Jovian Releases Results for the First Quarter of Fiscal 2011

Client Assets Increased by $1.0 Billion over Q1 Fiscal 2010

TORONTO, Aug. 11 /CNW/ - Jovian Capital Corporation (TSX: JOV) ("Jovian") today released its results for the three months ended June 30, 2010.

Q1 Fiscal 2011 Highlights

    
    -  Revenue of $27.1 million, compared to $25.4 million in the first
       quarter of fiscal 2010
    -  Client assets increased by $1.0 billion to $11.9 billion from $10.9
       billion in the first quarter of fiscal 2010
    -  EBITDA of negative $0.5 million compared with EBITDA of negative $0.9
       million in the first quarter of fiscal 2010
    -  Completed $10 million placement of convertible debentures with a 5-
       year term
    -  BetaPro launched first commodity spread ETFs and leveraged copper ETFs
    

"We are pleased to have strengthened our balance sheet during the quarter through a $10 million placement of convertible debentures," said Philip Armstrong, CEO of Jovian. "The proceeds of this transaction provide us with access to long-term capital to fund our future growth and have enhanced our financial flexibility by allowing us to limit our short-term debt while significantly reducing our interest carrying costs."

"Financial markets remained turbulent during the first quarter of fiscal 2011 as investors reacted to the ongoing European debt issues. Despite the uncertain markets, our client assets grew slightly to $11.9 billion during the quarter," added Mr. Armstrong. "We continued to grow our Horizons ETF franchise with the launch of innovative new products including the world's first commodity spread ETFs and North America's first two-times inverse leveraged ETFs that offer exposure to the daily price of copper futures contracts."

    
    Selected Financial Data (unaudited)

    -------------------------------------------------------------------------
    in thousands of Canadian dollars               Three months ended
    -------------------------------------------------------------------------
                                             June 30/10           June 30/09
    -------------------------------------------------------------------------
    Revenues                                     27,110               25,356
    -------------------------------------------------------------------------
    Compensation and Benefits, Selling,
     General and Administration                  27,334               26,048
    -------------------------------------------------------------------------
    Adjusted EBITDA(2)                             (224)                (692)
    -------------------------------------------------------------------------
    Stock-based Compensation Expense(1)             242                  162
    -------------------------------------------------------------------------
    EBITDA(2)                                      (466)                (854)
    -------------------------------------------------------------------------
    Loss                                         (2,933)              (3,879)
    -------------------------------------------------------------------------
    Loss Per Share - Basic*                     (0.34)               (0.46)
    -------------------------------------------------------------------------
    Loss Per Share - Diluted*                   (0.34)               (0.46)
    -------------------------------------------------------------------------

    (1)  For measurement purposes, stock-based compensation expense, which is
         a non-cash item, is excluded from compensation and benefits expense
         in this table in order to determine Adjusted EBITDA.
    (2)  EBITDA and Adjusted EBITDA are non-GAAP performance measures
         utilized by Jovian. EBITDA is defined here as earnings before
         interest on long-term debt, taxes, depreciation, amortization,
         impairment, revaluation of share redemption liability and non-
         controlling interest. Adjusted EBITDA is EBITDA adjusted for stock-
         based compensation.
    *  Earnings per share for all periods have been adjusted to reflect the
         20:1 common shares consolidation effective April 29, 2009.
    

Financial Review

Q1 Fiscal 2011

Revenue for the quarter ended June 30, 2010, was $27.1 million, compared to $25.4 million in the first quarter of fiscal 2010. The increase in revenue is the result of increased asset levels as well as improved investment banking and principal trading revenue. During the quarter, total client assets increased by $1.0 billion compared to the same period last year. This represents an increase in AUM and AUA of $0.6 billion and $0.4 billion, respectively.

Expenses for the quarter ended June 30, 2010, were $30.1 million, compared to $29.2 million for the first quarter of fiscal 2010.

Adjusted EBTIDA(2), a key management performance measure, was negative $0.2 million for the quarter, compared to negative $0.7 million during the same period the prior fiscal year. Net loss for the three-month period ended June 30, 2010, was $2.9 million, compared with $3.9 million in the first quarter of fiscal 2010.

Liquidity and Capital Resources

Cash and those investments considered highly liquid, included in securities owned on the consolidated balance sheet, were $26.6 million as at June 30, 2010, compared with $31.8 million as at March 31, 2010. For the three months ended June 30, 2010, Jovian reported an increase in cash and cash equivalents of $3.4 million. The increase largely resulted from financing activities including the $10 million proceeds received on the Debenture issuance and $0.9 proceeds on the operating line of credit. This increase was offset by the early repayment of a $5 million loan facility and $0.2 million in fees paid for the issuance of the Debentures.

About Jovian Capital Corporation (www.joviancapital.com)

Jovian acquires, creates and grows financial services companies specializing in wealth and asset management. The Jovian group of companies (AlphaPro Management Inc., BetaPro Management Inc., Horizons Exchange Traded Funds Inc., Hahn Investment Stewards & Company Inc., Horizons Funds Inc., JovInvestment Management Inc., Leon Frazer & Associates Inc., MGI Financial Inc., MGI Securities Inc., MGI Securities (USA) Inc. and T.E. Wealth) manages $11.5 billion of client assets ($6.5 billion in assets under management and $5.0 billion in assets under administration). Additional information is available at www.sedar.com.

SOURCE Jovian Capital Corporation

For further information: For further information: Don Sangster, Investor Relations, Jovian Capital Corporation, (416) 933-5744; or Philip Armstrong. C.E.O., Jovian Capital Corporation, (416) 933-5752

Organization Profile

Jovian Capital Corporation

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