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Press release from Marketwire

IGM Financial Inc. Reports First Quarter Earnings

Friday, May 06, 2011

IGM Financial Inc. Reports First Quarter Earnings10:34 EDT Friday, May 06, 2011WINNIPEG, MANITOBA--(Marketwire - May 6, 2011) -Readers are referred to the disclaimer regarding Forward-Looking Statements at the end of this Release.IGM Financial Inc. (IGM or the Company) (TSX:IGM) today announced earnings results for the first quarter of 2011.Net earnings available to common shareholders for the three months ended March 31, 2011 were $211.8 million or 81 cents per share compared to $191.8 million or 73 cents per share in 2010. This represents an increase of 11.0% on a per share basis.Revenues for the three months ended March 31, 2011 were $720.4 million compared to $665.3 million a year ago. Expenses were $433.1 million for the first quarter of 2011 compared to $400.0 million a year ago. Total assets under management at March 31, 2011 were $134.1 billion. This compared with total assets under management of $123.4 billion at March 31, 2010, an increase of 8.7%. Shareholders' equity at March 31, 2011 was $4.3 billion, unchanged from March 31, 2010. Return on average common equity for the three months ended March 31, 2011 was 20.3% compared to 18.4% for the comparative period in 2010. Investors Group Operations At March 31, 2011 there were 2,655 Consultants with 4 years or more of Investors Group experience, up from 2,641 at December 31, 2010. The number of Investors Group Consultants was 4,586 at March 31, 2011 down from 4,686 at December 31, 2010. "Sales increased over 2010 by 9% for mutual funds, 14% for insurance and 15% for mortgage originations as our Consultants served the diverse financial planning needs of our clients," said Murray J. Taylor, President and Chief Executive Officer of Investors Group Inc. "Our total number of Consultants reflects continued strong retention of experienced Consultants and refinements to our recruiting process during the quarter."Mutual fund sales for the first quarter were $2.05 billion compared to $1.88 billion in the prior year, and mutual fund net sales for the first quarter were $504 million compared to net sales of $560 million a year ago. The twelve month trailing redemption rate (excluding money market funds) was 8.4% at March 31, 2011, compared to 7.5% at March 31, 2010.Mutual fund assets under management at March 31, 2011 were $64.0 billion compared to $59.2 billion at March 31, 2010, an increase of 8.1%. Mackenzie Operations Total sales for the first quarter of 2011 were $3.49 billion compared to $3.23 billion in the prior year. Total net sales for the first quarter were $121 million compared to total net sales of $101 million a year ago. "Investment performance of our mutual fund family remained strong, with 61% of our fund assets ranked in the first or second quartile of their respective asset categories over the last three years," said Charles R. Sims, F.C.A., President and Chief Executive Officer of Mackenzie Financial Corporation. Mackenzie's total assets under management at March 31, 2011 were $70.7 billion compared with total assets under management of $64.9 billion at March 31, 2010, an increase of 9.0%. Mutual fund assets under management at March 31, 2011 were $44.8 billion compared to $41.3 billion a year ago, an increase of 8.5%. Dividends The Board of Directors has declared a dividend of 51.25 cents per share on the Company's common shares and has declared a dividend of $0.36875 per share on the Company's 5.90% Non-Cumulative First Preferred Shares, Series "B". The common share dividend is payable on July 29, 2011 to shareholders of record on June 30, 2011 and the preferred share dividend is payable on August 2, 2011 to shareholders of record on June 30, 2011. Forward-Looking Statements Certain statements in this Release, other than statements of historical fact, are forward-looking statements based on certain assumptions and reflect IGM Financial's current expectations. Forward-looking statements are provided for the purposes of assisting the reader in understanding the Company's financial position and results of operations as at and for the periods ended on certain dates and to present information about management's current expectations and plans relating to the future and readers are cautioned that such statements may not be appropriate for other purposes. These statements may include, without limitation, statements regarding the operations, business, financial condition, expected financial results, performance, prospects, opportunities, priorities, targets, goals, ongoing objectives, strategies and outlook of the Company, as well as the outlook for North American and international economies, for the current fiscal year and subsequent periods. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, or include words such as "expects", "anticipates", "plans", "believes", "estimates", "seeks", "intends", "targets", "projects", "forecasts" or negative versions thereof and other similar expressions, or future or conditional verbs such as "may", "will", "should", "would" and "could". This information is based upon certain material factors or assumptions that were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking statements, including the perception of historical trends, current conditions and expected future developments, as well as other factors that are believed to be appropriate in the circumstances.By its nature, this information is subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct and that objectives, strategic goals and priorities will not be achieved. A variety of material factors, many of which are beyond the Company's and its subsidiaries' control, affect the operations, performance and results of the Company, and its subsidiaries, and their businesses, and could cause actual results to differ materially from current expectations of estimated or anticipated events or results. These factors include, but are not limited to: the impact or unanticipated impact of general economic, political and market factors in North America and internationally, interest and foreign exchange rates, global equity and capital markets, management of market liquidity and funding risks, changes in accounting policies and methods used to report financial condition (including uncertainties associated with critical accounting assumptions and estimates), the effect of applying future accounting changes (including adoption of International Financial Reporting Standards), operational and reputational risks, business competition, technological change, changes in government regulations and legislation, changes in tax laws, unexpected judicial or regulatory proceedings, catastrophic events, the Company's ability to complete strategic transactions, integrate acquisitions and implement other growth strategies, and the Company's success in anticipating and managing the foregoing factors. The reader is cautioned that the foregoing list of factors is not exhaustive of the factors that may affect any of the Company's forward-looking statements. The reader is also cautioned to consider these and other factors, uncertainties and potential events carefully and not place undue reliance on forward-looking statements. Other than as specifically required by law, the Company undertakes no obligation to update any forward-looking statements to reflect events or circumstances after the date on which such statements are made, or to reflect the occurrence of unanticipated events, whether as a result of new information, future events or results, or otherwise.Additional information about the risks and uncertainties of the Company's business is provided in its disclosure materials filed with the securities regulatory authorities in Canada, available at www.sedar.com.The unaudited interim Consolidated Financial Statements and Management's Discussion and Analysis (MD&A) of operating results are available on IGM Financial Inc.'s website at www.igmfinancial.com. IGM Financial Inc. is one of Canada's premier personal financial services companies, and one of the country's largest managers and distributors of mutual funds and other managed asset products, with over $134 billion in total assets under management as of April 30, 2011. Its activities are carried out principally through Investors Group, Mackenzie Financial Corporation and Investment Planning Counsel. IGM Financial Inc. is a member of the Power Financial Corporation group of companies. Media Note: A live webcast of IGM's Analyst conference call for the First Quarter 2011 will be held Friday May 6, 2011 at 3:00 P.M. (ET) at www.igmfinancial.com. Media and interested parties may alternatively choose to listen to the live analyst teleconference call by dialing 1-866-226-1792 or 416-340-2216.IGM FINANCIAL INC.Consolidated Statements of Earnings(unaudited) Three months ended March 31(in thousands of Canadian dollars, except shares and per share amounts)20112010RevenuesManagement fees$ 492,062$ 449,734Administration fees92,79388,514Distribution fees89,69172,849Net investment income and other45,86054,212720,406665,309ExpensesCommission233,629213,696Non-commission169,183159,027Interest30,27127,302433,083400,025Earnings before income taxes287,323265,284Income taxes73,28070,051Net earnings214,043195,233Perpetual preferred share dividends2,2133,467Net earnings available to common shareholders$ 211,830$ 191,766Average number of common shares(in thousands)- Basic259,289262,632- Diluted260,332264,069Earnings per share (in dollars)- Basic$ 0.82$ 0.73- Diluted$ 0.81$ 0.73IGM FINANCIAL INC.Financial HighlightsAs at and for the three months ended March 31(unaudited)20112010% ChangeNet earnings available to common shareholders ($ millions)$ 211.8$ 191.810.5%Diluted earnings per share0.810.7311.0Return on equity20.3%18.4%Dividends per share0.51250.5125-Total assets under management(1)($ millions)$ 134,081$ 123,3688.7%Investors GroupMutual funds64,04959,2248.1MackenzieMutual funds44,82441,331Sub-advisory, institutional and other accounts25,85523,526Total70,67964,8579.0CounselMutual funds2,8342,25425.7For the three months ended March 31, 2011Investors GroupMackenzieCounselTotal(2)Mutual Funds and Institutional Sales ($ millions)Gross sales$ 2,046$ 3,486$ 169$ 5,577Net sales50412173619(1)Total assets under management excluded $3.5 billion of assets sub-advised by Mackenzie on behalf of Investors Group and Investment Planning Counsel ($3.0 billion at March 31, 2010).(2)Total Gross Sales and Net Sales excluded $124 million and $79 million respectively in accounts sub-advised by Mackenzie on behalf of Investors Group and Investment Planning Counsel.FOR FURTHER INFORMATION PLEASE CONTACT: Ron ArnstIGM Financial Inc.Media Relations(204) 956-3364ron.arnst@igmfinancial.com