MONTREAL, May 11, 2012 /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 March 31, 2012 ("the second quarter").
Financial and Operating Highlights
- AUM closed at $28.7B compared to $28.9B for the quarter ended December 31, 2011 and compared to $29.5B for the quarter ended March 31, 2011
- Revenue declined by $0.6 million to $15.5 million from the quarter ended December 31, 2011 and by $2.4 million from the quarter ended March 31, 2011
- EBITDA remained stable at $3.4 million compared to the quarter ended December 31, 2011 and decreased by $0.9 million from the quarter ended March 31, 2011
- Net earnings before non-recurring items remained stable at $0.04 per share compared to the quarter ending December 31, 2011 and $0.08 per share for the quarter ending March 31, 2011
- The Firm recorded a net loss of $0.01 per share compared to net earnings of $0.02 per share for the quarter ended December 31, 2011 and $0.05 for the quarter ended March 31, 2011
- Subsequent to the end of the quarter, Fiera Capital closed two strategic transactions:
- Fiera acquired the business of Natcan Investment Management for $309.5 million, subject to reduction. The acquisition results in Fiera Capital becoming the fourth largest independent asset manager in Canada, with assets under management of approximately $54 billion.
- Fiera Properties acquired Roycom Inc., providing the Firm with a highly experienced and successful operating platform in the institutional real estate management market.
"The acquisition of Natcan creates a powerful platform for growth and adds significant revenue and earnings leverage for Fiera Capital," said Jean-Guy Desjardins, Chairman,C.E.O and C.I.O. "In addition to our enhanced distribution capacity, we have already identified all of the expected synergies from combining the two organizations and our focus will be on completing the integration. Our investment and servicing teams are working effectively together to service our clients and maintain our highly ranked investment performance."
Second Quarter 2012 Financial and Operating Results
The following table provides selected financial information for the three month period ended March 31, 2012 compared to the quarter ended December 31, 2011 and to last year same period.
Financial Highlights (In thousands)
| 3 months ended | ||||||
| March 31, 2012 | December 31, 2011 | |
March 31, 2011 | |||
| AUM (in millions) | 28,691 | 28,920 | 29,452 | |||
| Revenue | ||||||
| Base management fees | 15,489 | 15,246 | 16,921 | |||
| Performance fees | 43 | 885 | 1,015 | |||
| 15,532 | 16,131 | 17,936 | ||||
| Operating Expenses | 12,130 | 12,720 | 13,626 | |||
| EBITDA | 3,402 | 3,411 | 4,310 | |||
| Adjusted EBITDA | 3,357 | 2,638 | 3,980 | |||
| Net Earnings (Loss) | (434) | 829 | 1,898 | |||
| Adjusted EBITDA per share | 0.09 | 0.07 | 0.11 | |||
| Earnings (Loss) per share | (0.01) | 0.02 | 0.05 | |||
| Earnings per share (excluding non-recurring items) | 0.04 | 0.04 | 0.08 | |||
Financial and Operating Results
Revenues for the three-month period ended March 31, 2012 decreased by $2.4 million or 13.4% to $15.5 million compared to $17.9 million for the comparable period in prior year. The decrease in revenue is due mainly to lower performance fees, the non-repatriation of certain externally managed international equity mandates, the departure of certain private wealth servicers and lower AUM in the Retail sector. These factors were offset by an increase in net revenues due to market appreciation, and new mandates from existing and new clients.
Operating expenses decreased by $1.5 million or 11% to $12.1 million for the three-month period ended March 31, 2012, compared to $13.6 million for the same period in 2011. The improvement resulted from an overall reduction in SG&A expenses and lower external manager expenses due to the repatriation of the management of international equity mandates from external sub-advisors, in line with the firm's plans.
Adjusted earnings before interest, taxes, depreciation and amortization (a non-IFRS measure of performance) decreased by $0.6 million or 15.7% to $3.4 million for the three-month period ended March 31, 2012, from $4.0 million for the same period of 2011. EBITDA margin remained stable at 22%. (Adjusted EBITDA eliminates the effect of performance fees on EBITDA).
For the quarter ended March 31, 2012, the Firm recorded a loss of $0.4 million or $0.01 per share (both basic and fully diluted). For the three-month period ended March 31, 2011, the Firm earned $1.9 million or $0.05 per share (both basic and fully diluted). The net earnings were impacted by $2.6 million ($1.8 million net of income taxes) of non-recurring costs related to the Natcan transaction or a $0.05 (basic and fully diluted) per share impact. Excluding these expenses, net earnings for the current quarter would have been $1.4 million or $0.04 (basic and fully diluted) earnings per share.
Mr. Desjardins continued "We are also pleased to welcome the team from Roycom Inc. into the Fiera Properties family. The new entity will create a new national real estate investment platform that will be focused on providing clients with pooled fund and segregated account, real estate management services and builds on our reputation as a leading manager of alternative investments in Canada.
Dividend
The Board of Directors has declared a dividend of $0.08 per Class A Subordinate Voting share and Class B Special Voting share of Fiera, payable on June 21, 2012 to shareholders of record at the close of business on May 24, 2012. 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
Mélanie Tardif, CMA
NATIONAL Public Relations
514 843-2060
Additional information relating to the Company, including the Company's annual information form, is on SEDAR at www.sedar.com.
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