Jovian Releases Results for the Fourth Quarter and Fiscal Year Ended March 31 2011

EBITDA increased to $6.3 million from $1.6 million in fiscal 2010

TORONTO, June 22, 2011 /CNW/ - Jovian Capital Corporation (TSX: JOV) ("Jovian") today released its results for the three and twelve months ended March 31, 2011.

Fiscal 2011 Highlights

  • EBITDA increased 294% to $6.3 million from $1.6 million in fiscal 2010
  • Revenue increased 22% to $135.8 million, compared to $111.3 million in fiscal 2010
  • Client assets increased 15% or $1.8 billion to $13.5 billion from $11.7 billion in fiscal 2010
  • Net loss of $3.5 million compared with a loss of $2.9 million in fiscal 2010
  • Completed $10 million convertible debenture issue and $15 million in secured debt issue
  • Launched 17 new ETF products into the marketplace, including seven actively managed ETFs

Subsequent events

  • Horizons BetaPro ("BetaPro") increased its investment in BetaShares Holdings Pty. Ltd. ("BetaShares Holdings") to approximately 40%

"We made strong progress in all key areas of our business in fiscal 2011, as we significantly increased our total client assets and assets under management," said Philip Armstrong, CEO of Jovian. "The growth in our asset base was reflected in our financial performance.  We also saw major improvements in our brokerage business, in particular in our capital markets group, helping our revenues to increase by 22% over fiscal 2010 and our EBITDA to improve by nearly 300%. We also took steps to strengthen our balance sheet through an issue of convertible debentures."

"Our ETF businesses, BetaPro and AlphaPro, continued to build on their leadership positions in the ETF space, launching 17 innovative new products during the year," continued Mr. Armstrong. "BetaPro also expanded its global presence for future international growth through an additional investment in BetaShares Holdings, a rapidly growing Australian ETF company."

Selected Financial Data (audited)

in thousands of Canadian dollars   Three months ended Year ended
   Mar 31/11 Mar 31/10 Mar 31/11 Mar 31/10
Revenues   44,128 28,599 135,802 111,281
Compensation and Benefits, Selling, General and Administration   38,997 27,557 128,670 108,748
Adjusted EBITDA2   5,131 1,042 7,132 2,533
Stock-based Compensation Expense1   188 220 792 973
EBITDA2   4,943 822 6,340 1,560
Earnings (Loss)   1,685 (1,299) (3,515)            (2,939)
Earnings (Loss) Per Share - Basic*   0.20 (0.15) (0.41) (0.35)
Earnings (Loss) Per Share - Diluted*   0.20 (0.15) (0.41) (0.35)

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 and non-controlling interest.  Adjusted EBITDA is EBITDA adjusted for stock-based compensation.

* Earnings per share have been adjusted where applicable to reflect the 20:1 common shares consolidation.

Financial Review

Fourth Quarter Fiscal 2011

Revenue for the quarter ended March 31, 2011, increased by $15.5 million to $44.1 million from $28.6 million for the fourth quarter of fiscal 2010.

Expenses for the quarter ended March 31, 2011, were $42.4 million, compared to $29.9 million for the fourth quarter of fiscal 2010. Compensation and benefits expense was $24.3 million for the fourth quarter of 2011, compared with $15.0 million for the same period in fiscal 2010.

Adjusted EBTIDA2, a key management performance measure, was $5.1 million for the quarter, compared to $1.0 million during the same period the prior fiscal year. The change is largely due to the increase in comparable EBITDA of $5.9 million in the Wealth Management segment, offset by a $0.9 million decrease in the Traditional Asset Managers segment and a $0.4 million decrease in the ETF Managers segment.

Fiscal 2011

For the fiscal year ended March 31, 2011, revenue increased by 22% to $135.8 million from $111.3 million the prior year. The increase in revenue was attributed to the increase in both AUM and AUA, as well as increased investment banking and principal trading revenue, offset by the termination of the Canadian Medical Discoveries Fund contracts during the first quarter of fiscal 2010 and the sale of the fund recordkeeping and administration operations of Felcom Data Services Inc. during the third quarter of fiscal 2010, and their resulting lack of revenue contribution for the subsequent quarters.

Expenses for the year ended March 31, 2011, were $139.3 million, compared to $114.2 million for fiscal 2010. Compensation and benefits expense was $74.9 million for the year ended March 31, 2011, compared with $58.1 million the prior fiscal year.

Adjusted EBTIDA2, was $7.1 million for the fiscal year, compared to $2.5 million during fiscal 2010. Again, the change is largely due to the increase in comparable EBITDA of $7.8 million in the Wealth Management segment, offset by a $2.0 million decrease in the Traditional Asset Managers segment and a $0.9 million decrease in the in the ETF Managers segment.

Liquidity and Capital Resources
Cash and those investments considered highly liquid, included in securities owned on the consolidated balance sheet, were $31.8 million as at March 31, 2011, compared with $33.8 million as at December 31, 2010. Jovian has a capital structure comprising of debt, capital stock, warrants, contributed surplus, deficit and accumulated other comprehensive income.

About Jovian Capital Corporation
Jovian acquires, creates and grows financial services companies specializing in three primary market segments: wealth management, traditional asset managers, and exchange traded fund asset managers. The Jovian group of companies (AlphaPro Management Inc., BetaPro Management Inc., Hahn Investment Stewards & Company Inc., Horizons Exchange Traded Funds Inc., JovFunds Management Inc., JovInvestment Management Inc., Leon Frazer & Associates Inc., MGI Financial Inc., MGI Securities Inc., MGI Securities (USA) Inc. and T.E. Wealth) manages approximately $13.5 billion of client assets ($8.0 billion in assets under management and $5.5 billion in assets under administration).  Additional information is available at www.joviancapital.com and www.sedar.com.

SOURCE Jovian Capital Corporation

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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