Canaccord Financial Inc. says its second-quarter loss widened to $14.8-million as it booked charges related to the restructuring of its money-losing wealth management business.
The Toronto-based financial services firm said Wednesday its loss for the second quarter of fiscal 2013 amounted to 19 cents per share, compared to a net loss of $5.3-million, or 9 cents per share, in the same quarter a year earlier.
Adding to the wider loss was a $13.6-million, one-time restructuring charge related to the closure of 16 of its wealth management offices across the country and reductions in the number of advisers at the remaining locations.
Excluding restructuring and significant items, the company reported income of $5.9-million, or 3 cents per share, compared to a loss of $1.7-million in the year-ago quarter, or 5 cents per share.
That beat analysts’ expectations for an adjusted loss of 6 cents per share on revenue of $178.6-million, according to Thomson Reuters.
Revenue grew 56 per cent to $186.6-million from $119.5-million.
The company said it booked expenses of $204.9-million, up 62 per cent from $126.4-million in the same period of 2012.
President and CEO Paul Reynolds said the company made a number of moves in the quarter to strengthen the performance of certain divisions.
“In particular, we expect these activities will allow our wealth management businesses to operate more competitively within this dynamic economic environment,” he said.
Canaccord’s North American wealth management division generated $37-million in revenue and recorded a pre-tax net loss of $20.5-million.
That included $13.6-million in charges associated with restructuring its Canadian wealth management platform.
Its Canaccord Genuity capital markets division also booked a restructuring charge of $4.4-million and acquisition related costs of $388,000. It saw revenue increase 71 per cent year-over-year to $119-million and credited better performance at its U.S. and U.K. operations.
“In fact, our U.S. and U.K. businesses are beginning to build the kind of momentum we expected from our acquisition of Collins Stewart Hawkpoint plc,” the company said.
Canaccord Genuity provides corporate brokering, securities and advisory services to corporate and institutional clients.
Through Collins Stewart Wealth Management, Canaccord Genuity also provides wealth management services to individual investors, institutions and intermediaries. Based in London, the business has over 650 employees at 12 offices across the United Kingdom and Europe.
The company has offices in 12 countries worldwide, including wealth management officers in Canada, Australia, the U.K. and Europe. Canaccord Genuity, the international capital markets division, operates in Canada, the U.S., the U.K., France, Germany, Ireland, Italy, China, Hong Kong, Singapore, Australia and Barbados.
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