IGM Financial Inc. reports first quarter earnings
Winnipeg – May 7, 2010: IGM Financial Inc. (IGM or the Company) (TSX:IGM) today announced earnings results for the first quarter of 2010.
Net income for the three months ended March 31, 2010 was $178.7 million compared to net income of $133.5 million in 2009. Earnings per share were 68 cents compared to earnings per share of 51 cents in 2009, an increase of 33.3%.
Gross revenues for the three months ended March 31, 2010 were $649.4 million compared to $562.9 million a year ago. Operating expenses were $402.7 million for the first quarter of 2010, compared to $377.6 million a year ago.
Total assets under management at March 31, 2010 were $123.4 billion. This compared with total assets under management of $98.7 billion at March 31, 2009, an increase of 25.0%.
Shareholders' equity at March 31, 2010 was $4.5 billion, compared to $4.2 billion at March 31, 2009. Return on average common equity for the three months ended March 31, 2010 was 16.7% compared to 12.9% for the comparative period in 2009.
Investors Group Operations
The number of Investors Group Consultants was 4,637 at March 31, 2010 up from 4,633 at December 31, 2009.
Mutual fund sales for the first quarter were $1.9 billion compared to $1.4 billion in the prior year and mutual fund net sales for the first quarter were $560 million compared to net sales of $309 million a year ago.
The twelve month trailing redemption rate (excluding money market funds) was 7.5% at March 31, 2010, compared to 7.7% at March 31, 2009.
“First quarter net sales of mutual funds were up 81% over the same period last year based on a significant increase in sales and continued near record low redemption rate,” said Murray J. Taylor, President and Chief Executive Officer of Investors Group Inc. “Our Consultant network expanded for the 23rd consecutive quarter, up 3.4% since March 31, 2009.”
Mutual fund assets under management at March 31, 2010 were $59.2 billion compared to $46.6 billion at March 31, 2009, an increase of 27.2%.
Total sales for the first quarter of 2010 were $3.2 billion compared to $2.9 billion in the prior year. Total net sales for the first quarter were $101 million compared to total net redemptions of $299 million in the prior year.
“The medium term relative performance of our diversified offering of mutual funds remained strong, with 66% of our fund assets ranked in the first or second quartile of their respective asset categories over the last three years,” said Charles R. Sims, President and Chief Executive Officer of Mackenzie Financial Corporation.
Mackenzie’s total assets under management at March 31, 2010 were $64.9 billion compared with total assets under management of $52.6 billion at March 31, 2009, an increase of 23.3%. Mutual fund assets under management at March 31, 2010 were $41.3 billion compared to $33.7 billion a year ago, an increase of 22.8%.
The Board of Directors has declared a dividend of 51.25 cents per share on the Company’s common shares and has declared a dividend of $0.36875 per share on the Company’s 5.90% Non-Cumulative First Preferred Shares, Series “B”. The common share dividend is payable on July 30, 2010 to shareholders of record on June 28, 2010 and the preferred share dividend is payable on August 3, 2010 to shareholders of record on June 28, 2010.
Certain statements in this Release, other than statements of historical fact, are forward-looking statements based on certain assumptions and reflect IGM Financial ’s current expectations. Forward-looking statements are provided for the purposes of assisting the reader in understanding the Company’s 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 and 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, 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.
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’ control, affect the operations, performance and results of the Company, and its subsidiaries, 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 (including adoption of International Financial Reporting Standards), 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, the Company's ability to complete strategic transactions, integrate acquisitions and implement other growth strategies, and the Company’s success in anticipating and managing the foregoing factors.
The reader is cautioned that the foregoing list of factors 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 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 is provided in its disclosure materials filed with the securities regulatory authorities in Canada, available at www.sedar.com.
A review of activities and performance for IGM Financial Inc., together with financial details and a management discussion, will be published in the Company’s 2010 First Quarter Report to Shareholders which should be mailed to shareholders on or about May 20, 2010.
Financial Statements and Notes
IGM Financial Inc. is one of Canada's premier personal financial services companies, and one of the country’s largest managers and distributors of mutual funds and other managed asset products, with over $123 billion in total assets under management as of April 30, 2010. Its activities are carried out principally through Investors Group, Mackenzie Financial Corporation and Investment Planning Counsel. IGM Financial Inc. is a member of the Power Financial Corporation group of companies.
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Media Note: A live webcast of IGM’s Analyst conference call for the First Quarter 2010 will be held Friday May 7, 2010, at 3:30 P.M. (ET) at www.igmfinancial.com. Media and interested parties may alternatively choose to listen to the live analyst teleconference call by dialing 1-877-240-9772 or 416-340-8530.