TORONTO, Oct. 2, 2017 /CNW/ - Home Capital Group Inc. ("Home Capital" or "the Company") (TSX: HCG) today reported it has substantially completed Project Expo, an expense savings initiative announced in February 2017, and expects to achieve approximately $15 million in future annual cost savings as previously targeted.
"We have now substantially completed Project Expo including changes to the Company's workforce and process flows, focusing on the critical talent and structure needed to enhance our service offering to our stakeholders and building our business for long term success," said Yousry Bissada, President and Chief Executive Officer. "We have taken important steps to ensure we achieve a more efficient cost structure, and we are now firmly focused on crafting and executing a strategy for Home Capital that will drive our growth as one of Canada's leading alternative mortgage providers."
In early 2017, the Company launched an expense savings initiative, Project Expo that targeted annualized cost savings of $15 million when compared to the annualized run rate of Q4 2016 expenses (excluding items of note). With Project Expo now substantially complete, the Company expects to achieve that goal, however it still faces elevated expense levels related to the liquidity event that occurred earlier this year.
Project Expo largely focused on reducing employment, premises and other operating costs. The Company has now completed its initiative to streamline and re-balance the organization's workforce relative to Project Expo. Approximately 65 full-time positions in the Company's operational, sales and underwriting division were impacted today. Taking into account the changes made today, head count measured from the end of Q2 2017 has been reduced by approximately 10%.
The Company has previously recorded restructuring expenses related to Project Expo of approximately $9.7 million after tax or $0.15 diluted earnings per share in the first half of 2017. As the project is now substantially complete, the Company does not expect to record any further significant expenses with respect to Project Expo other than those recorded up to the end of Q2 2017.
Caution Regarding Forward-looking Statements
This press release contains forward-looking information within the meaning of applicable Canadian securities legislation. Please refer to Home Capital's 2016 Annual Report, available on Home Capital's website at www.homecapital.com, and on the Canadian Securities Administrators' website at www.sedar.com, for Home Capital's Caution Regarding Forward-looking Statements.
About Home Capital Group Inc.
Home Capital Group Inc. is a public company, traded on the Toronto Stock Exchange (HCG), operating through its principal subsidiary, Home Trust Company. Home Trust is a federally regulated trust company offering residential and non-residential mortgage lending, securitization of insured residential mortgage products, consumer lending and credit card services. In addition, Home Trust offers deposits via brokers and financial planners, and through its direct to consumer deposit brand, Oaken Financial. Home Trust also conducts business through its wholly owned subsidiary, Home Bank. Licensed to conduct business across Canada, Home Trust has offices in Ontario, Alberta, British Columbia, Nova Scotia, Quebec and Manitoba.
SOURCE Home Capital Group Inc.
For further information: Laura Lepore, Assistant Vice President, Investor Relations (416) 933-5652, [email protected]