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Press release from CNW Group

Fiera Capital Reports Strong Revenues and Earnings for Second Quarter of 2013; Increases Quarterly Dividend by 11%

Tuesday, August 13, 2013

Fiera Capital Reports Strong Revenues and Earnings for Second Quarter of 2013; Increases Quarterly Dividend by 11%

08:30 EDT Tuesday, August 13, 2013

MONTREAL, Aug. 13, 2013 /CNW Telbec/ - Fiera Capital Corporation (TSX: FSZ) ("Fiera Capital" or "the Firm"), a leading independent Canadian investment firm, today reported its financial results for the second quarter ended June 30, 2013 ("the second quarter"). The firm also announced that it has raised its quarterly dividend to $0.10 per share, from $0,09 per share.

"Our growth strategy has allowed Fiera Capital to create significant value for our shareholders and clients, and the strong financial results of the second quarter clearly demonstrate the potentials from our acquisitions. We are indeed rapidly gaining leverage on our fixed costs, resulting in stronger margin and profitability growth," said Jean-Guy Desjardins, Chairman, CEO and CIO of Fiera Capital. "We are very proud to have passed on the benefits of our robust financial performance to our shareholders with two dividend increases over the past six months, representing a combined 25% raise."

Financial and Corporate Highlights

For the three months ended June 30, 2013:

  • Revenue increased by $3.0 million or 10% to $33.2 million compared to the previous quarter ended March 31, 2013, and by $6.9 million or 26% from the corresponding quarter ended June 30, 2012.
  • Earnings before interest, taxes, depreciation and amortization ("EBITDA") increased by $1.1 million or 10% to $12.1 million compared to the quarter ended March 31, 2013, and increased by $1.7 million or 16% from the quarter ended June 30, 2012.
  • Adjusted earnings before interest, taxes, depreciation and amortization (Adjusted "EBITDA") increased by $1.5 million or 13% to $12.9 million compared to the quarter ended March 31, 2013, and increased by $2.1 million or 20% from the quarter ended June 30, 2012.
  • Assets under management ("AUM") remained stable at $65 billion at June 30, 2013, compared to March 31, 2013 and increased by $10.7 billion or 20% from June 30, 2012.
  • The Firm recorded net earnings of $0.06 per share compared to net earnings of $0.03 per share for the quarter ended March 31, 2013, and a net loss per share of $(0.06) for the quarter ended June 30, 2012.
  • Adjusted net earnings for the period were $8.9 million or $0.16 (basic and fully diluted) per share compared to adjusted net earnings of $7.5 million or $0.13 per share for the previous quarter ended March 31, 2013, and adjusted net earnings of $7.1 million or $0.13 per share for the period ended June 30, 2012.
  • On May 1st, 2013 Fiera Capital closed the transaction previously announced on January 18, 2013, with GMP Capital Inc. to acquire selected alternative investment funds of GMP Investment Management (the "GMP acquisition") representing approximately $0.6 billion in assets under management. A new subsidiary called Fiera Quantum was created as a result of the acquisition, which is immediately accretive to earnings.
  • On June 28, 2013, Fiera Axium Infrastructure completed a third closing of its second infrastructure fund for additional capital commitments of $81 million, bringing the total to over $800 million for its two funds.
  • On July 15, 2013, subsequent to quarter-end, Fiera Capital jointly announced the launch by Fiera Properties of one of the largest open-ended Canadian property funds in more than 20 years, representing $352 million in equity capital from investors. The Fund is designed to provide pension funds, foundations, endowments, and private investors with an open investment fund design.

"Our proposals and new business pipeline is robust and growing, indicating positive momentum across all our distribution channels, and our solid fund performance and well-diversified portfolio will continue to generate growth opportunities for the future," added Mr. Desjardins. "In addition, we are increasingly recognized as a leader in the alternative investment field in both the institutional and retail sectors, and the GMP acquisition further strengthens our capabilities in that regard. On the infrastructure and real estate front, there is very strong demand for our strategies, as evidenced by the successful additional closing of our funds during the quarter."

"As planned, we are also pursuing our North American expansion strategy. We are confident that our business model, operating platform and significant scale combined with strong fund performance, and well established investment teams and product offering will help us succeed in that market," concluded Mr. Desjardins.

Second Quarter 2013 Financial and Operating Results

The following table provides selected financial information for the three-month period ended June 30, 2013 compared to the quarter ended March 31, 2013 and to the same period in 2012.

Financial Highlights (in $ thousands)

         
        Three months ended  
    June 30, 2013 March 31, 2013 June 30, 2012
AUM (in $ millions)   65,092 65,702 54,375
Revenue        
Base management fees   32,860 30,118 26,098
Performance fees - Traditional Asset   299 60 20
Performance fees - Alternative Asset   19 37 139
    33,178 30,215 26,257
Operating Expenses   21,099 19,273 15,833
EBITDA   12,079 10,942 10,424
Net Earnings (Loss)   3,114 1,586 (3,463)
Attributable to:        
  Company's shareholders   3,364 1,586 (3,463)
  Non-controlling interest   (250) - -
      3,114 1,586 (3,463)
PER SHARE        
  EBITDA   0.21 0.19 0.18
  Adjusted EBITDA(1)   0.23 0.20 0.19
  Net Earnings (Loss)   0.06 0.03 (0.06)
  Adjusted Net Earnings(2)   0.16 0.13 0.13

(1) Adjusted EBITDA per share excludes non-cash compensation related items.
(2) Adjusted Net Earnings per share excludes non-recurring and non-cash items.

AUM as of June 30, 2013 and June 30, 2012 (in $ millions)

       
  June 30, 2013 June 30, 2012 Variance
Institutional 38,162 30,105 8,057
Private Wealth 1,948 1,101 847
Retail 24,982 23,169 1,813
AUM - end of period 65,092 54,375 10,717

Financial and Operating Results

Revenues for the three-month period ended June 30, 2013 increased by $6.9 million or 26% to $33.2 million compared to $26.3 million for the same period in the prior year. The increase in revenues is due primarily to the Firm's acquisitions of assets from CWM, UBS and GMP combined with additional AUM resulting from new mandates.

Operating expenses increased by $5.3 million or 33% to $21.1 million for the three-month period ended June 30, 2013 compared to $15.8 million for the same period in 2012. The increase resulted from an overall rise in selling, general and administration expenses ("SG&A") expenses of $5.6 million following the acquisition of assets from CWM, UBS and GMP, offset by lower external manager expenses of $0.3 million for the three months ended June 30, 2013.

Earnings before interests, taxes, depreciation and amortization ("EBITDA") increased by $1.7 million or 16% at $12.1 million for the three-month period ended June 30, 2013 from $10.4 million for the same period of 2012. EBITDA were negatively impacted by $0.8 million or $0.02 per share of non-cash compensation related items during the quarter. When added back to the firm's EBITDA of $12.1 million or 0.21 per share, adjusted EBITDA for the three-month period ended June 30, 2013 were $12.9 million or $0.23 per share (basic and fully diluted) compared to adjusted EBITDA of $10.7 million or $0.19 per share (basic and fully diluted) for the same period in 2012.

For the quarter ended June 30, 2013, the Firm earned $3.4 million or $0.06 per share (basic and fully diluted), compared to a net loss of $3.5 million or $0.06 per share (basic and fully diluted) for the three-month period ended June 30, 2012. Net earnings were negatively impacted by $3.8 million or $0.07 per share of non-cash items and $1.3 million or $0.02 per share of non-recurring costs (net of income taxes) during the quarter. When added back to the firm's net earnings of $3.4 million or $0.06 per share, adjusted net earnings for the three-month period ended June 30, 2013 were $8.5 million or $0.16 per share (basic and fully diluted) compared to adjusted net earnings of $7.1 million or $0.13 per share (basic and fully diluted) for the same period in 2012.

Dividend

The Board of Directors has declared a dividend of $0.10 per Class A Subordinate Voting share and Class B Special Voting share of Fiera, payable on September 23, 2013 to shareholders of record at the close of business on August 26, 2013. The dividend is an eligible dividend for income tax purposes.

Forward-Looking Statements

This document may contain certain forward-looking statements. These statements relate to future events or future performance, and reflect management's expectations or beliefs regarding future events, including business and economic conditions and Fiera Capital's growth, results of operations, performance and business prospects and opportunities. Such forward-looking statements reflect management's current beliefs and are based on information currently available to management. In some cases, forward-looking statements can be identified by terminology such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate", "predict", "potential", "continue", "target", "intend" or the negative of these terms, or other comparable terminology.

By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and a number of factors could cause actual events or results to differ materially from the results discussed in the forward-looking statements. In evaluating these statements, readers should specifically consider various factors that may cause actual results to differ materially from any forward-looking statement.

These factors include, but are not limited to, market and general economic conditions, the nature of the financial services industry, and the risks and uncertainties detailed from time to time in Fiera Capital's interim and annual consolidated financial statements, and its Annual Report and Annual Information Form filed on www.sedar.com. These forward-looking statements are made as of the date of this document, and Fiera Capital assumes no obligation to update or revise them to reflect new events or circumstances.

About Fiera Capital Corporation

Fiera Capital is a leading publicly traded, independent investment firm. The Firm is one of only a handful of full service, multi-product investment firms in Canada, offering clients a proven top tier track record in equity and fixed income management as well as depth and expertise in asset allocation and alternative investments. www.fieracapital.com

 

 

SOURCE: Fiera Capital Corporation

For further information:

Erica Lily Smith
514-574-1791
esmith@national.ca

Additional information relating to the Company, including the Company's annual information form, is on SEDAR at www.sedar.com.

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