Readers are referred to the disclaimer regarding
Forward-Looking Statements, Non-IFRS Financial Measures
and Other Financial Measures at the end of this Release.
WINNIPEG, MB, May 2, 2024
/CNW/ - IGM Financial Inc. (IGM or the Company) (TSX: IGM) today
announced earnings results for the first quarter of 2024.
IGM HIGHLIGHTS
- Net earnings of $223.4 million
or $0.94 per share compared to
$381.3 million or $1.60 per share in the first quarter of
2023.
- Record high adjusted net earnings1 were
$224.5 million or $0.94 per share for the first quarter of 2024
compared to $206.3 million or
$0.87 per share in the first quarter
of 2023, an increase of 8.0%.
- Assets under management and advisement of $252.2 billion, up 5.0% from the prior
quarter and up 7.7% from the first quarter of
2023.2
- IGM's assets under management and advisement including
strategic investments were $422.3
billion compared with $390.2
billion at December 31, 2023
and $349.7 billion at March 31, 2023.2
- Net outflows were $128 million
compared to net inflows of $674
million in 2023.2
"Strong client investment returns in the quarter and ongoing
expense discipline contributed to a record first quarter adjusted
net earnings result," said James
O'Sullivan, President and Chief Executive Officer of IGM
Financial Inc. "We were also very pleased with the noteworthy
growth in AUA at China Asset Management Co., Ltd. and Wealthsimple.
Our proportionate share of the quarterly growth in AUA was
$14.0 billion and $2.0 billion, respectively."
Net earnings available to common shareholders for the first
quarter of 2024 were $223.4 million
or $0.94 per share compared to
$381.3 million or $1.60 per share in 2023. Adjusted net earnings
available to common shareholders1 for the first quarter
of 2024 were $224.5 million or
$0.94 per share compared to
$206.3 million or $0.87 per share in 2023.
WEALTH MANAGEMENT
Reflects the activities of its core business and strategic
investments that are principally focused on providing financial
planning and related services. This segment includes the activities
of IG Wealth Management, the Company's investments in Rockefeller
Capital Management (Rockefeller) and Wealthsimple Financial Corp.
(Wealthsimple), and, until the fourth quarter of 2023, Investment
Planning Counsel (IPC) which was classified as discontinued
operations.
Adjusted net earnings available to common shareholders in
the first quarter of 2024 were $111.2
million, an increase of 4.4% compared to the first quarter
of 2023, and represented 49.5% of IGM's adjusted net earnings
available to common shareholders.
Assets under advisement including strategic investments
at March 31, 2024 were $175.5 billion, an increase of 7.8% from
$162.8 billion at December 31, 2023 and an increase of 44.2% from
$121.6 billion at March 31, 2023.
IG Wealth Management
Assets under advisement at March 31, 2024 were $128.0
billion, an increase of 5.6% from $121.2 billion at December
31, 2023 and an increase of 10.5% from $115.9 billion at March
31, 2023.
Quarterly net client inflows were $46
million,3 compared to net client inflows of
$504 million in the first quarter of
2023.
Quarterly gross client inflows were $3.7 billion, an increase of 1.0% from 2023.
Wealthsimple
The fair value of the Company's investment in Wealthsimple was
$722 million at March 31, 2024 compared to $607 million at December
31, 2023. Wealthsimple's AUA increased in the quarter from
$31.0 billion at December 31, 2023 to $38.7
billion at March 31, 2024, an
increase of 24.8%. The increase in fair value is consistent with
the increase in public market peer valuations, as well as
Wealthsimple's business performance and revised revenue
expectations.
ASSET MANAGEMENT
Reflects the activities of its core business and strategic
investments primarily focused on providing investment management
services. This segment includes the operations of Mackenzie
Investments and the Company's investments in China Asset Management Co., Ltd. (ChinaAMC)
and Northleaf Capital Group Ltd. (Northleaf).
Adjusted net earnings available to common shareholders in
the first quarter of 2024 were $86.8
million, an increase of 12.1% compared to the first quarter
of 2023, and represented 38.7% of IGM's adjusted net earnings
available to common shareholders.
Assets under management including strategic investments
at March 31, 2024 were $327.4 billion, an increase of 7.3% from
$305.1 billion at December 31, 2023 and an increase of 7.6% from
$304.4 billion at March 31, 2023.
Mackenzie Investments
Total assets under management were $203.7 billion, an increase of 4.1% from
$195.7 billion at December 31, 2023 and an increase of 5.1% from
$193.8 billion at March 31, 2023. Third party assets under
management were $124.2 billion at
March 31, 2024, an increase of 4.4%
from December 31, 2023 and an
increase of 6.1% from March 31,
2023.
Investment fund net redemptions were $194 million3 compared to net sales of
$72 million in the first quarter of
2023.
Mutual fund gross sales were $2.4
billion, up 3.0% from the first quarter of 2023.
ETF business – ETF assets under management totalled
$13.8 billion at March 31, 2024, up from $12.9 billion at December
31, 2023 and $12.8 billion at
March 31, 2023. Excluding investment
in ETFs by IGM's managed products, ETF assets under management were
$6.1 billion at March 31, 2024, compared to $5.5 billion at December
31, 2023 and $5.1 billion at
March 31, 2023.
ChinaAMC
The Company's proportionate share of ChinaAMC's first quarter
earnings was $26.9 million compared
to $28.1 million in the first quarter
of 2023.
CORPORATE AND OTHER
Represents the investments in Great-West Lifeco Inc. (Lifeco)
and Portage Ventures LPs, as well as unallocated capital.
Lifeco – The Company's proportionate share of Lifeco's
first quarter earnings was $22.8
million4 compared to $20.6
million in the first quarter of 2023. The Company's
proportionate share of Lifeco's base earnings was $23.9 million compared to $20.4 million in the first quarter of 2023.
DIVIDENDS
The Board of Directors has declared a dividend of
56.25 cents per share on the Company's common shares which is
payable on July 31, 2024 to
shareholders of record on June 28,
2024.
|
|
1
|
A non-IFRS measure
– see Non-IFRS Financial Measures and Other Financial Measures
section of this press release. Adjusted net earnings exclude Other
items.
|
|
In 2024, these
consisted of ($1.1) million reflecting the Company's proportionate
share of items Lifeco excludes from its base earnings (Lifeco other
items). Base earnings is an alternate measure Lifeco uses to
understand the underlying business performance compared to IFRS net
earnings.
|
|
In 2023, these
consisted of:
|
|
•
|
A gain on the sale of a
portion of the Company's investment in Lifeco of $174.8 million
after-tax ($179.1 million pre-tax).
|
|
•
|
Lifeco other items of
$0.2 million.
|
2
|
Assets under management
and advisement and net flows exclude discontinued operations (IPC).
Including discontinued operations:
|
|
•
|
IGM assets under
management and advisement were $260.4 billion at March 31,
2023.
|
|
•
|
IGM assets under
management and advisement including strategic investments were
$376.0 billion at March 31, 2023.
|
|
•
|
IGM net inflows
including discontinued operations were $990 million in the first
quarter of 2023.
|
3
|
In the first quarter of
2024, the IG Wealth Management pension plan redeemed $177 million
from IG Wealth Management mutual funds that was re-allocated into a
separately managed account managed by Mackenzie.
|
4
|
In the first quarter of
2024, the Company recorded its proportionate share of first quarter
Lifeco earnings based on actual earnings.
|
FORWARD-LOOKING STATEMENTS
Certain statements in this Release, other than statements of
historical fact, are forward-looking statements based on certain
assumptions and reflect IGM Financial Inc.'s (IGM Financial, IGM or
the Company) and, where applicable, its subsidiaries' and
strategic investments', current expectations.
Forward-looking statements are provided to assist the reader in
understanding the Company's, and its subsidiaries and strategic
investments, financial position and results of operations as at and
for the periods ended on certain dates and to present information
about management's current expectations and plans relating to the
future. Readers are cautioned that such statements may not be
appropriate for other purposes. These statements may include,
without limitation, statements regarding the operations, business,
financial condition, expected financial results, performance,
prospects, opportunities, priorities, targets, goals, ongoing
objectives, strategies and outlook of the Company, and its
subsidiaries and strategic investments, as well as the
outlook for North American and international economies, for the
current fiscal year and subsequent periods. 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", "plans", "believes", "estimates",
"seeks", "intends", "targets", "projects", "forecasts" or negative
versions thereof and other similar expressions, or future or
conditional verbs such as "may", "will", "should", "would" and
"could".
This information is based upon certain material factors or
assumptions that were applied in drawing a conclusion or making a
forecast or projection as reflected in the forward-looking
statements, including the perception of historical trends, current
conditions and expected future developments, as well as other
factors that are believed to be appropriate in the circumstances.
While the Company considers these assumptions to be reasonable
based on information currently available to management, they may
prove to be incorrect.
By its nature, this information is subject to inherent risks
and uncertainties that may be general or specific and which give
rise to the possibility that expectations, forecasts, predictions,
projections or conclusions will not prove to be accurate, that
assumptions may not be correct and that objectives, strategic goals
and priorities will not be achieved.
A variety of material factors, many of which are beyond the
Company's and its subsidiaries' and strategic investments' control,
affect the operations, performance and results of the Company and
its subsidiaries and strategic investments, and
their businesses, and could cause actual results to differ
materially from current expectations of estimated or anticipated
events or results. These factors include, but are not limited to:
the impact or unanticipated impact of general economic, political
and market factors in North
America and internationally, interest and foreign exchange
rates, global equity and capital markets, management of market
liquidity and funding risks, changes in accounting policies and
methods used to report financial condition (including uncertainties
associated with critical accounting assumptions and estimates), the
effect of applying future accounting changes, operational and
reputational risks, business competition, technological change,
changes in government regulations and legislation, changes in tax
laws, unexpected judicial or regulatory proceedings, catastrophic
events, outbreaks of disease or pandemics (such as COVID-19), the
Company's ability to complete strategic transactions, integrate
acquisitions and implement other growth strategies, and the
Company's and its subsidiaries' and strategic
investments' success in anticipating and managing the
foregoing factors.
The reader is cautioned that the foregoing list is not
exhaustive of the factors that may affect any of the Company's
forward-looking statements. The reader is also cautioned to
consider these and other factors, uncertainties and potential
events carefully and not place undue reliance on forward-looking
statements.
Other than as specifically required by applicable Canadian
law, the Company undertakes no obligation to update any
forward-looking statements to reflect events or circumstances after
the date on which such statements are made, or to reflect the
occurrence of unanticipated events, whether as a result of new
information, future events or results, or otherwise.
Additional information about the risks and uncertainties of
the Company's business and material factors or assumptions on which
information contained in forward-looking statements is based is
provided in its disclosure materials filed with the securities
regulatory authorities in Canada,
available at www.sedarplus.ca.
NON-IFRS FINANCIAL MEASURES AND OTHER FINANCIAL
MEASURES
This report contains Non-IFRS financial measures and non-IFRS
ratios that do not have standard meanings prescribed by IFRS and
may not be directly comparable to similar measures used by other
companies. These measures and ratios are used to provide
management, investors and investment analysts with additional
measures to assess earnings performance.
Non-IFRS financial measures include, but are not limited to,
"adjusted net earnings available to common shareholders", "adjusted
net earnings", "adjusted earnings before income taxes", "adjusted
earnings before interest and taxes" (Adjusted EBIT), "earnings
before interest, taxes, depreciation and amortization before sales
commissions" (EBITDA before sales commissions), and "earnings
before interest, taxes, depreciation and amortization after sales
commissions" (EBITDA after sales commissions). These measures
exclude other items which are items of a non-recurring nature, or
that could make the period-over-period comparison of results from
operations less meaningful. Effective in the first quarter of 2024,
these measures also exclude the Company's proportionate share of
items that Great-West Lifeco Inc. (Lifeco) excludes from its IFRS
reported net earnings in arriving at Lifeco's base earnings. Base
earnings is an alternate measure Lifeco uses to understand the
underlying business performance compared to IFRS net earnings.
Lifeco's financial information can be obtained in its disclosure
materials filed on www.sedarplus.ca. Comparative periods have been
restated to reflect this change. EBITDA before sales commissions
excludes all sales commissions. EBITDA after sales commissions
includes all sales commissions and highlights aggregate cash
flows.
Non-IFRS ratios include the following:
Ratio
|
Numerator
|
Denominator
|
Adjusted earnings
per share (Adjusted EPS)
|
Adjusted net
earnings available to common shareholders
|
Average number of
outstanding common shares on a diluted basis
|
Return (Adjusted
return) on equity (ROE, Adjusted ROE)
|
Net earnings
(Adjusted net earnings) available to common
shareholders
|
Average
shareholders' equity excluding non-controlling
interest
|
ROE (Adjusted ROE)
excluding the impact of fair value through other comprehensive
income investments
|
Net earnings
(Adjusted net earnings) available to common
shareholders
|
Average
shareholders' equity excluding non-controlling interest and the
impact of fair value through other comprehensive income investments
net of tax
|
Refer to the appropriate reconciliations of non-IFRS
financial measures, including as components of non-IFRS ratios, to
reported results in accordance with IFRS included in IGM Financial
Inc.'s most recent Management's Discussion and Analysis.
This report also contains other financial measures which
include:
- Assets Under Management and Advisement
(AUM&A) represents the consolidated AUM and AUA of
IGM Financial's core businesses IG Wealth Management and Mackenzie
Investments. In the Wealth Management segment, AUM is a component
part of AUA. All instances where the Asset Management segment is
providing investment management services or distributing its
products through the Wealth Management segment are eliminated in
our reporting such that there is no double-counting of the same
client savings held at IGM Financial's core businesses. AUM&A
excludes IPC's AUM, AUA, sales, redemptions and net flows which
have been disclosed as Discontinued operations.
- Assets Under Advisement (AUA) are the key
driver of the Wealth Management segment. AUA are savings and
investment products held within client accounts of our Wealth
Management segment core business.
- Assets Under Management (AUM) are the key
driver of the Asset Management segment. AUM are an additional
driver of revenues and expenses within the Wealth Management
segment in relation to its investment management activities. AUM
are client assets where we provide investment management services,
and include investment funds where we are the fund manager,
investment advisory mandates to institutions, and other client
accounts where we have discretionary portfolio management
responsibilities.
- Assets Under Management and Advisement Including
Strategic Investments (AUM&A Including SI)
represents AUM&A including the Company's proportionate share
of the AUM&A of strategic investments based on the Company's
direct and indirect ownership of the strategic investments. The
strategic investments included are those whose activities are
primarily in asset and wealth management, and include ChinaAMC,
Northleaf, Rockefeller and Wealthsimple. Rockefeller client assets
include assets under management and advisement as well as assets
held for investment purposes and only receiving administrative
services.
FIRST QUARTER WEBCAST AND CONFERENCE CALL
IGM Financial Inc.'s First Quarter 2024 results conference call
and webcast will be held on Friday, May 3,
2024 at 8:00 a.m. ET. The
webcast and conference call can be accessed respectively through
igmfinancial.com/en or you may register to obtain a calendar
booking with your dial in numbers, PIN and webcast links.
Alternatively, dial 1-844-763-8274 or +1-647-484-8814.
The most recent Consolidated Financial Statements and
Management's Discussion and Analysis (MD&A) of operating
results are available on IGM Financial Inc.'s website at
igmfinancial.com/en.
ABOUT IGM FINANCIAL INC.
IGM Financial Inc. is one of Canada's leading diversified wealth and asset
management companies with approximately $252
billion in total assets under management and advisement at
March 31, 2024. The
company provides a broad range of financial planning and investment
management services to help more than two million Canadians meet
their financial goals. Its activities are carried out principally
through IG Wealth Management and Mackenzie Investments. IGM
Financial is a member of the Power Corporation group of
companies.
IGM FINANCIAL
INC.
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
Statements of Earnings
|
|
|
|
|
|
|
|
(unaudited)
|
Three months ended
March 31
|
(in thousands of
Canadian dollars, except per share amounts)
|
2024
|
|
2023
|
|
|
|
|
Revenues
|
|
|
|
Wealth
management
|
$
582,565
|
|
$
534,111
|
Asset
management
|
241,866
|
|
236,154
|
Dealer compensation
expense
|
(80,092)
|
|
(79,326)
|
Net asset
management
|
161,774
|
|
156,828
|
Net investment income
and other
|
15,627
|
|
10,949
|
Gain on sale of Lifeco
shares
|
-
|
|
179,118
|
Proportionate share of
associates' earnings
|
51,700
|
|
53,044
|
|
811,666
|
|
934,050
|
|
|
|
|
Expenses
|
|
|
|
Advisory and business
development
|
265,627
|
|
245,641
|
Operations and
support
|
203,828
|
|
201,775
|
Sub-advisory
|
17,835
|
|
15,846
|
Interest
|
32,250
|
|
28,055
|
|
519,540
|
|
491,317
|
Earnings before income
taxes
|
292,126
|
|
442,733
|
Income taxes
|
67,318
|
|
63,361
|
Net earnings from
continuing operations
|
224,808
|
|
379,372
|
Net earnings from
discontinued operations
|
-
|
|
3,129
|
Net earnings
|
224,808
|
|
382,501
|
Non-controlling
interest
|
(1,423)
|
|
(1,163)
|
Net earnings
available to common shareholders
|
$
223,385
|
|
$
381,338
|
|
|
|
|
Earnings per share (in
dollars)
|
|
|
|
Net earnings available
to common shareholders from continuing operations
|
|
|
|
- Basic
|
$
0.94
|
|
$
1.59
|
- Diluted
|
$
0.94
|
|
$
1.59
|
Net earnings available
to common shareholders
|
|
|
|
- Basic
|
$
0.94
|
|
$
1.60
|
- Diluted
|
$
0.94
|
|
$
1.60
|
IGM FINANCIAL
INC.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial
Highlights
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As at and for the three
months ended March 31
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
2024
|
|
2023
|
|
Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings
available to common shareholders ($ millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Earnings
|
|
|
|
|
|
|
|
$
223.4
|
|
$
381.3
|
|
(41.4)
|
%
|
|
Adjusted Net Earnings
(1)
|
|
|
|
|
|
|
|
224.5
|
|
206.3
|
|
8.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Earnings
|
|
|
|
|
|
|
|
0.94
|
|
1.60
|
|
(41.3)
|
|
|
Adjusted Net Earnings
(1)
|
|
|
|
|
|
|
|
0.94
|
|
0.87
|
|
8.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on
equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Earnings
|
|
|
|
|
|
|
|
13.2 %
|
|
24.6 %
|
|
|
|
|
Adjusted Net Earnings
(1)
|
|
|
|
|
|
|
|
13.3 %
|
|
13.3 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends per
share
|
|
|
|
|
|
|
|
0.5625
|
|
0.5625
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated assets
under management and advisement (AUM&A)(2)(3)
($ millions)
|
|
|
|
$
252,189
|
|
$
234,087
|
|
7.7
|
%
|
Consolidated assets
under management(2)
|
|
|
|
|
|
|
|
237,734
|
|
222,283
|
|
7.0
|
|
|
Wealth Management
(IG Wealth Management)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets under
management(4)
|
|
|
|
|
|
|
|
113,566
|
|
104,069
|
|
|
|
|
|
|
Other assets under
advisement
|
|
|
|
|
|
|
|
14,455
|
|
11,804
|
|
|
|
|
|
|
Assets under
advisement
|
|
|
|
|
|
|
|
128,021
|
|
115,873
|
|
10.5
|
|
|
Asset Management
(Mackenzie Investments)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment
funds
|
|
|
|
|
|
|
|
64,921
|
|
61,576
|
|
|
|
|
|
|
Institutional
SMA
|
|
|
|
|
|
|
|
7,966
|
|
6,826
|
|
|
|
|
|
|
Sub-advisory to Canada
Life
|
|
|
|
|
|
|
|
51,281
|
|
48,582
|
|
|
|
|
|
|
Total excluding
sub-advisory to Wealth Management
|
|
|
|
|
|
124,168
|
|
116,984
|
|
|
|
|
|
|
Sub-advisory and AUM to
Wealth Management
|
|
|
|
|
|
79,503
|
|
76,785
|
|
|
|
|
|
|
Total assets under
management
|
|
|
|
|
|
|
|
203,671
|
|
193,769
|
|
5.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
AUM&A including strategic investments
|
|
|
|
|
|
422,336
|
|
349,671
|
|
20.8
|
|
|
|
Consolidated
AUM&A
|
|
|
|
|
|
|
|
252,189
|
|
234,087
|
|
|
|
|
|
Strategic
investments(5)
|
|
|
|
|
|
|
|
170,147
|
|
115,584
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Flows
|
|
|
|
|
|
|
|
Wealth
|
|
Asset
|
|
|
|
($
millions)
|
|
|
|
|
|
|
|
|
Management(4)
|
|
Management(6)
|
|
Total
(3)
|
|
|
For the three months
ended March 31, 2024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment fund net
sales
|
|
|
|
|
|
|
|
$
(315)
|
|
$
(194)
|
|
$
(509)
|
|
|
|
Institutional SMA net
sales
|
|
|
|
|
|
|
|
-
|
|
20
|
|
20
|
|
|
|
IGM product net
sales
|
|
|
|
|
|
|
|
(315)
|
|
(174)
|
|
(489)
|
|
|
|
Other dealer net
flows
|
|
|
|
|
|
|
|
361
|
|
-
|
|
361
|
|
|
|
Total net
flows
|
|
|
|
|
|
|
|
46
|
|
(174)
|
|
(128)
|
|
(1)
|
Non-IFRS Financial
Measures
|
|
|
2024 adjusted net
earnings excluded Lifeco other items of ($1.1) million.
|
|
|
2023 adjusted net
earnings excluded:
|
|
|
•
|
A gain on the sale of a
portion of the Company's investment in Lifeco of $174.8 million
after-tax ($179.1 million pre-tax).
|
|
|
•
|
Lifeco other items of
$0.2 million.
|
|
(2)
|
2023 excludes
discontinued operations of IPC. At March 31, 2023, IPC's AUA
totalled $30.9 billion and AUM totalled $4.8 billion, and on a
consolidated AUM&A basis totalled $26.4 billion.
|
(3)
|
Consolidated results
eliminate double counting where business is reflected within
multiple segments.
|
(4)
|
Includes separately
managed accounts.
|
(5)
|
Proportionate share of
strategic investments' AUM comprised of: 27.8% (2023 - 27.8%) of
ChinaAMC's AUM; 56% (2023 - 56%) of Northleaf's AUM; 20.5% (2023 -
nil) of Rockefeller's client assets; and 27.1% (2023 - 27.1%) of
Wealthsimple's AUA.
|
(6)
|
Asset Management flows
activity excludes sub-advisory to Canada Life and the Wealth
Management segment.
|
SOURCE IGM Financial Inc.