CI Financial reports second quarter results: Earnings per share increase 16%

TSX Symbol: CIX

TORONTO, Aug. 8, 2013 /CNW/ - CI Financial Corp. ("CI") today released unaudited financial results for the quarter ended June 30, 2013.

HIGHLIGHTS	Quarter ended June 30, 2013 ($millions except per share amounts)	Quarter ended March 31, 2013 ($millions except per share amounts)	% change	Quarter ended June 30, 2012 ($millions except per share amounts)	% change
Assets Under Management	81,650	80,471	1	71,559	14
Average Assets Under Management	81,691	78,810	4	71,385	14
Pre-Tax Operating Earnings Per Share^1	0.62	0.59	5	0.55	13
EBITDA Per Share^1	0.67	0.64	5	0.61	10
Adjusted Net Income^2	104.0	98.5	6	90.1	15
Earnings Per Share	0.37	0.35	6	0.25	48
Adjusted Earnings Per Share^2	0.37	0.35	6	0.32	16
SG&A Expenses	38 bps	39 bps	(3)	40 bps	(5)
Dividends Recorded Per Share	0.265	0.250	6	0.240	10
Net Debt^3	447.9	503.6	(11)	614.2	(27)
Gross Sales	3,377	3,804	(11)	2,010	68
Net Sales	978	1,147	(15)	(270)	n/a

	^1Pre-Tax Operating Earnings and EBITDA (earnings before interest, taxes, depreciation and amortization) are not standardized earnings measures prescribed by IFRS; however, management believes that most of its shareholders, creditors, other stakeholders and investment analysts prefer to include the use of these performance measures in analyzing CI's results. CI defines pre-tax operating earnings as income before income taxes less redemption fee revenue, non-recurring items, performance fees and investment gains, plus amortization of deferred sales commissions (DSC) and fund contracts. CI's method of calculating these measures may not be comparable to similar measures presented by other companies.
	^2Adjusted for a non-recurring tax charge in the quarter ended June 30, 2012.
	^3Net of cash and marketable securities not required for regulatory working capital.

For the quarter ended June 30, 2013, average assets under management reached a record high of $81.7 billion, an increase of 14% from the same quarter of the previous year and an increase of 4% from the prior quarter. CI had a record level of second quarter gross sales and its highest level of second quarter net sales since 2000. Gross sales of funds were $3.4 billion during the quarter, an increase of 68% year over year, while net sales increased to $978 million from net redemptions of $270 million in the same quarter one year ago.

At June 30, 2013, CI also reached a record level of assets under management for a quarter-end at $81.6 billion, up 14% from $71.6 billion at June 30, 2012. In comparison, the S&P/TSX Composite Index increased 8% and the DEX Universe Bond Index was unchanged over the same period.

For the second quarter of 2013, CI reported earnings per share of $0.37, up 48% from $0.25 per share in the second quarter of 2012 and up 6% from $0.35 per share in the first quarter of 2013. The second quarter of 2012 included a non-recurring tax charge. Adjusting for this charge, earnings per share increased 16% year over year. In addition, CI reported EBITDA per share for the second quarter of 2013 of $0.67, a 10% increase from the second quarter of 2012 and a 5% increase from the prior quarter. Pre-tax operating earnings per share were up 13% from the second quarter of 2012 and up 5% from the prior quarter.

"The quarter was excellent on many counts," said Stephen A. MacPhail, CI President and Chief Executive Officer. "Strong positive returns for our fund investors, expanded support from a broad base of advisors and continued investment in training, new products and money management expertise resulted in CI achieving record high asset levels and the best net inflows in over a decade."

CI maintained its discretionary spend below the rate of growth in assets under management. Selling, general and administrative (SG&A) expenses as a percentage of average assets under management were 0.38% in the second quarter of 2013, down from 0.40% in the second quarter of the prior year.

CI generated $114.2 million in free cash flow during the quarter ended June 30, 2013 compared to $104.7 million in the second quarter of 2012. CI's cash flow facilitated a reduction in net debt by $55.7 million and the payment of $73.7 million in dividends. As at July 31, 2013, CI had 283,762,131 shares outstanding.

The Board of Directors declared monthly cash dividends of $0.09 per share payable on each of September 13, October 15 and November 15, 2013 to shareholders of record on August 31, September 30 and October 31, 2013, respectively. The monthly dividend represents a yield of 3.4% on CI's closing share price of $31.59 on August 7, 2013.

For detailed financial statements for the quarter ended June 30, 2013, including Management's Discussion and Analysis, please refer to CI's website at www.cifinancial.com under Reports, or contact [email protected].

Analysts' Conference Call
CI will hold a conference call with analysts today at 4 p.m. Eastern time. Speaking on the call will be Mr. MacPhail and Douglas Jamieson, Executive Vice-President and Chief Financial Officer. The conference call and a slide presentation will be accessible through a webcast at www.ci.com/q2. Alternatively, investors may listen to the discussion by dialling 1-866-696-5910 (passcode: 9533678).

The call will be available for playback later in the day until August 22, 2013 at 1-800-408-3053 (passcode: 9921688). The webcast will be archived at www.ci.com/q2.

CI Financial Corp. (TSX: CIX) is an independent, Canadian-owned wealth management company. CI offers a broad range of investment products and services, including an industry-leading selection of investment funds, and is on the Web at www.cifinancial.com.

This press release contains forward-looking statements with respect to CI and its products and services, including its business operations and strategy and financial performance and condition. Although management believes that the expectations reflected in such forward-looking statements are reasonable, such statements involve risks and uncertainties. Actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors, including interest rates, business competition, changes in government regulations or in tax laws, and other factors discussed in materials filed with applicable securities regulatory authorities from time to time.

 

 

SOURCE: CI Financial Corp.

Stephen A. MacPhail
President and Chief Executive Officer
CI Financial Corp.
[phone]