AGF Management Limited (AGF or the Company) (TSX: AGF.B) today announced financial results for the second quarter ended May 31, 2022.
“This quarter marked AGF’s 65th anniversary, a testament to our disciplined investment approach, our unwavering commitment to our clients and our history of innovation,” said Kevin McCreadie, Chief Executive Officer and Chief Investment Officer, AGF. “We are pleased to report our seventh consecutive quarter of positive net mutual fund sales and continued strong investment performance, outperforming our one-year and three-year targets in an environment marked by significant market volatility, demonstrating our ability to navigate regulatory change and further diversify our investments.”
AGF’s mutual fund gross sales were $818 million for the quarter compared to $1,060 million in the comparative period, while net sales were $132 million compared to $408 million in the comparative period. AGF’s sales have continued to outpace the industry. During the quarter the industry2 reported net redemptions, while AGF retail mutual funds3 remained in net sales.
“This quarter we struck new relationships with key platforms and further diversified our distribution strategy to meet the unique needs of our clients in different markets,” said Judy Goldring, President and Head of Global Distribution, AGF. “And we continue to see the results of this approach reporting another quarter of net positive mutual fund sales.”
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Three months ended |
Six months ended |
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May 31, |
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February 28, |
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May 31, |
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May 31, |
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May 31, |
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| (in millions of Canadian dollars, except per share data) |
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2022 |
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2022 |
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2021 |
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2022 |
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2021 |
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| Income |
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| Management, advisory, administration fees |
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| and deferred sales charges |
$ |
113.1 |
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$ |
114.1 |
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$ |
108.6 |
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$ |
227.2 |
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$ |
211.5 |
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| Share of profit (loss) of joint ventures |
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(0.2) |
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(0.6) |
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0.1 |
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(0.8) |
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0.9 |
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| Other income from fee-earning arrangements |
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0.7 |
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0.8 |
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0.4 |
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1.5 |
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0.4 |
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| Fair value adjustments and other income |
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3.9 |
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10.6 |
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0.4 |
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14.5 |
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3.9 |
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| Total Income |
$ |
117.5 |
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$ |
124.9 |
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$ |
109.5 |
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$ |
242.4 |
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$ |
216.7 |
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| Selling, general and administrative |
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47.3 |
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49.3 |
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47.1 |
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96.6 |
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95.1 |
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| Deferred selling commissions |
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17.8 |
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19.3 |
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17.7 |
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37.1 |
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33.3 |
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| EBITDA before commissions1 |
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35.4 |
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40.0 |
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28.2 |
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75.4 |
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54.7 |
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| EBITDA |
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17.6 |
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20.7 |
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10.5 |
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38.3 |
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21.4 |
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| Net income |
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10.1 |
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12.9 |
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5.0 |
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23.0 |
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10.6 |
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| Diluted earnings per share |
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0.14 |
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0.18 |
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0.07 |
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0.32 |
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0.15 |
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| Free cash flow1 |
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12.3 |
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13.3 |
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10.4 |
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25.6 |
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20.9 |
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| Dividends per share |
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0.10 |
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0.09 |
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0.08 |
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0.19 |
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0.16 |
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| (end of period) |
Three months ended |
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May 31, |
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February 28, |
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November 30, |
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August 31, |
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May 31, |
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| (in millions of Canadian dollars) |
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2022 |
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2022 |
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2021 |
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2021 |
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2021 |
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| Mutual fund assets under management (AUM)2 |
$ |
22,849 |
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$ |
23,625 |
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$ |
24,006 |
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$ |
23,792 |
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$ |
22,290 |
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| Institutional, sub-advisory and ETF accounts AUM |
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8,372 |
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9,059 |
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9,371 |
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10,302 |
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9,713 |
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| Private client AUM |
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6,946 |
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7,102 |
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7,077 |
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7,073 |
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6,689 |
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| Private alternatives AUM |
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58 |
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69 |
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73 |
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99 |
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134 |
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| Total AUM |
$ |
38,225 |
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$ |
39,855 |
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$ |
40,527 |
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$ |
41,266 |
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$ |
38,826 |
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| Private alternatives fee-earning assets3 |
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2,052 |
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2,100 |
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2,108 |
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2,094 |
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1,983 |
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| Total AUM and fee-earning assets3 |
$ |
40,277 |
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$ |
41,955 |
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$ |
42,635 |
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$ |
43,360 |
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$ |
40,809 |
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| Net mutual fund sales2 |
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132 |
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330 |
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352 |
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288 |
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408 |
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| Average daily mutual fund AUM2 |
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23,183 |
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24,075 |
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23,896 |
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23,104 |
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22,011 |
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| 1 |
EBITDA before commissions (earnings before interest, taxes, depreciation, amortization and deferred selling commissions), adjusted EBITDA before commissions, adjusted net income, adjusted diluted earnings per share and Free Cash Flow are not standardized measures prescribed by IFRS. The Company utilizes non-IFRS measures to assess our overall performance and facilitate a comparison of quarterly and full-year results from period to period. They allow us to assess our investment management business without the impact of non-operational items. These non-IFRS measures may not be comparable with similar measures presented by other companies. These non-IFRS measures and reconciliations to IFRS, where necessary, are included in the Management’s Discussion and Analysis available at www.agf.com. |
| 2 |
Mutual fund AUM includes retail AUM, pooled fund AUM and institutional client AUM invested in customized series offered within mutual funds. |
| 3 |
Fee-earning assets represents assets in which AGF has carried interest ownership and earns recurring fees but does not have ownership interest in the managers. |
For further information and detailed financial statements for the second quarter ended May 31, 2022, including Management’s Discussion and Analysis, which contains discussions of non-IFRS measures, please refer to AGF’s website at www.agf.com under ‘About AGF’ and ‘Investor Relations’ and at www.sedar.com.
Conference Call
AGF will host a conference call to review its earnings results today at 11 a.m. ET.
The live audio webcast with supporting materials will be available in the Investor Relations section of AGF’s website at www.agf.com or at https://edge.media-server.com/mmc/p/k7tb88zf. Alternatively, the call can be accessed toll-free in Canada by dialing 1 (866) 455-3403 (PIN: 27114683#), or in the United States by dialing 1 (866) 374-5140 (PIN: 27114683#).
A complete archive of this discussion along with supporting materials will be available at the same webcast address within 24 hours of the end of the conference call.
About AGF Management Limited
Founded in 1957, AGF Management Limited (AGF) is an independent and globally diverse asset management firm. AGF brings a disciplined approach to delivering excellence in investment management through its fundamental, quantitative, alternative and high-net-worth businesses focused on providing an exceptional client experience. AGF’s suite of investment solutions extends globally to a wide range of clients, from financial advisors and individual investors to institutional investors including pension plans, corporate plans, sovereign wealth funds and endowments and foundations.
AGF has investment operations and client servicing teams on the ground in North America, Europe and Asia. With over $40 billion in total assets under management and fee-earning assets, AGF serves more than 800,000 investors. AGF trades on the Toronto Stock Exchange under the symbol AGF.B.
AGF Management Limited shareholders, analysts and media, please contact:
Adrian Basaraba
Senior Vice-President and Chief Financial Officer
416-865-4203, InvestorRelations@agf.com
Courtney Learmont
Vice-President, Finance
647-253-6804, InvestorRelations@agf.com
Caution Regarding Forward-Looking Statements
This press release includes forward-looking statements about the Company, including its business operations, strategy and expected financial performance and condition. 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,’ ‘estimates,’ ‘anticipates,’ ‘intends,’ ‘plans,’ ‘believes’ or negative versions thereof and similar expressions, or future or conditional verbs such as ‘may,’ ‘will,’ ‘should,’ ‘would’ and ‘could.’ In addition, any statement that may be made concerning future financial performance (including income, revenues, earnings or growth rates), ongoing business strategies or prospects, fund performance, and possible future action on our part, is also a forward-looking statement. Forward-looking statements are based on certain factors and assumptions, including expected growth, results of operations, business prospects, business performance and opportunities. While we consider these factors and assumptions to be reasonable based on information currently available, they may prove to be incorrect. Forward-looking statements are based on current expectations and projections about future events and are inherently subject to, among other things, risks, uncertainties and assumptions about our operations, economic factors and the financial services industry generally. They are not guarantees of future performance, and actual events and results could differ materially from those expressed or implied by forward-looking statements made by us due to, but not limited to, important risk factors such as level of assets under our management, volume of sales and redemptions of our investment products, performance of our investment funds and of our investment managers and advisors, client-driven asset allocation decisions, pipeline, competitive fee levels for investment management products and administration, and competitive dealer compensation levels and cost efficiency in our investment management operations, as well as general economic, political and market factors in North America and internationally, interest and foreign exchange rates, global equity and capital markets, business competition, taxation, changes in government regulations, unexpected judicial or regulatory proceedings, technological changes, cybersecurity, the possible effects of war or terrorist activities, outbreaks of disease or illness that affect local, national or international economies (such as COVID-19), natural disasters and disruptions to public infrastructure, such as transportation, communications, power or water supply or other catastrophic events, and our ability to complete strategic transactions and integrate acquisitions, and attract and retain key personnel. We caution that the foregoing list is not exhaustive. The reader is cautioned to consider these and other factors carefully and not place undue reliance on forward-looking statements. Other than specifically required by applicable laws, we are under no obligation (and expressly disclaim any such obligation) to update or alter the forward-looking statements, whether as a result of new information, future events or otherwise. For a more complete discussion of the risk factors that may impact actual results, please refer to the ‘Risk Factors and Management of Risk’ section of the 2021 Annual MD&A.
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| 1 |
Fee-earning assets represents assets in which AGF has carried interest ownership and earns recurring fees but does not have ownership interest in the managers. |
| 2 |
Long-term funds. |
| 3 |
Retail mutual fund net sales are calculated as reported mutual fund net sales less non-recurring institutional net sales in excess of $5 million invested in our mutual funds. |
