - | 16.8 | |||||||||
| Less: Non-controlling interest revenues | 0.2 | 0.1 | 0.2 | 0.2 | 0.3 | ||||||||||
| Adjusted net revenue | 262.6 | 270.6 | 280.0 | 304.1 | 331.8 | ||||||||||
| Adjusted EBITDA margin | 64.1 | % | 63.5 | % | 65.2 | % | 68.1 | % | 67.4 | % | |||||
| Canada Wealth Management Adjusted EBITDA (unaudited) | |||||||||||||||
| 31-Dec-22 | 30-Sep-22 | 30-Jun-22 | 31-Mar-22 | 31-Dec-21 | |||||||||||
| Adjusted EBITDA | 14.5 | 13.7 | 13.0 | 12.9 | 13.5 | ||||||||||
| Reported net revenue | 205.5 | 197.7 | 196.9 | 202.9 | 201.1 | ||||||||||
| Less: FX gains/(losses) | (0.4 | ) | 0.5 | (0.0 | ) | 0.1 | 0.8 | ||||||||
| Less: Non-Operating Other gains/(losses) | - | - | - | - | - | ||||||||||
| Less: Non-controlling interest revenues | 14.4 | 13.9 | 13.3 | 13.1 | 11.9 | ||||||||||
| Adjusted Revenue | 191.5 | 183.4 | 183.6 | 189.7 | 188.4 | ||||||||||
| Adjusted EBITDA margin | 7.6 | % | 7.5 | % | 7.1 | % | 6.8 | % | 7.1 | % | |||||
| US Wealth Management Adjusted EBITDA (unaudited) | |||||||||||||||
| 31-Dec-22 | 30-Sep-22 | 30-Jun-22 | 31-Mar-22 | 31-Dec-21 | |||||||||||
| Adjusted EBITDA | 59.9 | 51.8 | 55.4 | 52.5 | 40.0 | ||||||||||
| Reported net revenue | 193.1 | 168.2 | 173.4 | 169.2 | 125.9 | ||||||||||
| Less: FX gains/(losses) | 0.0 | (0.0 | ) | (0.0 | ) | 0.0 | 3.7 | ||||||||
| Amortization of equity method investments | (2.5 | ) | - | - | - | - | |||||||||
| Less: NCI revenues | 26.0 | 21.1 | 21.3 | 22.2 | 5.8 | ||||||||||
| Adjusted Revenue | 169.6 | 147.2 | 152.2 | 147.0 | 116.5 | ||||||||||
| Adjusted EBITDA margin | 35.3 | % | 35.2 | % | 36.4 | % | 35.7 | % | 34.3 | % | |||||
Contacts
Investor Relations
Jason Weyeneth, CFA
Vice-President, Investor Relations & Strategy
416-681-8779
jweyeneth@ci.com
Media
Canada
Murray Oxby
Vice-President, Communications
416-681-3254
moxby@ci.com
United States
Jimmy Moock
Managing Partner, StreetCred
610-304-4570
jimmy@streetcredpr.com
ci@streetcredpr.com
