MONTREAL, March 21, 2013 /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 fifth quarter ended December 31, 2012 ("the fifth quarter") for the fiscal period (fifteen months) ended December 31, 2012. The Firm also announced that it has raised its quarterly dividend to $0.09 per share, from $0.08 per share.
"From almost every perspective, fiscal 2012 was a year of positive transformation and growth for Fiera Capital and its shareholders," said Jean-Guy Desjardins, Chairman, CEO and CIO of Fiera Capital. "As a result of our acquisitions, our solid investment performance and the introduction of new funds, we more than doubled Fiera Capital's assets and improved our operating leverage and our financial performance. The Board has decided to pass on the benefits of this growth and performance to our shareholders by declaring a substantial increase in the dividend on our Class A and B shares. We are increasing the dividend by 12.5%.
"Our growth in 2012 provided clear net benefit for our clients as well," continued Mr. Desjardins. "Through our acquisitions, we added bright new talent to our leading portfolio management and client service teams. With our growth we gained the critical mass to leverage our operational platform including better client services, increased research capacity and more effective compliance."
"Finally, we extended Fiera Capital's reach during the year. As a result of our acquisitions, we increased our presence throughout Canada, with new operations in Calgary and Halifax and a deeper presence in both the Ontario and Quebec markets. At Fiera Capital, we are building our presence as a strong and growing force in the North American asset management industry," he added.
Financial and Operating Highlights
Following the closing of the Natcan transaction in April 2012, Fiera has changed its fiscal year end from September 30 to December 31. As a result, fiscal 2012 is a fifteen-month period ending December 31, 2012.
For the three months ended December 31, 2012:
- AUM increased by $1.8 billion to $57.0 billion compared to the previous quarter ended September 30, 2012 and by $28.1 billion compared to the quarter ended December 31, 2011.
- Revenue increased by $4.6 million to $31.0 million compared to the quarter ended September 30, 2012 and increased by $14.9 million from the quarter ended December 31, 2011.
- Gross margin improved to 40.2% for the three months ended December 31, 2012 compared to gross margin of 35.6% in the quarter ended September 30, 2012 and 21.2% for the three months ended December 31, 2011.
- EBITDA increased by $3.0 million to $12.5 million from the quarter ended September 30, 2012 and improved by 9.0 million compared to the quarter ended December 31, 2011.
- The Firm recorded net earnings of $0.05 per share, which was stable compared to the quarter ended September 30, 2012 and an increase compared to net earnings per share of $0.02 for the same quarter in 2011.
- Adjusted net earnings for the period were $9.3 million or $0.16 (basic and fully diluted) earnings per share. The adjusted net earnings for the three-month period ended September 30, 2012 and December 31, 2011 were respectively $6.6 million or $0.12 (basic and fully diluted) earnings per share and $2.8 million or $0.08 (basic and fully diluted) earnings per share.
- Subsequent to the end of the quarter, on January 18, 2013 Fiera Capital announced that it has reached an agreement with GMP Capital Inc. ("GMP"), one of Canada's leading independent investment dealers, to acquire flagship funds pertaining to the GMP Diversified Alpha Fund and the Canadian ABCP Fund, which together represent approximately $570 million in assets under management. In addition, key members of GMP Investment Management's team will join a newly created Fiera Capital subsidiary in which the management team will own a minority interest of 45%.
- Also, subsequent to the end of the quarter, on January 31, 2013 Fiera Capital announced the closing of the transaction under which Fiera acquired the Canadian fixed income, Canadian equity and domestic balanced account business from UBS Global Asset Management (Canada) Inc., representing assets under management of approximately $8 billion for a cash consideration of $52 million, subject to certain adjustments. This transaction, previously announced on December 11, 2012, is immediately accretive to earnings.
Fifth Quarter 2012 Financial and Operating Results
The following table provides selected financial information for the three-month period ended December 31, 2012 compared to the quarter ended September 30, 2012 and to the same period in 2011 as well as the fifteen-month period ended December 31 2012 compared to the twelve-month period ended September 30, 2011:
Financial Highlights (In thousands)
|Three months ended||Period ended|
|AUM (in millions)||57,043||55,221||28,920||57,043||29,020|
|Base management fees||27,034||25,874||15,247||109,741||66,202|
|Performance fees - Traditional Asset Class||3,651||519||799||5,036||681|
|Performance fees - Alternative Asset Class||324||5||85||551||3,260|
|Adjusted net earnings1||0.16||0.12||0.08||0.58||0.44|
(1) Adjusted net earnings per share excludes non-recurring and non-cash items
December 2012 AUM Continuity schedule (in millions)
|December 31, 2012||September 30, 2012||Q5 NET VARIANCE|
|AUM - end of period||57,043||55,221||1,822|
Financial and Operating Results
Revenues for the three-month period ended December 31, 2012 increased by $14.9 million or 92.2% to $31.0 million compared to $16.1 million for the same period in the prior year. The increase in revenues is mainly due to the Natcan and CWM acquisitions combined with new AUM resulting from sales efforts.
Operating expenses increased by $5.8 million or 45.9% to $18.6 million for the three-month period ended December 31, 2012, compared to $12.7 million for the same three months in 2011. The increase in operating expense resulted from an overall rise in SG&A expenses of $5.7 million combined with higher external manager expenses of $0.1 million for the three months ended December 31, 2012 following the Natcan acquisition.
Gross margin improved to 40.2% for the three months ended December 31, 2012 compared to gross margin of 35.6% in the quarter ended September 30, 2012 and 21.2% for the three months ended December 31, 2011. The improvement in gross margin is primarily the result of increased operating leverage following the acquisitions of Natcan and CWM in fiscal 2012.
For the quarter ended December 31, 2012, the Firm earned $3.1 million or $0.05 per share (basic and fully diluted). For the three-month period ended December 31, 2011, the Firm earned $0.8 million or $0.02 per share (both basic and fully diluted). The net earnings were negatively impacted by $4.6 million or $0.08 per share of non-cash items and $1.6 million or $0.03 per share of non-recurring costs (net of income taxes) during the quarter. When added back to the firm's net earnings of $3.1 million or $0.05 per share, the adjusted net earnings, for the three-month period ended December 31, 2012 were $9.3 million or $0.16 (basic and fully diluted) earnings per share.
The Board of Directors has declared a dividend of $0.09 per Class A Subordinate Voting share and Class B Special Voting share of Fiera, payable on April 30, 2013 to shareholders of record at the close of business on April 2, 2013. The dividend is an eligible dividend for income tax purposes.
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
SOURCE: FIERA CAPITAL CORPORATION