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Guardian Capital TSX: GCG-T

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Guardian Capital Group Limited (TSX: GCG; GCG.A) Announces 2021 First Quarter Operating Results

GlobeNewswire - Wed May 12, 3:51PM CDT

EQNX::TICKER_START (TSX:GCG.TO),(TSX:GCG-A.TO), EQNX::TICKER_END

All per share figures disclosed below are stated on a diluted basis.

For the three months ended March 31
($ in thousands, except per share amounts)                   2021        2020
Net revenue                                                  $   64,694  $  49,901
Operating earnings                                               17,504     10,813
Net gains (losses)                                               41,971     (161,289 )
Net earnings (loss) attributable to shareholders                 49,625     (136,368 )
Attributable to shareholders:
EBITDA                                                       $   21,211  $  14,370
Adjusted cash flow from operations                               18,492     13,320
Attributable to shareholders, per share:
Net earnings (loss)                                          $   1.83    $  (5.35    )
EBITDA                                                           0.78       0.53
Adjusted cash flow from operations                               0.68       0.49
As at                                             2021       2020
($ in millions, except per share amounts)         March 31   December 31 March 31
Assets under management                           $  47,643  $   45,984  $  27,527
Assets under administration                          28,680      22,289     18,152
Shareholders' equity                                 737         700        563
Securities                                           654         633        524
Per share:
Shareholders' equity                              $  27.14   $   25.69   $  20.94
Securities                                           24.05       23.23      19.50

The Company is reporting another set of record highs in both assets under management ("AUM") and assets under administration ("AUA") this quarter, for a total of $76.3 billion in total client assets. This growth was achieved while navigating through the challenging environment over the past year. The Company has continued the practice stated in its 2020 Annual Report, whereby it has not furloughed any employees as a result of the pandemic, nor has it accessed any government wage subsidies or support throughout this period.

The Company's AUM grew to $47.6 billion as at March 31, 2021, a 4% increase from $46.0 billion as at December 31, 2020, and a 73% increase from $27.5 billion as at March 31, 2020. The continued recovery in the global financial markets, the strong inflow of assets experienced by GuardCap Asset Management Limited ("GuardCap"), the UK-based investment management subsidiary, and the addition of assets through acquisitions drove the growth in AUM. The AUM managed by GuardCap has grown to $12.2 billion as at March 31, 2021, $1.5 billion growth since the beginning of the quarter, and tripling from the $4.0 billion reported at the end of 2019.

The Company's AUA grew to $28.7 billion as at March 31, 2021, a 29% increase from $22.3 billion as at December 31, 2020 and a 58% increase from $18.2 billion as at March 31, 2020. The acquisition of a Canadian wealth management business on March 1, 2021, which was subsequently renamed Guardian Partners Inc. ("GPI") added $5.4 billion in total client assets, of which $5.1 billion is included in AUA and $0.3 billion in AUM.

The Company is reporting Operating earnings of $17.5 million for the quarter ended March 31, 2021, 62% or $6.7 million higher than the $10.8 million reported in the first quarter of 2020. The significant growth experienced by the Company's businesses was led by GuardCap, IDC Worldsource Insurance Network Inc., the MGA subsidiary and, to a lesser extent, the contributions from the businesses acquired over the past two quarters.

The Net revenue for the current quarter grew to a historic high of $64.7 million, 30% or $14.8 million higher than the $49.9 million reported in the same quarter in the prior year. The increase reflects our successful organic growth in revenues since March 31, 2020, and to a lesser extent the addition of revenues from the acquired businesses.

Expenses in the current quarter were $47.2 million, an $8.1 million increase from $39.1 million in the same quarter in the prior year. The higher expenses reflect the growth in our businesses, and the addition of $4.0 million in new expenses from the acquired businesses.

The global equities markets continued to experience positive performance since the pandemic induced steep decline in the first quarter of 2020. As a result, the Company's Net gains in the current quarter were $42.0 million, compared to Net losses of $161.3 million in the first quarter of 2020.

As a result of the Net gains and Operating earnings described above, the Company's Net earnings attributable to shareholders in the current quarter were $49.6 million, compared to a Net loss of $136.4 million in the same quarter in 2020.

EBITDA attributable to shareholders for the current quarter was $21.2 million, compared to $14.4 million in the same period in the prior year. Adjusted cash flow from operations attributable to shareholders for the current quarter was $18.5 million, compared to $13.3 million in the same quarter in the prior year. The increases of 47% and 38%, respectively, in these measures are reflective of the growth delivered by the Company's operating businesses.

The Company's Shareholders' equity as at March 31, 2021 increased to $737 million, or $27.14 per share, from $700 million, or $25.69 per share as at December 31, 2020, and $563 million or $20.94 per share as at March 31, 2020. The fair value of the Company's Securities as at March 31, 2021 increased to $654 million, or $24.05 per share, from $633 million, or $23.23 per share as at December 31, 2020 and $524 million or $19.50 per share as at March 31, 2020.

The Board of Directors has declared a quarterly eligible dividend of $0.18 per share, payable on July 19, 2021, to shareholders of record on July 12, 2021.

The Company's financial results for the past eight quarters are summarized in the following table.

Mar 31, 2021               Dec 31, 2020  Sep 30, 2020  Jun 30, 2020  Mar 31, 2020       Dec 31, 2019  Sep 30, 2019      Jun 30, 2019
As at ($ in millions)
Assets under management                                           $            47,643        $    45,984   $    32,734   $    31,196   $    27,527        $    31,147   $    30,243       $    30,088
Assets under administration                                                    28,680             22,289        20,755        20,010        18,152             20,248        19,040            18,784
For the three months ended ($ in thousands)
Net revenue                                                       $            64,694        $    63,724   $    52,042   $    50,124   $    49,901        $    49,865   $    45,983       $    45,963
Operating earnings                                                             17,504             18,493        12,108        13,427        10,813             13,030        12,105            12,590
Net gains (losses)                                                             41,971             80,983        35,739        43,254        (161,289 )         24,140        (1,274  )         7,957
Net earnings (loss)                                                            50,861             87,083        42,652        51,244        (134,911 )         31,808        8,952             17,601
Net earnings (loss) attributable to shareholders                               49,625             86,039        42,201        50,486        (136,368 )         30,787        8,275             16,838
Net earnings (loss) attributable to shareholders:
Class A and Common per share (in $)
Basic                                                             $            1.95          $    3.38     $    1.66     $    1.99     $    (5.35    )    $    1.20     $    0.32         $    0.65
Diluted                                                                        1.83               3.16          1.56          1.87          (5.35    )         1.13          0.31              0.62
Dividends paid on Class A and Common shares (in $)                $            0.160         $    0.160    $    0.160    $    0.160    $    0.150         $    0.150    $    0.150        $    0.150
As at
Shareholders' equity ($ in thousands)                             $            737,363       $    699,610  $    631,863  $    596,265  $    562,821       $    682,777  $    653,983      $    647,983
Per Class A and Common share  (in $)
Basic                                                             $            29.02         $    27.54    $    24.80    $    23.50    $    22.18         $    26.73    $    25.49        $    25.26
Diluted                                                                        27.14              25.75         23.25         22.07         20.94              25.01         23.93             23.73
Total Class A and Common shares outstanding (shares in thousands)              27,691             27,740        27,758        27,758        27,758             27,839        27,956            27,956

Guardian Capital Group Limited is a diversified financial services company founded in 1962. The Company is headquartered in Canada and has offices in the United Kingdom, the United States and the Caribbean. It provides institutional and high net worth investment management services to clients; financial services to international investors; and services to financial advisors in its national mutual fund dealer, securities dealer, and life insurance managing general agency. Its Common and Class A shares are listed on The Toronto Stock Exchange.

For further information, contact:

Donald Yi               George Mavroudis
Chief Financial Officer President and Chief Executive Officer
(416) 350-3136          (416) 364-8341

The Company's management uses EBITDA attributable to shareholders (formerly EBITDA), including the per share amount, Adjusted cash flow from operations attributable to shareholders (formerly Adjusted cash flow from operations), including the per share amount, Shareholders' equity per share and Securities per share to evaluate and assess the performance of its business. These measures do not have standardized measures under International Financial Reporting Standards ("IFRS"), and are therefore unlikely to be comparable to similar measures presented by other companies. However, management believes that most shareholders, creditors, other stakeholders and investment analysts prefer to include the use of these measures in analyzing the Company's results. The Company defines EBITDA as net earnings before interest, income taxes, amortization, stock-based compensation, net gains or losses, less amounts attributable to non-controlling interests. The Company defines Adjusted cash flow from operations attributable to shareholders (formerly Adjusted cash flow from operations) as net cash from operating activities, net of changes in non-cash working capital items and non-controlling interests. The most comparable IFRS measures are Net earnings, which were $50.9 million in 2021 (2020 - Net Loss $134.9 million), and Net cash from operating activities, which was $6.1 million in 2021 (2020 - $4.3 million). The per share amounts for EBITDA attributable to shareholders, Adjusted cash flow from operations attributable to shareholders, Shareholders' equity and Securities are calculated by dividing the amounts by diluted shares, which Is calculated in a manner similar to net earnings attributable to shareholders per share. More detailed descriptions of these non-IFRS measures are provided in the Company's Management's Discussions and Analysis, including a reconciliation of these measures to their most comparable IFRS measures.

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