Q3-2019 Earnings Call November 7, 2019 Important Information This - - PowerPoint PPT Presentation

q3 2019 earnings call
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Q3-2019 Earnings Call November 7, 2019 Important Information This - - PowerPoint PPT Presentation

Q3-2019 Earnings Call November 7, 2019 Important Information This presentation contains forward-looking statements concerning anticipated future events, results, circumstances, performance or expectations with respect to CI Financial Corp.


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Q3-2019 Earnings Call

November 7, 2019

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Important Information

This presentation contains forward-looking statements concerning anticipated future events, results, circumstances, performance or expectations with respect to CI Financial Corp. (“CI”) and its products and services, including its business operations, strategy and financial performance and condition. Forward-looking statements are typically identified by words such as “believe”, “expect”, “foresee”, “forecast”, “anticipate”, “intend”, “estimate”, “goal”, “plan” and “project” and similar references to future periods, or conditional verbs such as “will”, “may”, “should”, “could” or “would”. These statements are not historical facts but instead represent management beliefs regarding future events, many of which by their nature are inherently uncertain and beyond management’s control. Although management believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, such statements involve risks and uncertainties. The material factors and assumptions applied in reaching the conclusions contained in these forward-looking statements include that the investment fund industry will remain stable and that interest rates will remain relatively

  • stable. Factors that could cause actual results to differ materially from expectations include, among other things, general economic and

market conditions, including interest and foreign exchange rates, global financial markets, changes in government regulations or in tax laws, industry competition, technological developments and other factors described or discussed in CI’s disclosure materials filed with applicable securities regulatory authorities from time to time. The foregoing list is not exhaustive and the reader is cautioned to consider these and other factors carefully and not to place undue reliance on forward-looking statements. Other than as specifically required by applicable law, CI undertakes no obligation to update or alter any forward-looking statement after the date on which it is made, whether to reflect new information, future events or otherwise. This presentation contains non-IFRS financial measures that do not have any standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies. However, management uses these financial measures and also believes that most shareholders, creditors, other stakeholders and investment analysts prefer to include the use of these financial measures in analyzing CI’s results. These non-IFRS measures are described and/or reconciled to the nearest IFRS measure in CI’s Management’s Discussion and Analysis available at www.cifinancial.com. Figures exclude non-controlling interest, where applicable.

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Conference Call Participants

Kurt MacAlpine Chief Executive Officer Douglas Jamieson Chief Financial Officer

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Topics for Discussion

Q3 highlights & challenges Q3 financial performance review Q4 update Corporate strategic priorities Q&A

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  • CI net redemptions continue, but improved $0.9 billion as compared to Q2-19 & Q3-18
  • Reached significant milestones during the quarter

➢ CI First Asset ETF AUM at all-time high: $7.4 billion ➢ Liquid alternatives reached $1 billion in just 10 months

  • Continuing to evolve our wealth management business

➢ Assets under advisement at record levels: $47.4 billion ➢ Official launch of Assante Connect, a division of WealthBar

  • Repurchased $150 million of shares (7.7 million)
  • On track with SG&A savings previously identified
  • Outlined a new strategic direction for the company

Q3 Highlights & Challenges

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Financial Highlights

Change [millions, except per share] Q3-2019 Q2-2019 Q3-2018 QoQ YoY Average AUM $129,784 $131,133 $138,322

  • 1%
  • 6%

Ending AUM $129,998 $130,186 $136,526 0%

  • 5%

Assets under advisement $47,383 $46,606 $44,359 2% 7% Net income $139.0 $138.5* $158.2 0%

  • 12%

per share $0.60 $0.58* $0.62 3%

  • 3%

Free cash flow $144.7 $146.5 $169.2

  • 1%
  • 14%

*Q2-2019 adjusted for a $26.6 million ($35.0 million before tax) restructuring provision

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SG&A

(in $millions)

105.0 98.4 100.9 99.3 98.6

90.0 95.0 100.0 105.0 110.0 Q3-18 Q4-18 Q1-19 Q2-19 Q3-19

23.9 25.1 25.1 25.5 26.0

22.0 24.0 26.0 28.0 Q3-18 Q4-18 Q1-19 Q2-19 Q3-19

Asset Management Asset Administration

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Free Cash Flow & Return to Shareholders

(in $millions)

169 157 144 147 145 61 45 44 43 42 189 160 61 95 150

  • 50

100 150 200 250 300 Q3-2018 Q4-2018 Q1-2019 Q2-2019 Q3-2019

Free Cash Flow Dividends Buybacks

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Debt

*Reflects EBITDA adjusted for provisions, where applicable

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Q4 Update

Acquisitions completed this quarter:

WisdomTree Asset Management Canada

Snap Projections

Redpoint Investment Management Strategic investments completed this quarter:

d1g1t

October net sales ($ millions) Canadian retail (133) Canadian institutional (79) International 97 Closed business (74) Total (189)

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Strategic Priorities

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Rationale for Each Strategic Priority

Modernize our asset management business Expand our wealth management platform Globalize our company

  • Scale is becoming

increasingly important, and difficult to achieve in Canada

  • Investors want to be

serviced and supported globally

  • Talent acquisition from

global markets

  • Role of advisor is more

important than ever

  • Our breadth of

capabilities uniquely positions us to be Canada's market leader

  • Consumers' lives are

becoming increasingly complex and digital

  • Evolving demographics
  • Shifts in investor

preferences

  • Changing expectations for

servicing and support

  • Ongoing regulatory

change

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Examples of Initiatives Currently Underway

Strategic Priority Initiatives

Modernize our asset management business

Expand our alternatives capabilities Increase ETF market share Predictive analytics in sales & marketing Engage with new client segments Develop discretionary capabilities Enter U.S. Registered Investment Advisor (RIA) market Finalizing exclusive partnership Acquired WisdomTree’s Canadian ETF business Building machine learning analytics model Acquired Snap Projections to reach younger clients Partnership with d1g1t to offer SMA/UMA platform Letter of intent to acquire 2 U.S. RIAs

Expand our wealth management platform Globalize our company

Examples

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Q&A