CI Financial reports financial results for 2008; Posts sales of $11.6 billion



    TSX Symbol: CIX

    TORONTO, Feb. 24 /CNW/ - CI Financial Corp. ("CI") today released audited
financial results for the year ended December 31, 2008.

    
    -------------------------------------------------------------------------
                               Year ended            Year ended
                           December 31, 2008     December 31, 2007
                            (millions except      (millions except      %
    HIGHLIGHTS              per unit amounts)     per unit amounts)  Change
    -------------------------------------------------------------------------
    Average Retail Assets
     Under Management                $60,208               $64,958       -7
    -------------------------------------------------------------------------
    Gross Sales                      $11,636               $11,444        2
    -------------------------------------------------------------------------
    Net Sales                         $1,740                $1,898       -8
    -------------------------------------------------------------------------
    EBITDA(1)                         $633.6                $737.9      -14
    -------------------------------------------------------------------------
    EBITDA Per Unit(1)                 $2.27                 $2.61      -13
    -------------------------------------------------------------------------
    Net Income                        $445.4                $625.1      -29
    -------------------------------------------------------------------------
    Earnings Per Unit                  $1.60                 $2.21      -28
    -------------------------------------------------------------------------
    Earnings Before Income Taxes(1)
     Per Unit                          $1.53                 $1.99      -23
    -------------------------------------------------------------------------
    (1) EBITDA (earnings before interest, taxes, depreciation and
        amortization) and earnings before income taxes are not standardized
        earnings measures prescribed by GAAP; 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's method of calculating these
        measures may not be comparable to similar measures presented by other
        companies. EBITDA is a measure of operating performance, a
        facilitator for valuation and a proxy for cash flow.
    

    Fee-earning assets at December 31, 2008 were $80.3 billion, down 24% from
$105.6 billion a year earlier. This decrease is mostly attributable to
declining markets, partially offset by positive net sales of funds.
Fee-earning assets were comprised of $50.4 billion in investment funds and
pools at CI Investments Inc. and United Financial Corporation, $394 million in
structured products, $3.8 billion in institutional managed assets at KBSH
Capital Management Inc. and Altrinsic Global Advisors, LLC, $24.6 billion in
dealer assets under administration (at Assante Wealth Management (Canada) Ltd.
and Blackmont Capital Inc.), and $1.1 billion in other fee-earning assets.
    Gross sales and net sales of funds for the year ended December 31, 2008
were $11.6 billion and $1.7 billion, respectively. These figures represent
another strong year of sales for CI and ranks it as one of the top three
independent mutual fund companies by net sales in 2008. It also marks the
fifth consecutive year that CI has achieved annual net sales exceeding $1.6
billion - a level achieved by only one other fund complex in Canada.
    For the year ended 2008, CI reported EBITDA per unit of $2.27, down 13%
from $2.61 per unit in 2007. Included in CI's 2008 results are an $11.0
million restructuring charge and a $3.3 million amortization expense, which
related to the acceleration of vesting of deferred equity units (DEUs). In
addition, CI had an $11.0 million expense relating to adjustments to the value
of marketable securities, the majority of which involved a strategic
investment in a publically traded fund company.
    Excluding the above charges, CI's EBITDA for 2008 was $658.9 million, or
$2.36 per unit.
    CI reported $0.27 in earnings per unit before tax, $0.19 in earnings per
unit, and $0.46 in EBITDA per unit for the quarter. This compared with $0.48
in earnings per unit before tax, $0.66 in earnings per unit, and $0.65 in
EBITDA per unit for the quarter ended December 31, 2007. The items affecting
fourth quarter results include a $3.3 million accelerated amortization of
DEUs, a $6.0 million adjustment to marketable securities, and a $2.4 million
provision related to a legacy Assante claim. Adjusting for these items results
in pretax income of $0.31 per unit, net income per unit of $0.22, and EBITDA
of $0.50 per unit.
    In addition to the above, net income for the quarter ended December 31,
2008 was affected by $21.7 million in income taxes. This compares to a $51.5
million income tax recovery realized in the comparable period of 2007. The
income tax expense in the fourth quarter of 2008 reflects future income tax
adjustments relating to CI's conversion back to a corporate structure and is a
non-cash item. CI's future tax asset is anticipated to offset any cash taxes
in 2009. Furthermore, for the quarter ended December 31, 2008, there was an
increase of $5.6 million in amortization of deferred sales commission from the
same period in 2007 resulting from CI's continued high level of fund sales.
    CI's selling, general and administration (SG&A) charges for the fourth
quarter, adjusted for the acceleration of DEU amortization and stock-based
compensation, was $77.3 million compared to an adjusted SG&A of $87.9 million
in the third quarter. This 12% reduction reflects CI's efforts to reduce costs
in response to the decline in its assets under management. Following cost
reductions in the third quarter, CI moved more aggressively to reduce expenses
throughout the fourth quarter in all its business lines, achieving material
savings in compensation and operational expenses. CI expects that the expense
reductions initiated in the third and fourth quarters of 2008 will generate
savings exceeding $40 million in 2009.
    For detailed financial statements for the quarter and year ended December
31, 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.
    In other matters, CI converted back to a corporation on January 1, 2009.
A quarterly dividend of $0.12 per share plus an extra dividend of $0.04 per
share, for a total of $0.16 per share was declared payable on April 15, 2009
with a record date of March 31, 2009. The regular quarterly dividend
represents a yield of 4.2% on CI's closing share price of $11.30 on February
23, 2009.
    As of January 31, 2009, there were 294,603,613 shares of CI outstanding.
    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. 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 4:00 p.m. Eastern time to discuss CI's
fourth quarter results.
    The webcast will include a slide presentation and be available at
www.ci.com/q4. Alternatively, investors may listen to the discussion by
dialing (416) 644-3424 or 1-800-591-7539.
    The call will be available for playback until March 10, 2009 at (416)
640-1917 or 1-877-289-8525 (passcode: 21297965, followed by the number sign).
The webcast will be archived at www.ci.com/q4.

    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:

For further information: Stephen A. MacPhail, President, (416) 364-1145


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