Mackenzie
Review of the Business

Assets Under Management and Administration

Total Mackenzie assets under management and administration as at December 31, 2004 were $43.3 billion, an increase of 13.9% over the previous year.

Mackenzie's mutual fund assets under management were $37.3 billion at December 31, 2004, an increase of 10.4% from $33.8 billion at December 31, 2003.

Sales of Mackenzie's mutual funds were $6.8 billion, an increase of 28.5% from $5.3 billion in 2003. This compares to an overall industry increase in mutual fund sales of 27.5%. During 2004 redemptions of mutual funds were $6.0 billion as compared to redemptions of $5.4 billion in 2003. Net sales of mutual funds during 2004 were $795 million, as compared to net redemptions of $69 million last year. Despite improving market conditions in 2004, investors were slow to return to the equity markets and for much of the year remained invested in conservative investments such as money market, income and balanced funds. Net sales of long-term funds were $819 million in 2004, compared to $209 million in 2003.

During 2004, Mackenzie's redemption rate for long-term funds was 13.8% as compared to 13.0% in 2003. A factor contributing to this increase is the growth in the amount of Mackenzie's mutual fund units that were originally sold on a deferred sales charge basis that are no longer subject to a redemption fee. The redemption rate for long-term funds for all other members of IFIC increased to 14.8% at December 31, 2004 from 13.8% in 2003.

Market performance increased mutual fund assets by $2.7 billion during the year, as compared to an increase of $3.0 billion in 2003.

In addition to its mutual fund business, an important component of Mackenzie's operations is the provision of investment management, administration and distribution services for other investment products. As at December 31, 2004, Mackenzie provided investment management services to private and institutional accounts with assets of $4.9 billion, a 48.3% increase from the corresponding period last year, and provided administration and distribution services to venture capital funds with $1.0 billion in net assets. Also at December 31, 2004, Mackenzie's structured products totalled $129.0 million, excluding the assets in the CIBC FULPaY† Mackenzie Funds – Linked Deposit Notes, as those assets are included in the underlying Mackenzie mutual fund.

Table 7: Changes In Assets Under Management And Administration - Mackenzie