Record Net Earnings of $515 Million Push Up Value of Solidarity Fund QFL
Share by $1.73 to $23.51

12-month return reaches 11.5%

MONTREAL, Jan. 4 /CNW Telbec/ - The Solidarity Fund QFL (the "Fund") turned in a positive performance for the first half of its fiscal year despite a still precarious economic and financial situation. Thus, for the six-month period ended November 30, 2009, the Fund achieved record net earnings of $515 million, generating an 8% return. Net assets rose to $7 billion while share value increased to $23.51, $1.73 above its July 6 price.

The Fund's return for the 12-month period, from December 1, 2008 to November 30, 2009, stands at 11.5%.

"I am extremely proud of the return generated by the Fund for its 571,000 shareholders over the last 12 months. This is just one more reason why Quebecers can put their trust in us. In fact, with the RRSP season just around the corner, I would like to take this opportunity to urge Quebecers to save. The saving rate in Québec has been falling sharply for years, which is cause for concern. In 2008, it was 2.1%, compared to about 20% in the early '80s. Saving with the Fund's RRSP pays off. Thanks to its 30% tax credits, payroll deduction option and immediate tax savings, our RRSP is more accessible than traditional RRSP products and makes it easier to get into the habit of saving for retirement. I would like to acknowledge our 2,000 energetic local representatives (LR), who once again this year, will do whatever they can to encourage their coworkers to save, because they know that those who start saving early are the ones who will enjoy a more comfortable retirement. I'd also like to thank the Fund's management team and all our employees for their invaluable contribution," said Fund Chairman and QFL President Michel Arsenault.

"In the last six months, both the portfolio of development capital investments in SMEs and the marketable securities portfolio did well, returning 7.6% and 10.2% respectively. For the latter, we have been capitalizing on the rebound in the equity and financial markets since the spring. And I'm especially proud of the return generated by our private equity portfolio, which invests in Québec SMEs and which attests to the careful analyses conducted by our teams and to the drive of Québec entrepreneurs," added the Fund's President and Chief Executive Officer, Yvon Bolduc.

The Fund's RRSP, a savings solution that pays off

The compounded return earned by the Fund shareholders, which includes the impact of the 30% tax credits, compares favourably with other savings products. The following table shows the 5-, 7- and 10-year return factoring in the tax credits.

    
    -------------------------------------------------------------------------
                                5-Year Return  7-Year Return  10-Year Return
    -------------------------------------------------------------------------
    Factoring in the 30% tax
    credits, a shareholder who
    invests the same amount           14.9%*       11.5%*        7.6%*
    each year through payroll
    deduction would earn a
    compounded annual return of:
    -------------------------------------------------------------------------
    *Does not include RRSP tax deductions.
    

The Fund's returns are especially attractive when compared to the most popular savings products. For example, according to Globefund, over the last five years the average annual compounded return of Canadian neutral balanced funds was 4.0%, while a 5-year non-redeemable guaranteed investment certificate (GIC) currently yields about 2% per annum.

Shares still available

Anyone can purchase Fund shares, either through payroll deduction, pre-authorized withdrawal or a lump-sum payment. Shares are still available for the current fiscal year, for which the Fund's Board of Directors has capped at $700 million, the value of shares the Fund can issue giving rise to labour-sponsored fund tax credits.

571,000 Quebecers have a stake in the CH

In addition to recent investments in GLV, Groupe Bermex, Premier Tech, Bombardier, Smardt Chiller Group and Medicago, the Fund also participated in a transaction involving the Montréal Canadiens Hockey Club, the Bell Centre and the Gillett Entertainment Group. Not only did this deal bring the Club's ownership back to Québec and give the Fund's 571,000 shareholders a stake in the team, it also helped support economic spin-offs associated with 1,200 direct and indirect jobs. The Fund is confident that this will be a profitable investment for its shareholders.

Well-deserved recognition

The Fund continues to stand out as an economic player and financial partner. As such, in September, Canada's Venture Capital & Private Equity Association (CVCA) awarded the Fund and its co-investors the 2009 Deal of the Year Award (venture capital category) for their investment in Virochem Pharma. As well, Red Herring, a respected magazine published in California, ranked the Fund among the 100 top venture capital funds in the world.

Highlights

    
    -------------------------------------------------------------------------
                                       November 30, 2009       May 31, 2009
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                          (in dollars)         (in dollars)
    -------------------------------------------------------------------------
    Net value per share                       23.51                21.78
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
                                               (in billion of dollars)
    -------------------------------------------------------------------------
    Net assets                                  7.0                  6.4
    -------------------------------------------------------------------------

                                                      November 30

    -------------------------------------------------------------------------
                                               2009                 2008
    -------------------------------------------------------------------------
                                                       (6 months)
                                                (in millions of dollars)
    -------------------------------------------------------------------------
    Revenues                                    111                  126
    -------------------------------------------------------------------------
    Net earnings (net loss)                     515               (1,116)
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
    Six-month return                            8.0%               (15.3%)
    -------------------------------------------------------------------------
    

SOURCE Fonds de solidarité FTQ

For further information: For further information: The telephone number provided below is for the exclusive use of journalists and other media representatives: Josée Lagacé, Senior Advisor, Press Relations and Communications, Solidarity Fund QFL, (514) 850-4835


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