Q3 2009 Highlights: - Assets Under Management ("AUM") were $4.3 billion as at September 30, 2009, compared to $5.6 billion as at September 30, 2008 and $4.4 billion as at June 30, 2009 - Management Fees were $20.7 million, a decrease of $12.2 million, or 37%, from Q3 2008 - Base EBITDA was $8.0 million, compared with $15.2 million in the comparable prior year period - Net income was $5.5 million ($0.04 per share), versus $3.7 million ($0.02 per share) in Q3 2008 - Declared a third quarter dividend of $0.025 per share on November 3, 2009 - Introduced low-load option for investors in Series A units of Sprott mutual funds - Effective November 2, 2009, expanded the distribution of the FNSSC(1)-Multi Manager Fund from FNSSC members only to all eligible investors (name of the fund changed to "Sprott Multi-Manager Fund") ----------------------- (1) Federation of National Specialty Societies of Canada
"During the third quarter, many of our mutual funds benefited from the continued momentum in equity markets, as well as superior stock picking by our investment managers, with both the Sprott Small Cap Equity Fund and the Sprott Energy Fund posting returns of more than 17%," said
"We continue to work diligently to drive growth in each of our three businesses: Sprott Asset Management, Sprott Private Wealth, and Sprott Consulting. Sprott Consulting has added a valuable private equity-type component to our revenue mix, and contributed significantly to our revenues in 2008. We expect further strong performance from this business in the future," added
Assets Under Management ------------------------------------------------------------------------- Three Three Nine Nine months months months months ended ended ended ended September September September September $ millions 30, 2009 30, 2008 30, 2009 30, 2008 ------------------------------------------------------------------------- AUM, beginning of quarter 4,444 7,726 4,449 6,215 ------------------------------------------------------------------------- Net sales (redemptions) (252) 122 (503) 680 ------------------------------------------------------------------------- Market value appreciation (depreciation) of portfolios 146 (2,242) 392 (1,289) ------------------------------------------------------------------------- AUM, end of quarter 4,338 5,606 4,338 5,606 -------------------------------------------------------------------------
In the third quarter of 2009, AUM decreased to
On a year-over-year basis, AUM decreased by 22.6% to
Income Statement
Total revenue for the third quarter of 2009 decreased by 13.4% to
Management fees declined by 37.0% to
Crystallized performance fees for the three- and nine-month periods ended
Gains from proprietary investments in the third quarter and first nine months of 2009, totaled
Other income decreased by
Total expenses for the three- and nine-month periods ended
Net income for the third quarter of 2009 was
Dividends
On
Conference Call and Webcast
A conference call and webcast will be held today,
*Non-GAAP Financial Measures
This press release includes financial terms (including AUM and net sales) that the Company utilizes to assess the financial performance of its business that are not measures recognized under Canadian generally accepted accounting principles (GAAP). These non-GAAP measures should not be considered alternatives to performance measures determined in accordance with GAAP and may not be comparable to similar measures presented by other issuers. For additional information regarding the Company's use of non-GAAP measures, including the calculation of these measures, please refer to the "Non-GAAP Financial Measures" section of the Company's Management's Discussion and Analysis and its financial statements available on the Company's website at www.sprottinc.com and on SEDAR at www.sedar.com.
Forward-Looking Statements
This release contains "forward-looking statements" which reflect the current expectations of the Company. These statements reflect management's current beliefs with respect to future events and are based on information currently available to management. Forward-looking statements involve significant known and unknown risks, uncertainties and assumptions. Many factors could cause actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements including, without limitation, those listed under the heading "Risk Factors" in the Company's annual information form dated
About Sprott Inc.
Sprott Inc. is a leading independent asset manager dedicated to achieving superior returns for its clients over the long term. The company currently operates through three distinct business units: Sprott Asset Management L.P. ("Sprott Asset Management"), Sprott Private Wealth L.P. ("Sprott Private Wealth"), and Sprott Consulting L.P. ("Sprott Consulting").
Sprott Asset Management is the investment manager of the Sprott family of mutual funds and hedge funds and discretionary managed accounts; Sprott Private Wealth provides wealth management services to high net worth individuals; and Sprott Consulting provides management, administrative and consulting services to other companies, including Sprott Resource Corp. (TSX: SCP).
Sprott Inc. is headquartered in
Balance Sheet Information September 30, 2009 December 31, 2008 (In $ 000's,) $ $ ------------------------------------------------------------------------- Total Assets 82,095 123,430 Total Liabilities 16,092 43,916 ------------------------------------------------------------------------- Shareholders' Equity 66,003 79,514 ------------------------------------------------------------------------- Summary Income Statement For the For the For the For the three three nine nine months months months months ended ended ended ended September September September September 30, 2009 30, 2008 30, 2009 30, 2008 (In $ 000's, except per share amounts) $ $ $ $ ------------------------------------------------------------------------- Revenue Management fees 20,702 32,860 64,971 102,251 Crystallized Performance Fees 152 1,257 2,367 5,554 Unrealized and realized gains (losses) on proprietary investments 657 (9,706) 3,567 (4,310) Other income 520 1,015 874 4,559 ------------------------------------------------------------------------- Total revenue 22,031 25,426 71,779 108,054 ------------------------------------------------------------------------- Expenses Compensation and benefits 6,212 9,513 21,025 29,313 Trailer fees 4,672 7,022 14,092 22,078 General and administration 2,620 2,721 8,454 7,796 Donations 285 306 861 997 Amortization 197 269 636 382 ------------------------------------------------------------------------- Total expenses 13,986 19,831 45,068 60,566 ------------------------------------------------------------------------- Income before income taxes 8,045 5,595 26,711 47,488 Provision for income taxes 2,539 1,927 8,194 15,720 ------------------------------------------------------------------------- Net income and comprehensive income for the period 5,506 3,668 18,517 31,768 Other expenses(1) 771 843 2,358 1,332 Provision for income taxes 2,539 1,927 8,194 15,720 ------------------------------------------------------------------------- EBITDA 8,816 6,438 29,069 48,820 Unrealized and realized (gains) losses on proprietary investments (657) 9,706 (3,567) 4,310 Performance fees net of performance fee related bonus pool(2) (114) (943) (1,775) (4,165) ------------------------------------------------------------------------- Base EBITDA 8,045 15,201 23,727 48,965 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Net Income Per Share - basic .04 .02 .12 .22 ------------------------------------------------------------------------- Net Income Per Share - fully diluted .04 .02 .12 .22 ------------------------------------------------------------------------- (1) Includes interest, amortization and non-cash stock-based compensation expense. (2) Performance Fee related bonus pool is equal to 25% of Performance Fee Revenue.
For further information: Investor contact information: (416) 203-2310 or (877) 403-2310 or [email protected]
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