Fiera Capital reports record fourth quarter and fiscal 2013 results

  • Board Approves Quarterly Dividend Increase of 10%
  • Fiera Capital Announces Key Appointments to Management Team to Support Growing North American Platform :
    • Marcel Larochelle joins as EVP and CFO
    • Sylvain Roy named CIO

MONTREAL, March 20, 2014 /CNW Telbec/ - Fiera Capital Corporation (TSX: FSZ) ("Fiera Capital" or "the Firm"), a leading independent Canadian investment firm, is pleased to announce its financial results for the fourth quarter ("the fourth quarter") and fiscal year ended December 31, 2013.

"2013 was a stellar year for Fiera Capital, as we continued to forge our presence as leaders in the North American asset management industry, realizing growth in all of our market segments. This included major inroads in the U.S. through strategic acquisitions, big wins in the institutional sector and new partnerships," said Jean-Guy Desjardins, Chairman and CEO of Fiera Capital."The significant increase in revenues and earnings is a testimony both to the strength of our expansion strategy and of our outstanding team of talented and passionate professionals, each of whom embody Fiera Capital's commitment to providing superior investment management services."

Key Financial and Corporate Highlights

  • Assets under management ("AUM") increased by $10.3 billion, or 15%, to $77.5 billion as at December 31, 2013, from $67.2 billion from September 30, 2013, and increased by $19.4 billion, or 33%, from December 31, 2012.
  • Revenue increased by $20.1 million, or 57%, to $55.2 million for the fourth quarter, versus the previous quarter ended September 30, 2013, and by  $24.2 million, or 78%, from the corresponding quarter ended December 31, 2012.
  • Adjusted earnings before interest, taxes, depreciation and amortization ("adjusted EBITDA") increased by $10.8 million, or 90%, to $22.9 million for the fourth quarter, compared to the quarter ended September 30, 2013, and  by $10.2 million, or 80%,  from the quarter ended December 31, 2012.
  • Adjusted EBITDA margin improved to 41.5% for the period, compared to adjusted EBITDA margin of 34.4% for the previous quarter ended September 30, 2013, and to 41.1% for the comparable period ended December 31, 2012.
  • The Firm recorded net earnings attributable to the Company's shareholders of $8.5 million, or $0.13 per share (basic and diluted), for the fourth quarter, versus net earnings attributable to the Company's shareholders of $1.5 million, or $0.03 per share (basic and diluted), for the quarter ended September 30, 2013, and net earnings attributable to the Company's shareholders of $3.1 million, or  $0.05 per share (basic and diluted), for the quarter ended December 31, 2012.
  • Adjusted net earnings for the period were $18.3 million, or $0.29 (basic) and $0.28 (diluted) per share, compared to adjusted net earnings of $8.7 million, or $0.15 per share (basic and diluted), for the previous quarter ended September 30, 2013, and adjusted net earnings of $9.4 million, or $0.16 per share (basic and diluted), for the period ended December 31, 2012.
  • On October 31, 2013, Fiera Capital announced the closing of the transactions to acquire Bel Air Investment Advisors of Los Angeles and Wilkinson O'Grady of New York for total consideration of US$156.25 million.
  • In January 2014, the Firm announced that it has been selected by Russell Investments Canada Limited and U.K. based Russell Investments Company II PLC to sub-advise two of their global equity strategies. Fiera Capital becomes the first Canadian firm appointed to manage one of Russell's global equity investment strategies on its Canadian platform.
  • Fiera Capital's Board of Directors has approved a 10% quarterly dividend increase to $0.11 per share. Fiera Capital's per share dividend has increased each year since inception and has grown at a compounded annual rate of 16%.

Key Management Appointments To Support Future Growth

Fiera Capital also announced the following key appointments within its management team:

Marcel Larochelle will be joining Fiera Capital as Executive Vice-President and Chief Financial Officer, effective April 7, 2014. This is a newly created position within Fiera Capital's management team. In this capacity, Mr. Larochelle will be responsible for a number of key strategic support functions of the Firm.

Fellow of the Canadian Institute of Actuaries and holding the CFA designation, Mr. Larochelle is a seasoned investment management industry veteran. Up until recently and since 2008, he was president and CEO of UBS Global Asset Management Canada's institutional division. Previously, he held various senior investment management and consulting positions in Canada, the U.S., Latin America, and Europe.

Sylvain Roy has been appointed Chief Investment Officer (CIO). Most recently Assistant CIO, Mr. Roy has 16 years of industry experience and has been with Fiera Capital since its creation.

"In order to ensure that we continue to grow sustainably to the benefit of both our clients and our shareholders, it is important that we have the right structure and team in place. Consequently, we are very pleased to have attracted an executive of Marcel's caliber who brings on board a wealth of international experience and in-depth knowledge of the industry. I have no doubt that he will greatly contribute to our strategic development," added Mr. Desjardins.

"I am equally pleased to confirm the appointment of Sylvain Roy as CIO. Sylvain has been participating in strategic decisions related to our investment teams since Fiera Capital's founding ten years ago, and he has been instrumental to our success. As CIO, he will continue to ensure that investment performance remains our highest priority," concluded Mr. Desjardins.

Fourth Quarter and Full Year 2013 Financial and Operating Results

The following table provides selected financial information for the quarter ended December 31, 2013, compared to the quarter ended September 30, 2013, and to the same period in 2012, as well as the twelve months ended December 31, 2013 (fiscal 2013), compared to the fifteen months ended December 31, 2012 (fiscal 2012).

Key Financial Highlights ($ in thousands)

   
  Quarters ended Periods ended
  December 31,
2013

September 30,
2013

December 31,
2012

December 31,
2013
12 months
December 31,
2012
15 months
AUM ($ in millions) 77,485 67,163 58,138 77,485 58,138
Revenue          
  Base management fees 44,243 34,388 27,034 141,610 109,741
  Performance fees -
Traditional assets
6,529 294 3,651 7,181 5,036
  Performance fees -
Alternative assets
4,450 429 324 4,936 551
Total revenue 55,222 35,111 31,009 153,727 115,328
Expenses          
  SG&A and external managers 33,609 23,236 18,554 97,215 76,225
  Other expenses 13,201 10,381 9,369 41,907 36,077
Total expenses 46,810 33,617 27,923 139,122 112,302
Net earnings 8,412 1,494 3,086 14,605 3,026
Attributable to:          
  Company's shareholders 8,481 1,508 3,086 14,939 3,026
  Non-controlling interest (69) (14) - (334) -
  8,412 1,494 3,086 14,605 3,026
EARNINGS          
  Adjusted EBITDA(1) 22,941 12,085 12,746 59,228 40,303
  Net earnings 8,412 1,494 3,086 14,605 3,026
  Adjusted net earnings(2) 18,313 8,717 9,415 43,437 28,431
           
BASIC PER SHARE          
  Adjusted EBITDA(1) 0.36 0.22 0.23 1.01 0.82
  Net earnings 0.13 0.03 0.05 0.26 0.06
  Adjusted Net Earnings(2) 0.29 0.15 0.16 0.74 0.59
DILUTED PER SHARE          
  Adjusted EBITDA(1) 0.35 0.22 0.23 1.00 0.82
  Net earnings 0.13 0.03 0.05 0.25 0.06
  Adjusted Net Earnings(2) 0.28 0.15 0.16 0.73 0.59
(1) Adjusted EBITDA excludes non-cash compensation, acquisition and restructuring related costs.
(2) Adjusted net earnings exclude non-recurring and non-cash items.
Fiera Capital selected adjusted EBITDA and adjusted net earnings as non-IFRS key performance measures.
These non-IFRS measures are defined in the Company's MD&A.

Assets under Management ($ in millions)

       
  December 31, 2013 September 30, 2013 December 31, 2012
Institutional                41,478               39,888                  31,835
Private Wealth 10,535 2,049 1,828
Retail 25,472 25,226 24,475
AUM - end of period 77,485 67,163 58,138

Financial and Operating Results

Revenues for the quarter ended December 31, 2013, increased by $24.2 million, or 78%, to $55.2 million compared to $31.0 million for the same period of the prior year. The increase in revenues is due primarily to various acquisitions of assets combined with organic growth of AUM.

Selling, general and administration ("SG&A") expenses and external managers expenses increased by $15 million, or 81%, to $33.6 million for the quarter ended December 31, 2013, compared to $18.6 million for the same period in 2012. The increase resulted from  overall raise in SG&A expenses of $14.1 million following the acquisition of assets from UBS, GMP, Bel Air Investment Advisors and Wilkinson O'Grady combined with higher external manager expenses of $0.9 million for the three months ended December 31, 2013

Adjusted EBITDA increased by $10.2 million, or 80%, to $22.9 million for the quarter ended December 31, 2013, compared to $12.7 million for the same period of 2012.

Adjusted EBITDA per share was $0.36 (basic) and $0.35 (diluted) for the quarter ended December 31, 2013, compared to adjusted EBITDA per share of $0.23 (basic and diluted) for the quarter ended December 31, 2012.

For the quarter ended December 31, 2013, the Firm earned $8.5 million, or $0.13 per share (basic and diluted), compared to net earnings of $3.1 million, or $0.05 per share (basic and diluted), for the quarter ended December 31, 2012.

Net earnings were negatively affected by $7.8 million, or $0.13 per share (basic) and $0.12 (diluted), of non-cash items, and by $2 million, or $0.03 per share (basic and diluted), of acquisition and restructuring costs (net of income taxes) during the quarter.  When added back to the Firm's net earnings of $8.5 million, or $0.13 per share (basic and diluted), adjusted net earnings for the quarter ended December 31, 2013, were $18.3 million, or $0.29 per share (basic) and $0.28 (diluted), compared to adjusted net earnings of $9.4 million, or $0.16 per share (basic and diluted), for the same period in 2012.

Dividend

The Board of Directors has declared a dividend of $0.11 per Class A subordinate voting share and Class B special voting share of Fiera Capital, payable on April 29, 2014, to shareholders of record at the close of business on April 1st, 2014.  The dividend is an eligible dividend for income tax purposes.

Conference Call

Fiera Capital will hold a conference call at 11 a.m. (Eastern Time) on March 20, 2014, to discuss these results. The telephone number to access the conference call is 1-888-231-8191 (toll-free), conference ID: 2677814.

A presentation highlighting the results of the fourth quarter of 2013 will be available on the same day in the Investor section of Fiera Capital's Website (www.fieracapital.com), under Events and Presentations.

A replay of the call will be available until March 27, 2014. The telephone numbers to access the replay of the call is 1-855-859-2056 (toll-free), access code 2677814. The replay of the conference call will also be available in the Investor section of the Website under Events and Presentations, in the days following the event.

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 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, multiproduct 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

For further information:

Mélanie Tardif, CPA, CMA
Director, Corporate Communications and Investor Relations
Fiera Capital Corporation
514-954-6456
mtardif@fieracapital.com

Additional information relating to the Firm, including its Annual Information Form, is available on SEDAR at www.sedar.com.