CI Financial : reports fourth quarter and annual results for 2019

TORONTO - CI Financial Corp. ('CI') (TSX: CIX) today released audited financial results for the quarter and year ended December 31, 2019.

'We achieved a record financial quarter by being diligent in reducing our SG&A expensesto $113.8 million, a result of right sizing our business to reflect the current industry environment,' said Kurt MacAlpine, CI Chief Executive Officer. 'With these changes, we will begin to selectively invest in high growth opportunities and other initiatives that support our three strategic priorities of modernizing our asset management business, expanding our wealth management platform and globalizing our company.

At the same time, we are returning cash to shareholders through share repurchases, which totalled $142 million in the fourth quarter, and paying a quarterly dividend of $0.18 a share. 'Our key initiatives include the acquisition of WisdomTree Canada, which is scheduled to close soon, growing our ETF assets by $1 billion to more than $10 billion,' Mr. MacAlpine said. 'This builds on the exceptional performance of our existing CI First Asset ETF business, which posted asset growth of $4.2 billion or 95% in 2019. 'In addition, we've taken the first steps in building our U.S. wealth management business with the acquisition of majority stakes in two registered investment advisors: Surevest Wealth Management and One Capital Management. These are excellent firms that will form a solid foundation for a growing RIA operation. 'In the fourth quarter,' Mr. MacAlpine said, 'we saw a significant improvement in our sales trends.

Although the firm remains in net redemptions, our Canadian retail net sales excluding closed products improved by $1.0 billion over the prior quarter and by $1.9 billion over the same quarter a year earlier.'

Financial results CI reported record quarterly earnings per share of $0.66 for the fourth quarter of 2019, up from $0.60 for the third quarter of 2019 and $0.57 for the fourth quarter of 2018. For the year ended December 31, 2019, CI reported adjusted earnings per share of $2.41 - also a record for CI. This comparesto $2.38 for the year ended December 31, 2018. Adjusted earnings exclude a restructuring provision of $26.6 million ($35.0 - 2 - million before taxes) from the second quarter of 2019. With that provision, reported earnings per share for 2019 were $2.30.

During the quarter, CI's management continued to reduce discretionary expenses, primarily on the asset management side of the business. As a result, selling, general and administrative ('SG&A') expenses for the fourth quarter were $113.8 million, down 9% from $124.6 million in the third quarter of 2019 and 8% from $123.5 million in the fourth quarter of 2018. For the year, SG&A expenses were $489.3 million, down from $512.6 million in 2018. CI generated $168.3 million in free cash flow during the quarter ended December 31, 2019, up from $144.7 million in the quarter ended September 30, 2019 and $156.5 million in the quarter ended December 31, 2018. For 2019, CI generated $603.1 million in free cash flow, compared with $655.5 million in 2018. Average assets under management were $130.9 billion for the quarter ended December 31, 2019, up 1% from both comparable quarters.

For the year, average assets under management were $130.2 billion, down 5% from $137.2 billion for the prior year. At December 31, 2019, CI's ending assets under management were $132.1 billion, compared with $130.0 billion at September 30, 2019 and $124.4 billion at December 31, 2018. Assets under advisement were $49.8 billion on December 31, 2019, up 5% when compared with September 30, 2019 and up 19% when compared with the prior year. CI's assets under advisement include the assets of Assante Wealth Management (Canada) Limited, Stonegate Private Counsel, and WealthBar Financial Services Inc. CI reported $1.9 billion in overall net redemptions for the fourth quarter of 2019. CI's Canadian retail business, excluding products closed to new investors, had $0.4 billion in net redemptions, representing an improvement of $1.0 billion over the third quarter of 2019 and an improvement of $1.9 billion over the fourth quarter of 2018. CI's Canadian institutional business had $1.5 billion in net redemptions, a large proportion of which related to a client that moved assets to an in house manager. CI's international business had net sales of $0.2 billion for the fourth quarter of 2019, while CI's closed business, comprised primarily of segregated fund contracts that are no longer available for sale, had $0.2 billion in net redemptions for the quarter.

About CI Financial

CI Financial Corp. (TSX: CIX) is an independent company offering global asset management and wealth management advisory services. Its primary operating businesses are CI Investments Inc., Assante Wealth Management (Canada) Ltd., CI Private Counsel LP, GSFM Pty Ltd. of Australia, WealthBar Financial Services Inc., and BBS Securities Inc.

This press release contains forward looking statements concerning anticipated future events, results, circumstances, performance or expectations with respect to CI Financial Corp. ('CI') and its products and services, including its business operations, strategy and financial performance and condition. Forward looking statements are typically identified by words such as 'believe', 'expect', 'foresee', 'forecast', 'anticipate', 'intend', 'estimate', 'goal', 'plan' and 'project' and similar references to future periods, or conditional verbs such as 'will', 'may', 'should', 'could' or 'would'. These statements are not historical facts but instead represent management beliefs regarding future events, many of which by their nature are inherently uncertain and beyond management's control.

Although management believes that the expectations reflected in such forward looking statements are based on reasonable assumptions, such statements involve risks and uncertainties. The material factors and assumptions applied in reaching the conclusions contained in these forward looking statements include that the investment fund industry will remain stable and that interest rates will remain relatively stable.

Factorsthat could cause actual resultsto differ materially from expectations include, among other things, general economic and market conditions, including interest and foreign exchange rates, global financial markets, changes in government regulations or in tax laws, industry competition, technological developments and other factors described or discussed in CI's disclosure materials filed with applicable securities regulatory authorities from time to time. The foregoing list is not exhaustive and the reader is cautioned to consider these and other factors carefully and not to place undue reliance on forward looking statements. Other than as specifically required by applicable law, CI undertakes no obligation to update or alter any forward looking statement after the date on which it is made, whether to reflect new information, future events or otherwise.

Contact:

Tel: [phone]

Email: [e-mail]

(C) 2020 Electronic News Publishing, source ENP Newswire