DundeeWealth(R) Reports First Quarter 2010 Results

TORONTO, May 11 /CNW/ - DundeeWealth Inc. ("DundeeWealth" or the "Company") (TSX: DW) today released interim unaudited financial results for the three months ended March 31, 2010. In the first three months of 2010, the Company earned $74.5 million before interest, taxes, depreciation and amortization ("EBITDA") with net earnings of $33.0 million.

The Company disposed of a significant portion of its investment in collateralized loan obligations ("CLOs") during the first quarter of 2010 for cash proceeds of $21.9 million, contributing to EBITDA with a resulting gain of $18.6 million included in investment income for the period.

    
    Highlights
    ----------


    -------------------------------------------------------------------------
                   As at:                  March 31, 2010  December 31, 2009
             (in billions of $)
    -------------------------------------------------------------------------
    AUM (Assets Under Management)               38.8              36.1
    -------------------------------------------------------------------------
    AUA (Assets Under Administration)           26.0              25.5
    -------------------------------------------------------------------------
    Bank Deposits                                7.5               7.2
    -------------------------------------------------------------------------
    Total                                       72.3              68.8
    -------------------------------------------------------------------------
         For the three months ended:       March 31, 2010    March 31, 2009
             (in millions of $)
    -------------------------------------------------------------------------
    Revenues                                   234.7             152.7
    -------------------------------------------------------------------------
    EBITDA                                      74.5              23.0
    -------------------------------------------------------------------------
    

Consolidated revenues for the three months ended March 31, 2010 were $234.7 million, up 54% (42% excluding the gain realized on the sale of the CLOs) compared with $152.7 million for the same period in 2009. At the same time, selling, general and administrative ("SG&A") expenses in the first quarter of 2010 were $72.5 million as compared to $62.7 million in the first quarter of 2009.

"Our results this quarter emphasize our ability to generate revenue by capitalizing on market opportunities and the impact of our efforts to remove costs from operations," said David Goodman, President and Chief Executive Officer of DundeeWealth Inc. "We continue to grow revenue at a faster pace than SG&A and remain focused on improving margins across the business."

Management fee revenue was $134.4 million in the first quarter of 2010, up 52% from the same period last year, primarily a result of a 50% increase in average levels of assets under management ("AUM"), from $23.4 billion to $35.0 billion.

In the first quarter of 2010, the Company, through its Dynamic family of funds, led the industry in net sales overall and ranked first among all other independent asset managers in net sales of long-term funds, according to the Investment Funds Institute of Canada ("IFIC"). Dynamic Funds(R) has been one of the top two independent asset managers in terms of net sales in seven of the eight most recent quarters.

Dynamic's portfolio management team won industry accolades this quarter when it took home 14 Canadian Lipper Fund Awards trophies for consistently strong risk-adjusted returns, the greatest number awarded to any fund company.

DundeeWealth's industry-leading sales momentum coupled with the strong performance of core mutual funds in the Dynamic line up increased the Company's mutual fund market share to 3.99% from 3.76% at the end of 2009 and 3.13% at the end of the first quarter last year. During the first quarter of 2010, Dynamic's market share was the fastest growing among the 10 largest asset managers in Canada, according to IFIC. Furthermore, March 31, 2010 AUM of $38.8 billion represents an all time high for the Company.

"The Dynamic Funds story is evidence of our ability to sell all major long-term asset classes, to lead the industry in asset gathering activities in several market environments and to respond to the evolving needs of the investing community," Mr. Goodman added. "We remain committed to our strong relationship with financial advisors and focused on creating for them innovative and timely investment solutions."

Revenues in the Capital Markets division for the first quarter of 2010 were $27.8 million, up from $15.9 million for the same period last year. Investment banking activities in Dundee Capital Markets have generally increased momentum over the last few quarters.

During the first three months of 2010, revenues in the Retail Distribution division increased to $69.4 million from $59.2 million in the first quarter of 2009, primarily due to an increase in assets under administration ("AUA") as investors began to revisit their portfolios following several months on the sidelines. Furthermore, increasing operational efficiency in the retail division remains a priority.

In the first quarter of 2010, DundeeWealth paid a special dividend of $0.025 per common and special share, allowing shareholders to participate directly in a portion of the net, after-tax performance fees earned in 2009. This quarter, the Company also doubled its regular quarterly dividend to $0.07 per common and special share, effective April 1, 2010.

For detailed interim unaudited consolidated financial statements, along with Management's Discussion and Analysis as at and for the three months ended March 31, 2010, please refer to DundeeWealth's website www.dundeewealth.com or www.sedar.com.

Conference Call

President and Chief Executive Officer David Goodman will host a conference call with analysts today at 1:00 p.m. ET to discuss the results. Joining Mr. Goodman on the call will be John Pereira, Chief Financial Officer, and other senior executives. Investors may listen to the discussion by dialing 416-849-6167 or 1-866-339-5645 (no passcode required).

The call will be available for playback from approximately 3:00 p.m. on May 11 until May 25, 2010 at 416-915-1035 or 1-866-245-6755 (passcode: 992553, followed by the number sign). The conference call will be archived on DundeeWealth's website (www.dundeewealth.com).

About DundeeWealth Inc.

DundeeWealth is a Canadian owned, independent wealth management company that currently oversees $73.3 billion in fee earning assets. It provides diversified wealth management and investment solutions including alternative and tax-advantaged products, capital markets and advisory services to financial advisors, institutions, corporations and foundations, and innovative wealth management through independent financial advisors across Canada. Its award winning investment brand, Dynamic Funds, managed by Goodman & Company, Investment Counsel Ltd., is also available outside of Canada through distribution platforms in Europe and the United States. DundeeWealth is listed on the Toronto Stock Exchange (TSX: DW).

For further information: John Pereira, Chief Financial Officer, DundeeWealth Inc., [phone]; Myra Reisler, Manager, Public Affairs, DundeeWealth Inc., [phone]