News Column

CI Financial reports fourth quarter results: Earnings per share increase 21%

February 13, 2014

TSX Symbol: CIX

TORONTO, Feb. 13, 2014 /CNW/ - CI Financial Corp. ("CI") today released audited financial results for the quarter and year ended December 31, 2013.




HIGHLIGHTS1

Quarter ended

December 31, 2013

($millions except

per share amounts)
Quarter ended

September 30, 2013

($millions except

per share amounts)
%

change
Quarter ended

December 31, 2012

($millions except

per share amounts)
%

change
Assets Under Management 91,090    85,557    6    75,723    20   
Average Assets Under Management 88,558    84,125    5    74,323    19   
Pre-Tax Operating Earnings Per Share2 0.68    0.64    6    0.58    17   
EBITDA Per Share 2 0.72    0.68    6    0.63    14   
Net Income 116.2    107.8    8    95.0    22   
Earnings Per Share 0.41    0.38    8    0.34    21   
SG&A Expenses3 37 bps    37 bps    0    39 bps    (5)   
Dividends Recorded Per Share 0.280    0.270    4    0.240    17   
Net Debt4 315.3    403.7    (22)    526.5    (40)   
Gross Sales 3,516    3,160    11    3,513    0   
Net Sales 707    853    (17)    724    (2)   




HIGHLIGHTS

Year ended

December 31, 2013

($millions except

per share amounts)
Year ended

December 31, 2012

($millions except

per share amounts)
% change
Average Assets Under Management 83,325    72,606    15   
Pre-Tax Operating Earnings Per Share1 2.52    2.26    12   
EBITDA Per Share 2 2.71    2.48    9   
Net Income 426.4    352.2    21   
Earnings Per Share 1.50    1.24    21   
Adjusted Earnings Per Share5 1.50    1.31    15   
SG&A Expenses 38 bps    39 bps    (3)   
Free Cash Flow 456.2    423.9    8   
Dividends Recorded Per Share 1.065    0.955    12   
Gross Sales 13,858    10,597    31   
Net Sales 3,686    973    279   


All figures are net of non-controlling interest.
Pre-Tax Operating Earnings and EBITDA (earnings before interest, taxes, depreciation and amortization) are not standardized earnings measures prescribed by IFRS; however, management believes that most of its shareholders, creditors, other stakeholders and investment analysts prefer to include the use of these performance measures in analyzing CI's results. CI defines pre-tax operating earnings as income before income taxes less redemption fee revenue, non-recurring items, performance fees and investment gains, plus amortization of deferred sales commissions (DSC) and fund contracts. CI's method of calculating these measures may not be comparable to similar measures presented by other companies.
3 As a percentage of assets under management.
Net of cash and marketable securities not required for regulatory working capital.
5 Adjusted for an $18.8 million non-cash tax adjustment in 2012.



For the year ended December 31, 2013, average assets under management were $83.3 billion, an increase of 15% from the previous year. In 2013, CI experienced the highest level of total annual gross and net sales in over a decade. Gross sales of funds were $13.9 billion compared to $10.6 billion for the year ended December 31, 2012. CI's net sales increased 279% year over year to $3.7 billion in fiscal 2013. Positive sales momentum continued through to the fourth quarter of 2013, when CI experienced the highest level of gross and net retail sales in any fourth quarter of the last decade. Retail sales in the fourth quarter of 2013 were nearly four times higher than the same quarter the prior year.

At December 31, 2013, CI reached a record level of assets under management for a quarter-end at $91.1 billion, up 20% from $75.7 billion at December 31, 2012. In comparison, the S&P/TSX Composite Index increased 13% and the DEX Universe Bond Index lost 1% over the same period.

For the fourth quarter of 2013, CI reported earnings per share of $0.41, up 21% from $0.34 per share in the fourth quarter of 2012 and up 8% from $0.38 per share in the third quarter of 2013. CI reported EBITDA per share for the fourth quarter of 2013 of $0.72, a 14% increase from the fourth quarter of 2012 and a 6% increase from the prior quarter. Pre-tax operating earnings per share were up 17% from the fourth quarter of 2012 and up 6% from the prior quarter.

CI maintained its change in discretionary spend below the rate of growth in assets under management. Selling, general and administrative (SG&A) expenses as a percentage of average assets under management fell to 37 basis points in the fourth quarter of 2013, down from 39 basis points in the fourth quarter of the prior year.

CI generated $456.2 million in free cash flow during the year ended December 31, 2013 compared to $423.9 million in 2012. CI's cash flow facilitated a reduction in net debt by $211.2 million and the payment of $297.7 million in dividends. As at January 31, 2014, CI had 284,680,002 shares outstanding.

"2013 was one of CI's best years for investment performance, asset growth and sales," said Stephen A. MacPhail, CI President and Chief Executive Officer. "We have taken advantage of this success to continue to invest significantly in investment management and all service elements of our business. This year has seen a continuation of strong sales and asset growth with CI's assets under management now $92.6 billion, up 5% from the average for the fourth quarter of 2013."

The Board of Directors declared a monthly cash dividend of $0.095 per share payable on each of March 14, April 15, and May 15, 2014 to shareholders of record on February 28, March 31and April 30, 2014, respectively. The monthly dividend represents a yield of 3.2% on CI's closing share price of $35.60 on February 12, 2014.

For detailed financial statements for the quarter ended December 31, 2013, including Management's Discussion and Analysis, please refer to CI's website at www.cifinancial.com under Reports, or contact investorrelations@ci.com.

Analysts' Conference Call

CI will hold a conference call with analysts today at 4 p.m. Eastern time. Speaking on the call will be Mr. MacPhail and Douglas Jamieson, Executive Vice-President and Chief Financial Officer. The conference call and a slide presentation will be accessible through a webcast at www.ci.com/q4. Alternatively, investors may listen to the discussion by dialling 1-866-696-5910 or (416) 340-2217 (passcode: 9243090).

The call will be available for playback later in the day until February 27, 2014 at (905) 694-9451 or 1-800-408-3053 (passcode: 3704742). The webcast will be archived at www.ci.com/q4.

CI Financial Corp. (TSX: CIX) is an independent, Canadian-owned wealth management company. CI offers a broad range of investment products and services, including an industry-leading selection of investment funds, and is on the Web at www.cifinancial.com.

This press release contains forward-looking statements with respect to CI and its products and services, including its business operations and strategy and financial performance and condition. Although management believes that the expectations reflected in such forward-looking statements are reasonable, such statements involve risks and uncertainties. Actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors, including interest rates, business competition, changes in government regulations or in tax laws, and other factors discussed in materials filed with applicable securities regulatory authorities from time to time.

 

SOURCE CI Financial Corp.


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