Igm Financial Inc. · TSX:IGM
Igm Financial — Q2 2012 Earnings Presentation
38 slides from Igm Financial's earnings presentation, Aug 2, 2012
Slide 1: IGM Financial Q2, 2012 Results
IGM FINANCIAL Q2, 2012 Results August 2, 2012
Slide 2: IGM Financial – Conference Call Participants
IGM Financial – Conference Call Participants Murray J. Taylor Charles R. Sims Kevin E. Regan President & CEO, President & CEO, Executive Vice-President Investors Group Mackenzie & CFO, IGM Financial Co - President & CEO, Co - President & CEO, IGM Financial IGM Financial 2
Slide 3: Caution Concerning Forward Looking Statements
Caution Concerning Forward Looking Statements Certain statements in this report 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 assistin
Slide 4: Non-IFRS Financial Measures and Additional IFRS Measures
Non-IFRS Financial Measures and Additional IFRS Measures • Net earnings available to common shareholders, which is an additional measure in accordance with IFRS, may be subdivided into two components consisting of: – Operating earnings available to common shareholders; and – Other items, which inclu
Slide 5: Documents Incorporated by Reference
Documents Incorporated by Reference This summary document and webcast are meant to discuss, not to serve as a substitute for, information included in these documents. The reader is hereby cautioned to refer to the following documents relating to IGM Financial’s results: 1. Documents related to IGM F
Slide 6: Highlights, Investors Group, Mackenzie
1. Highlights 2. Investors Group 3. Mackenzie 6
Slide 7: IGM Financial Highlights – Earnings
IGM Financial Highlights – Earnings IGM Financial’s Operating Earnings Per Share decreased by 14.6% during the second quarter of 2012 relative to the second quarter of 2011, and decreased by 9.8% year to date. Three months ended June 30 Six months ended June 30 2011 2012 Change 2011 2012 Change 1
Slide 8: IGM Financial Highlights – Gross Sales
IGM Financial Highlights – Gross Sales IGM Financial had gross sales of $3.2 billion during Q2, 2012 and $7.5 billion year to date. IGM Financial Investment Product Gross Sales ($ Millions) Three Months Ended June 30, 2012 Six Months Ended June 30, 2012 Investors IGM Investors IGM Group Mackenzie
Slide 9: IGM Financial Highlights – Net Sales
IGM Financial Highlights – Net Sales IGM Financial had net redemptions of $1.7 billion during Q2, 2012 and $2.5 billion year to date. IGM Financial Investment Product Net Sales ($ Millions) Three Months Ended June 30, 2012 Six Months Ended June 30, 2012 Investors IGM Investors IGM Group Mackenzie
Slide 10: IGM Financial Highlights – Assets Under Management
IGM Financial Highlights – Assets Under Management IGM Financial’s total assets under management decreased by 5.0% during Q2, 2012 relative to Q1, 2012 and declined by 9.4% relative to Q2, 2011. Quarter Q2, 2012 Change ($ Billions) Jun 30, Sep 30, Dec 31, Mar 31, Jun 30, Last Last 2011 2011 2011 2
Slide 11: Operating Environment – Industry Sales Mix
Operating Environment – Industry Sales Mix The industry experienced declines in both gross and net sales during Q2, 2012 relative to Q2, 2011. Industry Mutual Fund Net Sales by Primary Distribution Emphasis Three months ended June 30 ($ Billions) Long Term Funds Total Funds 2011 2012 Change 2011 2
Slide 12: Operating Environment – Industry Sales Mix
Operating Environment – Industry Sales Mix Income-oriented and balanced funds continued to experience positive net sales during the second quarter of 2012. Industry Mutual Fund Net Sales ($ Billions) Q2, 2010 Q3, 2010 Q4, 2010 Q1, 2011 Q2, 2011 Q3, 2011 Q4, 2011 Q1, 2012 Q2, 2012 Income-oriented 2
Slide 13: Operating Environment – Financial Markets
Operating Environment – Financial Markets During Q2, 2012, industry long term mutual fund assets declined by 2.0% primarily as a result of declines in global equity markets. Canadian Mutual Fund Industry Long Term Mutual Fund Assets Under Management ($ Billions) Q3, 2012 at 900 Q2, 2012 August 1 M
Slide 14: IGM Financial Highlights – Assets Under Management
IGM Financial Highlights – Assets Under Management Average mutual fund assets under management decreased by 2.6% during Q2, 2012 relative to Q1, 2012 and average total assets declined by 2.9%. Assets Under Management ($ Billions) Average Assets Under Management ($ Billions) 140 Total Mutual 130 To
Slide 15: IGM Financial Highlights – Assets Under Management
IGM Financial Highlights – Assets Under Management Average mutual fund assets under management decreased by 8.2% during Q2, 2012 relative to Q2, 2011 and average total assets declined by 9.7%. Average Assets Under Management ($ Billions) 132.0 124.0 122.8 119.0 119.2 22.1 20.5 19.2 Sub-advisory, 1
Slide 16: IGM Financial Highlights – Operating Earnings
IGM Financial Highlights – Operating Earnings IGM Financial’s Operating Earnings decreased by 15.9% during Q2, 2012 relative to Q2, 2011 and decreased by 10.4% relative to the prior quarter. Operating Earnings 1 ($ Millions) 212.8 213.0 196.0 199.7 179.0 Q2, 2011 Q3, 2011 Q4, 2011 Q1, 2012 Q2, 201
Slide 17: IGM Financial Highlights – Operating Earnings Per Share
IGM Financial Highlights – Operating Earnings Per Share IGM Financial’s Operating Earnings Per Share decreased by 14.6% during Q2, 2012 relative to Q2, 2011 and decreased by 10.2% relative to the prior quarter. Operating Earnings per Share 1 ($ Diluted) 0.82 0.82 0.78 0.76 0.70 Q2, 2011 Q3, 2011 Q
Slide 18: Highlights, Investors Group, Mackenzie
1. Highlights 2. Investors Group 3. Mackenzie 18
Slide 19: Investors Group Consultant Network
Investors Group Consultant Network The Consultant Network increased to 4,526 during Q2, 2012 and the number of Consultants with greater than four years experience increased to 2,727. Number of Investors Group Consultants As at December 31 (unless otherwise indicated) 5,000 4,633 4,686 4,608 4,522
Slide 20: Investors Group Mutual Fund Gross Sales
Investors Group Mutual Fund Gross Sales Investors Group had gross sales of $1.3 billion during Q2, 2012, down 7.0% relative to Q2, 2011. Three months ended June 30 Six months ended June 30 ($ Millions) ($ Millions) 1,405 3,451 1,306 3,140 2011 2012 2011 2012 Investors Group 20
Slide 21: Investors Group Mutual Fund Redemption Rate
Investors Group Mutual Fund Redemption Rate Investors Group’s twelve month trailing redemption rate on long term mutual funds was 9.4% at June 30, 2012, well below the industry average. Redemption Rate on Long Term Mutual Funds 1 (Last Twelve Month Trailing % of Average Assets Under Management) 20
Slide 22: Investors Group Mutual Fund Net Sales
Investors Group Mutual Fund Net Sales Investors Group had net redemptions of $324 million during Q2, 2012, compared to net redemptions of $145 million during the prior year. Three months ended June 30 Six months ended June 30 ($ Millions) ($ Millions) 359 (145) (149) (324) 2011 2012 2011 2012 Inve
Slide 23: Insurance and Mortgage Distribution
Insurance and Mortgage Distribution Investors Group insurance product sales increased by 12% during the first half of 2012 and mortgage originations were up 61%. New Annualized Insurance Premiums Mortgage Originations Six months ended June 30 Six months ended June 30 ($ Millions) ($ Millions) 1,18
Slide 24: Investors Group Client Experience
Investors Group Client Experience The median client return was approximately (3.6%) during the second quarter of 2012 and positive 0.9% year to date. Investors Group Client Rate of Return (%) 10 5 4.7 2.3 0 (2.6) 90% of clients had (3.6) (5) returns within this range (9.0) (10) (15) Median Client
Slide 25: Investors Group Mutual Fund Assets Under Management
Investors Group Mutual Fund Assets Under Management The average balance of mutual fund assets under management declined by 6.9% during Q2, 2012 relative to Q2, 2011. Average Assets Under Management ($ Billions) 62.8 59.4 59.8 58.5 57.5 Q2, 2011 Q3, 2011 Q4, 2011 Q1, 2012 Q2, 2012 Investors Group 2
Slide 26: Investors Group Operating Segment – EBIT
Investors Group Operating Segment – EBIT Investors Group’s Earnings before Interest & Taxes declined by 15.6% during Q2, 2012 relative to Q2, 2011, and decreased by 13.1% year to date. Earnings before Interest & Taxes Earnings before Interest & Taxes Three months ended June 30 Six months ended Jun
Slide 27: Investors Group Operating Segment – EBIT
Investors Group Operating Segment – EBIT Investors Group’s Operating Earnings before Interest & Taxes were $169.1 million during the second quarter of 2012. Three months ended June 30 ($ Millions, unless otherwise indicated) 2011 2012 Change Average mutual fund assets under management ($ billions)
Slide 28: Investors Group Developments
Investors Group Developments 1. Consultant Network • The Consultant Network grew slightly during the quarter through strong retention of experienced Consultants and an increase in new Consultants joining Investors Group. 2. Pricing and Product Enhancements • Reductions in management fees effective J
Slide 29: Highlights, Investors Group, Mackenzie
1. Highlights 2. Investors Group 3. Mackenzie 29
Slide 30: Mackenzie Gross Sales
Mackenzie Gross Sales Mackenzie had gross sales of investment products of $2.0 billion during the second quarter of 2012 and $4.7 billion year to date. Mackenzie Gross Sales of Investment Products Mackenzie Gross Sales of Investment Products Three months ended June 30 Six months ended June 30 ($ M
Slide 31: Mackenzie Mutual Fund Gross Sales
Mackenzie Mutual Fund Gross Sales Mackenzie’s income-oriented Sentinel sub-brand continued to experience strong flows during the second quarter of 2012. 1 Gross Sales Mix of Long Term Mutual Funds by Mackenzie Sub-Brand Three month periods ended June 30 2 5% 14% 8% 9% 11% Symmetry & other 10% 7% 6
Slide 32: Mackenzie Mutual Fund Redemption Rate
Mackenzie Mutual Fund Redemption Rate Mackenzie’s twelve month trailing redemption rate on long term mutual funds was 16.4% at June 30, 2012. 1 Redemption Rate on Long Term Mutual Funds (Last Twelve Month Trailing % of Average Assets Under Management) 24% 20% 3 16.6% Industry, peer companies of 16
Slide 33: Mackenzie Net Sales
Mackenzie Net Sales Mackenzie had net redemptions of $1.3 billion during the second quarter of 2012 and $2.2 billion year to date. Mackenzie Net Sales of Investment Products Mackenzie Net Sales of Investment Products Three months ended June 30 Six months ended June 30 ($ Millions) ($ Millions) 336
Slide 34: Mackenzie Investment Performance
Mackenzie Investment Performance 58% of Mackenzie’s assets and 62% of funds reside within funds which have had first or second quartile performance over the last five years. Mackenzie Mutual Funds in First or Second Quartile As at June 30, 2012 62% 58% 56% 54% 53% 48% % of assets under management
Slide 35: Mackenzie Assets Under Management
Mackenzie Assets Under Management The average balance of total assets under management decreased by 12.0% during Q2, 2012 relative to Q2, 2011, and average mutual fund assets declined by 10.5%. Average Assets Under Management ($ Billions) 69.9 65.4 63.8 62.2 61.6 25.7 Institutional, sub- 24.1 22.9
Slide 36: Mackenzie Operating Segment – EBIT
Mackenzie Operating Segment – EBIT Mackenzie’s Earnings before Interest and Taxes decreased by 21.1% during Q2, 2012 relative to Q2, 2011, and decreased by 20.7% year to date. Earnings before Interest & Taxes 1 Earnings before Interest & Taxes 1 Three months ended June 30 Six months ended June 30
Slide 37: Mackenzie Operating Segment – EBIT
Mackenzie Operating Segment – EBIT Mackenzie’s Operating Earnings before Interest and Taxes were $62.4 million during the second quarter of 2012. Three months ended June 30 ($ Millions, unless otherwise indicated) 2011 2012 Change Average assets under management ($ billions) Total 69.9 61.6 (12.0%
Slide 38: Mackenzie Developments
Mackenzie Developments 1. Investment Management and Product • 81% of Mackenzie mutual fund assets rated three stars or better by Morningstar at June 30, 2012 compared to 80% for the industry. • Several fund mergers during the quarter as Mackenzie continues to adjust its product shelf to provide enha