AGF Management Limited reports continued improvements in investment performance
Investment performance and net outflows continue to improve
Toronto | January 27, 2016
AGF Management Limited (“AGF” or “the Company”) today announced its operating and financial results for the fiscal year and quarter ended November 30, 2015.
Total assets under management (AUM) were $33.6 billion, compared to $35.1 billion in 2014.
Retail gross sales increased 3.2%, while net redemptions were 20.0% lower for the twelve-month period ended November 30, 2015, compared with the prior 12 months.
Investment management performance continued to improve throughout the year, with 58% of AUM ranked above median for the one-year period ending December 31, 2015. That compares with 34% in 2014. AUM above median over three years improved to 50% as compared to 29% in 2014.
“We are enhancing processes and risk measures to ensure we deliver consistent, repeatable results to our clients,” said Kevin McCreadie, President and Chief Investment Officer, AGF Investments Inc. “We’re encouraged that these changes are having such a positive impact on performance.”
Amidst ongoing global market volatility, the Company remains focused on risk management solutions such as the newly-launched AGF Flex Asset Allocation Fund. Advised by State Street Global Advisors, this fund offers long-term growth while limiting downside risk.
In November, AGF acquired a majority interest in FFCM, LLC. It is a U.S.-based advisor that manages factor-driven and market-neutral ETFs along with a number of ETF managed strategies. This represents a strategically significant capability given the growth of ETFs in North America.
AGF is also announcing today that Robert J. Bogart, Executive Vice President and CFO will be assuming a new role as Executive Vice President, Head of Corporate Development, effective July 1, 2016. Mr. Bogart’s focus will be to oversee and continue to build out key strategic growth initiatives including FFCM, the alternatives platform and the private client segment.
Adrian Basaraba will assume the role of Chief Financial Officer of AGF Management Limited effective July 1, 2016. For the past decade, Mr. Basaraba has been an integral part of AGF’s Senior Leadership Team most recently as Senior Vice President, Finance.
"Our key strategic objectives of improving investment performance, offering innovative investment solutions to our clients and developing an alternatives platform are progressing well," said Blake C. Goldring, Chairman and Chief Executive Officer of AGF. "I am confident that these efforts, along with the leadership changes we are making, will continue to support our mission to help investors succeed and our commitment to creating shareholder value."
AUM were $33.6 billion at November 30, 2015, compared to $35.1 billion at November 30, 2014.
Consolidated revenue from continuing operations was $449.6 million, compared to $464.5 million in the same period in 2014. That reflects lower average AUM levels partially offset by the revenue growth from AGF’s alternative platform.
During the year, the Company recorded a $5.7 million gain on a special distribution from Stream Asset Financial LP (Stream) from the monetization of Stream’s seed asset. That gain offsets a $7.2 million restructuring provision related to a workforce reduction in connection with a review of the investment management and shared service functions.
Earnings before interest, taxes, depreciation and amortization (EBITDA) was $127.2 million, compared to $154.9 million in 2014. Net income from continuing operations was $48.3 million, compared to $59.1 million in 2014.
Diluted earnings per share (EPS) from continuing operations for the year ended November 30, 2015 were $0.58, compared to $0.68 in 2014.
Dividends paid to shareholders in 2015 were $0.51 per share, compared to $1.08 in 2014. In fiscal 2015, AGF repurchased a total of 5,599,964 shares for $39.1 million. In total, AGF returned $81.6 million to shareholders through a combination of cash dividends and share buybacks.
During the fourth quarter of 2015, net income from continuing operations was $8.1 million, compared to $12.6 million during the same period in 2014. Excluding a $2.8 million restructuring charge, AGF posted EBITDA of $28.3 million, compared to $34.4 million in Q4-2014.
Adjusted diluted EPS from continuing operations was $0.12 in the three months ended November 30, 2015, compared to $0.14 for the same period in 2014.
AGF will host a conference call to review its earnings results today at 11:00 a.m. ET.
The live audio webcast with supporting materials will be available in the Investor Relations section of AGF’s website at www.agf.com or at http://edge.media-server.com/m/p/qjvb4mrr. Alternatively, the call can be accessed toll-free in North America by dialing 1-800-708-4540 (Passcode #: 41579170).
A complete archive of this discussion along with supporting materials will be available at the same webcast address within 24 hours of the end of the conference call.
AGF Management Limited is one of Canada's premier independent investment management firms with offices across Canada and subsidiaries around the world. AGF's products include a diversified family of mutual funds, mutual fund wrap programs and pooled funds. AGF also manages assets on behalf of institutional investors including pension plans, foundations and endowments as well as for private clients. With approximately $33 billion in total assets under management, AGF serves more than one million investors. AGF trades on the Toronto Stock Exchange under the symbol AGF.B.
Robert J. Bogart
Executive Vice-President and Chief Financial Officer
Senior Vice-President, Finance
This release includes forward-looking statements. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, or include words such as ‘expects,’ ‘anticipates,’ ‘intends,’ ‘plans,’ ‘believes’ or negative versions thereof and similar expressions, or future or conditional verbs such as ‘may,’ ‘will,’ ‘should,’ ‘would’ and ‘could.’ Forward-looking statements are based on certain factors and assumptions, including expected growth, results of operations, economic factors, business prospects, business performance and opportunities. While the Company considers these factors and assumptions to be reasonable based on information currently available, they may prove to be incorrect. Forward-looking statements are not guarantees of future performance, and actual events and results could differ materially from those expressed or implied by forward-looking statements due to, but not limited to, important risk factors such as level of assets under management, volume of sales and redemptions of investment products, performance of investment funds and of investment managers and advisors, pipeline, competitive fee levels for investment management products and administration, and competitive dealer compensation levels and cost efficiency in our investment management operations, as well as interest and foreign-exchange rates, taxation, changes in government regulations, unexpected judicial or regulatory proceedings, and the Company’s ability to complete strategic transactions and integrate acquisitions. The Company cautions that the foregoing list is not exhaustive. The reader is cautioned to consider these and other factors carefully and not place undue reliance on forward-looking statements. Forward-looking statements are given only as at the date of this release and other than specifically required by applicable laws, the Company is under no obligation (and expressly disclaims any such obligation) to update or alter the forward-looking statements, whether as a result of new information, future events or otherwise. Additional risks and uncertainties can be found in our MD&A for the fiscal year ended November 30, 2015 under the headings “Caution Regarding Forward-Looking Statements” and “Risk Factors and Management of Risk” and in our other filings with Canadian securities regulatory authorities.