Guardian Capital Group Limited Annual Meeting of Shareholders May - - PowerPoint PPT Presentation

Guardian Capital Group Limited

Annual Meeting of Shareholders

May 10, 2019 George Mavroudis | President and Chief Executive Officer

This presentation may contain “forward-looking statements” with respect to Guardian Capital Group Limited and its products and services, including its business operations and strategy and financial performance and condition. These statements, characterized by such words as “goal”, “outlook”, “intends”, “expects”, “plan”, “prospects”, “are confident”, “believe” and ”anticipate”, are intended to reflect Guardian’s objectives, plans, expectations, estimates, beliefs and intentions. By their nature, forward-looking statements involve risks and uncertainties. There is a risk that the expectations reflected in such forward-looking statements will not be achieved. Undue reliance should not be placed on these statements, as a number of factors could cause actual results to differ materially from Guardian’s objectives, plans, expectations and estimates reflected in the forward-looking statements. Factors that could cause actual results to differ materially from expectations include, among other things, general economic and market conditions, including interest rates, business competition, changes in government regulations

• r in tax laws, and other factors.

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Forward Looking Statements

Guardian Overview 4 Financial Highlights 6 Investment Management 14 Financial Advisory 21

4

Guardian’s Businesses

Corporate Activities and Investments

• Management expertise,

financing, coordination of business activities and support

• Shareholders’ equity:

$656 million¹ (2018 - $599M)

• Securities holdings:

$674 million¹ (2018 - $627M)

• Market Capitalization: $667 million2
• TSX Listed: GCG, GCG.A

¹As at March 31, 2019 2As at May 8, 2019

Investment Management

AUM of $29.6 billion¹

Financial Advisory

AUA of $18.7 billion¹

5

Guardian’s Fee Generating Assets

Investment Management

Assets Under Management | As at period end | ($ billions)

Financial Advisory

Assets Under Administration | As at period end | ($ billions)

2014 2015 2016 2017 2018 Q1 2019

$25.0 $24.3 $27.3 $27.3 $27.0 $29.6

2014 2015 2016 2017 2018 Q1 2019

$13.1 $14.9 $16.5 $17.8 $17.4 $18.7

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2018 Financial Statement Highlights

1 As defined in Guardian’s MD&A

($ millions, except per share amounts) 2018 2017 % Increase / Decrease Net revenues $171.5 $151.2 13% Operating earnings $46.4 $48.2 (4%) Net earnings (losses) attributable to shareholders ($17.0) $96.8 (118%) EBITDA¹ $56.2 $52.8 7% AUM $26,962 $27,250 (1%) AUA $17,385 $17,795 (2%) Shareholders’ equity, per share¹ $21.57 $21.88 (1%) Securities, per share¹ $22.58 $22.49 0%

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Q1 2019 Financial Statement Highlights

1 As defined in Guardian’s MD&A

($ millions, except per share amounts) 2019 2018 % Increase / Decrease Net revenues $ 44.3 $ 41.5 7% Operating earnings $ 11.2 $ 10.5 7% Net earnings (losses) attributable to shareholders $ 67.2 $ (6.2) 1184% EBITDA¹ $ 14.5 $ 12.5 16% AUM $ 29,621 $ 29,457 1% AUA $ 18,745 $ 17,601 6% Shareholders’ equity, per share¹ $ 23.66 $ 21.98 8% Securities, per share¹ $ 24.30 $ 22.84 6%

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Financial Highlights

Net Revenue

For the years ended ($ millions)

2014 2015 2016 2017 2018 Q1 2019 $119.3 $132.9 $142.7 $151.2 $171.5

$27.7 $35.1 $38.6 $41.5 $44.3 $32.3

First Quarter Results

Operating Earnings

For the years ended ($ millions)

2014 2015 2016 2017 2018 Q1 2019 $38.1 $43.0 $44.7 $48.2 $46.4

$8.6 $11.4 $12.5 $10.5 $10.5 $11.2

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Diversified Revenue Sources

For the year ended December 31, 2018

(in $ millions)

$108.1 $23.4 $25.8 $14.1 Asset-Based Revenues (63%) Dividend and Interest (14%)

TOTAL $171.5

Insurance (15%) Other (8%)

For the year ended December 31, 2010

(in $ millions)

$41.8 $15.5 $2.3 $5.4 Asset-Based Revenues (64%) Dividend and Interest (24%) Insurance (4%) Other (8%)

TOTAL $65.0

2014 2015 2016 2017 2018 2019 $0.065 $0.075 $0.085 $0.100 $0.125 $0.150

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Return to Shareholder: Dividends

$1.9 $2.2 $2.5 $3.4

For 2019, the rate represents the latest quarterly declared dividend. For years 2014-2018, the rates represent the dividend paid in the fourth quarter.

$2.8

Quarterly Dividends Per Share

For the periods ended ($ per share)

Total Annual Dividends Paid

For the periods ended ($millions)

2014 2015 2016 2017 2018 Q1 2019 $7.2 $8.6 $9.7 $11.1 $13.3 First Quarter Results

$1.7 $2.2 $2.5 $2.8 $1.9 $3.4

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Return to Shareholder: Share Buybacks

2012 2013 2014 2015 2016 2017 2018 $7.8 $7.9 $5.7 $14.4 $23.9 $15.2

$26.0

Since 2012, approximately $100.8 million has been returned to shareholders in the form of share buybacks. * Excludes the effects of treasury stock

Share Buybacks

For the periods ended ($ millions)

Shares (in 000’s) Average Price (in $’s) Outstanding at Jan. 1, 2012 33,843 2012 (800) $9.73 2013 (574) $13.73 2014 (324) $17.45 2015 (817) $17.62 2016 (1,173) $20.35 2017 (632) $24.08 2018 (1,118) $23.28 2019

• Total Purchases

(5,438) $18.54 Outstanding at Mar. 31, 2019* 28,405

$154 $40 $21 $18 $20

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Managing Our Investment Portfolio

$359 $233 $20 $61

As at March 31, 2019

Securities

(in $ millions) | Total $674

Bank of Montreal (53%) Investment Funds (35%) Real Estate (3%) Other Equities (9%)

Guardian Capital Proprietary Strategies

(in $ millions) | Total $253

Global Equity (61%) Emerging Markets Equity (16%) Canadian Equity (8%) Fixed Income (7%) Real Estate (8%)

2014 2015 2016 2017 2018 Q1 2019 $16.78 $17.72 $20.97 $22.49 $22.58 $24.30 2014 2015 2016 2017 2018 Q1 2019 $15.62 $16.55 $19.62 $21.88 $21.57 $23.66

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A Focus on Shareholder Value

Equity per share, diluted

As at period end (in $)

Securities per share, diluted

As at period end (in $)

14

Investment Management

• $29.6 billion in AUM
• Competitive investment products
• Executing on opportunities
• Active across multiple

distribution channels

As at March 31, 2019

Institutional Investment Management

$26.5 billion in AUM

Private Wealth

$3.1 billion in AUM

15

Institutional Investment Solutions

• Core
• Liability Driven
• Short Duration
• High Yield
• Unconstrained HY

As at March 31, 2019

CANADIAN EQUITIES $9.8 billion FOREIGN EQUITIES $9.7 billion FIXED INCOME $7.0 billion

• Large Cap Core
• Growth
• Equity Income
• High Conviction All Cap
• Systematic Strategies
• Fundamental Global &

Emerging Market Equity

• US Equity Large Cap and

All Cap Growth

16

Institutional Investment Solutions

Growth in Global AUM

($ billions)

Growth of Global Revenue

($millions)

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

2014 2015 2016 2017 2018 Q1 2019 16% 21% 23% 26% 48% 53%

$- $10.0 $20.0 $30.0 $40.0 $50.0 $60.0

¹Revenue is Q1 2019 annualized

Global Revenue % Domestic Revenue % Global Revenue $ Global AUM % Domestic AUM % Global AUM $

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

2014 2015 2016 2017 2018 Q1 2019 11% 15% 14% 16% 34% 37%

$- $2.0 $4.0 $6.0 $8.0 $10.0 $12.0 $14.0

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High-Conviction Investing - Performance

2% 4% 6% 8% 10% 12% 14%

Fundamental Global Equities Alta Select US Large Cap Canadian Focused Equity Fundamental Emerg Mkts Fundamental EAFE

Guardian High-Conviction Investing Strategies (Since Inception Performance)

Strategy Return Benchmark Return

Above chart represents the quartile ranking of annualized performance since inception, as a percentage

18

Institutional AUM: By Geography (in Billions)

INTERNATIONAL CLIENTS US CLIENTS

2017: $22.8 2018: $21.0 2017: $0.8 2018: $1.0

As at March 31 for the noted year

CANADIAN CLIENTS

2019: $19.2 2017: $0.3 2018: $4.6 2019: $5.5 2019: $1.8

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Distribution Channels GUARDIAN CAPITAL GROUP

$29.6 billion in AUM

As at March 31, 2019

INSTITUTIONAL

$11.7 billion

RETAIL INTERMEDIARY

$14.8 billion

50%

PRIVATE WEALTH

$3.1 billion

10%

SUB- ADVISORY $3.9 billion WRAP $10.9 billion

40%

20

Private Wealth

• Managing over $3 billion on behalf of
• ver 1700 households across 3 offices

in Canada

• Increased use of Guardian solutions

with approximately $826 million invested in Guardian Capital Funds as at March 31, 2019 ($218 million in 2012)

• Beneficiary of $610 million in referral
• f client accounts from Worldsource

advisors

Assets Under Management

As at period ends ($ billions)

2014 2015 2016 2017 2018 Q1 2019 $2.1 $2.3 $2.9 $3.0 $2.9 $3.1

Mutual Fund & Securities Dealerships

$13.6 billion in AUA

Life Insurance MGA

$5.1 billion in AUA

21

Financial Advisory

• $18.7 billion in AUA
• National distribution platforms
• Leading platform for Canada’s

independent financial advisors

As at March 31, 2019

22

• Significant growth in operating earnings through acquisitions, organic growth and management of costs
• Represents approximately 28% of Guardian’s operating earnings in 2018

Financial Advisory

2014 2015 2016 2017 2018 Q1 2019 $0.8 $2.7 $2.6 $4.4 $2.9 $3.3 $6.4 $10.1 $11.0 $14.6 $12.9

Operating Earnings ($ millions)

First Quarter Results

2014 2015 2016 2017 2018 Q1 2019 $10.1 $10.8 $12.0 $12.9 $12.7 $13.6

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Mutual Fund and Securities Dealers

• 7% increase in AUA in Q1 2019
• A source of AUM for Guardian’s

Investment Management business

• Approximately $786 million

invested or referred into Guardian solutions at March 31, 2019

First Quarter Results

Assets Under Administration

As at period ends ($ billions)

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• $24.6 million in net revenues for

2018, a 5% increase from 2017

• Net revenue continues to

transition away from transaction based towards trailer commissions and fee based revenue

Mutual Fund and Securities Dealers

2014 2015 2016 2017 2018 Q1 2019 $18.3 $20.4 $21.7 $23.4 $24.6 $4.4 $6.1 $5.8 $5.2 $6.2 $5.0

Net Revenue

($ millions)

First Quarter Results

2014 2015 2016 2017 2018 Q1 2019 $3.0 $4.0 $4.5 $4.9 $4.6 $5.1

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Life Insurance Managing General Agency

2014 2015 2016 2017 2018 Q1 2019 $45.1 $56.0 $90.4 $77.0 $111.0 $9.9 $16.6 $29.4 $16.6 $31.0 $12.8 First Quarter Results

Assets Under Administration

As at period end | ($ billions)

Premiums: Life Insurance Policies Sold

For the period end | ($ millions)

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Life Insurance Managing General Agency

• Record high net revenue of

$32.4 million in 2018

• $14.5 million of annual service

commissions in 2018, compared to $11.4 million in 2017

• $111 million in new premiums in

2018 will add an estimated $2.7 million in new annual service commissions in future years

2014 2015 2016 2017 2018 Q1 2019 $17.1 $21.5 $25.2 $28.6 $32.4 $3.6 $7.0 $9.4 $5.0 $6.1 $8.0

Net Revenue

($ millions)

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