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CI Financial reports fourth quarter and annual results: Assets under management increase 6%

TSX Symbol: CIX

TORONTO, Feb. 16, 2017 /CNW/ - CI Financial Corp. ("CI") today released audited financial results for the quarter and year ended December 31, 2016.

ANNUAL RESULTS1 (in $millions except for per share data)

Year ended

December 31, 2016

Year ended

December 31, 2015

%
change

Assets Under Management

117,889

111,124

6

Average Assets Under Management

110,852

108,384

2

Net Income

503.0

553.5

(9)

Adjusted Net Income2,3

532.1

563.7

(6)

Earnings Per Share

1.86

1.99

(7)

Adjusted Earnings Per Share2,3

1.96

2.02

(3)

EBITDA Per Share2,3

3.10

3.33

(7)

Adjusted EBITDA Per Share 2,3

3.24

3.37

(4)

Free Cash Flow3

604.7

606.4

-





QUARTERLY RESULTS1 (in $millions except for per share data)

Quarter ended

December 31, 2016

Quarter ended

December 31, 2015

%
change

Average Assets Under Management

114,780

108,688

6

Net Income

121.0

127.2

(5)

Adjusted Net Income2,3

140.6

137.0

3

Earnings Per Share

0.45

0.46

(2)

Adjusted Earnings Per Share2,3

0.53

0.50

6

EBITDA Per Share2,3

0.75

0.79

(5)

Adjusted EBITDA Per Share 2,3

0.85

0.83

2

Free Cash Flow3

154.0

151.4

2





OTHER QUARTERLY METRICS

Quarter ended

December 31, 2016

Quarter ended

December 31, 2015

%
change

Dividends Recorded Per Share (in $)

0.345

0.330

5

Long-Term Debt (in $millions; including current portion)

758.7

559.3

36

Net Debt (in $millions)3

572.9

433.1

32

SG&A Expenses4

35.5 bps

35.4 bps

-

Return on Equity5

27.9%

29.2%

n/a

 

1 All results are net of non-controlling interest.
2 The year ended December 31, 2016 excludes $39.6 million ($29.1 million after tax) in provisions for compensation, legal and tax costs. The quarter ended December 31, 2016 excludes $26.6 million ($19.6 million after tax) in provisions for compensation, legal and tax costs. The year ended December 31, 2015 excludes income of $7.5 million related to a fair value adjustment to contingent consideration, $19.6 million ($16.2 million after tax) in provisions for compensation, legal and tax costs, and a $3.0 million ($1.4 million after tax and non-controlling interest) acceleration in the amortization of fund management contracts. The quarter ended December 31, 2015 excludes $10.8 million ($9.8 million after tax) in provisions for compensation, legal and tax costs.
3 Adjusted net income, adjusted earnings per share, EBITDA (earnings before interest, taxes, depreciation and amortization), EBITDA per share, adjusted EBITDA per share, pre-tax operating earnings, free cash flow and net debt are not standardized measures prescribed by IFRS; however, CI believes that these financial measures provide information that is useful to investors in understanding CI's performance and facilitate a comparison of quarterly and full-year results from period to period. These non-IFRS measures and reconciliations to IFRS, where necessary, are included in Management's Discussion and Analysis available at www.cifinancial.com.
4 As a percentage of average assets under management.
5 Trailing 12 months.

Average assets under management reached $110.9 billion for 2016, an increase of 2% from 2015. Fourth quarter average assets were up 6% year over year. At December 31, 2016, CI's assets under management were $117.9 billion, up $6.8 billion or 6% from $111.1 billion at December 31, 2015. Effective November 15, 2016, CI's assets under management included the assets of Grant Samuel Funds Management (GSFM), a leading independent manager and distributor of investment strategies and products in the Australian and New Zealand markets.

CI had gross sales of $3.5 billion in the fourth quarter of 2016, up 9% from the prior quarter and down 3% from the fourth quarter of 2015. During the fourth quarter of 2016, two financial institutions redeemed a total of $2.3 billion in assets from CI, as was expected and discussed during CI's third quarter earnings conference call in November. The margins associated with these assets were low and the financial impact will be minimal. In total, CI reported net redemptions of $2.6 billion in the fourth quarter, down from net sales of $0.3 billion in the fourth quarter of last year.

Earnings per share in the fourth quarter were $0.45, a decrease of 2% from $0.46 in the fourth quarter of 2015. Earnings per share adjusted to exclude provisions for compensation, legal and tax costs, were $0.53, up from $0.51 in the prior quarter and up from $0.50 in the same quarter last year. For the year, earnings per share were $1.86 compared with $1.99 in 2015; adjusted earnings per share were $1.96, down 3% from $2.02 last year.

Adjusted EBITDA per share was $0.85 for the fourth quarter of 2016, up 2% from $0.83 per share for both the prior quarter and the fourth quarter of 2015.

Selling, general and administrative (SG&A) expenses as a percentage of average assets under management were 35.5 basis points, in line with 35.4 basis points for both the prior quarter and the same quarter in 2015.

CI generated $604.7 million in free cash flow during the year ended December 31, 2016, as compared to $606.4 million in 2015. CI's cash flow facilitated the repurchase of $290.9 million in CI shares and the payment of $368.7 million in dividends in 2016. As at January 31, 2017, CI had 264,767,657 shares outstanding.

"2016 was a unique and challenging year for CI and the industry," said Peter W. Anderson, CI Chief Executive Officer. "During the year we made a number of strategic improvements to our business to address these challenges and our fourth quarter results show that our strategy is working. I am very pleased with the position of our business today, but I'm even more excited about the initiatives that will be rolled out in 2017."

The Board of Directors declared a monthly cash dividend of $0.115 per share, payable on each of March 15, 2017, April 13, 2017 and May 15, 2017 to shareholders of record on February 28, 2017, March 31, 2017 and April 30, 2017, respectively. The monthly dividend represented a yield of 4.9% on CI's closing share price of $28.31 on February 15, 2017.

For detailed financial statements for the quarter and year ended December 31, 2016, including Management's Discussion and Analysis, which contains discussions of non-IFRS measures, please refer to CI's website at www.cifinancial.com under Reports, or contact investorrelations@ci.com.

Analysts' Conference Call
CI will hold a conference call with analysts today at 4 p.m. Eastern time. Chief Executive Officer Peter Anderson and Chief Financial Officer Douglas Jamieson will be presenting CI's results. Also attending will be Steven Donald, President of Assante Wealth Management, Barry Gordon, President and Chief Executive Officer of First Asset Investment Management, Neal Kerr, President of CI Institutional Asset Management, and Roy Ratnavel, Head of Retail Sales for CI Investments. The call and a slide presentation will be accessible through a webcast at www.ci.com/q4. Alternatively, investors may listen to the discussion by dialling (416) 340-2217 or 1-800-806-5484 (passcode: 8268169). A replay of the call will be available until March 2, 2017 at (905) 694-9451 or 1-800-408-3053 (passcode: 3729048). The webcast will be archived at www.ci.com/q4.

CI Financial Corp. (TSX: CIX) is an independent, Canadian-owned wealth management company. Its primary operating businesses are CI Investments Inc., one of Canada's largest investment managers, advisory businesses Assante Wealth Management and Stonegate Private Counsel, Grant Samuel Funds Management of Australia, and First Asset Investment Management, a leader in providing actively managed exchange-traded funds to the Canadian marketplace. CI is on the Web at www.cifinancial.com.

This press release contains forward-looking statements with respect to CI and its products and services, including its business operations and strategy and financial performance and condition. Although management believes that the expectations reflected in such forward-looking statements are reasonable, such statements involve risks and uncertainties. Actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors, including interest rates, business competition, changes in government regulations or in tax laws, and other factors discussed in materials filed with applicable securities regulatory authorities from time to time.

SOURCE CI Financial Corp.


 
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