CI Financial reports third quarter results: Earnings per share increase 19%; dividend raised 6%

TORONTO, Nov. 7, 2013 /CNW/ - CI Financial Corp. ("CI") today released unaudited financial results for the quarter ended September 30, 2013.

HIGHLIGHTS

Quarter ended
September 30, 2013
($millions except
per share amounts)
Quarter ended
June 30, 2013
($millions except
per share amounts)
%
change
Quarter ended
September 30, 2012
($millions except
per share amounts)
%
change
Assets Under Management 85,557 81,650 5 73,866 16
Average Assets Under Management 84,125 81,691 3 72,437 16
Pre-Tax Operating Earnings Per Share1 0.64 0.62 3 0.56 14
EBITDA Per Share 1 0.68 0.67 1 0.62 10
Net Income 107.8 104.0 4 91.3 18
Earnings Per Share 0.38 0.37 3 0.32 19
SG&A Expenses 37 bps 38 bps (3) 38 bps (3)
Dividends Recorded Per Share 0.270 0.265 2 0.240 13
Net Debt2 403.7 447.9 (10) 552.8 (27)
Gross Sales 3,160 3,377 (6) 2,433 30
Net Sales 853 978 (13) 358 138
1   Pre-Tax Operating Earnings and EBITDA (earnings before interest, taxes, depreciation and amortization) are not standardized earnings measures prescribed by IFRS; however, management believes that most of its shareholders, creditors, other stakeholders and investment analysts prefer to include the use of these performance measures in analyzing CI's results. CI defines pre-tax operating earnings as income before income taxes less redemption fee revenue, non-recurring items, performance fees and investment gains, plus amortization of deferred sales commissions (DSC) and fund contracts. CI's method of calculating these measures may not be comparable to similar measures presented by other companies.
2   Net of cash and marketable securities not required for regulatory working capital.

For the quarter ended September 30, 2013, average assets under management reached a record high of $84.1 billion, an increase of 16% from the same quarter of the previous year and an increase of 3% from the prior quarter. CI had a record level of third quarter gross sales and its highest level of third quarter net sales since 2000. Gross sales of funds were $10.3 billion during the nine months ended September 30 2013, an increase of 46% year over year, while net sales increased to $3.0 billion from $249 million in the same period one year ago.

At September 30, 2013, CI reached a record level of assets under management for a quarter-end at $85.6 billion, up 16% from $73.9 billion at September 30, 2012. In comparison, the S&P/TSX Composite Index increased 7% and the DEX Universe Bond Index lost 1% over the same period.

For the third quarter of 2013, CI reported earnings per share of $0.38, up 19% from $0.32 per share in the third quarter of 2012 and up 3% from $0.37 per share in the second quarter of 2013. CI reported EBITDA per share for the third quarter of 2013 of $0.68, a 10% increase from the third quarter of 2012 and a 1% increase from the prior quarter. Pre-tax operating earnings per share were up 14% from the third quarter of 2012 and up 3% from the prior quarter.

CI maintained its change in discretionary spend below the rate of growth in assets under management. Selling, general and administrative (SG&A) expenses as a percentage of average assets under management fell to 37 basis points in the third quarter of 2013, down from 38 basis points in the third quarter of the prior year.

CI generated $119.0 million in free cash flow during the quarter ended September 30, 2013 compared to $110.4 million in the third quarter of 2012. CI's cash flow in the quarter facilitated a reduction in net debt by $44.2 million and the payment of $76.6 million in dividends. As at October 31, 2013, CI had 283,960,356 shares outstanding.

"By all accounts it was a very successful quarter," said Stephen A. MacPhail, CI President and Chief Executive Officer. "Our net sales in 2013 reached $3 billion by the end of the third quarter, our asset levels at CI and Assante are at all-time highs, our investment in training and advisor support has never been higher, and our increased profitability has allowed CI to raise its dividend a record three times in 2013."

The Board of Directors declared a $0.005 increase in the monthly cash dividend to $0.095 per share payable on each of December 13, 2013, January 15, 2014, and February 14, 2014 to shareholders of record on November 30, 2013, December 31, 2013 and January 31, 2014, respectively. The monthly dividend represents a yield of 3.3% on CI's closing share price of $34.25 on November 6, 2013.

For detailed financial statements for the quarter ended September 30, 2013, including Management's Discussion and Analysis, please refer to CI's website at www.cifinancial.com under Reports, or contact investorrelations@ci.com.

Analysts' Conference Call
CI will hold a conference call with analysts today at 4 p.m. Eastern time. Speaking on the call will be Mr. MacPhail and Douglas Jamieson, Executive Vice-President and Chief Financial Officer. The conference call and a slide presentation will be accessible through a webcast at www.ci.com/q3. Alternatively, investors may listen to the discussion by dialling 1-866-696-5910 or (416) 340-2217 (passcode: 9533678).

The call will be available for playback later in the day until November 21, 2013 at (905) 694-9451 or 1-800-408-3053 (passcode: 6097126). The webcast will be archived at www.ci.com/q3.

CI Financial Corp. (TSX: CIX) 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, and is on the Web at www.cifinancial.com.

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.

SOURCE: CI Financial Corp.

For further information:

Stephen A. MacPhail
President and Chief Executive Officer
CI Financial Corp.
(416) 364-1145


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