Fiera Sceptre reports its earnings for the fourth quarter of 2011

Fourth quarter completes a successful first year of combined operations

MONTREAL, Dec. 15, 2011 /CNW Telbec/ - Fiera Sceptre Inc. (TSX: FSZ) ("Fiera Sceptre" or "the Firm"), a leading independent Canadian investment firm, today reported its financial results for the fourth quarter ended September 30, 2011 ("the fourth quarter").

Basis for Comparison

On September 1, 2010, Fiera Sceptre announced that it had completed the statutory plan of arrangement pursuant to which the businesses of Sceptre Investment Counsel Limited ("Sceptre") and Fiera Capital Inc. ("Fiera Capital") were combined to create a leading-edge, publicly traded independent investment firm. For accounting purposes, Fiera Capital was deemed to be the acquirer in the business combination of Fiera Capital and Sceptre. As a result, current financial reporting is based on Fiera Capital's reporting cycle and includes historical data up to and including September 1, 2010 and the combined results after the closing date. The earnings for the fourth quarter of 2011 are the results of the combined entity.

Fourth Quarter Highlights

  • Revenue for the three-month period ended September 30, 2011 was $16.7 million, an increase of 44.9% or $5.2 million compared to $11.5 million for the same period in 2010;
     
  • Operating expenses were $12.5 million for the three-month period ended September 30, 2011, an increase of 21.6% or $2.2 million compared to $10.3 million for the same period in 2010;
     
  • Adjusted earnings before interest, taxes, depreciation and amortization (Adjusted EBITDA) (a non-GAAP measure of performance) were $4.0 million for the three-month period ended September 30, 2011, an increase of $2.8 million or over 100% compared to the adjusted EBITDA of $1.2 million for the same period in 2010 (Adjusted EBITDA eliminates the effect of performance fees on EBITDA);
     
  • Adjusted EBITDA per share was $0.11 for the three-month period ended September 30, 2011, an increase of $0.03 or 38% compared to the adjusted EBITDA per share of $0.08 for the same period in 2010;
     
  • For the quarter ended September 30, 2011, net earnings were $1.3 million compared to $0.1 million for the corresponding three month period of last year.

"Despite challenging markets conditions, we are very satisfied with our results after a full year of operations," said Jean-Guy Desjardins, Chairman, CEO and CIO of Fiera Sceptre. "The benefits of a more diversified business model, the greater scalability of our platform and the delivery on the anticipated synergies have enabled the Firm to deliver solid results", added Mr. Desjardins. "In addition, we continued to invest in a number of growth initiatives such as the opening of our first office in the United-States and the creation of a new Real Estate Fund Management venture."

Fourth Quarter 2011 Financial and Operating Results

The following table provides selected financial information for the three-month period and year ended September 30, 2011 compared to the same periods in 2010.
 

  3 months ended   Year ended
  September 30,
2011
('000)
  September 30,
2010
('000)
  September 30,
2011
('000)
  September 30,
2010
('000)
AUM (in millions) 29,020   30,755   29,020   30,755
Revenue 16,729   11,541   72,761   41,524
Operating Expenses 12,466   10,251   51,464   33,770
EBITDA 4,263   1,290   21,298   7,754
Adjusted EBITDA 4,034   1,197   18,670   5,543
Net Earnings 1,297   91   8,958   3,493
Adjusted EBITDA per share 0.11   0.08   0.51   0.35
Earnings per share 0.04   0.01   0.25   0.22
Earnings per share (excluding non-recurring items) 0.06   0.03   0.34   0.25

 

Revenue for the three-month period ended September 30, 2011 increased by $5.2 million or 44.9% to $16.7 million, compared to revenue of $11.5 million for the same period in 2010. This increase was primarily driven by the addition of Sceptre's assets under management ("AUM") combined with marketing efforts which resulted in a higher average level of AUM and, ultimately, the fees charged by the Firm.

Operating expenses were $12.5 million for the three-month period ended September 30, 2011, compared to $10.3 million for the same period in 2010, resulting in an increase of $2.2 million. The increase is attributable to an overall growth in selling, general and administration expenses of $2.4 million driven mainly by the addition of Sceptre's operations. The decrease of $0.2 million in fees paid to external managers offsets the increase in selling, general and administration expenses.

For the fourth quarter of 2011, earnings before interest, taxes, depreciation and amortization ("EBITDA") increased over 100% or $3.0 million to $4.3 million, mainly due to a higher revenue base. Adjusted EBITDA, which eliminates the effect of performance fees, was $4.0 million for the three-month period ended September 30, 2011, an increase of $2.8 million compared to $1.2 million for the same period last year.

For the three-month period ended September 30, 2011, net earnings were $1.3 million compared to $0.1 million for the same period in the prior fiscal year.

Dividend

The Board of Directors has approved a dividend of $0.08 per share payable January 16, 2012 to shareholders of record on December 29, 2011. 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 Sceptre'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 Sceptre'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 Sceptre assumes no obligation to update or revise them to reflect new events or circumstances.

About Fiera Sceptre

Fiera Sceptre 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.fierasceptre.ca

Additional information relating to the Company, including the Company's annual information form, is on SEDAR at www.sedar.com.