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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Fiera Capital Corporation | TSX:FSZ | Toronto | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
-0.02 | -0.28% | 7.22 | 7.18 | 7.25 | 7.24 | 7.14 | 7.23 | 114,408 | 21:12:16 |
MONTREAL, Nov. 8, 2023 /CNW/ - Fiera Capital Corporation (TSX: FSZ) ("Fiera Capital" or the "Company"), a leading independent asset management firm, today announced its financial results for the third quarter ended September 30, 2023. Financial references are in Canadian dollars unless otherwise indicated.
(in $ thousands except where | Q3 | Q2 | Q3 | YTD | YTD | |
2023 | 2023 | 2022 | 2023 | 2022 | ||
End of period AUM (in $ billions) | 155.3 | 164.2 | 158.3 | 155.3 | 158.3 | |
Average AUM (in $ billions) | 160.7 | 164.5 | 161.6 | 163.0 | 167.4 | |
IFRS Financial Measures | ||||||
Total revenues | 158,740 | 159,843 | 160,554 | 475,674 | 496,742 | |
Base management fees | 147,645 | 149,793 | 145,649 | 444,866 | 455,411 | |
Net earnings 1 | 11,067 | 10,484 | 8,666 | 19,034 | 22,844 | |
Non-IFRS Financial Measures | ||||||
Adjusted EBITDA 2 | 43,942 | 45,468 | 45,248 | 128,233 | 139,013 | |
Adjusted EBITDA margin 2 | 27.7 % | 28.4 % | 28.2 % | 27.0 % | 28.0 % | |
Adjusted net earnings 1,2 | 23,651 | 28,708 | 23,875 | 75,903 | 88,682 | |
LTM Free Cash Flow 2 | 98,056 | 45,198 | 92,472 | 98,056 | 92,472 | |
Note: Certain totals, subtotals and percentages may not reconcile due to rounding |
"The end of the third quarter saw a significant shift in market sentiment resulting in a reversal in equity market performance and a large shift in the yield curve impacting bond markets. Unfavorable markets resulted in a reduction of $4.7 billion in our AUM, of which $3 billion related to fixed income. In this weak market environment, we remain focused on our performance and dedicated to our clients. Our investment teams continue to execute on their mandates to be well positioned for when investors begin re-allocating capital." said Jean-Guy Desjardins, Chairman of the Board and Global Chief Executive Officer. "Our regional distribution model is almost fully implemented with the recently announced appointment of Eric Roberts, Executive Director and Chief Executive Officer, Fiera USA. The search for our fourth and final appointment, a Canadian CEO, is also in the final phases."
"We remain pleased with our operating performance in the face of market volatility, which has shown a year-over-year increase in base management fees. This performance along with our positive free cash flow enabled us to reduce our debt, as well as significantly improve our last twelve-month free cash flow in the third quarter." said Lucas Pontillo, Executive Director and Global Chief Financial Officer. "I am also announcing that the Board of Directors has approved a dividend of 21.5 cents per share, payable on December 18, 2023."
Assets Under Management (in $ millions, unless otherwise indicated)
By Platform | June 30, 2023 | New | Lost | Net Contributions | Net Organic | Market and Other4 | Strategic5 | September 30, |
Public Markets, excluding AUM | 95,208 | 438 | (391) | (412) | (365) | (3,159) | — | 91,684 |
Public Markets AUM sub-advised | 50,096 | 91 | (3,104) | (84) | (3,097) | (1,609) | (520) | 44,870 |
Public Markets - Total | 145,304 | 529 | (3,495) | (496) | (3,462) | (4,768) | (520) | 136,554 |
Private Markets | 18,893 | 215 | (163) | (248) | (196) | 66 | — | 18,763 |
Total | 164,197 | 744 | (3,658) | (744) | (3,658) | (4,702) | (520) | 155,317 |
By Distribution Channel | June 30, 2023 | New | Lost | Net Contributions | Net Organic | Market and Other4 | Strategic5 | September 30, |
Institutional | 89,857 | 351 | (2,358) | (360) | (2,367) | (3,181) | (520) | 83,789 |
Financial Intermediaries | 60,276 | 182 | (1,131) | (81) | (1,030) | (1,487) | — | 57,759 |
Private Wealth | 14,064 | 211 | (169) | (303) | (261) | (34) | — | 13,769 |
Total | 164,197 | 744 | (3,658) | (744) | (3,658) | (4,702) | (520) | 155,317 |
By Platform | December 31, | New | Lost | Net Contributions | Net Organic | Market and Other4 | Strategic5 | September 30, |
Public Markets, excluding AUM | 91,046 | 2,511 | (2,572) | (1,031) | (1,092) | 1,730 | — | 91,684 |
Public Markets AUM sub-advised | 49,219 | 122 | (6,698) | (955) | (7,531) | 3,702 | (520) | 44,870 |
Public Markets - Total | 140,265 | 2,633 | (9,270) | (1,986) | (8,623) | 5,432 | (520) | 136,554 |
Private Markets | 18,241 | 1,394 | (546) | (477) | 371 | 151 | — | 18,763 |
Total | 158,506 | 4,027 | (9,816) | (2,463) | (8,252) | 5,583 | (520) | 155,317 |
By Distribution Channel | December 31, | New | Lost | Net Contributions | Net Organic | Market and Other4 | Strategic5 | September 30, |
Institutional | 84,330 | 2,473 | (4,002) | (1,009) | (2,538) | 2,517 | (520) | 83,789 |
Financial Intermediaries | 60,275 | 737 | (5,024) | (632) | (4,919) | 2,403 | — | 57,759 |
Private Wealth | 13,901 | 817 | (790) | (822) | (795) | 663 | — | 13,769 |
Total | 158,506 | 4,027 | (9,816) | (2,463) | (8,252) | 5,583 | (520) | 155,317 |
Third Quarter Financial Highlights
The Company's financial highlights reflect the following major items for the third quarter of 2023:
Year-to-Date Financial Highlights
The Company's financial highlights reflect the following major items for the nine-month period ended September 30, 2023 compared to the nine-month period ended September 30, 2022:
Third Quarter Business Highlights
Strategic Transactions
In connection with the Company's previously announced strategic distribution partnership with New York Life Investments ("NYLIM"), on September 13, 2023, the Company sold four funds to NYLIM which were brought into its MainStay Funds lineup. A gain on sale of funds of $5.1 million was recognized during the quarter.
Subsequent to September 30, 2023
Leadership Announcements
As part of the Company's global expansion strategy, the Company appointed Eric Roberts as Executive Director and CEO, Fiera USA, effective November 13, 2023. Mr. Roberts will directly lead the marketing and distribution teams across the United States and provide executive leadership for all employees in the region. This follows the previously announced appointments of Klaus Schuster and Rob Petty as Executive Director and CEO of Fiera EMEA (Europe, Middle East and Africa) and Fiera Asia, respectively.
These appointments allow us to expand and strengthen our presence in the United States, EMEA and Asia respectively, as the Company continues to implement its new regionalized distribution model with a focus on building local capabilities.
Dividend Decared
On November 7, 2023, the Board of Directors declared a quarterly dividend of $0.215 per Class A Share and Class B Share, payable on December 18, 2023 to shareholders of record at the close of business on November 20, 2023. The dividend is an eligible dividend for income tax purposes.
Additional details relating to the company's operating results can be found on our Investor Relations web page under Financial Documents - Quarterly Results - Management's Discussion and Analysis.
Conference Call
Live
Fiera Capital will hold a conference call at 10:00 a.m. (ET) on Wednesday, November 8, 2023, to discuss its financial results. The dial-in number to access the conference call from Canada and the United States is 1-888-390-0620 (toll-free) and 1-416-764-8651 from outside North America.
The conference call will also be accessible via webcast in the Investor Relations section of Fiera Capital's website, under Events and Presentations.
Replay
An audio replay of the call will be available until November 15, 2023 by dialing 1-888-390-0541 (toll free), access code 896532 followed by the number sign (#).
The webcast will remain available for three months following the call and can be accessed in the Investor Relations section of Fiera Capital's website under Events and Presentations.
Footnotes
1) Attributable to the Company's shareholders.
2) Earnings before interest, taxes, depreciation and amortization ("EBITDA"), Adjusted EBITDA, Adjusted EBITDA margin and Adjusted EBITDA per share, Adjusted net earnings and Adjusted net earnings per share (basic and diluted), and Last Twelve Months ("LTM") Free Cash Flow are not standardized measures prescribed by International Financial Reporting Standards ("IFRS"), and are therefore unlikely to be comparable to similar measures presented by other companies. We have included non-IFRS measures to provide investors with supplemental measures of our operating and financial performance. We believe non-IFRS measures are important supplemental metrics of operating and financial performance because they highlight trends in our core business that may not otherwise be apparent when relying solely on IFRS measures. Securities analysts, investors and other interested parties frequently use non-IFRS measures in the evaluation of issuers, many of which present non-IFRS measures when reporting their results. Management also uses non-IFRS measures in order to facilitate operating and financial performance comparisons from period to period, to prepare annual budgets and to assess its ability to meet future debt service, capital expenditure and working capital requirements.
FOR THE THREE MONTHS ENDED | FOR THE NINE-MONTH | ||||
September 30, 2023 | June 30, 2023 | September 30, 2022 | September 30, 2023 | September 30, 2022 | |
Net earnings | 12,236 | 11,921 | 9,849 | 23,409 | 27,055 |
Income tax expense | 2,353 | 5,140 | 6,172 | 7,640 | 8,448 |
Amortization and depreciation | 13,381 | 13,435 | 13,679 | 40,529 | 42,548 |
Interest on long-term debt and | 12,485 | 11,215 | 8,550 | 34,293 | 24,015 |
Interest on lease liabilities, foreign | 3,805 | (2,370) | 6,039 | 2,225 | 6,964 |
EBITDA | 44,260 | 39,341 | 44,289 | 108,096 | 109,030 |
Restructuring, acquisition related | 1,511 | 3,448 | 2,772 | 12,969 | 11,933 |
Accretion and change in fair value | (537) | (2,024) | (2,626) | (3,042) | 983 |
Share-based compensation | 3,423 | 3,951 | 1,749 | 9,881 | 18,169 |
Loss (gain) on investments, net | 419 | 157 | (950) | (711) | 554 |
Gain on sale of funds | (5,139) | — | — | (5,139) | — |
Other expenses (income) | 5 | 595 | 14 | 6,179 | (1,656) |
Adjusted EBITDA | 43,942 | 45,468 | 45,248 | 128,233 | 139,013 |
Per share basic | 0.41 | 0.44 | 0.44 | 1.24 | 1.36 |
Per share diluted | 0.31 | 0.37 | 0.43 | 1.19 | 1.34 |
Weighted average shares | 105,921 | 103,720 | 102,906 | 103,646 | 102,382 |
Weighted average shares | 141,294 | 122,875 | 104,512 | 107,739 | 104,005 |
Reconciliation to Adjusted Net Earnings (in $ thousands)
FOR THE THREE MONTHS ENDED | FOR THE NINE-MONTH | ||||
September 30, 2023 | June 30, 2023 | September 30, 2022 | September 30, 2023 | September 30, 2022 | |
Net earnings attributable to the | 11,067 | 10,484 | 8,666 | 19,034 | 22,844 |
Amortization and depreciation | 13,381 | 13,435 | 13,679 | 40,529 | 42,548 |
Restructuring, acquisition related and | 1,511 | 3,448 | 2,772 | 12,969 | 11,933 |
Accretion and change in fair value of | (340) | (1,712) | (2,339) | (2,280) | 2,571 |
Share-based compensation | 3,423 | 3,951 | 1,749 | 9,881 | 18,169 |
Gain on sale of funds | (5,139) | — | — | (5,139) | — |
Other expenses (income) | 5 | 595 | 14 | 6,179 | (1,656) |
Tax effect of above-mentioned items | (257) | (1,493) | (666) | (5,270) | (7,727) |
Adjusted net earnings attributable | 23,651 | 28,708 | 23,875 | 75,903 | 88,682 |
Per share – basic | |||||
Net earnings | 0.10 | 0.10 | 0.08 | 0.18 | 0.22 |
Adjusted net earnings | 0.22 | 0.28 | 0.23 | 0.73 | 0.87 |
Per share – diluted | |||||
Net earnings | 0.09 | 0.09 | 0.08 | 0.18 | 0.22 |
Adjusted net earnings | 0.18 | 0.24 | 0.23 | 0.70 | 0.85 |
Weighted average shares | 105,921 | 103,720 | 102,906 | 103,646 | 102,382 |
Weighted average shares | 141,294 | 122,875 | 104,512 | 107,739 | 104,005 |
Reconciliation to LTM Free Cash Flow (in $ thousands)
FOR THE THREE MONTHS ENDED | ||||||||
Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | |
2023 | 2023 | 2023 | 2022 | 2022 | 2022 | 2022 | 2021 | |
Net cash generated by (used in) operating | 79,708 | 14,123 | (13,463) | 66,722 | 25,686 | 46,853 | (25,951) | 97,226 |
Settlement of purchase price obligations and | — | (1,500) | — | — | (3,476) | (23,901) | — | — |
Proceeds on promissory note | 1,510 | 1,460 | 1,536 | 1,497 | 1,455 | 1,375 | 1,334 | 1,319 |
Distributions received from joint ventures and | 1,617 | 502 | 4,252 | 2,513 | 3,621 | 4,338 | 6,330 | 2,256 |
Dividends and other distributions to NCI | — | (5,895) | — | 10 | — | (1,753) | (1,425) | (19) |
Lease payments, net of lease inducements | (3,837) | (4,925) | (4,510) | (4,607) | (4,396) | (4,221) | (4,306) | (4,822) |
Interest paid on long-term debt and | (12,174) | (12,019) | (10,379) | (9,713) | (8,191) | (8,299) | (7,427) | (6,636) |
Other restructuring costs | 1,226 | 452 | 1,180 | 1,056 | 470 | 160 | 418 | 883 |
Acquisition related and other costs | 130 | 341 | 716 | 527 | 153 | 680 | 1,412 | 1,326 |
Free Cash Flow | 68,180 | (7,461) | (20,668) | 58,005 | 15,322 | 15,232 | (29,615) | 91,533 |
LTM Free Cash Flow | 98,056 | 45,198 | 67,891 | 58,944 | 92,472 | 109,828 | 145,257 | 135,012 |
3) Net Organic Growth represents the sum of New, Lost and Net Contributions.
4) Market and Other includes the impact of market changes, income distributions and foreign exchange.
5) Relates to the sale of three Public Markets funds that were sub-advised by PineStone to New York Life Investments, in connection with the strategic distribution partnership.
Forward-Looking Statements
This document contains forward-looking statements relating to future events or future performance and reflecting 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. Forward-looking statements may include comments with respect to Fiera Capital's objectives, strategies to achieve those objectives, expected financial results, and the outlook for Fiera Capital's businesses and for the Canadian, American, European, Asian and other global economies. Such statements reflect management's current beliefs and are based on factors and assumptions it considers to be reasonable based on information currently available to management and may typically be identified by terminology such as "believe", "expect", "aim", "goal", "plan", "anticipate", "estimate", "may increase", "may fluctuate", "predict", "potential", "continue", "target", "intend" or the negative of these terms or other comparable terminology and similar expressions of future or conditional verbs, such as "will", "should", "would" and "could."
By their very nature, forward-looking statements involve numerous assumptions, inherent risks and uncertainties, both general and specific, and the risk that predictions, forecasts, projections, expectations or conclusions will not prove to be accurate. As a result, the Company does not guarantee that any forward-looking statement will materialize and readers are cautioned not to place undue reliance on these forward-looking statements. A number of important factors, many of which are beyond Fiera Capital's control, could cause actual events or results to differ materially from the predictions, forecasts, projections, expectations, or conclusions expressed in such forward-looking statements which include, but are not limited to, risks related to investment performance and investment of the assets under management ("AUM"), AUM concentration related to strategies sub-advised by PineStone, reputational risk, regulatory compliance, information security policies, procedures and capabilities, privacy laws, litigation risk, insurance coverage, third-party relationships, growth and integration of acquired businesses, AUM growth, key employees, ownership structure and potential dilution, indebtedness, market risk, credit risk, inflation, interest rates and recession risks and other factors described in the Company's Annual Information Form for the year ended December 31, 2022 under the heading "Risk Factors" or discussed in other materials filed by the Company with applicable securities regulatory authorities from time to time which are available on SEDAR+ at www.sedarplus.ca.
The preceding list of important factors is not exhaustive. When relying on forward-looking statements in this document and any other disclosure made by Fiera Capital, investors and others should carefully consider the preceding factors, other uncertainties and potential events. Fiera Capital does not undertake to update or revise any forward-looking statements, whether written or oral, that may be made from time to time by it or on its behalf in order to reflect new events or circumstances, except as required by applicable laws.
About Fiera Capital Corporation
Fiera Capital is a leading independent asset management firm with a growing global presence. The Company delivers customized and multi-asset solutions across public and private market asset classes to institutional, financial intermediary and private wealth clients across North America, Europe and key markets in Asia. Fiera Capital's depth of expertise, diversified investment platform and commitment to delivering outstanding service are core to our mission of being at the forefront of investment management science to create sustainable wealth for clients. Fiera Capital trades under the ticker FSZ on the Toronto Stock Exchange.
Headquartered in Montreal, Fiera Capital, with its affiliates in various jurisdictions, has offices in over a dozen cities around the world, including New York (U.S.), London (UK), and Hong Kong (SAR).
Each affiliated entity (each an "Affiliate") of Fiera Capital only provides investment advisory or investment management services or offers investment funds in the jurisdictions where the Affiliate is authorized to provide services pursuant to an exemption from registration and/or the relevant product is registered.
Fiera Capital does not provide investment advice to U.S. clients or offer investment advisory services in the U.S. In the U.S., asset management services are provided by Fiera Capital's affiliates who are investment advisers that are registered with the U.S. Securities and Exchange Commission (SEC) or exempt from registration. Registration with the SEC does not imply a certain level of skill or training. For details on the particular registration of, or exemptions therefrom relied upon by, any Fiera Capital entity, please consult https://www.fieracapital.com/en/registrations-and-exemptions.
Additional information about Fiera Capital, including the Company's annual information form, is available on SEDAR+ at www.sedarplus.ca.
SOURCE Fiera Capital Corporation
Copyright 2023 Canada NewsWire
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