GMP Capital Trust reports results for second quarter 2007



    Record quarterly revenue in Capital Markets;
    Profitability achieved in Wealth Management

    TORONTO, Aug. 9 /CNW/ - GMP Capital Trust (the Fund) today released its
financial results for the three and six months ended June 30, 2007. Revenue
for the second quarter of 2007 was $127.4 million, representing an increase of
61.6% over the same period last year while revenue for the first half of 2007
increased 37.8% over the same period last year to $242.0 million. This
quarter's performance represents the highest quarterly revenue figure reported
by the Fund.
    The Capital Markets segment generated revenue of $108.0 million for the
second quarter of 2007, a new quarterly record, and $206.5 million for the
first half of 2007. The Wealth Management segment reported $14.1 million in
revenue this quarter and $25.0 million for the first half of 2007. The Private
Capital Management segment generated $6.2 million in second quarter revenue
and $12.3 million for the first half of 2007. The Fund's net income was
$38.6 million and $83.0 million for the second quarter and first half of 2007
respectively, despite a $2.9 million non-cash future tax expense recognized
this quarter in response to new income trust tax legislation. The Fund
generated an annualized return on unitholders' equity (ROE) of 51.9% for the
second quarter and 57.8% for the first half of 2007.

    
    Second Quarter 2007 Highlights

    -   Revenue of $127.4 million compared with $78.8 million in Q2/06
    -   Pre-tax income of $45.5 million compared with $29.2 million in Q2/06
    -   Net income of $38.6 million ($0.61 per basic unit) compared with
        $27.7 million ($0.48 per basic unit) in Q2/06
    -   Annualized ROE of 51.9% compared with 53.6% in Q2/06
    -   Distributable cash of $47.3 million ($0.75 per basic unit) compared
        with $28.7 million ($0.50 per basic unit) in Q2/06
    -   Payout ratio of 49.8% compared with 71.3% in Q2/06


    Year-to-Date 2007 Highlights

    -   Revenue of $242.0 million compared with $175.7 million in first
        half 2006
    -   Pre-tax income of $94.0 million compared with $71.8 million in first
        half 2006
    -   Net income of $83.0 million ($1.32 per basic unit) compared with
        $66.3 million ($1.15 per basic unit) in first half 2006
    -   Annualized ROE of 57.8% compared with 66.9% in first half 2006
    -   Distributable cash of $97.2 million ($1.55 per basic unit) compared
        with $67.9 million ($1.18 per basic unit) in first half 2006
    -   Payout ratio of 48.4% compared with 56.6% in first half 2006
    

    "GMP continues to demonstrate its ability to create strong returns for
our unitholders. Our results for the second quarter and first half of the year
provide clear evidence of the strength of our business model," said Kevin
Sullivan, Chief Executive Officer. "The contributions made by our talented
professionals, combined with favourable market conditions, led to the
generation of record revenue for GMP, and very strong performance across all
of our business segments. We are pleased with our results and remain committed
to the continued growth and development of our business."

    SECOND QUARTER 2007 BUSINESS SEGMENT HIGHLIGHTS

    
    Capital Markets

    -   Revenue of $108.0 million, up 48.9% from $72.6 million in Q2/06,
        which set a new quarterly record
    -   Expenses of $60.1 million, up 45.3% from $41.3 million in Q2/06
    -   Income before income taxes of $48.0 million, up 53.6% from
        $31.2 million in Q2/06
    -   Record investment banking revenue of $63.4 million, up 39.9% from
        $45.3 million in Q2/06, driven by a record $51.2 million in
        underwriting revenue
    -   Ranked No. 1 in the value of common equity underwriting having led or
        co-led 26 transactions valued at over $1.4 billion(1), including New
        Gold Inc., Pacific Stratus Energy Ltd., Eastern Platinum Limited,
        Sprott Molybdenum Participation Corporation and Red Back Mining Inc.
    -   GMP Europe and GMP Securities partnered on 10 equity underwriting
        transactions placed with European institutions
    -   Merger and acquisition advisory mandates announced in Canada
        involving GMP Securities valued at approximately US$6.5 billion(2),
        up $3.0 billion from Q2/06

    -------------------------------------
    (1) Source: FPInfomart as at July 25, 2007. Data is ranked by value of
        transactions and is presented on a "Full Credit to Book" basis
        whereby the entire transaction value is allocated to the bookrunner.
        For these purposes, "equity" includes the following: private
        placements with a $1.5 million minimum; special warrants,
        irrespective of whether the issuer has received the total proceeds;
        common shares and units; convertible debt; and exercise of over-
        allotment option of original transaction launched during the period
        reported on. For these purposes, "equity" excludes the following:
        preferred shares, preferred hybrids, income trusts, rights offerings,
        and other derivatives.
    (2) Source: Bloomberg as at July 25, 2007. Data contains announced
        transactions based in Canada in the specified period; includes target
        or seller and acquirer.

    -   Commission income from sales and trading activity reached a new
        quarterly record of $36.6 million, up 42.4% from $25.7 million in
        Q2/06
    -   Ranked No. 1 in block trading volume on the Toronto Stock Exchange
        with a market share of 12.7%(3)


    Wealth Management

    -   Revenue of $14.1 million, up 98.8% from $7.1 million in Q2/06, with
        new records achieved in both commission and fee-based revenues
    -   Expenses of $13.3 million, up 67.1% from $7.9 million in Q2/06
    -   Income before income taxes of $0.9 million compared with a loss of
        $0.8 million in Q2/06
    -   Assets under administration (AUA) of $4.1 billion, up 73.1% from
        $2.4 billion in Q2/06; investment management and fee-based products
        have grown to approximately one-quarter of total AUA
    -   GMP Private Client expanded its operations with the establishment of
        a branch office in Montreal


    Private Capital Management

    -   Revenue of $6.2 million
    -   Expenses of $4.0 million
    -   Income before income taxes of $2.2 million
    -   EdgeStone, through Equity Fund III, continued its active investment
        participation in the Canadian private equity sector:

        -  purchased the assets of cheque-maker and direct marketer Custom
           Direct Income Fund in a transaction valued at approximately
           $199 million in cash and approximately US$37.5 million in assumed
           debt(4);
        -  purchased all of the outstanding units of Stephenson's Rental
           Services Income Fund in a transaction valued at approximately
           $139 million in cash(5)

    -------------------------------------
    (3) Source: CanadaEquity.com as at July 25, 2007.
    (4) Closed June 14, 2007.
    (5) Closed July 17, 2007

    
    DISTRIBUTION POLICY AND DISTRIBUTIONS

    The Fund intends to continue to make regular monthly distributions of
$0.125 per Fund unit ($1.50 per annum) to holders of Fund units of record on
the last business day of each month. It is expected that Griffiths McBurney
L.P. will make the same monthly distributions to holders of its Exchangeable
L.P. units. Distributions are expected to be payable on or about the 20th of
each month following declaration.

    Q2 CONFERENCE CALL

    Management will host a conference call and live audio webcast today at
11:00 a.m. (ET) to discuss the Fund's second quarter ended June 30, 2007. The
call may be accessed by dialing 416-644-3417 or 1-800-732-6179. The webcast
will be accessible at gmpcapitaltrust.com and will be archived on the site. A
replay of the conference call will be available from Thursday, August 9, at
1:00 p.m. (ET) to Thursday, August 16, at 11:59 p.m. (ET). The dial-in number
for the replay is 416-640-1917 or 1-877-289-8525; access code 21240548followed
by the number sign.

    OTHER INFORMATION

    This press release should be read in conjunction with the accompanying
management's discussion and analysis and unaudited interim consolidated
financial statements for the three and six months ended June 30, 2007, which
are available on the Fund's website at gmpcapitaltrust.com and on SEDAR at
sedar.com.

    Meaning of Certain References

    In this press release all references to "we", "our", "us", "GMP" and
"Fund Group" refer to the Fund, together with its consolidated operations. All
references to "Capital Markets" refer to the investment banking, sales and
trading and research segment of the Fund Group, which includes the following
main operating subsidiaries: GMP Securities L.P. (GMP Securities), Griffiths
McBurney Corp., and GMP Securities Europe LLP (GMP Europe). All references to
"Wealth Management" refer to the full-service investment brokerage services of
the Fund Group offered by GMP Private Client L.P. (GMP Private Client). All
references to "Private Capital Management" refer to the capital, strategic
direction, business and financial advice provided to mid-market and early
stage companies by EdgeStone Capital Partners, L.P. (EdgeStone). All
references to "Fund units" refer to trust units of the Fund. All references to
"Exchangeable L.P. units" refer to Class B limited partner units of Griffiths
McBurney L.P. All references to "units" refer collectively to the Fund units
and the Exchangeable L.P. units.

    ABOUT GMP CAPITAL TRUST

    GMP Capital Trust carries on business through the following principal
entities: GMP Securities L.P., Griffiths McBurney Corp., GMP Securities Europe
LLP, GMP Private Client L.P. and EdgeStone Capital Partners, L.P. GMP
Securities L.P. is a leading independent Canadian investment dealer focused on
investment banking and institutional equities for corporate clients and
institutional investors. GMP Securities L.P. can be found on the web at
gmpsecurities.com. Griffiths McBurney Corp. services institutional clients in
the United States while GMP Securities Europe LLP provides investment banking
and institutional equity services to clients located in Europe. GMP Private
Client L.P. is a full-service investment firm focused on high-net-worth
private investors that provides wealth preservation, income and growth
strategies delivered by seasoned investment advisors. GMP Private Client L.P.
can be found on the web at gmpprivateclient.com. EdgeStone Capital Partners,
L.P. is one of Canada's leading private equity firms, providing capital,
strategic direction and business and financial advice to help promising
mid-market and early stage companies achieve their full potential. EdgeStone
Capital Partners, L.P. can be found on the web at edgestone.com. GMP Capital
Trust is listed on the Toronto Stock Exchange under the symbol GMP.UN. The
website is gmpcapitaltrust.com. GMP Capital Trust has offices in Toronto,
Calgary, Montreal, Vancouver, Geneva and London.

    Forward-Looking Statements

    This press release may contain "forward-looking statements" (as defined
under applicable securities laws) concerning anticipated future events,
results, circumstances, performance or expectations that are not historical
facts but instead represent our beliefs, expectations, estimates and
projections regarding future events, many of which, by their nature, are
inherently uncertain and beyond our control. These statements are not
guarantees of future performance and are subject to numerous risks and
uncertainties, including those described in the Fund's regulatory filings,
which are available on the Fund's website at gmpcapitaltrust.com and on SEDAR
at sedar.com. The Fund Group's primary business activities, by their nature,
are both competitive and subject to various risks. These risks include market,
credit, liquidity, operational and regulatory risks and other risk factors
including, without limitation, variations in the value of securities, the
volatility and liquidity of equity trading markets, the volume of new
financings and mergers and acquisitions, competition in the marketplace for
suitable investments, sustainability of fees, nature and type of portfolio
company investments, ability to realize carried interest entitlements and
dependence on key personnel. Other factors, such as general economic
conditions also may have an impact on the Fund Group's results of operations.
Many of these risks and uncertainties can affect our actual results and could
cause our actual results to differ materially from those expressed or implied
in any forward-looking statement made by us or on our behalf. Except as
required by applicable law, we undertake no obligation to publicly update or
revise any forward-looking statement, whether as a result of new information,
future events or otherwise.

    Non-GAAP Measures

    Certain financial terms included in this press release (e.g.,
"distributable cash" and "payout ratio") are not recognized measures under
Canadian generally accepted accounting principles (GAAP) and do not have any
standardized meanings prescribed by GAAP. Therefore, readers are cautioned
that these measures may not be comparable to similar measures presented by
other issuers. For a more comprehensive discussion on the Fund's use of
non-GAAP measures, please see the "Presentation of Financial Information and
Non-GAAP Measures" section of the Fund's management's discussion and analysis
for the year ended December 31, 2006 which is available on the Fund's website
at gmpcapitaltrust.com and on SEDAR at sedar.com.

    
    GMP Capital Trust

                     Management's Discussion and Analysis
               for the three and six months ended June 30, 2007
    

    Management's Discussion and Analysis

    -------------------------------------------------------------------------
    About This Management's Discussion and Analysis

    This management's discussion and analysis ("MD&A") relates to the second
quarter ended June 30, 2007, which reflects the three-month period from
April 1, 2007 to June 30, 2007 ("second quarter 2007"), and the first six
months of fiscal 2007 ("first half 2007"). Comparative figures provided in
this MD&A relate to the three and six months ended June 30, 2006 ("second
quarter 2006" and "first half 2006", respectively).
    Unless otherwise stated herein, this MD&A is current as at August 8,
2007. All amounts are in Canadian dollars and are based on financial
statements prepared in accordance with Canadian generally accepted accounting
principles ("GAAP"), unless otherwise specified herein. This MD&A should be
read in conjunction with the unaudited interim consolidated financial
statements of GMP Capital Trust (the "Fund") as at and for the three months
ended June 30, 2007 ("Second Quarter Financial Statements"), the Fund's
management's discussion and analysis for fiscal 2006 ("2006 Annual MD&A") and
the Fund's audited annual consolidated financial statements for the year ended
December 31, 2006 ("2006 Annual Financial Statements"), which can be accessed
on the Fund's website at gmpcapitaltrust.com and on the SEDAR website at
sedar.com.
    All references to "Capital Markets" refer to the investment banking,
equity research, and sales and trading capabilities of the Fund Group, which
are provided by the following main operating subsidiaries: GMP Securities,
Griffiths McBurney Corp. and GMP Europe. All references to "Wealth Management"
refer to the full-service investment brokerage services of the Fund Group,
which are provided by GMP Private Client. All references to "Private Capital
Management" refer to the capital, strategic direction, business and financial
advice provided to mid-market and early stage companies by EdgeStone. All
references to "Corporate" include inter-segment eliminations and
enterprise-wide amounts not specifically allocated to the business segments.
Capitalized terms not otherwise defined in this MD&A have the meaning ascribed
to such terms on page 2 of the 2006 Annual MD&A.

    -------------------------------------------------------------------------
    Presentation of Financial Information and Non-GAAP Measures

    Financial results, including related historical comparatives, contained
in this MD&A have been prepared using the continuity of interests method of
accounting. Accordingly, the financial results from December 1, 2005 to
June 30, 2007 are those of the Fund and results from August 1, 2005 to
November 30, 2005 are those of the Company. The acquisition of EdgeStone has
been accounted for under the purchase method and the results of its operations
have been included in the Fund's financial statements since the acquisition
date of July 4, 2006.
    Because of the differences in accounting between the Fund and the
Company, we have presented certain non-GAAP measures (including distributable
cash), in addition to the financial statements of the Fund, to assist in
comparing the historical financial performance of the Company to the Fund's
results. Such pro forma information is intended to reflect the financial
results of the Company as if it had carried on business as an income trust.
    Non-GAAP earnings measures do not have any standard meaning prescribed by
GAAP and are therefore unlikely to be comparable to similar measures presented
by other issuers. Non-GAAP earnings measures should not be considered as
alternatives to net income or comparable metrics determined in accordance with
GAAP as indicators of the Fund's performance, liquidity, cash flows and
profitability. In addition, the Fund Group uses non-GAAP measures to assess
its financial performance. Investors may find these non-GAAP financial
measures useful in analyzing financial performance. For more information on
our non-GAAP measures, see "Presentation of Financial Information and Non-GAAP
Measures" in the 2006 Annual MD&A.

    -------------------------------------------------------------------------
    Forward-Looking Statements

    This document contains "forward-looking statements" (as defined under
applicable securities laws) concerning anticipated future events, results,
circumstances, performance or expectations that are not historical facts but
instead represent management's beliefs, expectations, estimates and
projections regarding future events, many of which, by their nature, are
inherently uncertain and beyond our control. These statements are not
guarantees of future performance and are subject to numerous risks and
uncertainties, including those described in this document. The Fund Group's
primary business activities are both competitive and subject to various risks.
These risks include market, credit, liquidity, operational and regulatory
risks and other risk factors including, without limitation, variations in the
market value of securities, the volatility and liquidity of equity trading
markets, the volume of new financings and mergers and acquisitions ("M&A"),
competition in the marketplace for suitable investments, sustainability of
fees, nature and type of portfolio company investments, ability to realize
carried interest entitlements and dependence on key personnel. Other factors,
such as general economic conditions also may have an affect on the Fund
Group's results of operations. Many of these risks and uncertainties can
affect our actual results and could cause our actual results to differ
materially from those expressed or implied in any forward-looking statement
made by us or on our behalf. Except as required by applicable law, management
and the board of trustees of the Fund undertake no obligation to publicly
update or revise any forward-looking statement, whether as a result of new
information, future events or otherwise. For a description of risks that could
cause our actual results to materially differ from our current expectations,
please see the "Risk Management" section in the 2006 Annual MD&A and
"Description of the Business - Risk Management" and "Risk Factors" in the
Fund's annual information form dated February 28, 2007.

    -------------------------------------------------------------------------
    Business Environment and Market Outlook

    The Fund Group's business performance is closely related to the
performance of the Canadian capital markets, which are, by their nature,
cyclical and affected by political, economic and other factors and conditions
in Canada and the rest of the world.
    Concerns expressed earlier in the year over indications of significant
slowdowns in the U.S. and Canadian economies abated during the second quarter.
Strong overall global economic growth outside the U.S. helped to offset
weakness in certain areas of the U.S. economy, such as the housing market, and
contributed to the financial performance of U.S. corporations with significant
overseas operations. The Canadian economy enjoyed a positive level of
expansion in the first half of 2007. Several economic observers concluded that
primary indicators in both Canada and the U.S. remain, overall, positive in
the near term.
    On May 29, 2007, the Bank of Canada had signaled a likely increase in
interest rates indicating that growth in the Canadian economy and inflation
were running ahead of its expectations. This signal by the Bank of Canada,
together with other supporting factors, including a weaker U.S. dollar, stable
commodity prices and steady capital inflows primarily related to continuing
M&A activity, prompted a rise in the value of the Canadian dollar. In early
June, the Canadian dollar rose above US$0.94 for the first time in nearly 30
years. On July 10, 2007, the Bank of Canada announced an increase of its
overnight lending rate to 4.5% in an effort to stabilize the rate of
inflation.
    Global demand for commodities continued to be brisk during the second
quarter, primarily driven by strong economic growth in China, tight
inventories and a weaker U.S. dollar. This level of global demand ensured that
commodity prices, which in some cases had rallied to alltime highs in the
first quarter of 2007, remained strong throughout the second quarter,
notwithstanding declines experienced in the prices for metals and minerals at
the end of June. In the energy sector, global oil prices strengthened relative
to the first quarter, due to continued tight supply and demand fundamentals,
geopolitical tensions in key supply regions and refining capacity issues. Oil
prices have maintained this strength heading into the second half of 2007.
Natural gas prices started strongly in the second quarter due to improved
fundamentals at the end of winter, but weakened toward the end of the quarter
as storage levels continued to increase ahead of expectations. In the absence
of a change in the current supply and demand fundamentals, prices could remain
at current levels throughout the third quarter.
    The strong M&A activity experienced in the first quarter of 2007
continued into the second quarter. According to financial Post Crosbie:
Mergers & Acquisitions in Canada summary data, 510 M&A transactions valued at
$201.6 billion were announced in Canada in second quarter 2007, compared with
the 537 announced in second quarter 2006 valued at $69.2 billion(1). In the
mining sector, recent stock price performance has been dominated by M&A
activity as the pace of transactions picked up in the mid-tier and large
capitalization mining stocks. The M&A activity is also causing valuations to
expand in part due to the scarcity of investment opportunities in the sector.
    Global capital markets continued to exhibit strength and positive
activity throughout the second quarter, and the Canadian equity markets were
no exception. Total equity trading volume on the Toronto Stock Exchange
("TSX") in second quarter 2007 increased 19.85% over the same period in
2006 (2), while the benchmark S&P/TSX Composite Index closed the quarter at
13,906.57, representing an increase of 19.75% over its closing value at the
end of the second quarter 2006.
    Moving into the third quarter, the capital markets are seeing typical
seasonal slowing combined with volatility that started in July, and may
continue for the balance of the quarter. Many sectors, including financial
services, have experienced a market downturn that has been affected by U.S.
sub-prime credit concerns flowing into the Canadian market. Market instability
overall has been attributed to investor concerns over rising inflation and
central bank rate tightening, however we note that the global market and
Canadian industry fundamentals remain strong, providing support for
commodities. Some industry reports suggest that rising crude prices are likely
to be the catalyst for renewed M&A activity in Canada's energy patch,
particularly among those companies with extensive oil sands exposure.

    
    -------------------------------------------------------------------------
    Second Quarter and Year-to-Date Highlights


    Selected financial information

    ($000, except
     per unit,    Three months ended     Change   Six months ended    Change
     headcount               June 30   increase/           June 30  increase/
     and % amounts)  2007       2006  (decrease)   2007       2006 (decrease)
    ------------------------ -------- ---------- --------- -------- ---------
    Revenue         127,387     78,830   61.6%    242,043    175,699   37.8%
    Expenses         82,431     49,600   66.2%    148,427    103,851   42.9%
    Income before
     income taxes    45,531     29,200   55.9%     93,988     71,811   30.9%
    Net income       38,566     27,650   39.5%     83,035     66,258   25.3%
    Basic earnings
     per unit         $0.61      $0.48   27.1%      $1.32      $1.15   14.8%
    Diluted earnings
     per unit         $0.60      $0.46   30.4%      $1.30      $1.11   17.1%
    Cash
     distributions
     declared per
     unit            $0.375    $0.3542    5.9%      $0.75    $0.6668   12.5%
    Distributable
     cash per basic
     unit(a),(c)      $0.75      $0.50   50.0%      $1.55      $1.18   31.4%
    Payout
     ratio(b),(c)     49.8%      71.3%  (21.5%)     48.4%      56.6%   (8.2%)
    Return on
     equity(c)        51.9%      53.6%   (1.7%)     57.8%      66.9%   (9.1%)
    Total assets  1,291,588    890,517   45.0%  1,291,588    890,517   45.0%
    Total
     headcount(d)       384        270   42.2%        384        270   42.2%
    ------------------------ ---------- ------- ---------- ---------- -------
    ------------------------ ---------- ------- ---------- ---------- -------

    (a) Distributable cash per basic unit is determined by dividing
        distributable cash by the weighted-average number of basic units
        outstanding for the applicable period, on a basis consistent with the
        determination of net income per basic unit.
    (b) The payout ratio is determined by dividing aggregate cash
        distributions declared by distributable cash.
    (c) Distributable cash, payout ratio and return on equity are considered
        to be non-GAAP measures. These measures do not have any standardized
        meaning prescribed by GAAP and are therefore unlikely to be
        comparable to similar measures presented by other issuers. This data
        should be read in conjunction with the "Presentation of Financial
        Information and Non-GAAP Measures" section in this MD&A. Please see
        the "Distributable Cash and Distributions" section in this MD&A for a
        reconciliation from distributable cash to cash provided by (used in)
        operating activities.
    (d) Total headcount includes employees and partners of the Fund Group.


    ----------------------------------------
    1.  Source: FPinfomart as at July 25, 2007.
    2.  Source: TSX eReview reports: May 2006, June 2006, May 2007,
        June 2007.

    
    -------------------------------------------------------------------------
    Second Quarter 2007 vs. Second Quarter 2006

    Revenue for the second quarter 2007 reached $127.4 million, the highest
quarterly revenues reported by the Fund representing an increase of
$48.6 million (or 61.6%) over second quarter 2006. These results reflect a
continued focus on our strategy for diversification and profitable growth,
executed with strong operating discipline in a favourable global capital
market environment. This quarter saw record performances from the Capital
Markets and Wealth Management segments and the inclusion of revenue generated
by the Private Capital Management segment for which no comparable period
exists. Revenue from the Capital Markets segment rose by $35.5 million (or
48.9%) this quarter over the same period in 2006 while the Wealth Management
segment generated an increase in revenue of $7.0 million (or 98.8%) over
second quarter 2006 and the Private Capital Management segment contributed
$6.2 million to the Fund Group's revenues in the period.
    Investment banking revenues reached a record $63.4 million this quarter,
up $18.1 million compared with second quarter 2006, driven by strong growth in
equity underwriting revenues in the quarter. Commission revenues increased
$15.6 million to $45.0 million in second quarter 2007 with the Capital Markets
and Wealth Management segments both experiencing record commission revenue in
the period. Investment management and fee revenue increased $8.3 million to
$9.7 million this quarter reflecting the addition of management fees generated
by the Private Capital Management segment and record fee-based revenue in the
Wealth Management segment driven by higher asset values and continued net
inflows into fee-based products. Revenue from principal activities was
$4.5 million in second quarter 2007 primarily reflecting unrealized gains on
asset values recorded as a result of favourable market conditions this
quarter. Interest revenue grew $0.6 million mainly as a result of higher
client-related activity. Other income reported a loss of $0.6 million in
second quarter 2007 reflecting primarily foreign exchange translation losses
recorded on certain investments due to the strengthening of the Canadian
dollar during the quarter.
    Expenses in second quarter 2007 were $82.4 million, representing an
increase of $32.8 million (or 66.2%) over second quarter 2006. Compensation
and benefits expenses were $62.4 million this quarter, an increase of
$23.7 million over second quarter 2006, largely due to higher variable
incentive-based compensation expenses which rose $19.0 million in second
quarter 2007 as a result of higher revenue generation in the Capital Markets
and Wealth Management segments. Fixed salaries and benefits costs rose $3.9
million compared to second quarter 2006 as a result of the inclusion of the
results of the Private Capital Management segment, $1.0 million in
restructuring charges recognized in the Capital Markets segment this quarter
and increased staffing levels in the Wealth Management and Capital Markets
segments.
    Non-compensation expenses, which include selling, general and
administrative, interest and amortization expenses, were $20.0 million in
second quarter 2007, an increase of $9.2 million over second quarter 2006.
Selling, general and administrative expenses rose $3.8 million over second
quarter 2006 as a result of higher levels of business activity and expansion
in the Capital Markets segment, continued organic growth in the Wealth
Management segment and the inclusion of $1.2 million in expenses relating to
the results of the Private Capital Management segment. Interest expense
increased $1.7 million over second quarter 2006 primarily due to financing
costs recorded in the Corporate segment and higher levels of client-related
activity experienced in the Wealth Management segment. Amortization expenses
in second quarter 2007 were $4.2 million, representing an increase of
$3.7 million over second quarter 2006 mainly due to the amortization of
intangible assets acquired in connection with the EdgeStone acquisition.
    Income tax expense as a percentage of income before income taxes was
15.3% in second quarter 2007 compared with 5.3% in second quarter 2006. This
effective tax rate reflects a $2.9 million non-cash increase in future income
tax liabilities (and expense) recognized this quarter upon the enactment of
new tax legislation by the Government of Canada in June 2007. This new
legislation imposed additional income taxes upon publicly traded income
trusts, including the Fund. For further details, see the "Changes in
Accounting Policies or Estimates" section in this MD&A. The increase in the
effective tax rate also reflects higher levels of expenses incurred in
non-taxable entities during second quarter 2007, for which many of these
expenses have no comparable amount reported in second quarter 2006. These
amounts are reported in the Corporate segment as enterprise-wide expenses and
include the amortization of intangible assets acquired in connection with the
EdgeStone acquisition and other expenses. In addition, second quarter 2006
included a favourable tax adjustment of $0.4 million recorded as a result of
our fiscal 2005 corporate tax filings completed during the quarter.
    Net income increased to $38.6 million ($0.61 per basic unit) in second
quarter 2007, compared with $27.7 million ($0.48 per basic unit) in second
quarter 2006. The annualized return on equity ("ROE") was 51.9% in second
quarter 2007 compared with annualized ROE of 53.6% in second quarter 2006.
Distributable cash was $47.3 million ($0.75 per basic unit) in second quarter
2007 compared with $28.7 million ($0.50 per basic unit) in second quarter
2006.

    -------------------------------------------------------------------------
    First Half 2007 vs. First Half 2006

    Revenue for the first half 2007 reached $242.0 million, an increase of
$66.3 million (or 37.8%) over first half 2006. These results largely reflected
continued strong momentum across the Capital Markets and Wealth Management
segments and the inclusion of results from the Private Capital Management
segment. The Capital Markets segment contributed $206.5 million in revenue, an
increase of $42.8 million (or 26.0%) driven by contributions from all major
business lines, including record commission revenues, strong growth in
investment banking revenue resulting from higher equity underwriting revenues,
and robust results in principal activities as a result of one-time gains
recorded in first quarter 2007. The Wealth Management segment contributed
revenue of $25.0 million, an increase of $11.2 million (or 80.6%) compared to
first half 2006 due to the continued successful execution of this segment's
growth strategy. The Private Capital Management segment contributed revenues
of $12.3 million for first half 2007, largely in the form of fee-based
revenues generated by EdgeStone in the management of the EdgeStone Funds.
    Expenses for first half 2007 reached $148.4 million, an increase of
$44.6 million (or 42.9%) over first half 2006. Compensation and benefits
expenses rose $26.8 million (or 32.1%) driven primarily by increased variable
incentive-based compensation expense as a result of higher revenue generation,
and higher fixed salaries and benefits costs, which resulted from the
inclusion of the Private Capital Management segment and higher staffing levels
particularly in the Wealth Management segment. Non-compensation expenses,
which include amortization expenses, selling general and administrative
expenses and interest expense, rose $17.8 million (or 86.5%) over first half
2006 reflecting increases in every major expense category. These expenses have
increased in support of higher levels of business activity and expansion in
the Capital Markets segment, the inclusion of the Private Capital Management
segment and the operational growth experienced by the Wealth Management
segment. First half 2007 includes $10.4 million in non-compensation expenses
for which no comparables exist for first half 2006 and include the following:
$6.4 million in amortization expense relating to the intangible assets
acquired in connection with the EdgeStone acquisition; $2.7 million in
expenses incurred by the Private Capital Management segment; and, $1.3 million
in expenses relating to GMP Europe.
    Net income increased to $83.0 million ($1.32 per basic unit) in first
half 2007, compared with $66.3 million ($1.15 per basic unit) in first half
2006. Annualized ROE for this period was 57.8% compared with 66.9% in first
half 2006, reflecting a 45.2% increase in average unitholders' equity to
$287.5 million in first half 2007 over the same period last year primarily as
a result of the EdgeStone acquisition in July 2006. Distributable cash was
$97.2 million ($1.55 per basic unit) in first half 2007 compared with
$67.9 million ($1.18 per basic unit) in first half 2006.

    -------------------------------------------------------------------------
    Results of Business Segments

    For second quarter 2007, management has revised its presentation of the
segment and consolidated results of the Fund. This change, which is described
further in Note 20 to the Second Quarter Financial Statements, has no
financial impact on the consolidated net income of the Fund.
    For further details relating to segmented information, see Note 28 to the
Fund's 2006 Annual Financial Statements and the "Overview and Strategy"
section in the 2006 Annual MD&A.

    -------------------------------------------------------------------------
    Capital Markets

    The following table presents a comparison of the results of the Capital
Markets segment for the three and six months ended June 30, 2007, with the
three and six months ended June 30, 2006.

    
    ($000,
     unless       Three months ended     Change   Six months ended    Change
     otherwise               June 30   increase/           June 30  increase/
     indicated)      2007       2006  (decrease)   2007       2006 (decrease)
    ------------------------ -------- ---------- --------- -------- ---------
    Revenue         108,034     72,567   48.9%    206,474    163,818   26.0%
      Investment
       banking       63,445     45,349   39.9%    108,717    100,156    8.5%
      Commission
       income        36,626     25,715   42.4%     68,423     52,802   29.6%
      Principal
       activities     4,495     (1,912) 335.1%     21,941      3,523  522.8%
      Interest
       income         3,011      3,293   (8.6%)     6,072      6,712   (9.5%)
      Other income      457        122  274.6%      1,321        625  111.4%
    Expenses
      Employee
       compensation
       and benefits  50,453     33,948   48.6%     87,956     74,212   18.5%
      Selling,
       general and
       administra-
       tive           8,618      6,541   31.8%     16,235     12,485   30.0%
      Interest          566        683  (17.1%)     1,198      1,229   (2.5%)
      Amortization      438        163  168.7%        909        326  178.8%
    ------------------------ ---------- ------- ---------- ---------- -------
    Income before
     income taxes
     and non-
     controlling
     interest        47,959     31,232   53.6%    100,176     75,566   32.6%
    Total headcount     233        205   13.7%        233        205   13.7%
    ------------------------ ---------- ------- ---------- ---------- -------
    ------------------------ ---------- ------- ---------- ---------- -------
    

    Second Quarter 2007 vs. Second Quarter 2006

    Capital Markets segment revenue rose to $108.0 million for second quarter
2007, an increase of $35.5 million (or 48.9%) over second quarter 2006,
reflecting record performances in investment banking and sales and trading as
the Canadian capital markets witnessed record levels of common equity
underwriting activity, high market liquidity and continued robust
customer-driven trading volume.

    The following table presents a comparison of investment banking revenue
by sector for the three and six months ended June 30, 2007, with the three and
six months ended June 30, 2006.

    
                  Three months ended     Change   Six months ended    Change
                             June 30   increase/           June 30  increase/
    ($000,           2007       2006  (decrease)   2007       2006 (decrease)
    ------------------------ -------- ---------- --------- -------- ---------
    Mining           37,347     23,135   61.4%     57,138     53,982    5.8%
    Oil and gas      15,998     11,000   45.4%     22,464     25,022  (10.2%)
    Industrials
     and special
     situations       4,143      4,984  (16.9%)    16,675     13,529   23.3%
    Technology and
     healthcare       4,246      3,764   12.8%      8,565      4,663   83.7%
    Telecommunica-
     tions, cable
     and media          219        966  (77.3%)     2,005      1,447   38.6%
    Non-bank
     financial
     services         1,492      1,500   (0.5%)     1,870      1,513   23.6%
    ------------------------ ---------- ------- ---------- ---------- -------
    Total Investment
     Banking Revenue 63,445     45,349   39.9%    108,717    100,156    8.5%
    ------------------------ ---------- ------- ---------- ---------- -------
    ------------------------ ---------- ------- ---------- ---------- -------
    

    Investment banking revenue was $63.4 million in second quarter 2007, an
increase of $18.1 million (or 39.9%) compared with second quarter 2006
reflecting continued robust capital markets activity in the mining and oil and
gas sectors. Underwriting revenues reached a new record in second quarter 2007
while M&A advisory fees were strong but lower than levels achieved in second
quarter 2006.
    Investment banking revenue included $51.2 million in underwriting
revenue, an increase of $23.3 million compared with second quarter 2006. GMP
Securities ranked first among Canadian investment dealers in the dollar value
of common equity issuance in second quarter 2007 (up from second place in
second quarter 2006) having led or co-led 26 underwriting transactions valued
at approximately $1.4 billion compared with approximately $681.0 million and
21 transactions in second quarter 2006(3). GMP Securities continued to
increase its overall participation in common equity underwriting activity,
having been involved in 63 transactions in second quarter 2007 compared to 55
in the same period last year. In addition, during the second quarter 2007, GMP
Securities partnered with GMP Europe on 10 equity underwriting transactions,
with GMP Europe providing significant placement into the European market on
select deals.
    Investment banking revenue included $12.2 million in advisory fees,
representing a decline of $5.2 million compared with second quarter 2006.
Although advisory fees recorded on completed transactions were lower this
quarter, the investment banking pipeline remains strong, with GMP Securities
ranked fifth among financial advisors in the number of M&A transactions
announced in Canada during second quarter 2007 (unchanged from second quarter
2006), with 13 advisory mandates valued at approximately US$6.5 billion,
compared with 10 transactions valued at US$3.5 billion in the same period last
year(4).
    Commission income generated through sales and trading activity
contributed a record $36.6 million to revenue in second quarter 2007, an
increase of $10.9 million compared with second quarter 2006. These strong
results were driven by higher overall trading volumes on the TSX, increased
trading volume by GMP Securities and lower facilitation losses, which were
17.2% of gross commissions generated, compared with 19.0% in second quarter
2006. GMP Securities maintained its number one ranking in block trading volume
on the TSX (unchanged from second quarter 2006) with a market share of 12.7%,
having traded 2.6 billion shares in second quarter 2007, compared with
2.0 billion in the same period last year(5).
    Revenue generated from principal activities was $4.5 million in second
quarter 2007 compared with a loss of $1.9 million reported for second quarter
2006. The results in second quarter 2007 were driven primarily by unrealized
gains recorded on broker warrants held.

    The following table presents a comparison of employee compensation and
benefits expenses for the three and six months ended June 30, 2007, with the
three and six months ended June 30, 2006.

    
    ($000,
     unless       Three months ended     Change   Six months ended    Change
     otherwise               June 30   increase/           June 30  increase/
     indicated)      2007       2006  (decrease)   2007       2006 (decrease)
    ------------------------ -------- ---------- --------- -------- ---------
    Fixed salaries
     and benefits     5,182      3,496   48.2%      9,199      6,869   33.9%
    Variable
     incentive-based
     compensation    43,031     28,639   50.3%     74,010     63,634   16.3%
    Fund unit-based
     compensation     2,240      1,813   23.6%      4,747      3,709   28.0%
    ------------------------ ---------- ------- ---------- ---------- -------
    Total Employee
     Compensation
     and Benefits    50,453     33,948   48.6%     87,956     74,212   18.5%
    Ratio of Total
     Compensation
     and Benefits
     to Revenue       46.7%      46.8%   (0.1%)     42.6%      45.3%   (2.7%)
    ------------------------ ---------- ------- ---------- ---------- -------
    ------------------------ ---------- ------- ---------- ---------- -------
    

    Employee compensation and benefits expenses increased by $16.5 million
over second quarter 2006. Variable incentive-based compensation as a
percentage of revenue was 39.8% in second quarter 2007 compared with 39.5% in
second quarter 2006. Fixed salaries and benefits include $1.0 million of
employee costs incurred this quarter due to restructuring in the investment
banking group. Fixed salaries and benefits also rose as employment levels
increased 13.7% compared with second quarter 2006. Fund unit-based
compensation rose in the second quarter 2007 reflecting higher costs
associated with the executive unit loan plan and the Fund's option plan
compared with the comparable period last year. The ratio of total compensation
and benefits expenses to revenue for second quarter 2007 was 46.7% compared
with 46.8% in second quarter 2006. This ratio continues to compare favourably
with that of our peer group of independent investment dealers in Canada and
the United States.

    
    ----------------------------------------
    (3) Source: FPinfomart as at July 25, 2007. Data is ranked by value of
        completed transactions and is presented on a "Full Credit to Book"
        basis whereby the entire transaction value is allocated to the
        bookrunner. For these purposes, "equity" includes the following:
        private placements with a $1.5 million minimum; special warrants,
        irrespective of whether the issuer has received the total proceeds;
        common shares and units; convertible debt; and exercise of over-
        allotment option of original transaction launched during the period
        reported on. For these purposes, "equity" excludes the following:
        preferred shares, preferred hybrids, income trusts, rights offerings,
        and other derivatives.
    (4) Source: Bloomberg as at July 25, 2007. Data contains announced
        transactions based in Canada in the specified period; includes target
        seller and acquirer.
    (5) Source: CanadaEquity.com as at July 25, 2007.
    

    Total non-compensation expenses were $9.6 million in second quarter 2007,
an increase of $2.2 million over second quarter 2006 primarily due to the
impact of higher levels of business activity and continued geographic
expansion. Total non-compensation expenses include $0.7 million of expenses
associated with GMP Europe for which no comparable period exists in 2006.
Increased levels of business activity in investment banking and sales and
trading resulted in higher brokerage, clearing and exchange fees and higher
levels of travel and promotional expenses for GMP Securities in second quarter
2007. Higher amortization expense in second quarter 2007 compared to second
quarter 2006 reflects the cost of the new space in the Toronto office
undertaken in September 2006 to support our continued business growth.
    The Capital Markets segment recorded record income before income taxes
and non-controlling interest of $48.0 million for second quarter 2007,
representing a 53.6% increase from $31.2 million in second quarter 2006.

    First Half 2007 vs. First Half 2006

    Capital Markets segment revenue grew to $206.5 million in first half
2007, compared with $163.8 million in first half 2006. Investment banking
revenue increased $8.6 million (or 8.5%) to $108.7 million for first half
2007, and was comprised of $80.0 million in underwriting revenue and
$28.7 million in advisory fees. Underwriting revenues were $11.8 million
higher on continued strength in the mining and oil and gas sectors while
advisory fees declined $3.2 million in first half 2007 compared to the
comparable period in 2006. Record sales and trading commissions were achieved
in first half 2007 with second quarter 2007 revenues surpassing our previous
quarterly record set in first quarter 2007. Rising equity prices, strong
client-driven demand, leading market share and lower facilitation losses of
13.3% in first half 2007 (compared with 16.3% in first half 2006) have all
contributed to this record performance. Revenue from principal activities rose
$18.4 million to $21.9 million in first half 2007 and included $13.0 million
in realized gains attributable to our holding in shares of Montreal Exchange
Inc. that arose from its listing on the TSX in 2007. $12.8 million of this
one-time gain was recorded in first quarter 2007 with the residual gain
reported in second quarter 2007 on the disposition of our remaining holding in
these shares. In its second quarter of operations, GMP Europe contributed $4.8
million to revenues in first half 2007.
    Employee compensation and benefits expenses for first half 2007 were
$88.0 million compared with $74.2 million in first half 2006 reflecting the
impact of higher revenue generation. The ratio of total compensation and
benefits to revenue was 42.6% compared with 45.3% in first half 2006.
Excluding from revenues the one-time gain attributable to our holding of
shares in Montreal Exchange Inc., this ratio was 45.5% in first half 2007.
Total non-compensation expenses were $18.3 million in first half 2007,
representing an increase of $4.3 million over the same period last year in
support of higher business activity and growth. Total non-compensation
expenses include $1.3 million of expenses associated with GMP Europe for which
no comparable period exists and $0.8 million in higher occupancy and
infrastructure costs associated with the additional space and update of our
Toronto offices. The majority of the remaining increase was primarily
attributable to the impact of higher levels of business activity.
    The Capital Markets segment recorded income before income taxes and
non-controlling interest of $100.2 million in first half 2007, representing a
32.6% increase from $75.6 million for first half 2006.

    -------------------------------------------------------------------------
    Wealth Management

    The following table presents a comparison of the results of the Wealth
Management segment for the three and six months ended June 30, 2007, with the
three and six months ended June 30, 2006.

    
    ($000,
     unless       Three months ended     Change   Six months ended    Change
     otherwise               June 30   increase/           June 30  increase/
     indicated)      2007       2006  (decrease)   2007       2006 (decrease)
    ------------------------ -------- ---------- --------- -------- ---------
    Revenue          14,137      7,110   98.8%     25,002     13,844   80.6%
      Commission
       income         8,331      3,652  128.1%     14,330      7,745   85.0%
      Investment
       management
       and fee
       income         3,442      1,424  141.7%      6,171      2,287  169.8%
      Interest
       income         2,312      2,034   13.7%      4,370      3,812   14.6%
      Other income       52          -       -        131          -       -
    Expenses         13,283      7,948   67.1%     24,338     15,299   59.1%
      Employee
       compensation
       and benefits   8,427      4,252   98.2%     14,998      7,916   89.5%
      Selling,
       general and
       administra-
       tive           2,908      1,983   46.6%      5,563      3,951   40.8%
      Interest        1,494      1,313   13.8%      2,808      2,757    1.8%
      Amortization      454        400   13.5%        969        675   43.6%
    Income/(loss)
     before income
     taxes and non-
     controlling
     interest           854       (838) 201.9%        664     (1,455) 145.6%
    Total headcount     116         65   78.5%        116         65   78.5%
    Number of
     investment
     advisors            46         23  100.0%         46         23  100.0%
    Number of
     advisory teams      31         19   63.2%         31         19   63.2%
    Assets under
     administration
     ($millions)      4,088      2,361   73.1%      4,088      2,361   73.1%
    ------------------------ ---------- ------- ---------- ---------- -------
    ------------------------ ---------- ------- ---------- ---------- -------

    Second Quarter 2007 vs. Second Quarter 2006

    The Wealth Management segment reported revenue of $14.1 million in second
quarter 2007, an increase of $7.0 million over second quarter 2006. Record
commission revenues and record fee-based revenues were achieved in second
quarter 2007, with revenues up $3.3 million overall compared with the previous
record reported in first quarter 2007. This performance reflects the growing
contribution of GMP Private Client's investment advisory teams.
    The following table presents the number of investment advisory teams at
GMP Private Client.

    Office Location                                           Advisory Teams
    -------------------------------------------------------------------------
                                       At August 8,  At June 30,  At June 30,
                                              2007         2007         2006
    -------------------------------------------------------------------------
    Toronto                                     17           17           12
    Montreal                                     1            -            -
    Calgary                                      9            9            5
    Vancouver                                    5            5            2
    -------------------------------------------------------------------------
    Total                                       32           31           19
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

    Two advisory teams were added during the second quarter 2007, bringing
the total number of advisory teams in the Wealth Management segment to 31 as
at June 30, 2007.
    As of the date hereof, GMP Private Client now manages approximately
$4.1 billion of client assets in equities, fixed income securities, mutual
funds, and managed account programs. The increase in total assets under
administration includes noteworthy growth in investment management and fee
products, which at $0.9 billion, or 22.0% of total assets under administration
as at June 30, 2007, represents an increase of 112% over second quarter 2006
levels.
    In April 2007, GMP Private Client announced the launch of personal and
business wealth protection through insurance solutions. Through GMP Insurance
Inc., a wholly owned subsidiary of GMP Private Client, and GMP Insurance
Inc.'s relationship with PPI Partners, a national insurance marketing firm,
clients of GMP Private Client have access to a comprehensive and innovative
range of insurance solutions. GMP Insurance Inc. began its operations in the
third quarter 2007.
    Following completion of second quarter 2007, GMP Private Client opened an
office in Montreal. In July 2007, two senior investment advisors joined the
Montreal office to form the branch management team.

    The following table presents a comparison of the employee compensation
and benefits expenses for the Wealth Management segment for the three and
six months ended June 30, 2007, with the three and six months ended June 30,
2006

    
                  Three months ended     Change   Six months ended    Change
                             June 30   increase/           June 30  increase/
    ($000,           2007       2006  (decrease)   2007       2006 (decrease)
    ------------------------ -------- ---------- --------- -------- ---------

    Fixed salaries
     and benefits     1,331        998   33.4%      2,663      1,998   33.3%
    Variable
     incentive-
     based
     compensation     6,393      2,881  121.9%     11,078      5,205  112.8%
    Fund unit-based
     compensation       102        102       -        202        200    1.0%
    Investment
     advisor
     transition
     assistance         601        271  121.8%      1,055        513  105.7%
    ------------------------ ---------- ------- ---------- ---------- -------
    Total Employee
     Compensation
     and Benefits     8,427      4,252   98.2%     14,998      7,916   89.5%
    ------------------------ ---------- ------- ---------- ---------- -------
    ------------------------ ---------- ------- ---------- ---------- -------
    

    Expenses for the Wealth Management segment were $13.3 million in second
quarter 2007, an increase of $5.3 million (or 67.1%) compared with second
quarter 2006. These expenses include $8.4 million in compensation and benefits
expenses and $4.9 million in non-compensation related expenses.
    Non-compensation expenses for second quarter 2007 increased $1.2 million
over second quarter 2006, reflecting increased selling, general and
administrative expenses due to the expansion of the Vancouver office, growth
of the managed asset platform and an overall increase in back-office support
for the growth in business activity.
    The Wealth Management segment reported income before income taxes and
non-controlling interest of $0.9 million for second quarter 2007, compared
with a loss of $0.8 million reported for second quarter 2006.

    First Half 2007 vs. First Half 2006

    Wealth Management segment revenue was $25.0 million for first half 2007,
an increase of $11.2 million (or 80.6%) compared with the same period last
year. Commission and fee-based revenues increased $10.5 million to reach
$20.5 million for first half 2007. Expenses were $24.3 million for the period,
representing an increase of $9.0 million compared with first half 2006. The
Wealth Management segment reported income before income taxes and
non-controlling interest of $0.7 million for first half 2007, compared with a
loss of $1.5 million in first half 2006.

    -------------------------------------------------------------------------
    Private Capital Management

    The following table presents the results for the Private Capital
Management segment, which consists of the business and operations of
EdgeStone, for the second quarter and first half 2007. The results of
EdgeStone's operations have been included in the Fund's financial statements
since the acquisition date of July 4, 2006. As a result, there is no
historical comparative period presented.

    
                                        Three months ended  Six months ended
    ($000, unless otherwise indicated)       June 30, 2007     June 30, 2007
    ------------------------------------------------------- -----------------
    Revenue                                          6,183            12,285
      Investment management and fee
       income                                        6,302            12,311
      Interest income                                   64               117
      Other income                                    (183)             (143)
    Expenses                                         3,962             7,799
      Employee compensation and benefits             2,580             5,085
      Selling, general and administrative            1,171             2,424
      Interest                                         148               158
      Amortization                                      63               132
    ------------------------------------------------------- -----------------
    Income before income taxes and
     non-controlling interest                        2,221             4,486
    Total headcount                                     35                35
    ------------------------------------------------------- -----------------
    ------------------------------------------------------- -----------------
    

    Second Quarter 2007

    The Private Capital Management segment reported revenue of $6.2 million
for second quarter 2007 comprised primarily of fee-based revenues generated by
EdgeStone in the management of the EdgeStone Funds.
    EdgeStone earns management fees and/or general partner distributions
based on invested capital for those EdgeStone Funds for which the commitment
period has terminated, and based on the original committed capital for those
EdgeStone Funds for which the commitment period remains outstanding. As at
June 30, 2007, EdgeStone earns management fees based on invested capital of
$274.7 million and earns general partner distributions or management fees
based on original committed capital of $907.5 million, of which $216.1 million
has been deployed.
    EdgeStone, through Equity Fund III, has been active, entering into the
following agreements during second quarter 2007:
    On June 14, 2007, EdgeStone and Custom Direct Income Fund finalized an
agreement that saw EdgeStone acquire the operating business of Custom Direct
Income Fund ("CDIF"). In doing so, EdgeStone agreed to acquire all of the
assets of CDIF, consisting of all of the outstanding shares of Custom Direct
Canada Inc. and all of the outstanding notes of Custom Direct ULC currently
held by CDIF, a transaction valued at approximately $199 million in cash.
Additionally, EdgeStone agreed to fund the repayment of certain debt on
closing of approximately US $37.5 million.
    On June 26, 2007, EdgeStone and Movie Distribution Income Fund ("Movie
Distribution") jointly announced that an alliance between EdgeStone and an
affiliate of Goldman Sachs agreed to acquire Movie Distribution's 49% indirect
interest in Motion Picture Distribution LP. The transaction remains subject to
approval of unitholders of Motion Distribution at a unitholder meeting
expected to be held in late August 2007.
    On July 17, 2007, EdgeStone and Stephenson's Rental Services Income Fund
("Stephenson's") finalized an agreement under which EdgeStone acquired all of
the outstanding units of Stephenson's for cash, at a price of $6.875 per unit,
a transaction valued at approximately $139 million.
    Fundraising continues for EdgeStone Capital Energy Fund L.P. and during
the quarter fundraising commenced for EdgeStone Capital Venture Fund III, L.P.

    The following table presents employee compensation and benefits expenses
for the Private Capital Management segment for the three and six months ended
June 30, 2007.

    
                                        Three months ended  Six months ended
    ($000)                                   June 30, 2007     June 30, 2007
    ------------------------------------------------------- -----------------

    Fixed salaries and benefits                      1,831             3,537
    Variable incentive-based
     compensation                                      669             1,386
    Fund unit-based compensation                        80               162
    ------------------------------------------------------- -----------------
    Total Employee Compensation and
     Benefits                                        2,580             5,085
    ------------------------------------------------------- -----------------
    ------------------------------------------------------- -----------------
    

    Expenses in second quarter 2007 include $2.6 million in employee
compensation and benefits and $1.4 million in non-compensation expenses. The
Private Capital Management segment reported income before income taxes and
non-controlling interest of $2.2 million for second quarter 2007.

    First Half 2007

    Private Capital Management segment revenue was $12.3 million for first
half 2007, comprised largely of management fees. Expenses were $7.8 million
for the period. The Private Capital Management segment reported income before
income taxes and non-controlling interest of $4.5 million for first half 2007.

    -------------------------------------------------------------------------
    Corporate

    The Corporate segment includes inter-segment eliminations between
business segments and enterprise-wide items. For further details relating to
inter-segment eliminations, see the "Results of Business Segments - Corporate"
section in the 2006 Annual MD&A. Due to the nature of the activities reported
in this segment, management believes that a period-over-period comparison is
not useful.

    The following table presents the results of the Corporate segment for
second quarter 2007 and second quarter 2006.

    
                                                  Three months ended June 30
                                                                       Total
                           Inter-segment   Enterprise-wide         Corporate
    -------------------------------------- ----------------- ----------------
    ($000)                 2007     2006     2007     2006     2007     2006
    -------------------------------------- ----------------- ----------------
    Revenue                (929)    (856)     (38)       9     (967)    (847)
    Expenses               (929)    (856)   6,040    1,173    5,111      317
      Employee
       compensation and
       benefits               -        -      941      546      941      546
      Selling, general
       and administra-
       tive                (929)    (300)     965      684       36      384
      Interest                -     (556)     899      (19)     899     (575)
      Amortization            -        -    3,235      (38)   3,235      (38)
    -------------------------------------- ----------------- ----------------
    Loss before income
     taxes and non-
     controlling interest     -        -   (6,078)  (1,164)  (6,078)  (1,164)
    -------------------------------------- ----------------- ----------------
    -------------------------------------- ----------------- ----------------

    The following table presents the results of the Corporate segment for
first half 2007 and first half 2006.

                                                    Six months ended June 30
                                                                       Total
                           Inter-segment   Enterprise-wide         Corporate
    -------------------------------------- ----------------- ----------------
    ($000)                 2007     2006     2007     2006     2007     2006
    -------------------------------------- ----------------- ----------------
    Revenue              (1,726)  (1,972)       8        9   (1,718)  (1,963)
    Expenses             (1,726)  (1,972)  11,718    2,272    9,992      300
      Employee
       compensation and
       benefits               -        -    1,960    1,121    1,960    1,121
      Selling, general
       and administra-
       tive              (1,726)    (564)   1,543    1,208     (183)     644
      Interest                -   (1,408)   1,780      (19)   1,780   (1,427)
      Amortization            -        -    6,435      (38)   6,435      (38)
    -------------------------------------- ----------------- ----------------
    Loss before income
     taxes and non-
     controlling interest     -        -  (11,710)  (2,263) (11,710)  (2,263)
    -------------------------------------- ----------------- ----------------
    -------------------------------------- ----------------- ----------------
    

    Second Quarter 2007 and First Half 2007

    The net loss before income taxes and non-controlling interest of
$6.1 million for second quarter 2007 and $11.7 million for first half 2007
reflects amortization expenses related to intangible assets acquired in
connection with the EdgeStone acquisition which occurred in July 2006.
Employee compensation and benefits expenses include the accrued compensation
relating to the Chief Executive Officer of the Administrator, the
administrator of the Fund, and other administrative support. Selling, general
and administrative expense includes enterprise-wide expenses that are not
allocated to the business segments. Interest expenses include financing costs
associated with the issuance of senior unsecured notes by GMP Holding
Partnership by way of private placement in November 2006.

    Second Quarter 2006 and First Half 2006

    The net loss before income taxes and non-controlling interest of
$1.2 million for second quarter 2006 and $2.3 million for first half 2006
reflects primarily executive incentive-based compensation amounts accrued in
the respective period and selling, general and administrative expenses not
allocated to business segments.



    
                                           Fiscal 2007           Fiscal 2006
    -------------------------------------------------------------------------
    ($000, except
     per unit/                            Three months          Three months
     common share                                ended                 ended
     amounts)                     30-Jun-07  31-Mar-07  31-Dec-06 30-Sept-06
    ---------------------------------------- ---------- ---------- ----------
    Revenue                         127,387    114,656    103,597     78,016
    Net income                       38,566     44,469     30,561     23,145
    Pro forma net income(a)             n/a        n/a        n/a        n/a
    Basic earnings per unit/
     common share(b)                  $0.61      $0.71      $0.49      $0.37
    Pro forma basic earnings
     per unit(a)                        n/a        n/a        n/a        n/a
    Diluted earnings per unit/
     common share(b)                  $0.60      $0.70      $0.48      $0.36
    Pro forma diluted earnings
     per unit(a)                        n/a        n/a        n/a        n/a
    ---------------------------------------- ---------- ---------- ----------
    ---------------------------------------- ---------- ---------- ----------


                                           Fiscal 2006           Fiscal 2005
    --------------------------------------------------- ---------------------
    ($000, except                                                      Three
     per unit/                            Three months Two months     months
     common share                                ended      ended      ended
     amounts)                     30-Jun-06  31-Mar-06  31-Dec-05  31-Oct-05
    ---------------------------------------- ---------- ---------- ----------
    Revenue                          78,830     96,869     53,225     64,888
    Net income                       27,650     38,608     13,520     15,809
    Pro forma net income(a)             n/a        n/a     17,288     23,259
    Basic earnings per unit/
     common share(b)                  $0.48      $0.67      $0.24      $0.28
    Pro forma basic earnings
     per unit(a)                        n/a        n/a      $0.30      $0.41
    Diluted earnings per unit/
     common share(b)                  $0.46      $0.65      $0.23      $0.27
    Pro forma diluted earnings
     per unit(a)                        n/a        n/a      $0.29      $0.40
    ---------------------------------------- ---------- ---------- ----------
    ---------------------------------------- ---------- ---------- ----------

    (a) This data is considered to be non-GAAP earnings measures. The
        selected pro forma data has been derived from and should be read in
        conjunction with the "Presentation of Financial Information and Non-
        GAAP Measures" and "Quarterly Pro forma Net Income Reconciliation"
        sections in this MD&A.
    (b) Common share amounts have been restated to reflect a two-for-one
        exchange of one common share of the Company for two Fund units.
        Common share amounts have been restated based on average common
        shares outstanding during the periods presented.

    Quarterly Pro Forma Net Income Reconciliation

    The following pro forma data is considered to be non-GAAP earnings
measures. The selected pro forma data has been derived and should be read in
conjunction with the "Presentation of Financial Information and Non-GAAP
Measures" sections in this MD&A.


                                                                 Fiscal 2005
    -------------------------------------------------------------------------
                                        Two months ended  Three months ended
    ($000)                                     31-Dec-05           31-Oct-05
    ----------------------------------------------------- -------------------

    Net income as reported                        13,520              15,809
    Add: Income taxes as reported                  5,738               8,854
    ----------------------------------------------------- -------------------
    Income before income taxes as
     reported                                     19,258              24,663
    Pro forma income tax expense(a)                1,970               1,404
    Pro forma net income(a)                       17,288              23,259
    ----------------------------------------------------- -------------------
    ----------------------------------------------------- -------------------

    (a) Net income for the reporting periods presented reflects an adjustment
        to income tax expense to reflect the current tax attributes of the
        Fund Group under the income trust structure. The pro forma income tax
        expense reflects required taxes relating to the corporate
        subsidiaries of the Fund.
    

    The Fund Group's revenue and operating results will fluctuate from month-
to-month, quarter-to-quarter and year-to-year as a result of a combination of
factors including economic, political and market conditions which, in turn,
affect the level of public offerings, M&A transactions, securities trading
activity in the Canadian marketplace, competition in the marketplace for
suitable investments, sustainability of fees, nature and type of portfolio
company investments, ability to realize carried interest entitlements and
dependence on key personnel, all of which ultimately impact the Fund Group's
revenue and operating results. This section should be read in conjunction with
the "Risk Factors - Risks Related to the Business - Significant Fluctuations
in Results" section in the Fund's annual information form dated February 28,
2007 and the "Historical Quarterly Information - Quarterly Earnings Trends and
Analysis" section in the 2006 Annual MD&A, each of which is incorporated by
reference herein.

    -------------------------------------------------------------------------
    Distributable Cash and Distributions

    Management views distributable cash and distributable cash per basic unit
as key measures used by investors, management and other stakeholders to
evaluate the ongoing performance of the Fund. The Fund intends to continue to
make distributions based on distributable cash, taking into account market
cycles.
    On July 18, 2007, the Canadian Institute of Chartered Accountants
finalized their interpretive release, "Standardized Distributable Cash in
Income Trusts and Other Flow-Through Entities", originally issued as a draft
in November 2006. The objective of the guidance is to improve the disclosure,
transparency and standardization in the reporting of distributable cash.
Management has not fully adopted the new guidance for its second quarter 2007
reporting given the timing of the interpretive release; however, management
will consider this further guidance for the Fund's third quarter 2007.
    The following table presents the Fund's determination of distributable
cash for second quarter and first half of fiscal 2007 and fiscal 2006.
Management had amended the distributable cash and payout ratio calculations in
2006, as described in the "Distributable Cash and Distributions" section in
the 2006 Annual Report and comparative amounts shown below have been restated
to reflect the revised presentation.

    
                                    Three months ended      Six months ended
    ($000, 000 of units,                       June 30               June 30
     except per unit amounts)          2007       2006       2007       2006
    ---------------------------------------- ---------- ---------- ----------
    Cash provided by (used in)
     operating activities           (70,477)    63,794    (21,127)    99,907
    Add/(Deduct):
      Net change in non-cash
       operating items(a)           118,161    (34,796)   119,736    (29,954)
      Maintenance capital
       expenditures(b)                 (613)      (255)    (1,329)      (613)
      Non-controlling interest          575        (30)       372        (37)
      Earnings of corporate
       subsidiaries not available
       for distribution(c)             (111)      (338)      (392)      (898)
      Future income taxes(d)           (283)       333        (63)      (490)
    ---------------------------------------- ---------- ---------- ----------
    Distributable cash(e)            47,252     28,708     97,197     67,915
    ---------------------------------------- ---------- ---------- ----------
    Weighted-average number of
     units - basic                   62,811     57,755     62,756     57,609
    Weighted-average number of
     units - diluted                 64,209     59,912     64,085     59,696
    Distributable cash per basic
     unit(e),(f)                      $0.75      $0.50      $1.55      $1.18
    Distributable cash per
     diluted unit(e),(f)              $0.74      $0.48      $1.52      $1.14
    Cash distributions declared      23,554     20,457     47,067     38,420
    Payout ratio (e),(g)              49.8%      71.3%      48.4%      56.6%
    ---------------------------------------- ---------- ---------- ----------
    ---------------------------------------- ---------- ---------- ----------

    (a) Represents the change in non-cash operating items recorded on the
        Fund's unaudited interim consolidated statement of cash flows in the
        Second Quarter Financial Statements.
    (b) Maintenance capital expenditures are determined based on the capital
        requirements necessary to sustain current levels of economic
        activity. For further details see the "Distributable Cash and
        Distributions - Maintenance Capital Expenditures" section in the 2006
        Annual MD&A.
    (c) The net income of the Fund's corporate subsidiaries is not included
        in the determination of distributable cash.
    (d) Future income taxes represent a non-cash item recorded on the Fund's
        unaudited interim consolidated statement of cash flows in the Second
        Quarter Financial Statements.
    (e) Distributable cash, distributable cash per basic unit, distributable
        cash per diluted unit, and payout ratio are not recognized measures
        under GAAP and do not have any standardized meanings prescribed by
        GAAP. Therefore, these measures may not be comparable to similar
        measures presented by other issuers. For further details, see the
        "Presentation of Financial Information and Non-GAAP Measures" section
        in this MD&A.
    (f) Distributable cash per basic unit and distributable cash per diluted
        unit is determined by dividing distributable cash by the weighted-
        average number of basic and diluted units, respectively, outstanding
        for the applicable period, on a basis consistent with the
        determination of net income per unit.
    (g) The payout ratio is determined by dividing aggregate cash
        distributions declared by distributable cash.
    

    The level of distributable cash available for distribution to unitholders
fluctuates monthly based on the financial performance of the Operating
Partnerships net of any reserves, which the board of directors of the General
Partners determines are necessary or desirable to withhold having regard to
the current and anticipated business of the Operating Partnerships. The
General Partners have exercised this discretion and have maintained certain
reserves during the first half 2007.
    The Fund's payout ratio in second quarter 2007 was 49.8% compared to
71.3% in the comparable period last year while the ratio in first half 2007
was 48.4% compared to 56.6% for first half 2006. Cash available for
distribution in first half 2007 was $97.2 million, an increase of
$29.3 million compared with first half 2006. This increase was driven by
strong performances in the first and second quarters in the Capital Markets
and Wealth Management segments and the contribution of EdgeStone's results for
which there are no results reported in the comparable period.
    The Fund pays cash distributions on a monthly basis to Fund unitholders,
and GMP Holding Partnership pays equal monthly cash distributions to holders
of Exchangeable L.P. units of record on the last business day of each month.
It is intended that the Fund will continue to make regular monthly
distributions of approximately $0.125 per Fund unit ($1.50 per annum) payable
to Fund unitholders of record on the last business day of each month. It is
expected that GMP Holding Partnership will continue to make identical monthly
distributions to holders of Exchangeable L.P. units. The Board of Trustees
reviews the distribution rate periodically and at year-end based on current
and anticipated business performance and regulatory capital requirements.
    Management expects its capital maintenance strategy to continue to be
funded through cash flows from operations and not through the issuance of
external debt. Additions to productive capacity in second quarter 2007 include
$1.8 million in capital assets primarily associated with the expansion of our
GMP Private Client Toronto office.
    Management is not aware of any restrictions on distributions arising from
compliance with financial covenants operational as at June 30, 2007 and those
that would be likely to become operational within the reasonably foreseeable
future assuming no material changes in current market, economic and business
conditions in which the Fund Group operates.
    For a further discussion on distributable cash, refer to the
"Distributable Cash and Distributions" section in the 2006 Annual MD&A.

    -------------------------------------------------------------------------
    Liquidity and Capital Resources

    The Fund's approach to the management of liquidity and capital resources
has not changed significantly from that described in the "Liquidity and
Capital Resources" section in the 2006 Annual MD&A.
    Management believes that our current holdings of cash and cash
equivalents, revenue from operations and credit and debt facilities that would
be available to the Fund Group provide us with a sufficient and appropriate
level of cash for both operating and regulatory purposes for the reasonably
foreseeable future assuming no material changes in the market, economic and
business conditions in which the Fund Group operates. Management expects the
Fund will continue to generate a sufficient amount of cash in the foreseeable
future through its current operating activities to maintain or grow
distributions to unitholders. We consider our liquidity profile to be sound
and management is not aware of any trends, demands, commitments or events that
are likely to materially change our current liquidity position. See "Risk
Factors - Risks Related to the Fund Units - Cash Distributions" in the Fund's
annual information form dated February 28, 2007 for a discussion of risks
associated with cash distributions.
    Certain of the Fund Group's Operating Partnerships have credit facilities
with Canadian chartered banks as described in the "Liquidity and Capital
Resources" section in the 2006 Annual MD&A. To accommodate the current growth
in business experienced in GMP Securities and GMP Private Client, GMP
Securities secured an increase of approximately $175 million in its credit
facilities, bringing the aggregate credit facilities outstanding with Canadian
chartered banks to approximately $525 million as of the date hereof. These
credit arrangements allow GMP Securities to facilitate the day-to-day
securities settlement process for both client and proprietary securities
transactions. As at June 30, 2007, the Fund Group had $35.0 million in short-
term borrowings outstanding under these facilities. As of the date hereof,
this short-term borrowing has been repaid.
    Cash consumed by operating activities was $70.5 million for the second
quarter 2007 and $21.1 million for the first half 2007, compared with cash
generation of $63.8 million for the second quarter 2006 and $99.9 million for
the first half 2006 primarily due to changes in non-cash operating items. Non-
cash operating items are determined on a trade-date basis and as such may vary
significantly on a day-to-day basis, although such variances do not
necessarily represent any change in the Fund Group's financial position. Cash
provided by operations, before changes in non-cash operating items was
$47.7 million for second quarter 2007 and $98.6 million for first half 2007,
which is higher than cash generated before non-cash items in second quarter
2006 of $29.0 million and first half 2006 of $70.0 million as a result of
strong earnings generation in 2007. The new tax legislation enacted this
quarter and described in the "Changes in Accounting Policies or Estimates"
section of this MD&A does not affect the Fund's cash provided by operations.
    Financing activities consumed $42.4 million of cash in first half 2007
compared with $33.9 million in first half 2006. Cash distributions of
$50.9 million were paid during first half 2007, which included the payment of
a $0.50 per unit special distribution in January 2007 to unitholders of record
December 29, 2006, compared with $23.8 million in cash distributions in first
half 2006. Short-term borrowings arranged by GMP Securities to facilitate the
settlement of certain securities transactions provided $35 million in cash as
at June 30, 2007. The issuance of Fund units through the Fund unit option plan
generated cash of $1.7 million in first half 2007 compared with $3.4 million
in first half 2006.
    Investing activities consumed $2.3 million of cash in first half 2007
compared with $3.4 million in first half 2006. Expenditures in second quarter
and first half 2007 primarily relate to the expansion of GMP Private Client's
Toronto office while second quarter and first half 2006 expenditures reflect
the build out of the Toronto offices for GMP Securities and GMP Private Client
and GMP Private Client's Vancouver and Calgary offices. Management expects
continued capital expenditures not yet committed but required to meet planned
growth in the Wealth Management segment.

    -------------------------------------------------------------------------
    Balance Sheet Data and Analysis

    As at June 30, 2007, total assets were $1,291.6 million, an increase of
$258.1 million from December 31, 2006 primarily reflecting increases in
trading securities ($20.7 million) and client receivables ($298.5 million),
offset primarily by declines in cash and cash equivalents ($65.5 million).
    Trading securities may fluctuate significantly on a day-to-day basis and
reflect normal client-driven and proprietary activities. The increase in
receivable from clients is primarily a function of the level of current open
transactions as at June 30, 2007 with clients compared to December 31, 2006
and reflects the higher level of market activity compared to December 31,
2006. These transactions may fluctuate significantly on a daily basis
depending on the volume of trading activity. For details relating to the
decrease in cash and cash equivalents, see the "Liquidity and Capital
Resources" section of this MD&A.
    As at June 30, 2007, total liabilities were $985.2 million, an increase
of $219.3 million from December 31, 2006. The increase primarily reflects
increases in payables to clients ($175.1 million) and brokers ($51.5 million)
and short-term borrowing ($35.0 million) as discussed in the "Liquidity and
Capital Resources" section of this MD&A. These increases were offset primarily
by declines in distributions payable of $31.3 million.
    The amounts payable to clients and brokers may fluctuate significantly on
a day-to-day basis and the increase reflects primarily the level of open
transactions outstanding with clients and brokers. The growth reflects the
higher levels of market activity over this period. Distributions payable as at
June 30, 2007 declined due to the special cash distribution, which totalled an
aggregate of $31.3 million that was accrued as at December 31, 2006 and paid
in January 2007.
    Unitholders' equity as at June 30, 2007 increased by $39.9 million from
December 31, 2006, primarily due to an increase in retained earnings.

    -------------------------------------------------------------------------
    Outstanding Unit Data

    The Fund is authorized to issue an unlimited number of Fund units and an
unlimited number of special voting units. Each special voting unit is issued
together with each Exchangeable L.P. unit issued by GMP Holding Partnership.
Each Exchangeable L.P. unit is indirectly exchangeable for one Fund unit.
Exchangeable L.P. units are not exchangeable for a period of one year from
issuance, except with the consent of the board of directors of GMP Corp., the
general partner of GMP Holding Partnership.

    
                                                Units issued and outstanding
                                                         as at June 30, 2007
    -------------------------------------------------------------------------
    (000)                                                     No.          $
    -------------------------------------------------------------- ----------
    Fund units                                             41,638     90,898
    Exchangeable L.P. units(a)                             21,197    101,553
    -------------------------------------------------------------- ----------
    Total                                                  62,835    192,451
    -------------------------------------------------------------- ----------
    -------------------------------------------------------------- ----------

    (a) Includes 4.019 million Exchangeable L.P. units held in escrow related
        to the EdgeStone acquisition on July 4, 2006. On July 4, 2007,
        1.608 million of these Exchangeable L.P. units were released from
        escrow. The Exchangeable L.P. units that remain in escrow are
        scheduled to be released on each of the second and third anniversary
        dates following the date of acquisition as follows: 50% and 50%.
    

    As of the date hereof, the outstanding capital of the Fund consists of
41.638 million Fund units and 21.197 million special voting units that are
issued together with each Exchangeable L.P. unit. Accordingly, there are
21.197 million Exchangeable L.P. units outstanding as at the date hereof. As
of August 8, 2007, 3.964 million options to acquire Fund units on a one-for-
one basis were outstanding.

    -------------------------------------------------------------------------
    Commitments and Contingencies

    Details of the Fund Group's commitments and contingencies outstanding can
be found in Note 26 to the 2006 Annual Financial Statements and in the
"Commitments and Contingencies" section of the 2006 Annual MD&A. During the
second quarter 2007, we entered into a seven-year lease arrangement for
premises in Vancouver in support of the continued build-out of the Wealth
Management segment. Future minimum annual lease payments total $2.1 million in
aggregate, and the commitment period expires in May 2014. There have been no
other significant changes to these commitments and contingencies during the
first half 2007.

    -------------------------------------------------------------------------
    Off-Balance Sheet Arrangements

    In the normal course of business, the Fund Group engages in certain
financial transactions that, under GAAP, are not recorded on the consolidated
balance sheet. The Fund Group's off-balance sheet transactions include
variable interest entities, derivatives and financial guarantees arising from
the executive unit loan plan. Details of our off-balance sheet arrangements
are provided in "Off-Balance Arrangements" in the 2006 Annual MD&A. For
details regarding derivatives and financial guarantees involving the Fund
Group, please see Notes 3 and 10, respectively, to the Second Quarter
Financial Statements. There have been no other significant changes to off-
balance sheet arrangements during the quarter.

    -------------------------------------------------------------------------
    Related-Party Transactions

    The Fund's policies and procedures for related-party transactions and the
nature of the Fund's related-party transactions have not changed materially
from December 31, 2006. For further information, refer to Note 17 in the 2006
Annual Financial Statements. Additional details on these transactions can be
found in Note 16 to the Second Quarter Financial Statements.

    -------------------------------------------------------------------------
    Critical Accounting Policies and Estimates

    The Fund Group's significant accounting policies are disclosed in Note 2
of the 2006 Annual Financial Statements. Certain of these policies require the
use of estimates or assumptions that in some cases may relate to matters that
are inherently uncertain. Accounting policies that require management's
judgment and estimates are described in the "Critical Accounting Policies and
Estimates" section of the 2006 Annual MD&A, which section is incorporated by
reference herein. Changes in critical accounting estimates were adopted this
quarter in response to new tax legislation enacted in June 2007 and changes in
accounting policies were adopted on January 1, 2007 related to the financial
instruments standards. These changes are described below in the "Changes in
Accounting Policies or Estimates" section of this MD&A.

    -------------------------------------------------------------------------
    Changes in Accounting Policies or Estimates

    Financial Instruments

    Commencing January 1, 2007, the Fund adopted three new accounting
standards issued by the CICA: Handbook Section 1530, Comprehensive Income,
Handbook Section 3855, Financial Instruments - Recognition and Measurement and
Handbook Section 3865, Hedges. These standards were adopted prospectively and
accordingly, comparative amounts for prior periods were not restated.
    In adopting these new standards, the Fund recognized all of its financial
assets and financial liabilities in the consolidated balance sheet according
to their classification under the new standards. The Fund has included in its
unaudited interim consolidated financial statements a consolidated statement
of comprehensive income and the cumulative changes in other comprehensive
income have been included in accumulated other comprehensive income, which has
been presented as a new component of unitholders' equity. There were no
changes in the carrying values of the Fund's financial assets and financial
liabilities as a result of implementing these new accounting standards.

    Income Trusts - Accounting for Income Taxes

    In June 2007, the Government of Canada enacted new legislation imposing
additional income taxes upon publicly traded income trusts, including the
Fund, commencing January 1, 2011. Prior to June 2007, the Fund estimated the
future income tax on certain temporary differences between amounts recorded on
its balance sheet for book and tax purposes at a nil effective tax rate. Under
the new legislation, the Fund now estimates the effective tax rate on the
post- 2010 reversal of these temporary differences to be 31.5%. Based on its
assets and liabilities as at June 30, 2007, the Fund has estimated the amount
of its temporary differences which were previously not subject to tax and has
estimated the periods in which these differences will reverse. The Fund
estimates that $9.2 million net taxable temporary differences will reverse
after January 1, 2011, resulting in an additional $2.9 million future income
tax liability. The taxable temporary differences relate to the intangible
assets acquired in connection with the EdgeStone acquisition. While the Fund
believes it will be subject to additional tax under the new legislation, the
estimated effective tax rate on temporary difference reversals after 2011 may
change in future periods. As the legislation is new, future technical
interpretations of the legislation could occur and could materially affect
management's estimate of the Fund's future income tax liability. The amount
and timing of reversals of temporary differences will also depend on the
Fund's future operating results, acquisitions and dispositions of assets and
liabilities and distribution policy. A significant change in any of the
preceding assumptions could materially affect the Fund's estimate of its
future tax liability.
    For further details, see Note 2 to the Second Quarter Financial
Statements.

    Cash Flow Statements

    In February 2007, the CICA amended Handbook Section 1540, Cash Flow
Statements, to address the disclosure requirements related to cash
distributions on financial instruments classified as equity that are
determined in accordance with a contractual agreement or relevant document.
The Fund has adopted the new disclosure requirements effective for second
quarter 2007. For further details, please refer to Note 14 to the Second
Quarter Financial Statements.

    -------------------------------------------------------------------------
    Future Changes in Accounting Policies or Estimates

    The following new guidance will be effective for the Fund's financial
statements in the future: i) CICA Handbook Section 1535, Capital Disclosures:
a new standard that requires an entity to disclose both qualitative and
quantitative information that enables users of financial statements to
evaluate the entity's objectives, policies and processes for managing capital,
which will be effective for the Fund beginning January 1, 2008; and ii) CICA
Handbook Section 3862, Financial Instruments - Disclosures, and CICA Handbook
Section 3863, Financial Instruments - Presentation: new standards to enhance
disclosure requirements related to the nature and extent of risks arising from
financial instruments and how the entity manages those risks, which will be
effective for the Fund beginning January 1,2008.
    We are currently assessing the impact of adopting these standards on our
consolidated financial statements.

    -------------------------------------------------------------------------
    Controls and Procedures

    Disclosure Controls and Procedures

    Management of the Administrator, the administrator of the Fund, has
designed disclosure controls and procedures to provide reasonable assurance
that material information relating to the Fund Group is made known to the
Chief Executive Officer and Chief Financial Officer of the Administrator to
allow for timely decisions regarding required disclosure.

    Changes in Internal Control Over Financial Reporting

    To the best of the knowledge and belief of the Chief Executive Officer
and Chief Financial Officer of the Administrator, no changes were made in the
Fund's internal control over financial reporting during second quarter 2007
that have materially affected, or are reasonably likely to materially affect,
the Fund's internal control over financial reporting.

    -------------------------------------------------------------------------
    Risk Management

    Management believes that effective risk management is of primary
importance to the success of the Fund Group. We have risk management processes
in place to monitor, evaluate and manage the principal risks we assume in
conducting our activities. These risks include market, credit, liquidity,
operational, legal and regulatory risk. During the second quarter 2007, an
increase in capital limits for facilitative liability trading was recommended
by senior management and approved by the Board of Trustees. The Fund Group's
revised capital limits are now $17.5 million, up from the previous limit of
$15.0 million. During periods of unusual activity, this limit can be raised to
$25.0 million with the approval of the Chief Executive Officer of the
Administrator. In the event that capital required on liability trading exceeds
$25.0 million or 50 percent of Risk Adjusted Capital, the approval of the
Chief Executive Officer and the independent trustees is required. Our approach
to the management of risk has not changed significantly from that described in
the "Risk Management" section of the 2006 Annual MD&A and the "Description of
the Business - Risk Management" section in our annual information form dated
February 28, 2007.

    -------------------------------------------------------------------------
    Risk Factors

    An investment in securities of the Fund involves a number of risks in
addition to those described under the "Forward-Looking Statements" section of
this MD&A and the "Risk Management" section of the 2006 Annual MD&A. These
risks and uncertainties are not the only ones facing the Fund Group. In
addition to other information contained or incorporated by reference in this
MD&A, the "Risk Factors" and "Description of the Business - Risk Management"
sections in our annual information form dated February 28, 2007 should be
given careful consideration. Additional risks and uncertainties not currently
known to the Fund Group, or that the Fund Group currently considers
immaterial, may also impair the operations of the Fund Group. If any such
risks actually occur, the business, financial condition, or liquidity and
results of operations of the Fund Group, and the ability of the Fund to make
distributions on the Fund units (and on GMP Holding Partnership to make
distributions on the Exchangeable L.P. units), could be materially adversely
affected.

    -------------------------------------------------------------------------
    Additional Information

    Additional information relating to the Fund is available on our website
at gmpcapitaltrust.com and on the SEDAR website at sedar.com, including the
Fund's annual information form.



    
                       Unaudited Interim Consolidated
                            Financial Statements

         as at and for the three and six months ended June 30, 2007

    -------------------------------------------------------------------------
    Interim Consolidated Balance Sheet

                                                          As at        As at
                                                        June 30, December 31,
    ($000)                                                 2007         2006
    ------------------------------------------------------------ ------------

    Assets
    Current
    Cash and cash equivalents                            73,916      139,691
    Securities
      Trading (NOTES 1 and 5)                           100,821       80,106
      Available-for-sale (NOTE 1)                         3,147            -
      Investment (NOTE 1)                                     -          897
    Receivable from
      Clients (NOTE 16)                                 713,698      415,233
      Brokers (NOTE 6)                                  153,332      153,940
    Other assets (NOTE 7)                                72,872       62,166
    ------------------------------------------------------------ ------------
    Total current assets                              1,117,786      852,033
    ------------------------------------------------------------ ------------
    Deferred costs (NOTE 8)                               6,399        8,279
    Capital assets (NOTE 9)                              16,664       15,775
    Employee loans receivable (NOTES 10, 11, 12 and 16)  17,939       16,854
    Future income taxes (NOTE 2)                              -        1,302
    Goodwill and other intangible assets (NOTE 4)       132,800      139,234
    ------------------------------------------------------------ ------------
    Total assets                                      1,291,588    1,033,477
    ------------------------------------------------------------ ------------
    ------------------------------------------------------------ ------------

    Liabilities and Unitholders' Equity
    Current
    Short-term borrowing (NOTE 15)                       35,000            -
    Obligations related to securities
     sold short (NOTES 1 and 5)                          22,264       36,102
    Payable to
      Clients (NOTE 16)                                 645,382      470,272
      Brokers (NOTE 6)                                   66,580       15,103
      Issuers                                            49,834       63,006
    Accounts payable and accrued liabilities             78,184       50,413
    Distributions payable (NOTE 14)                       7,854       39,161
    Other liabilities (NOTE 13)                          16,397       28,543
    ------------------------------------------------------------ ------------
    Total current liabilities                           921,495      702,600
    ------------------------------------------------------------ ------------
    Long-term debt                                       60,000       60,000
    Future income taxes (NOTE 2)                          1,285            -
    Agency fee obligation (NOTE 18)                       2,418        3,319
    ------------------------------------------------------------ ------------
    Total liabilities                                   985,198      765,919
    ------------------------------------------------------------ ------------
    Non-controlling interest                                622        1,738
    ------------------------------------------------------------ ------------

    Unitholders' equity                                 305,768      265,820
    ------------------------------------------------------------ ------------
    Total liabilities and unitholders' equity         1,291,588    1,033,477
    ------------------------------------------------------------ ------------
    ------------------------------------------------------------ ------------

    Commitments and contingencies (NOTE 22)

    See accompanying notes, which are an integral part of these unaudited
    interim consolidated financial statements.



    -------------------------------------------------------------------------
    Interim Consolidated Statements of Income


                             Three months ended         Six months ended
    ($000, except per              June 30                   June 30
     unit amounts)               2007         2006         2007         2006
    ---------------------------------- ------------ ------------ ------------

    Revenue
    Investment banking         63,445       45,349      108,717      100,156
    Commissions                44,957       29,367       82,753       60,547
    Investment management
     and fee income             9,744        1,424       18,482        2,287
    Principal activities        4,495       (1,912)      21,941        3,523
    Interest                    5,387        4,768       10,561        9,114
    Other                        (641)        (166)        (411)          72
    ---------------------------------- ------------ ------------ ------------
                              127,387       78,830      242,043      175,699
    ---------------------------------- ------------ ------------ ------------

    Expenses
    Employee compensation
     and benefits              62,401       38,746      109,999       83,249
    Selling, general
     and administrative        12,733        8,908       24,039       17,080
    Interest                    3,107        1,421        5,944        2,559
    Amortization                4,190          525        8,445          963
    ---------------------------------- ------------ ------------ ------------
                               82,431       49,600      148,427      103,851
    ---------------------------------- ------------ ------------ ------------
    Income before
     the undernoted            44,956       29,230       93,616       71,848
    Non-controlling interest     (575)          30         (372)          37
    ---------------------------------- ------------ ------------ ------------
    Income before
     income taxes              45,531       29,200       93,988       71,811
    Income taxes (NOTE 2)
      Current                   3,801        2,044        8,009        5,392
      Future                    3,164         (494)       2,944          161
    ---------------------------------- ------------ ------------ ------------
                                6,965        1,550       10,953        5,553
    ---------------------------------- ------------ ------------ ------------
    Net income                 38,566       27,650       83,035       66,258
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------

    Net income per unit
     (NOTE 19)
    Basic                       $0.61        $0.48        $1.32        $1.15
    Diluted                     $0.60        $0.46        $1.30        $1.11
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------



    -------------------------------------------------------------------------
    Interim Consolidated Statement of Comprehensive Income

                                                 Three months     Six months
                                                        ended          ended
    ($000)                                      June 30, 2007  June 30, 2007
    ---------------------------------------------------------- --------------

    Net income                                         38,566         83,035
    Other comprehensive income, net of taxes:
      Net unrealized losses on translation
       of foreign operations                             (176)          (187)
    ---------------------------------------------------------- --------------
    Other comprehensive loss                             (176)          (187)
    ---------------------------------------------------------- --------------
    Total comprehensive income                         38,390         82,848
    ---------------------------------------------------------- --------------
    ---------------------------------------------------------- --------------

    See accompanying notes, which are an integral part of these unaudited
    interim consolidated financial statements.



    -------------------------------------------------------------------------
    Interim Consolidated Statement of Changes in Unitholders' Equity

                                                   Exchangeable Exchangeable
                           Fund units   Fund units   L.P. units   L.P. units
    (000)                         No.            $          No.            $
    ---------------------------------- ------------ ------------ ------------

    Balance, December 31,
     2006                      40,417       86,819       22,240      103,396
    Net unrealized loss
     on translation of
     foreign operations             -            -            -            -
    Issued under unit option
     plans (NOTE 17)              178        2,236            -            -
    Exchange of Exchangeable
     L.P. units into
     Fund units                 1,043        1,843       (1,043)      (1,843)
    Fund unit-based
     compensation
     expense (NOTE 17)              -            -            -            -
    Cash distributions
     declared -
      Fund units (NOTE 14)          -            -            -            -
    Cash distributions
     declared -
      Exchangeable L.P.
       units (NOTE 14)              -            -            -            -
    Net income                      -            -            -            -
    ---------------------------------- ------------ ------------ ------------
    Balance, June 30,
     2007                      41,638       90,898       21,197      101,553
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------


                                                    Accumulated
                                                          other        Total
                          Contributed     Retained comprehensive unitholders'
                              surplus     earnings income (loss)      equity
    (000)                           $            $            $            $
    ---------------------------------- ------------ ------------ ------------
    Balance, December 31,
     2006                       2,649       72,945           11      265,820
    Net unrealized loss
     on translation of
     foreign operations             -            -         (187)        (187)
    Issued under unit option
     plans (NOTE 17)             (489)           -            -        1,747
    Exchange of Exchangeable
     L.P. units into
     Fund units                     -            -            -            -
    Fund unit-based
     compensation
     expense (NOTE 17)          2,420            -            -        2,420
    Cash distributions
     declared -
      Fund units (NOTE 14)          -      (30,838)           -      (30,838)
    Cash distributions
     declared -
      Exchangeable L.P.
       units (NOTE 14)              -      (16,229)           -      (16,229)
    Net income                      -       83,035            -       83,035
    ---------------------------------- ------------ ------------ ------------
    Balance, June 30,
     2007                       4,580      108,913         (176)     305,768
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------

    See accompanying notes, which are an integral part of these unaudited
    interim consolidated financial statements.



    -------------------------------------------------------------------------
    Interim Consolidated Statements of Cash Flows

                             Three months ended         Six months ended
                                   June 30                   June 30
    ($000)                       2007         2006         2007         2006
    ---------------------------------- ------------ ------------ ------------

    Operating Activities
    Net income                 38,566       27,650       83,035       66,258
    Add (deduct) items not
     involving cash
      Amortization              4,190          525        8,445          963
      Amortization of agency
       fees and private
       placement costs            450            -          932            -
      Amortization of lease
       inducement                 (78)           -         (139)           -
      Future income taxes       3,164         (333)       2,944          490
      Fund unit-based
       compensation expense     1,203          855        2,420        1,692
      Transition assistance
       and other loan
       amortization               764          271        1,344          513
      Non-controlling interest   (575)          30         (372)          37
    ---------------------------------- ------------ ------------ ------------
                               47,684       28,998       98,609       69,953
    Net change in non-cash
     operating items
     (NOTE 21)               (118,161)      34,796     (119,736)      29,954
    ---------------------------------- ------------ ------------ ------------
    Cash provided by
     (used in) operating
     activities               (70,477)      63,794      (21,127)      99,907
    ---------------------------------- ------------ ------------ ------------

    Financing Activities
    Proceeds from (repayment
     of) short-term borrowing  35,000            -       35,000          (54)
    Issuance of Fund units        622          300        1,747        3,364
    Cash distributions
     paid on Fund units       (15,498)     (12,163)     (50,894)     (23,828)
    Cash distributions
     paid on Exchangeable
     L.P. units                (8,049)      (7,088)     (27,479)     (13,344)
    Increase (decrease) in
     non-controlling interest     494            -         (744)           2
    ---------------------------------- ------------ ------------ ------------
    Cash provided by
     (used in) financing
     activities                12,569      (18,951)     (42,370)     (33,860)
    ---------------------------------- ------------ ------------ ------------

    Investing Activities
    Purchase of capital
     assets                    (1,768)      (2,211)      (2,193)      (3,367)
    Pre-operating expenditures      -            -          (85)           -
    ---------------------------------- ------------ ------------ ------------
    Cash used in investing
     activities                (1,768)      (2,211)      (2,278)      (3,367)
    ---------------------------------- ------------ ------------ ------------

    Net increase (decrease)
     in cash and cash
     equivalents              (59,676)      42,632      (65,775)      62,680
    Cash and cash equivalents,
     beginning of period      133,592       77,787      139,691       57,739
    ---------------------------------- ------------ ------------ ------------
    Cash and cash equivalents,
     end of period             73,916      120,419       73,916      120,419
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------

    Supplemental cash
     flow information
    Interest paid               3,978        1,421        5,348        2,559
    Income taxes paid           4,036        3,862        5,985       19,582
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------

    See accompanying notes, which are an integral part of these unaudited
    interim consolidated financial statements.



    -------------------------------------------------------------------------
    Note 1   Significant Accounting Policies

    Basis of presentation

    These unaudited interim consolidated financial statements of GMP Capital
    Trust (the "Fund") have been prepared by management in accordance with
    Canadian generally accepted accounting principles ("GAAP") and include
    the accounts of the Fund and its subsidiaries. These unaudited interim
    consolidated financial statements follow the same accounting principles
    and methods of application as those disclosed in note 2 to the Fund's
    audited annual consolidated financial statements as at and for the year
    ended December 31, 2006 ("2006 Annual Financial Statements"), except as
    described below. The Fund's unaudited interim consolidated financial
    statements do not include all disclosures required by GAAP for annual
    consolidated financial statements and accordingly, should be read in
    conjunction with the 2006 Annual Financial Statements. Certain
    comparative amounts have been reclassified to conform to the current
    period's presentation.

    Change in accounting policy

    Financial Instruments

    Commencing January 1, 2007, the Fund adopted three new accounting
    standards issued by the Canadian Institute of Chartered Accountants
    ("CICA"): Handbook Section 1530, Comprehensive Income, Handbook Section
    3855, Financial Instruments - Recognition and Measurement and Handbook
    Section 3865, Hedges. These standards were adopted prospectively and
    accordingly, comparative amounts for prior periods have not been
    restated.

    Comprehensive Income Section

    1530 introduces Other Comprehensive Income ("OCI"). OCI represents
    changes in unitholders' equity arising from unrealized gains and losses
    on financial assets classified as available-for-sale, net unrealized
    foreign currency translation gains or losses arising from self-sustaining
    foreign operations, and changes in the fair value of the effective
    portion of cash flow hedging instruments. As required, the Fund has
    included in its unaudited interim consolidated financial statements a
    consolidated statement of comprehensive income to report the changes in
    these items during the six months ended June 30, 2007. The cumulative
    changes in OCI are included in accumulated other comprehensive income
    ("AOCI"), which is presented as a new category of unitholders' equity in
    the unaudited statement of changes in unitholders' equity.

    Financial Instruments - Recognition and Measurement

    Section 3855 requires that all financial assets and financial liabilities
    (including derivatives) be measured at fair value on initial recognition
    except for certain related-party transactions. Measurement in subsequent
    periods depends on whether the financial asset or liability has been
    classified as held-for-trading, available-for-sale, held to maturity,
    loans and receivables or other liabilities.

    Financial instruments classified as held-for-trading are measured at fair
    value and unrealized gains and losses are included in net income in the
    period in which they arise. The Fund's financial instruments classified
    as held-for-trading include trading securities, securities sold short,
    and broker warrants. The Fund has historically measured these instruments
    at fair value and any unrealized gains and losses have been included in
    net income. The Fund's accounting treatment of trading securities,
    securities sold short and broker warrants remains unchanged as a result
    of implementing these new accounting standards.

    Derivative financial instruments that are not designated and effective
    hedging instruments must also be classified as held-for-trading and
    measured accordingly. The Fund enters into forward contracts in order to
    manage foreign exchange risk on pending security settlements in foreign
    currencies and these contracts are not designated as hedging instruments.
    Historically, the forward foreign exchange contracts have been recorded
    at their estimated fair market value with realized and unrealized gains
    and losses recorded in net income during the period. The Fund's
    accounting treatment of these forward contracts remains unchanged as a
    result of implementing these new accounting standards.

    For those financial assets and financial liabilities that have been
    designated as held-for-trading, the Fund is not required to identify any
    embedded derivatives that might exist within these instruments. The Fund
    conducted a search for embedded derivatives in all other contractual
    arrangements and did not identify any embedded features which required
    separate presentation from the related host contract.

    Available-for-sale assets are those non-derivative financial assets that
    are designated as available-for-sale or are not classified as held-for-
    trading, held to maturity, or loans and receivables. Available-for-sale
    assets are measured at fair value with unrealized gains and losses
    recorded in other comprehensive income until realized, at which time they
    will be recognized in net income. The Fund's financial assets classified
    as available-for-sale include all securities previously classified as
    investment securities. These securities do not have a quoted market price
    and have been historically recorded at cost with write-downs to reflect
    other-than-temporary impairments in value. This historic treatment is
    consistent with the new standard; therefore, the Fund's accounting
    treatment for its available-for-sale securities remains unchanged as a
    result of implementing these new accounting standards.

    Financial assets classified as loans and receivables, as well as other
    financial liabilities, are measured at amortized cost using the effective
    interest method of amortization.

    Transition

    On January 1, 2007, the Fund recognized all of its financial assets and
    financial liabilities in the consolidated balance sheet according to
    their classification under the new standards. As described above, there
    were no changes in the carrying values of the Fund's financial assets and
    financial liabilities as a result of implementing these new accounting
    standards.

    The Fund reclassified $11 of cumulative translation adjustments related
    to net investments in self-sustaining foreign operations to the opening
    balance of AOCI.

    Cash Flow Statements

    In February 2007, the CICA amended Handbook Section 1540, Cash Flow
    Statements, to address the disclosure requirements related to cash
    distributions on financial instruments classified as equity that are
    determined in accordance with a contractual agreement or relevant
    document. The Fund has adopted the new disclosure requirements effective
    April 1, 2007. For further details, please refer to note 14 of these
    unaudited interim consolidated financial statements.

    Future accounting changes

    Capital Disclosures

    The CICA issued a new accounting standard, Section 1535, Capital
    Disclosures, which requires the disclosure of both qualitative and
    quantitative information that enables users of financial statements to
    evaluate the entity's objectives, policies and processes for managing
    capital. This new standard will be effective for the Fund effective
    January 1, 2008.

    Financial Instruments

    The CICA issued two new accounting standards, Section 3862, Financial
    Instruments - Disclosure and Section 3863, Financial Instruments -
    Presentation, which apply to interim and annual financial statements
    relating to fiscal years beginning on or after October 1, 2007. The Fund
    intends to adopt these new standards effective January 1, 2008.



    -------------------------------------------------------------------------
    Note 2    Future Income Taxes

    In June 2007, the Federal Government of Canada enacted new legislation
    imposing additional income taxes upon publicly traded income trusts,
    including the Fund, effective January 1, 2011. Prior to June 2007, the
    Fund estimated the future income tax on certain temporary differences
    between the amounts recorded on its balance sheet for book and tax
    purposes at a zero effective tax rate. Under the enacted legislation, the
    Fund now estimates the effective tax rate on the post-2010 reversal of
    the identified temporary differences to be 31.5%. Temporary differences
    reversing prior to 2011 will not give rise to future income taxes.

    Based on its assets and liabilities as at June 30, 2007, the Fund has
    estimated the amount of its temporary differences which were previously
    not subject to tax and has estimated the periods in which these
    differences will reverse. The Fund estimates that approximately $9,162
    net taxable temporary differences will reverse after January 1, 2011,
    resulting in an additional $2,886 future income tax expense recognized in
    the current period. The taxable temporary differences relate principally
    to the excess of net book value of intangible assets that were acquired
    during the EdgeStone acquisition in excess of the respective tax values.



    -------------------------------------------------------------------------
    Note 3    Derivative Financial Instruments

    The following table presents the notional amounts of forward contracts
    outstanding:

                                     June 30, 2007         December 31, 2006
    ----------------------------------------------- -------------------------
                                 Sold       Bought       Bought         Sold
                                  US$           C$          US$           C$
    ---------------------------------- ------------ ------------ ------------
    Forward contracts          15,350       16,498       40,762       47,111
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------



    -------------------------------------------------------------------------
    Note 4   Goodwill And Intangible Assets

    Goodwill and intangible assets consist of the following:

                                                        June 30, December 31,
                                                           2007         2006
    ------------------------------------------------------------ ------------
                                       Accumulated     Net book     Net book
                                 Cost amortization        value        value
    ---------------------------------- ------------ ------------ ------------
    Goodwill                   75,279            -       75,279       75,279

    Finite life intangibles
    Management contracts       46,500        7,709       38,791       42,646
    Carried interest           23,300        5,057       18,243       20,771
    Other                         440          103          337          388

    Indefinite life
     intangibles
    Trade name                    150            -          150          150
    ---------------------------------- ------------ ------------ ------------
                              145,669       12,869      132,800      139,234
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------



    -------------------------------------------------------------------------
    Note 5    Trading Securities and Obligations Related to Securities Sold
              Short

    Trading securities and obligations related to securities sold short
    consist of the following:

                                     June 30, 2007         December 31, 2006
                              Trading   Securities      Trading   Securities
                           securities   sold short   securities   sold short
    ---------------------------------- ------------ ------------ ------------
    Equities                   97,783       22,264       76,226       36,102
    Broker warrants             3,038            -        3,880            -
    ---------------------------------- ------------ ------------ ------------
                              100,821       22,264       80,106       36,102
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------



    -------------------------------------------------------------------------
    Note 6    Securities Lending and Borrowing

    Securities lending and borrowing consist of the following:

                                              Cash                Securities
    -------------------------------------------------------------------------
                            Loaned or  Borrowed or    Loaned or  Borrowed or
                         delivered as  received as delivered as  received as
                           collateral   collateral   collateral   collateral
    ---------------------------------- ------------ ------------ ------------
    As at June 30, 2007        78,744            -            -       78,819
    As at December 31, 2006   115,108            -            -      114,100
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------



    -------------------------------------------------------------------------
    Note 7    Other Assets

    Other assets consist of the following:

                                                        June 30, December 31,
                                                           2007         2006
    ------------------------------------------------------------ ------------
    Funds deposited in trust                             47,023       39,478
    Accounts receivable and other                        23,029       18,186
    Amounts receivable from EdgeStone Funds                 988        2,301
    Prepaid expenses                                      1,832        2,038
    Future income taxes                                       -          163
    ------------------------------------------------------------ ------------
                                                         72,872       62,166
    ------------------------------------------------------------ ------------
    ------------------------------------------------------------ ------------



    -------------------------------------------------------------------------
    Note 8    Deferred Costs

    Deferred costs consist of the following:

                                                        June 30, December 31,
                                                           2007         2006
    ------------------------------------------------------------ ------------
                                       Accumulated     Net book     Net book
                                 Cost amortization        value        value
    ---------------------------------- ------------ ------------ ------------
    Pre-operating costs,
     GMP Private Client         3,172        2,291          881        1,409
    Pre-operating costs,
     GMP Europe                   947          152          795          920
    Agency fees                 5,790        1,801        4,169        5,342
    Financing costs               620           66          554          608
    ---------------------------------- ------------ ------------ ------------
                               10,709        4,310        6,399        8,279
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------



    -------------------------------------------------------------------------
    Note 9    Capital Assets

    Capital assets consist of the following:

                                                        June 30, December 31,
                                                           2007         2006
    ------------------------------------------------------------ ------------
                                       Accumulated     Net book     Net book
                                 Cost amortization        value        value
    ---------------------------------- ------------ ------------ ------------
    Furniture and fixtures      9,894        3,402        6,492        6,180
    Computer equipment          1,971        1,620          351          442
    Computer software           1,666          580        1,086          691
    Leasehold improvements     11,768        3,033        8,735        8,462
    ---------------------------------- ------------ ------------ ------------
                               25,299        8,635       16,664       15,775
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------



    -------------------------------------------------------------------------
    Note 10   Executive Unit Loan Plan

    The executive unit loan plan (the "Executive Unit Loan Plan") of GMP
    Securities L.P. ("GMP Securities"), as amended and restated in
    December 2006, is designed to incent senior executives of GMP Securities
    and better align their interests with those of GMP Securities and the
    Fund. During the six months ended June 30, 2007, there have been no
    changes to the Executive Unit Loan Plan.

    The value of pledged units against advances made to participating
    executives by GMP Securities and a Schedule I bank as at June 30, 2007
    was $50,946 (December 31, 2006 - $52,562). GMP Securities has provided a
    financial guarantee to the Schedule I bank in relation to the obligations
    of certain executives in the plan. The maximum potential amount of future
    payments under this guarantee is $2,457 as at June 30, 2007 (December 31,
    2006 - $3,439). Included in accounts payable and accrued liabilities as
    at June 30, 2007 is a bonus accrual of $4,848 (December 31, 2006 -
    $2,156) in connection with GMP Securities' obligation to pay cash bonuses
    to repay 50% of the total loans under the plan.

    The loans bear interest at rates between prime and prime plus 0.5% and
    interest charged to executives related to these loans for the three and
    six months ended June 30, 2007 was $104 and $210, respectively, (three
    and six months ended June 30, 2006 - $79 and $157). As at June 30, 2007,
    amounts owing to GMP Securities related to these loans were $6,050
    (December 31, 2006 - $6,742) and are included in employee loans
    receivable.



    -------------------------------------------------------------------------
    Note 11   Investment Advisor Transition Assistance Program

    During the three and six months ended June 30, 2007, the Fund recorded
    $601 and $1,055, respectively, (three months and six months ended
    June 30, 2006 - $271 and $513) in compensation expenses for transition
    assistance provided to investment advisors, with a corresponding
    reduction to loans outstanding. As at June 30, 2007, amounts owing to GMP
    Private Client L.P. ("GMP Private Client") related to these loans were
    $9,308 (December 31, 2006 - $7,028) and are included in employee loans
    receivable.



    -------------------------------------------------------------------------
    Note 12   Co-Investment Program

    As at June 30, 2007, the amount owing to EdgeStone Capital Partners,
    L.P. ("EdgeStone") related to loans made under the co-investment program
    was $1,351 (December 31, 2006 - $1,699) and is included in employee loans
    receivable. As at June 30, 2007, in connection with the co-investment
    program, EdgeStone has total commitments to fund cash of $1,701
    (December 31, 2006 - $1,824) upon capital calls made by the underlying
    EdgeStone Funds.



    -------------------------------------------------------------------------
    Note 13   Other Liabilities

    Other liabilities consist of the following:

                                                        June 30, December 31,
                                                           2007         2006
    ------------------------------------------------------------ ------------
    Amounts payable to EdgeStone Funds                    4,926       12,623
    Amounts payable to investors in EdgeStone Funds       2,425        6,533
    Deferred fee income                                   4,318        4,284
    Deferred lease inducement                             2,641        2,670
    Current portion of agency fee obligation (NOTE 18)    1,782        1,859
    Future income taxes                                     296            -
    Other                                                     9          574
    ------------------------------------------------------------ ------------
                                                         16,397       28,543
    ------------------------------------------------------------ ------------
    ------------------------------------------------------------ ------------



    -------------------------------------------------------------------------
    Note 14   Distributions

    There have been no changes to the Fund's distribution policy during the
    six months ended June 30, 2007. For further details regarding unitholder
    distributions, refer to note 18 to the 2006 Annual Financial Statements.
    Loans receivable from electing holders of $10,110 as at June 30, 2007
    (December 31, 2006 - $23,834) are recorded on the unaudited interim
    consolidated balance sheet net of cash distributions payable to these
    unitholders as at June 30, 2007. Distributions are calculated and
    recorded on an accrual basis of accounting. Distributions declared during
    the six months ended June 30, 2007 are as follows:

                                          Cash distribution per        Total
                                          Fund and Exchangeable distribution
    Record date             Payment date              L.P. unit       amount
    ------------------------------------- ---------------------- ------------
    January 31, 2007   February 20, 2007             $    0.125   $    7,832
    February 28, 2007     March 20, 2007             $    0.125   $    7,833
    March 30, 2007        April 20, 2007             $    0.125   $    7,848
    April 30, 2007          May 18, 2007             $    0.125   $    7,848
    May 31, 2007           June 20, 2007             $    0.125   $    7,853
    June 29, 2007          July 20, 2007             $    0.125   $    7,854
    ------------------------------------- ---------------------- ------------
    ------------------------------------- ---------------------- ------------

    The monthly cash distributions are determined by the Board of Trustees of
    the Fund based on the determination of distributable cash within GMP
    Securities, GMP Private Client, EdgeStone and GMP Europe (collectively,
    the "Operating Partnerships"). Distributable cash is defined in the
    limited partnership agreement of each Operating Partnership to mean
    earnings before income taxes, interest expense, depreciation and
    amortization ("EBITDA") earned by the Operating Partnerships for the
    distribution period, plus any additional cash on hand that the general
    partners of each Operating Partnership (collectively, the "General
    Partners") may reasonably determine to include in distributable cash,
    less payments to satisfy debt service obligations incurred in the period,
    general and administrative expenses, capital expenditures, and other
    expense obligations and commitments of the Operating Partnerships. Cash
    distributions are discretionary and the board of directors of each
    General Partner, in its sole discretion, may withhold reasonable reserves
    having regard to current and anticipated business and regulatory capital
    requirements of the Operating Partnerships, and to stabilize
    distributions having regard to recent and anticipated distributable cash.



    -------------------------------------------------------------------------
    Note 15   Short-Term Borrowing

    During the quarter, GMP Securities secured additional credit facilities
    with Canadian banks of $175,000, increasing the total available limit to
    the Fund Group under such facilities to $535,000 in the aggregate. These
    facilities consist of call loans, letters of credit, daylight overdraft
    facilities and demand facilities.

    GMP Securities borrows money primarily to facilitate the securities
    settlement process for both client and proprietary transactions and
    EdgeStone engages in short-term borrowing to fund capital calls in
    EdgeStone Funds until proceeds from permanent financings are received
    from investors.

    As at June 30, 2007, GMP Securities had $35,000 in call loans outstanding
    under these facilities (December 31, 2006 - $nil). Interest on these
    facilities is based on a floating rate per annum. Subsequent to June 30,
    2007, the full amount of the outstanding call loans was repaid.



    -------------------------------------------------------------------------
    Note 16   Related-Party Transactions

    The following balances arose from transactions with related parties:


                                                       June 30,  December 31,
                                                          2007          2006
    ------------------------------------------------------------ ------------
    Current assets
    Receivable from clients                             72,230        53,174
    Employee loans receivable                           17,939        16,854
    Other assets - amounts receivable from
     EdgeStone Funds (NOTE 7)                              988         2,301

    Current liabilities
    Payable to clients                                  54,773        88,578
    Other liabilities - amounts payable to
     EdgeStone Funds (NOTE 13)                           4,926        12,623
    ------------------------------------------------------------ ------------
    ------------------------------------------------------------ ------------



    -------------------------------------------------------------------------
    Note 17  Unit Option Plans

    The Fund has two plans under which options are outstanding. The first
    plan, the trust unit option plan, governs the options issued in exchange
    for share options as part of the conversion of GMP Capital Corp. into the
    Fund (the "Replacement Plan"). The second plan is the amended and
    restated trust unit and incentive unit option plan (the "New Plan") that
    was approved by the unitholders of the Fund at the annual general meeting
    held on April 18, 2006. For further details about the plans, refer to
    note 23 to the 2006 Annual Financial Statements.

    A summary of the status of the Fund's unit option plans as at June 30,
    2007 and the changes during the six months then ended is as follows:


                                          New Plan          Replacement Plan
    ----------------------------------------------- -------------------------
                                          Weighted                  Weighted
                                 Fund      average         Fund      average
                                 unit     exercise         unit     exercise
                              options        price      options        price
                                  No.            $          No.            $
    ---------------------------------- ------------ ------------ ------------
    Balance, December 31,
     2006                       2,027        20.71        2,178         8.23
    Fund unit options issued       64        21.72            -            -
    Incentive unit
     options issued                 3            -            -            -
    Exercise of Fund
     unit options                 (27)       17.50         (148)        8.60
    Exercise of incentive
     unit options                  (3)           -            -            -
    Forfeitures                   (60)       20.64          (70)        7.12
    ---------------------------------- ------------ ------------ ------------
    Balance, June 30, 2007      2,004        20.79        1,960         8.25
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------


    Options outstanding and vested under the New Plan and the Replacement
    Plan as at June 30, 2007 are as follows:

                                                       Weighted
                                          Weighted      average
                                           average    remaining
                                          exercise  contractual
    Range of              Outstanding        price         life       Vested
     exercise prices              No.            $       (years)         No.
    ---------------------------------- ------------ ------------ ------------
    Replacement Plan:
    $5.50                         824         5.50         6.44          211
    $7.00 to $9.85                970         9.61         7.23          246
    $10.56 to $17.70              166        13.87         8.12           27
    ---------------------------------- ------------ ------------ ------------
                                1,960                                    484
    ---------------------------------- ------------ ------------ ------------

    New Plan:
    $17.50                        688        17.50         8.45          128
    $18.45 to $27.75            1,316        22.51         9.28           51
    ---------------------------------- ------------ ------------ ------------
                                2,004                                    179
    ---------------------------------- ------------ ------------ ------------
    Balance, June 30, 2007      3,964                                    663
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------

    Options outstanding under the New Plan and the Replacement Plan as a
    percentage of Fund units and Exchangeable L.P. units outstanding as at
    June 30, 2007 was 6.31%.

    Fund unit compensation and contributed surplus

    During the three and six month periods ended June 30, 2007, the Fund
    recorded $1,203 and $2,420 in Fund unit-based compensation expense,
    respectively, (three and six months ended June 30, 2006 - $855 and
    $1,692), for options issued to employees, with a corresponding increase
    to contributed surplus. The weighted-average fair value of options issued
    under the New Plan during the six months ended June 30, 2007 was $5.54
    per Fund unit option (six month period ended June 30, 2006 - $6.30).

    The Fund follows the fair value method of accounting recommended by CICA
    Handbook Section 3870, Stock-Based Compensation and Other Stock-Based
    Payments.

    The weighted-average fair value of the options granted during the six
    months ended June 30, 2007 was calculated using the Black-Scholes option
    pricing model assuming the following weighted-average assumptions:

                                                               June 30, 2007
    -------------------------------------------------------------------------
    Risk-free interest rate                                            4.02%
    Distribution yield(a)                                              1.38%
    Expected volatility                                                  25%
    Expected option life                                             5 years
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    (a) For valuation purposes, the weighted-average distribution yield for
        the New Plan has been reduced on a percentage basis by an equivalent
        amount of the anticipated distributions, less a base distribution.



    -------------------------------------------------------------------------
    Note 18   Agency Fee Obligation

    The agency fee obligation in respect of private placement costs of
    EdgeStone Capital Equity Fund III, L.P. ("Equity Fund III") has principal
    repayments due on a quarterly basis commencing with the earning of
    related management fees associated with Equity Fund III. Interest is
    payable at a fixed rate of 5.5% per annum. The principal repayments are
    estimated as follows:

                                                                           $
    -------------------------------------------------------------------------
    2007                                                               1,018
    2008                                                               1,528
    2009                                                               1,527
    2010                                                                 127
    -------------------------------------------------------------------------
                                                                       4,200
    Less current portion                                               1,782
    -------------------------------------------------------------------------
                                                                       2,418
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    -------------------------------------------------------------------------
    Note 19   Net Income Per Unit

    Net income per unit consists of the following:

                             Three months ended         Six months ended
                                   June 30                   June 30
                                 2007         2006         2007         2006
    ---------------------------------- ------------ ------------ ------------
    Net income available
     to unitholders            38,566       27,650       83,035       66,258
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------

    Weighted-average number
     of units outstanding
    Basic
      Fund units               41,524       37,743       41,097       37,597
      Exchangeable L.P. units  21,287       20,012       21,659       20,012
    ---------------------------------- ------------ ------------ ------------
                               62,811       57,755       62,756       57,609
    Effect of Fund
     unit options               1,398        2,157        1,329        2,087
    ---------------------------------- ------------ ------------ ------------
    Diluted                    64,209       59,912       64,085       59,696
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------

    Net income per unit
    Basic                       $0.61        $0.48        $1.32        $1.15
    Diluted                     $0.60        $0.46        $1.30        $1.11
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------



    -------------------------------------------------------------------------
    Note 20   Segmented Information

    This quarter, management has revised the presentation of bonuses paid to
    the partners of GMP Europe. These amounts are now reported as variable
    incentive-based compensation expense in the Capital Markets segment and
    in the unaudited interim consolidated income statement of the Fund. These
    amounts were recorded as draws against minority interest for the three
    months ended March 31, 2007. This revised presentation ensures
    comparability amongst businesses within the Capital Markets segment and
    enables a more meaningful comparison of our financial results with other
    financial institutions. This change has no financial impact on our
    consolidated reported net income for the Fund. For further details
    relating to segmented information, see note 28 to the Fund's 2006 Annual
    Financial Statements.

    The following table presents information about the business segment
    results:

    Three months ended June 30                                          2007
    -------------------------------------------------------------------------
                                                 Private
                                        Wealth   Capital
                             Capital   Manage-   Manage-     Corp-
                             Markets      ment      ment     orate     Total
    --------------------------------- --------- --------- --------- ---------
    Revenue                  108,034    14,137     6,183      (967)  127,387
    Employee compensation
     and benefits             50,453     8,427     2,580       941    62,401
    Selling, general
     and administrative        8,618     2,908     1,171        36    12,733
    Interest                     566     1,494       148       899     3,107
    Amortization                 438       454        63     3,235     4,190
    --------------------------------- --------- --------- --------- ---------
    Income (loss) before
     income taxes and
     non-controlling
     interest                 47,959       854     2,221    (6,078)   44,956
    --------------------------------- --------- --------- --------- ---------
    --------------------------------- --------- --------- --------- ---------


    Three months ended June 30                                          2006
    -------------------------------------------------------------------------
                                                 Private
                                        Wealth   Capital
                             Capital   Manage-   Manage-     Corp-
                             Markets      ment      ment     orate     Total
    --------------------------------- --------- --------- --------- ---------
    Revenue                   72,567     7,110         -      (847)   78,830
    Employee compensation
     and benefits             33,948     4,252         -       546    38,746
    Selling, general
     and administrative        6,541     1,983         -       384     8,908
    Interest                     683     1,313         -      (575)    1,421
    Amortization                 163       400         -       (38)      525
    --------------------------------- --------- --------- --------- ---------
    Income (loss) before
     income taxes and
     non-controlling
     interest                 31,232      (838)        -    (1,164)   29,230
    --------------------------------- --------- --------- --------- ---------
    --------------------------------- --------- --------- --------- ---------



    Six months ended June 30                                            2007
    -------------------------------------------------------------------------
                                                 Private
                                        Wealth   Capital
                             Capital   Manage-   Manage-     Corp-
                             Markets      ment      ment     orate     Total
    --------------------------------- --------- --------- --------- ---------
    Revenue                  206,474    25,002    12,285    (1,718)  242,043
    Employee compensation
     and benefits             87,956    14,998     5,085     1,960   109,999
    Selling, general
     and administrative       16,235     5,563     2,424      (183)   24,039
    Interest                   1,198     2,808       158     1,780     5,944
    Amortization                 909       969       132     6,435     8,445
    --------------------------------- --------- --------- --------- ---------
    Income (loss) before
     income taxes and
     non-controlling
     interest                100,176       664     4,486   (11,710)   93,616
    --------------------------------- --------- --------- --------- ---------
    --------------------------------- --------- --------- --------- ---------


    Six months ended June 30                                            2006
    -------------------------------------------------------------------------
                                                 Private
                                        Wealth   Capital
                             Capital   Manage-   Manage-     Corp-
                             Markets      ment      ment     orate     Total
    --------------------------------- --------- --------- --------- ---------
    Revenue                  163,818    13,844         -    (1,963)  175,699
    Employee compensation
     and benefits             74,212     7,916         -     1,121    83,249
    Selling, general
     and administrative       12,485     3,951         -       644    17,080
    Interest                   1,229     2,757         -    (1,427)    2,559
    Amortization                 326       675         -       (38)      963
    --------------------------------- --------- --------- --------- ---------
    Income (loss) before
     income taxes and
     non-controlling
     interest                 75,566    (1,455)        -    (2,263)   71,848
    --------------------------------- --------- --------- --------- ---------
    --------------------------------- --------- --------- --------- ---------


    Revenue by geographic location

    For geographic reporting purposes, the Fund's business segments are
    grouped into Canada, the United States and Europe. Transactions are
    primarily recorded in the location that corresponds with the geographic
    location of the client. The following table presents the revenues of the
    Fund by geographic location:

                             Three months ended         Six months ended
                                   June 30                   June 30
                                 2007         2006         2007         2006
    ---------------------------------- ------------ ------------ ------------
    Canada                    115,835       71,130      221,680      160,590
    United States               8,687        7,700       15,237       15,109
    Europe                      2,865            -        5,126            -
    ---------------------------------- ------------ ------------ ------------
                              127,387       78,830      242,043      175,699
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------



    -------------------------------------------------------------------------
    Note 21   Net Change In Non-Cash Operating Items

    The net change in non-cash operating items consists of the following:

                             Three months ended         Six months ended
                                   June 30                   June 30
                                 2007         2006         2007         2006
    ---------------------------------- ------------ ------------ ------------
    Trading securities         99,861       74,907      (20,715)     (78,781)
    Investment securities           -            -          897            -
    Available-for-sale
     securities                  (542)           -       (3,147)           -
    Receivable from clients    (2,340)      76,878     (298,465)     (59,049)
    Receivable from brokers   (70,459)     126,207          608       16,018
    Other assets               (6,874)      (7,995)     (10,869)     (15,269)
    Deferred costs                754            -          948            -
    Other liabilities          (4,217)           -      (12,303)     (12,089)
    Obligations related to
     securities sold short      6,962        1,646      (13,838)      13,305
    Payable to clients         41,391     (142,642)     175,110       69,105
    Payable to brokers        (73,341)      42,916       51,477       81,263
    Payable to issuers       (126,896)    (123,378)     (13,172)      15,591
    Accounts payable and
     accrued liabilities       19,535      (13,414)      27,181         (829)
    Future income taxes          (273)           -         (118)           -
    Agency fee obligation        (528)           -         (901)           -
    Employee loans receivable  (1,194)        (329)      (2,429)         689
    ---------------------------------- ------------ ------------ ------------
                             (118,161)      34,796     (119,736)      29,954
    ---------------------------------- ------------ ------------ ------------
    ---------------------------------- ------------ ------------ ------------



    -------------------------------------------------------------------------
    Note 22   Commitments And Contingencies

    A full description of the commitments and contingencies outstanding as at
    December 31, 2006 can be found in note 26 to the 2006 Annual Financial
    Statements. There have been no significant changes to these commitments
    and contingencies during the three and six months ended June 30, 2007.
    During the quarter, the Fund entered into a lease arrangement for new
    Vancouver premises in support of the continued build-out of the Wealth
    Management segment. Future minimum annual lease payments total $2,120, in
    aggregate. The commitment period expires in May 2014.
    





For further information:

For further information: GMP Capital Trust, Investor Relations, 145 King
Street West, Suite 300, Toronto, Ontario, M5H 1J8, Tel: (416) 367-8600,  Fax:
(416) 941-0839, investorrelations@gmpcapitaltrust.com


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