Aston Hill announces second quarter 2012 results and the closing of Argent Energy Trust
CALGARY, Aug. 13, 2012 /CNW/ - Aston Hill Financial Inc. ("Aston Hill" or the "Company") (TSX:AHF) is pleased to announce it has filed its unaudited interim consolidated financial statements for the period ended June 30, 2012 and related Management Discussion and Analysis with Canadian securities regulatory authorities. The Company is also pleased to announce that it, in its capacity as administrator, has closed on the initial public offering of Argent Energy Trust ("Argent"), which began trading on the TSX, on Friday, August 10, 2012 under the symbol AET.un.
As of June 30, 2012, Aston Hill had approximately $5.62 billion in Assets under Advisory and Management ("AUM") compared to $3.39 billion at June 30, 2011 representing an increase of 66% year over year. Current AUM as at August 10, 2012 is $5.92 billion which represents a slight decrease from the prior quarter total of $5.95 billion. The decrease is largely due to the 5.3% overall reduction in the TSX composite index in the second quarter. Mutual fund sales were strong as positive net sales in the Company's proprietary mutual funds for the first and second quarters were $32.0 million and $64.8 million respectively.
Revenues for the second quarter of 2012 were approximately $5.779 million as compared to $3.538 million in the second quarter of 2011, representing a 63% year over year increase. Revenues decreased by 6% from the prior quarter due to the AUM decrease noted above. General and administrative expenses in the second quarter totaled $3.883 million as compared to $3.774 million in the first quarter, a 3% increase. The increase is largely the result of marketing costs associated with the continued push to sell Aston Hill's proprietary suite of mutual funds. For the second quarter of 2012, Aston Hill reported EBITDA1 of $0.886 million compared to $1.498 million in the first quarter. The decrease in EBITDA is primarily due to the decrease in fees associated with the termination of the Sword management contract, in addition to the decrease in management and advisory fees due to the 5.3% AUM valuation drop from market softening and the increase in marketing costs and trailer fees related to subscriptions on Aston Hill's proprietary suite of mutual funds. The expected short term decline in EBITDA should be offset by G&A recoveries coming from Argent and lower expected marketing costs in subsequent periods.
On August 10, 2012, Argent closed an initial public offering raising proceeds of $212 million. Argent is an open-ended "non-SIFT" Canadian trust which produces oil and gas in the United States. At Closing, Argent is expected to provide its unitholders with an annual distribution of 10.5% to be paid monthly based on the $10 per unit initial price. Aston Hill has signed an agreement with Argent to provide administrative services on an on-going basis for an overhead allocation of $700,000 plus reimbursement of administrative costs. Those administrative costs are expected to be approximately $1 million per year. The agreement also provides for the overhead allocation to be tiered with Argent's enterprise value. In addition, Aston Hill, as promoter for this offering, will receive initial units in Argent currently valued at $2.1 million which vest over three years. Further, the Company will recognize an unrealized gain on closing of $850,000 on its initial seed investment in Argent.
The Company continues to repurchase its own shares as part of its Normal Course Issuer Bid program. As at June 30, 2012, 298,400 shares were repurchased and cancelled at a total cost of $406,000.
Aston Hill is a diversified asset management company with a suite of retail mutual funds, closed end funds, private equity funds, hedge funds and segregated institutional funds. The Company is also engaged in the administration of Argent Energy Trust. Aston Hill has offices in Calgary and Toronto.
The TSX has neither approved nor disapproved the information contained herein.
- EBITDA: EBITDA is not a standardized earnings measure prescribed by IFRS; however, management believes that most of its shareholders, creditors, other stakeholders and investment analysts prefer to use this performance measure in analyzing Aston Hill's results.
- Forward-Looking Statements: This news release contains certain "forward-looking statements" within the meaning of such statements under applicable securities law. Forward-looking statements are frequently characterized by words such as "plan", "continue", "expect", "project", "intend", "believe", "anticipate", "estimate", "may", "will", "potential", "proposed" and other similar words, or statements that certain events or conditions "may" or "will" occur. These statements are only predictions. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this news release. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements.
For a detailed description of the risks and uncertainties facing the Company and its business and affairs, readers should refer to the Company's annual financial statements and management discussion and analysis for the year ended December 31, 2011, both of which are available at www.sedar.com. The Company undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change, unless required by law. The reader is cautioned not to place undue reliance on forward-looking statements.
SOURCE: Aston Hill Financial Inc.
For further information concerning this press release, please contact:
Eric Tremblay
Chief Executive Officer
Aston Hill Financial Inc.
(403) 770-4817
Larry Titley
Vice President and CFO
Aston Hill Financial Inc.
(403) 770-4808
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