TSX Symbol: CIX.UN
TORONTO, Nov. 11 /CNW/ - CI Financial Income Fund ("CI") today released
unaudited financial results for the quarter and nine months ended September
30, 2008.-------------------------------------------------------------------------
Quarter ended Quarter ended
September 30, 2008 September 30, 2007
(millions except (millions except %
HIGHLIGHTS per unit amounts) per unit amounts) change
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Average Retail Assets
Under Management $62,875 $65,244 -4
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Gross Sales $2,657 $2,496 6
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Net Sales $463 $149 211
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Net Income $118.1 $143.7 -18
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Earnings Per Unit $0.42 $0.50 -16
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Earnings Per Unit
(adjusted)(1) $0.45 $0.50 -10
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EBITDA(2) $152.0 $183.9 -17
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EBITDA Per Unit (2) $0.55 $0.64 -14
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EBITDA Per Unit
(adjusted)(1,2) $0.58 $0.64 -9
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(1) Adjusted for equity-based compensation expense,
conversion/restructuring costs and an adjustment to the value of
marketable securities.
(2) EBITDA (earnings before interest, taxes, depreciation and
amortization) is not a standardized earnings measure prescribed by
GAAP; however, management believes that most of its unitholders,
creditors, other stakeholders and investment analysts prefer to
include the use of this performance measure in analyzing CI's
results. EBITDA is a measure of operating performance, a facilitator
for valuation and a proxy for cash flow.Fee-earning assets at September 30, 2008 were $92.8 billion, down 14%
from $108.0 billion a year earlier. This decrease is mostly attributable to
declining markets and was partially offset by positive net sales of funds.
Fee-earning assets were comprised of $58.6 billion in investment funds and
pools at CI Investments Inc. and United Financial Corporation, $490 million in
structured products, $3.9 billion in institutional managed assets at KBSH
Capital Management Inc. and Altrinsic Global Advisors, LLC, $28.6 billion in
dealer assets under administration (at Assante Wealth Management (Canada) Ltd.
and Blackmont Capital Inc.), and $1.2 billion in other fee-earning assets.
For the quarter ended September 30, 2008, gross sales and redemptions
totalled $2.7 billion and $2.2 billion, respectively, compared with $2.5
billion and $2.3 billion, respectively, in the same quarter a year earlier.
Net sales for the quarter were $463 million, an increase of $314 million, or
211% from $149 million in the third quarter of 2007. Net sales for the nine
months ended September 30, 2008 were $1.8 billion. CI products that made
important contributions to the increase in sales included the Cambridge Funds,
which were launched in January 2008, and the SunWise Elite Plus segregated
funds. Sales of CI's products continue to be strong, with CI posting positive
long-term net sales of $10 million in October (net of $340 million in note
rebalancing). This trend has continued into November with month-to-date net
sales of long-term funds of $90 million.
CI reported $0.42 in earnings per unit and $0.55 in EBITDA per unit for
the quarter. Included in these results was $11 million ($7.3 million after
tax) of costs related to conversion back to a corporation and restructuring
expenses, an equity-based compensation recovery of $7.6 million ($5.1 million
after tax), and an adjustment to the value of marketable securities of $5
million ($4.2 million after tax). Excluding these adjustments, net income was
$0.45 per unit and EBITDA was $0.58 per unit for the quarter ended September
30, 2008. As a result of current initiatives, CI expects SG&A expenses to
decline by approximately $9 million in the fourth quarter of 2008 and by more
than $33 million in 2009.
"Given market conditions, CI has fared very well and we continue to be
among the leaders in the sale of long-term funds," said William T. Holland,
Chief Executive Officer. "In addition, over the past few months, we have
aggressively taken steps to deal with changes in the level of our assets under
management, which resulted in a decline in SG&A expenses from the second
quarter to the third quarter of 2008. However, the bulk of our efforts will be
apparent in the fourth quarter of 2008 and in fiscal 2009, putting CI in an
excellent position to take advantage of a market recovery."
For detailed financial statements for the quarter and nine months ended
September 30, 2008, including Management's Discussion and Analysis, please
refer to CI's website at www.ci.com/cix under Reports, or contact
investorrelations@ci.com.
As previously announced, CI intends to convert back to a corporation
effective January 1, 2009, upon the receipt of unitholder and regulatory
approvals. This change in structure will allow CI to pursue acquisition
opportunities as they become available, without the burden of the growth
limits that are imposed on income trusts. Following the conversion, CI will
pay dividends on a quarterly basis. CI intends to pay a dividend of $0.16 per
share payable on April 15, 2009 to shareholders of record on March 31, 2009.
As of October 31, 2008, there were 133,633,076 issued and outstanding
trust units of CI and 146,174,337 exchangeable limited partner units of
Canadian International LP, for a total of 279,807,413.
CI Financial Income Fund (TSX: CIX.UN) is an independent, Canadian-owned
wealth management company. CI offers a broad range of investment products and
services, including an industry-leading selection of investment funds. CI is
on the Web at www.ci.com/cix.
Analysts' Conference Call
Chief Executive Officer William T. Holland will host a conference call
and webcast with analysts today at 4:30 p.m. Eastern time to discuss CI's
third quarter results. Please note that the time of the call has been changed
from the previously announced time of 3:00 p.m.
The webcast will include a slide presentation and be available at
www.ci.com/q3. Alternatively, investors may listen to the discussion by
dialing (416) 644-3425 or 1-800-595-8550.
The call will be available for playback until Tuesday, November 25, 2008
at (416) 640-1917 or 1-877-289-8525 (passcode: 21288413, followed by the
number sign). The webcast will be archived at www.ci.com/q3.
This press release contains forward-looking statements with respect to CI
and its products and services, including its business operations and strategy
and financial performance and condition. Although management believes that the
expectations reflected in such forward-looking statements are reasonable, such
statements involve risks and uncertainties. Actual results may differ
materially from those expressed or implied by such forward-looking statements.
Factors that could cause actual results to differ materially from expectations
include, among other things, general economic and market factors, including
interest rates, business competition, changes in government regulations or in
tax laws, and other factors discussed in materials filed with applicable
securities regulatory authorities from time to time.
For further information: Stephen A. MacPhail, President, (416) 364-1145
