TORONTO, Feb. 2, 2012 /CNW/ - NexGen Financial Corporation ("NexGen" or "the Company"), today announced its preliminary and unaudited financial results for the three and 12 month periods ended December 31, 2011.
- Assets under management ("AUM") increased 11.8% to $920 million as of December 31, 2011, from $823 million at December 31, 2010
- Fee revenues increased 43% to $12.9 million for the year compared to $9.0 million in the previous year
- Operating EBITDA was $1.1 million ($0.24 per share), a $2.1 million improvement from the prior year.
For the year ended December 31, 2011, fee revenues were $12.9 million, an increase of 43% from $9.0 million in the prior year. Operating EBITDA was $1.1 million ($0.24 per share), a $2.1 million improvement from negative $1.0 million (negative $0.22 per share) in the prior year.
NexGen recorded a net loss in 2011 of approximately $1.9 million, or a loss of $0.40 per share, unchanged from a loss of $1.9 million, or a loss of $0.41 per share, in fiscal 2010. Included in the 2011 results is a one-time non-cash income tax expense of $1.1 million recognized in the first quarter of 2011 resulting from a corporate reorganization. On an adjusted basis (excluding the one-time item) net loss for the year was approximately $0.8 million.
For the year ended December 31, 2011, free cash flow was negative $1.5 million, a $2.1 million improvement, as compared to negative $3.6 million in the prior year. Excluding deferred sales commission, free cash flow was positive $0.7 million in fiscal 2011.
NexGen ended 2011 with working capital of $6.1 million, sufficient capital to fund growth into the medium term.
"We are quite pleased with the progress of our business in what has been a very challenging year for the asset management industry" said Laurie Munroe, President and CEO of NexGen.
Fourth Quarter Overview
During the fourth quarter of 2011, fee revenues increased by 19% to $3.7 million from $3.1 million in the fourth quarter of 2010. Operating EBITDA was $0.7 million, an increase of $0.4 million from the fourth quarter of 2010. Net income for the quarter was $0.3 million ($0.05 per share), compared to $0.3 million for same period last year ($0.06 per share). Free cash flow improved to $0.2 million during the quarter from negative $0.3 million for the same period the prior year.
These results are preliminary and subject to completion of the Company's year-end audit. NexGen expects to release its audited 2011 financial statements at the end of March 2012.
(1) Assets under management or "AUM" means the fair value of mutual funds managed by NexGen in respect of which fees are earned
(2) Operating EBITDA defined by NexGen as earnings before interest, taxes, depreciation and amortization, investment income and other non-cash expenses
(3) Free cash flow defined by NexGen as operating EBITDA less cash interest and deferred sales commissions
Non-GAAP financial measures such as "Assets Under Management" or "AUM", "Operating EBITDA", and "Free Cash Flow" do not have any standardized meaning prescribed by International Financial Reporting Standards ("IFRS") and may not be comparable to similar measures presented by other companies. Readers are cautioned that these non-GAAP measures are not alternatives to measures determined in accordance with IFRS and should not, on their own, be construed as indicators of performance, cash flows, or profitability. However, management of NexGen believes that most shareholders, creditors and other stakeholders prefer to include the use of these financial measures in analyzing the Company's results.
About NexGen Financial
NexGen Financial Corporation is a mutual fund company and was founded to develop value added investment solutions for financial advisors and their clients. The firm is focused on the creation of innovative investment products and services that meet the needs of Canadians seeking more tax efficient investment opportunities and greater control over the tax treatment of their investments. Managed by strong investment professionals, NexGen's unique Registered and Tax-Managed Fund offerings are well positioned as attractive investment opportunities for Canadians looking to alleviate the tax costs associated with traditional investment solutions.
Forward Looking Statements
This release may contain "forward-looking statements" which reflect the current expectations of the Company. These statements reflect management's current beliefs with respect to future events and are based on information currently available to management. Forward-looking statements involve significant known and unknown risks, uncertainties and assumptions. Many factors could cause actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements including, without limitation, those listed under the heading "Risk Factors" in the Company's Management Discussion and Analysis, which is available on the Company's website and on SEDAR at www.sedar.com. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results, performance or achievements could vary materially from those expressed or implied by the forward-looking statements contained in this release. Although the forward-looking statements contained in this release are based upon what the Company believes to be reasonable assumptions, the Company cannot assure investors that actual results, performance or achievements will be consistent with these forward-looking statements. These forward-looking statements are made as of the date of this release and the Company does not assume any obligation to update or revise them to reflect new events or circumstances.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For further information:
Laurie Munro, President & CEO
NexGen Financial Corporation
Abe Goenka, CFO & COO
NexGen Financial Corporation