{"id":203324,"date":"2021-02-11T01:16:00","date_gmt":"2021-02-11T06:16:00","guid":{"rendered":"https:\/\/metroactive.org\/wordpress\/?p=203324"},"modified":"2021-02-12T08:40:03","modified_gmt":"2021-02-12T13:40:03","slug":"ci-financial-2020-results-impress","status":"publish","type":"post","link":"https:\/\/metroactive.org\/wordpress\/2021\/02\/11\/ci-financial-2020-results-impress\/","title":{"rendered":"CI Financial 2020 Results Impress"},"content":{"rendered":"\n

Highlights<\/h1>\n\n\n\n

\u2022 Adjusted EPS1<\/sup> reaches record levels of $0.71 for Q4 and $2.45 for 2020<\/strong><\/p>\n\n\n\n

\u2022 Repurchased 1.8 million shares in Q4 for $29.8 million, and 14.0 million shares in 2020 for $258 million<\/strong><\/p>\n\n\n\n

\u2022 Paid quarterly dividend of $0.18 a share, totalling $37.8 million in Q4 and $155.3 million in 2020<\/strong><\/p>\n\n\n\n

\u2022 Continued expansion of North American wealth management platform through six acquisitions with $25 billion in assets in Q4; total of 14 acquisitions in 2020 almost doubles wealth assets to $96 billion<\/strong><\/p>\n\n\n\n

\u2022 Total assets increased 19% in Q4 and 27% in 2020 to $231.5 billion<\/strong><\/p>\n\n\n\n

\u2022 Acquisition announced after quarter-end expected to increase U.S. assets to $58 billion, total assets to $261 billion<\/strong><\/p>\n\n\n\n

\u2022 Significantly diversified investor base through NYSE listing (ticker CIXX), successful U.S. debt issue that raised US$960 million<\/strong><\/p>\n\n\n\n

\u2022 Completed corporate rebranding which included the rollout of CI Global Asset Management and alignment of in-house investment team<\/strong><\/p>\n\n\n\n

All financial amounts in Canadian dollars unless otherwise stated.<\/strong><\/em><\/p>\n\n\n\n

TORONTO (February 11, 2021) – CI Financial Corp<\/a>. (\u201cCI\u201d) (TSX: CIX, NYSE: CIXX) today released financial results for the quarter and year ended December 31, 2020.<\/p>\n\n\n\n

\u201cWe delivered a very successful fourth quarter, capping a transformative year for CI,\u201d said Kurt MacAlpine, CI Chief Executive Officer. \u201cIn 2020, we made great progress in executing on our strategic priorities of modernizing asset management, expanding wealth management, and globalizing the firm. While we are still in the early stages of executing our strategy, CI is a fundamentally different company than it was just a year ago.<\/p>\n\n\n\n

\u201cWe have almost doubled the size of our wealth management business, reaching $96 billion at the end of the year, and quickly built a significant presence in the United States,\u201d Mr. MacAlpine said. \u201cOur assets in the U.S. alone are nearing $60 billion with the completion of five acquisitions in the fourth quarter and an agreement this January to acquire Segall Bryant & Hamill, LLC of Chicago. The U.S. wealth management firms we acquired operate at strong margins and generated aggregate organic net new asset growth of 9% in 2020. These businesses are making important contributions to our results and we are committed to building on this progress in the coming year.<\/p>\n\n\n\n

There’s more…<\/h4>\n\n\n\n

\u201cWe have diversified our investor base by listing on the New York Stock Exchange in November and issuing debt in the United States in December,\u201d said Mr. MacAlpine. \u201cWith the re-opening of that offering in January, we have issued US$960 million in notes, demonstrating a high level of investor interest and confidence in CI and our strategy. While CI had no U.S. debt just two months ago, today over 50% of our bonds are issued in the U.S.<\/p>\n\n\n\n

\u201cIn asset management, we have kept up the pace of enhancements to the business, rebranding CI Investments to CI Global Asset Management, and building on our leadership in alternative investments with the launch of the CI Galaxy Bitcoin Fund and, in January, launching a private equity product with Adams Street Partners for accredited investors,\u201d Mr. MacAlpine said.<\/p>\n\n\n\n

CI is the market leader in liquid alternatives in Canada, with $3.2 billion in assets under management in this category as at December 31, 2020, offered in both mutual fund and exchange-traded fund structures.<\/p>\n\n\n\n

\u201cWe\u2019re making these substantial investments in CI\u2019s growth while achieving strong financial results, paying a quarterly dividend of $0.18 a share and continuing our share repurchase program,\u201d Mr. MacAlpine said. \u201cAs a result of growing wealth management revenues and prudent cost management, our earnings per share, on an adjusted basis1<\/sup>, were $0.71 for the fourth quarter, the highest in the company\u2019s history. For the year, adjusted earnings were $2.45, also a record high for the company.\u201d<\/p>\n\n\n\n

Financial results<\/strong><\/h2>\n\n\n\n

CI reported earnings per share of $0.50 for the fourth quarter of 2020, compared to $0.62 in the previous quarter and $0.66 in the fourth quarter of 2019. Adjusted earnings per share1<\/sup> for the fourth quarter were $0.71. This compares to adjusted earnings per share of $0.62 for the third quarter of 2020 and $0.66 for the same quarter a year ago. Adjusted earnings exclude a provision of $42.6 million ($55.8 million before tax) in the fourth quarter of 2020 for non-recurring items, including legal and restructuring charges, investment write-downs and losses from the early redemption of bonds.<\/p>\n\n\n\n

For the year ended December 31, 2020, CI reported record adjusted earnings per share of $2.45, versus $2.41 for fiscal 2019. Adjusted earnings exclude provisions taken in the first and fourth quarters of 2020 and in the second quarter of 2019.<\/p>\n\n\n\n

SG&A expenses for the fourth quarter were $116.7 million, up from $108.8 million in the prior quarter and $113.8 million in the same quarter of 2019. The change reflects the inclusion of results of acquired companies in the fourth quarter of 2020, partially offset by continued cost reduction in other areas of the business.<\/p>\n\n\n\n

CI generated $150.2 million in free cash flow1<\/sup> during the fourth quarter, an increase of 4% from $143.9 million in the third quarter and a decrease from $168.3 million in the same quarter a year ago.<\/p>\n\n\n\n

At December 31, 2020, total ending assets under management were $135.1 billion, representing an increase of 5% from September 30, 2020 and 3% from December 31, 2019. Core assets under management, which consists of assets managed by CI\u2019s Canadian and Australian subsidiaries, were $129.6 billion at December 31, 2020, an increase of 5% from the previous quarter-end and a decline of 2% year over year. During the fourth quarter, U.S. assets under management grew by 16% to $5.5 billion.<\/p>\n\n\n\n

Total Average Assets<\/h5>\n\n\n\n

Total average assets under management were $131.2 billion for the fourth quarter, up 2% from the third quarter and up 1% from the fourth quarter of 2019. Core average assets under management were $126.2 billion in the fourth quarter, compared to $124.6 billion for the previous quarter and $130.5 billion for the year-ago quarter.<\/p>\n\n\n\n

Total wealth management assets as at December 31, 2020 were $96.5 billion, which represents an all-time year-end high for CI and an increase of $30.4 billion or 46% over September 30, 2020 and an increase of $46.0 billion or 91% year over year.<\/p>\n\n\n\n

Canadian Wealth Management Assets<\/h5>\n\n\n\n

Canadian wealth management assets, at $67.3 billion, increased $16.1 billion or 31% during the quarter, reflecting net sales, market growth and the acquisition of Aligned Capital Partners Inc. in October 2020. Year over year, Canadian wealth management assets increased by 33%. This category also includes the assets of CI Assante Wealth Management (Assante Wealth Management (Canada) Limited), CI Private Counsel LP, CI Direct Investing (WealthBar Financial Services Inc.) and Virtual Brokers.<\/p>\n\n\n\n

U.S. wealth management assets were $29.2 billion at December 31, 2020, up 96% from $14.9 billion over the quarter. The change reflects the addition during the quarter of five U.S. RIA firms: RGT Wealth Advisors, LLC, The Roosevelt Investment Group, LLC, Doyle Wealth Management, LLC, Stavis & Cohen Private Wealth, LLC and Bowling Portfolio Management LLC. CI\u2019s U.S. wealth management assets also include assets of Balasa Dinverno Foltz LLC, The Cabana Group, LLC, Congress Wealth Management, LLC, One Capital Management, LLC and Surevest, LLC.<\/p>\n\n\n\n

CI posted $2.1 billion in overall net redemptions for the fourth quarter of 2020. CI\u2019s Canadian retail business, excluding products closed to new investors, had $1.3 billion in net redemptions for the fourth quarter of 2020, an improvement of $0.2 billion from the third quarter of 2020 but an increase from $0.4 billion in net redemptions for the fourth quarter of 2019. CI\u2019s Canadian institutional business had net redemptions of $0.9 billion for the fourth quarter of 2020, representing an improvement of $0.5 billion over the same quarter a year ago. Sales at GSFM were relatively flat, and CI\u2019s U.S. RIA business had $0.3 billion in net sales. CI\u2019s 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.<\/p>\n\n\n\n

Capital allocation<\/strong><\/h2>\n\n\n\n

In the fourth quarter of 2020, CI repurchased 1.8 million shares at a cost of $29.8 million (average cost of $16.96 per share) and paid $37.8 million in dividends at a rate of $0.18 a share.<\/p>\n\n\n\n

The Board of Directors declared a quarterly dividend of $0.18 per share, payable on July 15, 2021 to shareholders of record on June 30, 2021. The annual dividend rate of $0.72 per share represented a yield of 4.2% on CI\u2019s closing share price of $17.33 on February 10, 2021.<\/p>\n\n\n\n

Fourth quarter business highlights<\/strong><\/h3>\n\n\n\n