Canaccord Genuity Group
Inc. Reports Fourth Quarter Fiscal 2018 ResultsPR NewswireTORONTO, June 6, 2018Excluding significant items, fourth quarter earnings per common share of $0.28 (1)(All dollar
amounts are stated in Canadian dollars unless otherwise indicated)TORONTO, June 6, 2018 /PRNewswire/ - During the fourth quarter of fiscal 2018, the quarter ended March 31, 2018, Canaccord Genuity Group Inc. ((Canaccord Genuity, the Company, TSX:CF) generated $322.1 million in revenue. Excluding significant items (1), the Company recorded net income (3) of $37.3 million or net income of $33.0 million attributable to common shareholders (2) (earnings per common share of $0.28). Including all expense items, on an IFRS basis, the Company recorded a net loss (3) of $9.7 million or a net loss of $14.0 million attributable to common shareholders (2) (loss per common share of $0.15). These IFRS results include a non-cash accounting charge related to our Long-term Incentive Plan in the amount of $48.4 million as further described below. This charge has been treated as a significant item and excluded as an expense in the determination of our adjusted net income.During the fiscal year ended March 31, 2018, the Company generated $1.02 billion in revenue. Excluding significant items (1), the Company recorded net income (3) of $81.7 million or net income of $68.0 million attributable to common shareholders (2) (earnings per common share of $0.59). Including the accounting charge referred to above and all other expense items, on an IFRS basis, the Company recorded net income (3) of $17.1 million or net income of $3.4 million attributable to common shareholders (2) (earnings per common share of $0.03)."Fiscal 2018 was a pivotal year for our organization as we achieved our strategic goal of significantly increasing contributions from our global wealth management operations, while we continued to extract greater value from our global capital markets platform," said Dan Daviau, President & CEO of Canaccord Genuity Group Inc. "We delivered robust earnings growth and made excellent progress on our strategy of building a leading independent investment bank and wealth management firm, with disciplined expense management and stronger recurring revenue contributions."In addition to significant items related to the amortization of intangible assets acquired in connection with a business combination, acquisition-related costs, certain incentive-based payments related to the acquisition of Hargreave Hale and restructuring costs, an accounting charge related to our Long-Term Incentive Plan was also recorded during the fourth quarter of fiscal 2018 and treated as a significant item.The Company's Long-Term Incentive Plan has been an important element to the Company's incentive compensation program for several years. Under this plan, senior employees of the Company receive a portion of their annual compensation in the form of restricted stock units (RSUs). These RSUs vest over time, typically three years, and, prior to the accounting change described below, the cost of those RSUs was expensed over that vesting period. Certain non-substantive changes made to the plan by the Company which took effect on March 31, 2018, had the effect of causing a change in the method of expensing these awards so that they are now expensed at the time they are deemed to be earned which is generally the fiscal period in which the awards are either made or the immediately preceding fiscal year for those awards earned in respect of that preceding fiscal year. With this change in accounting treatment, the cost of RSU awards granted in respect of fiscal 2018 as well as the unamortized expense as at March 31, 2018 of outstanding awards granted prior to fiscal 2018 were expensed in the current quarter (Q4/18). This change did not affect awards made in connection with new hires or for retention purposes. The cost of those awards will continue to be recognized over the vesting period. With this change, the total expense for share-based awards recognized in fiscal 2018 was $94.7 million. This expense was comprised of the following two components:$46.3 million in respect of awards made in fiscal 2018 and the 2018 amortization expense associated with new hire and retention-based awards.$48.4 million in respect of awards granted prior to fiscal 2018The amount of $48.4 million in respect of awards granted prior to fiscal 2018 was treated as a significant item in our supplementary financial reporting and is therefore excluded in the determination of our adjusted earnings and earnings per share (i.e. excluding significant items) for Q4/18 and fiscal 2018.RSU awards are generally covered through shares held in employee benefit trusts, so this change in accounting treatment does not have an impact on either cash or capital.Going forward, in fiscal 2019 and fiscal periods after 2019, the share-based award expense recognized in each period will only reflect the cost of awards earned in respect of that period as well as the amortized cost of new hire and retention-based awards applicable to that period.Fourth Quarter of Fiscal 2018 vs. Fourth Quarter of Fiscal 2017Revenue of $322.1 million, an increase of 18.6% or $50.4 million from $271.7 millionExcluding significant items, expenses of $269.9 million, an increase of 16.3% or $37.7 million from $232.2 million (1)Expenses of $324.4 million, an increase of 38.5% or $90.1 million from $234.3 millionExcluding significant items, diluted earnings per common shares (EPS) of $0.28 compared to diluted EPS of $0.27 (1)Excluding significant items, net income (3) of $37.3 million compared to net income (3) of $32.7 million (1)Net loss (3) of $9.7 million compared to net income (3) of $31.0 millionDiluted loss per common share of $0.15 compared to diluted EPS of $0.26Fourth Quarter of Fiscal 2018 vs Third Quarter of Fiscal 2018Revenue of $322.1 million, an increase of 4.1% or $12.7 million from $309.4 millionExcluding significant items, expenses of $269.9 million, an increase of 4.1% or $10.7 million from $259.2 million (1)Expenses of $324.4 million, an increase of 23.5% or $61.8 million from $262.6 millionExcluding significant items, diluted EPS of $0.28 compared to diluted EPS of $0.31 (1)Excluding significant items, net income (3) of $37.3 million compared to net income (3) of $39.2 million (1) Net loss (3) of $9.7 million compared to net income (3) of $36.6 millionDiluted loss per common share of $0.15 compared to diluted EPS of $0.29Fiscal 2018 vs. Fiscal 2017Excluding significant items, revenue of $1.02 billion, an increase of 16.5% or $144.5 million from $878.4 million (1)Excluding significant items, expenses of $912.3 million, an increase of 11.6% or $95.2 million from $817.1 million (1)Revenue of $1.02 billion, an increase of 16.3% or $143.3 million from $879.5 millionExpenses of $987.1 million, an increase of 19.6% or $161.4 million from $825.7 millionExcluding significant items, diluted EPS of $0.59 compared to diluted EPS of $0.32(1)Excluding significant items, net income (3) of $81.7 million compared to net income (3) of $49.2 million (1)Net income (3) of $17.1 million compared to net income (3) of $43.2 millionDiluted EPS of 0.03 compared to diluted EPS of $0.27Financial Condition at End of Fourth Quarter Fiscal 2018 vs. Fourth Quarter Fiscal 2017Cash and cash equivalents balance of $862.8 million, an increase of $185.0 million from $677.8 millionWorking capital of $575.6 million, an increase of $87.1 million from $488.5 millionTotal shareholders' equity of $841.4 million, an increase of $76.6 million from $764.8 millionBook value per diluted common share of $5.71, an increase of $0.63 from $5.08 (4)On June 6, 2018, the Board of Directors approved a dividend of $0.12 per common share, payable on July 3, 2018, with a record date of June 22, 2018. The dividend is comprised of a $0.01 base quarterly dividend and an $0.11 supplemental dividend as outlined below. The Company's dividend policy which became effective March 31, 2017 is to pay a quarterly dividend of $0.01 per common share that will be declared and paid quarterly. Following the end of each fiscal year, the Board will review the capital position of the Company in the context of the market environment in combination with capital allocation requirements for its strategic priorities, and determine whether a supplemental dividend should be paid. Supplemental dividends, if declared, may be highly variable from year to year. All dividend payments will depend on general business conditions, the Company's financial condition, results of operations, capital requirements and such other factors as the Board determines to be relevant.On June 6, 2018, the Board approved a cash dividend of $0.24281 per Series A Preferred Share payable on July 3, 2018 to Series A Preferred shareholders of record as at June 22, 2018On June 6, 2018, the Board approved a cash dividend of $0.31206 per Series C Preferred Share payable on July 3, 2018 to Series C Preferred shareholders of record as at June 22, 2018. SUMMARY OF OPERATIONSCorporateOn April 25, 2018, the Company announced that it entered into an agreement to acquire Jitneytrade Inc. and Finlogik Inc. directly and through the purchase of Finlogik Capital Inc. Jitneytrade Inc. is a direct access broker and an active trader in futures and equity options in Canada. Finlogik Inc. is in the business of delivering value-added fintech solutions in the Canadian market. This acquisition closed on June 6, 2018.At its meeting on June 6, 2018, the Board of Directors approved the grant of 6,220,000 performance share options (PSOs) to senior management of the Company and its operating subsidiaries. The options will be granted under the terms of the Company's Performance Share Option (PSO) plan to be presented to the shareholders for their approval at the Company's annual general meeting to be held on August 2, 2018. The grant is subject to ratification at that meeting. The options will have an exercise price determined within the context of the market at the time of the grant, will have a term of five years and will time-vest rateably over four years (with one third vesting on each of the second, third and fourth anniversaries of the date of grant). PSOs will also be subject to market (stock price) performance vesting conditions, as well as have a three times exercise price cap on payout value.Capital MarketsCanaccord Genuity participated in 107 investment banking transactions globally, raising total proceeds of C$9.4 billion (5) during fiscal Q4/18Of these, Canaccord Genuity led or co-led 60 transactions globally, raising proceeds of C$2.4 billion (5) during fiscal Q4/18Significant investment banking transactions for Canaccord Genuity during fiscal Q4/18 include:£173.0 million initial public offering for Baillie Gifford US Growth Trust plc on LSEUS$312.5 million in two transactions for Atara Biotherapeutics on NasdaqUS$260.2 million for Xencor Inc. on NasdaqC$230.0 million for Aurora Cannabis on TSXC$149.5 million for Hydropothecary Corporation on TSXVUS$130.0 million in two transactions for Helios + Matheson on NasdaqC$132.8 million for MedReleaf on TSX£57.6 million for The Renewables Infrastructure Group Limited on LSE£51.5 million for Tyman plc on LSE£47.5 million for Triple Point Social Housing REITC$75.0 million for ABCann Global Corporation on TSXVUS$60.0 million initial public offering for BioXcel Therapeutics Inc.£35.0 million for Seeing Machines Limited on AIMC$51.7 million for Nuuvera Inc. on TSXVC$45.0 million for Etherium Capital on TSXV£21.1 million block trade for Liontrust Asset Management on LSEC$40.3 million for Namaste Technologies Inc. on CSE£18.4 million for Velocys plcC$38.7 million Initial Public Offering for Cannabis Growth Opportunity Corporation on CSEC$38.2 million for Pollard Banknote Ltd. on TSXC$34.9 million fully marketed equity financing for CoinsquareC$34.5 million for Profound Medical Corp. on TSXVUS$23.3 million for Tyme technologies on NasdaqC$30.2 million for Aleafia Inc. on TSXVC$30.2 million for Axis Auto Finance on TSXVC$29.7 million for HashChain Technology Inc. on TSXVUS $23.0 million for ConforMIS Inc. on NasdaqC$27.8 million for Sunniva Inc. on CSEC$27.1 million private placement for HyperBlock Technologies Corp.C$28.8 million for PRO Real Estate Investment Trust on TSXVC$25.3 million for Patriot One Technologies on TSXVC$24.2 million for Millenial Lithium Corp. on TSXVUS$13.0 million initial public offering for Kore Potash on AIMC$22.0 million for Standard Lithium Ltd. On TSXVC$17.5 million for Golden Leaf Holdings on CSEAUD$25.0 million placement and AUD$13 million debt funding for Alliance Mineral Assets Ltd on SGXAUD$10.5 million for Think Childcare Ltd. on ASXIn Canada, Canaccord Genuity participated in raising $221.9 million for government and corporate bond issuances during fiscal Q4/18Advisory fees recorded during fiscal Q4/18 were $40.9 million, a decrease of $11.5 million or 22.0% compared to the same quarter last yearDuring fiscal Q4/18, significant M&A and advisory transactions included:Rockspring Property Holdings Limited on its sale to PATRIZIA Immobilien AGArdian on its €670 million disposal of Trescal to OMERS Private EquityHLD/Dentressangle on its €1.5 billion acquisition of KiloutouThe Carlyle Group and PAI Partners on its €200 million disposal of CrouzetBroken Coast Cannabis Inc. on its C$273 million sale to AphriaPartnerships BC on its C$126.8 million financing for the Capital Regional District Treatment FacilityNorthern Star Resources on its A$23 million strategic investment in Echo ResourcesNuuvera on its C$787 million sale to Aphria Inc.Aurora Cannabis on its C$1.2 billion acquisition of CanniMed Therapeutics Inc.Thoma Bravo and Motus on Thoma Bravo's acquisition of the premier vehicle management platforms of Motus and RunzheimerOutpatient Imaging Affiliates, LLC on its sale to ICV PartnersBlockchain Dynamics on its C$30 million sale to CryptoGlobalAura Minerals on its merger with Rio Novo Gold Inc.BuildDirect.com on its restructuring and recapitalizationCanaccord Genuity Wealth Management (Global)Globally, Canaccord Genuity Wealth Management generated $117.6 million in revenue during Q4/18Assets under administration in Canada and assets under management in the UK & Europe and Australia were $61.3 billion at the end of Q4/18(4), an increase of 3.6% or $2.1 billion at the end of the previous quarter and an increase of 58.7% or $22.7 billion at the end of fiscal Q4/17Canaccord Genuity Wealth Management (North America)Canaccord Genuity Wealth ...Full story available on Benzinga.comWeiter zum vollständigen Artikel bei "Benzinga"