IGM Financial Inc. · TSX:IGM
IGM Financial — Q3 2015 Earnings Presentation
44 slides from IGM Financial's earnings presentation, Nov 6, 2015
Slide 1: IGM Financial Q3, 2015 Results
IGM FINANCIAL Q3, 2015 Results November 6, 2015
Slide 2: IGM Financial – Conference Call Participants
IGM Financial – Conference Call Participants Paul W. Hancock Jeffrey R. Carney Murray J. Taylor Kevin E. Regan Vice-President, President & CEO, President & CEO, Executive Vice- Finance and Investor Mackenzie Investors Group President & CFO, Relations IGM Financial Co - President & CEO, Co - Presiden
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 to assist the reader in unde
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, Mackenzie Investments, Investors Group
1. Highlights 2. Mackenzie Investments 3. Investors Group 6
Slide 7: IGM Financial Earnings
IGM Financial Earnings IGM Financial’s Operating Earnings were $199.0 million during Q3, 2015, and Operating Earnings Per Share were 81 cents. Change Q3, Q2, Q3, Last Last 2014 2015 2015 Year Quarter Operating Earnings ($ millions) 219.7 198.5 199.0 (9.4%) 0.3% Operating Earnings per share (dilute
Slide 8: IGM Financial Gross Sales
IGM Financial Gross Sales IGM Financial had mutual fund gross sales of $3.5 billion during Q3, 2015 and $11.9 billion year to date. IGM Financial Investment Product Gross Sales ($ Millions) Three Months Ended September 30, 2015 Nine Months Ended September 30, 2015 Investors IGM Investors IGM 1 1 G
Slide 9: IGM Financial Net Sales
IGM Financial Net Sales IGM Financial had mutual fund net sales of $9 million during Q3, 2015 and net sales of $49 million year to date. IGM Financial Investment Product Net Sales ($ Millions) Three Months Ended September 30, 2015 Nine Months Ended September 30, 2015 Investors IGM Investors IGM 1
Slide 10: IGM Financial Assets Under Management
IGM Financial Assets Under Management IGM Financial’s mutual fund assets under management declined by 0.2% during the last year to $124.9 billion. IGM Financial Ending Assets Under Management ($ Billions) Change Sep 30, Dec 31, Mar 31, Jun 30, Sep 30, Last Last 2014 2014 2015 2015 2015 Year Quarte
Slide 11: Industry Long Term Mutual Fund Assets
Industry Long Term Mutual Fund Assets During Q3, 2015, industry long term mutual fund assets decreased by 2.1%. Q4, 2015 Canadian Mutual Fund Industry Q3, 2015 at Oct 31 Long Term Mutual Fund Assets Under Management Mutual Fund Long Term Assets (2.1%) ($ Billions) Equity Markets: 1,300 Canada (S&P
Slide 12: Industry Sales by Distribution Emphasis
Industry Sales by Distribution Emphasis The advice channel experienced strong gross and net sales during the third quarter and year to date. Industry Mutual Fund Sales by Primary Distribution Emphasis Total Funds ($ Billions) Three Months Ended September 30 Nine Months Ended September 30 2014 2015
Slide 13: Industry Net Sales by Asset Class – Advice Channel
Industry Net Sales by Asset Class – Advice Channel The advice channel has experienced improved foreign equity net sales. Advice Channel Mutual Fund Net Sales ($ Billions) Q3, 2013 Q4, 2013 Q1, 2014 Q2, 2014 Q3, 2014 Q4, 2014 Q1, 2015 Q2, 2015 Q3, 2015 Income-Oriented (0.8) (0.5) 0.5 0.8 0.7 0.1 0.
Slide 14: Recent Relevant Research and Reports
Recent Relevant Research and Reports CSA / Brondesbury Group Report (published Jun. 11, 2015) − Important Clarification: “In our view, no empirical studies have been done to document whether investors have greater after-fee investment returns with fee-based compensation instead of commission-based c
Slide 15: IGM Financial Mutual Fund Assets Under Management
IGM Financial Mutual Fund Assets Under Management Mutual fund assets under management declined during the third quarter and were $127.9 billion at October 31, 2015. IGM Financial Mutual Fund Assets Under Management ($ Billions) Average Mutual Fund Assets Under Management ($ Billions) 140 Q3, 2015
Slide 16: IGM Financial Mutual Fund Assets Under Management
IGM Financial Mutual Fund Assets Under Management Average mutual fund assets under management were 1.9% higher during Q3, 2015 relative to Q3, 2014. Average Mutual Fund Assets Under Management ($ Billions) 129.9 131.4 128.6 126.2 124.6 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 16
Slide 17: IGM Financial Operating Earnings
IGM Financial Operating Earnings IGM Financial’s Operating Earnings were $199.0 million during the quarter. 1 Operating Earnings ($ Millions) 219.7 208.1 200.3 198.5 199.0 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 1. Please refer to slide 4 for a discussion of adjustments. 17
Slide 18: IGM Financial Operating Earnings Per Share
IGM Financial Operating Earnings Per Share IGM Financial’s Operating Earnings Per Share were 81 cents during Q3, 2015. 1 Operating Earnings per Share ($ Diluted) 0.87 0.83 0.81 0.80 0.80 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 1. Please refer to slide 4 for a discussion of adjustments. 18
Slide 19: Highlights, Mackenzie Investments, Investors Group
1. Highlights 2. Mackenzie Investments 3. Investors Group 19
Slide 20: Mackenzie Mutual Fund Gross Sales
Mackenzie Mutual Fund Gross Sales Mackenzie had mutual fund gross sales of $1.5 billion during the quarter, up 4.8% relative to Q3, 2014. Three months ended September 30 Nine months ended September 30 ($ Millions) ($ Millions) Up 4.8% Down 6.2% 1,485 5,515 1,417 5,313 141 Institutional rebalancing
Slide 21: Mackenzie Mutual Fund Gross Sales by Asset Class
Mackenzie Mutual Fund Gross Sales by Asset Class Mackenzie experienced strong growth in foreign equity fund sales during Q3, 2015. Mutual Fund Gross Sales by Asset Class Gross Sales Mix of Long Term Mutual Funds 1 Three months ended September 30 by Asset Class ($ Millions) $ % Sector / other 2014
Slide 22: Mackenzie Mutual Fund Redemption Rate
Mackenzie Mutual Fund Redemption Rate Mackenzie’s twelve month trailing redemption rate on long term mutual funds was 14.2% at September 30, 2015. 1 Redemption Rate on Long Term Mutual Funds (Last Twelve Month Trailing % of Average Assets Under Management) 24% 20% Industry, peer companies of 16% 1
Slide 23: Mackenzie LTM Mutual Fund Sales
Mackenzie LTM Mutual Fund Sales Mackenzie’s mutual fund gross sales have improved slightly over the past five months. 1 Mutual Fund Gross Sales and Redemptions 1 (Last Twelve Month Trailing - $ Billions) Redemption Rate 8.0 20% Gross Sales ($B) Redemptions ($B) 7.0 18% Redemption rate on long-term
Slide 24: Mackenzie Total Investment Product Net Sales
Mackenzie Total Investment Product Net Sales Mackenzie had total investment product net redemptions of $126 million during Q3, 2015. Total Investment Product Net Sales Mutual Fund Net Sales by Asset Class Three months ended September 30 Three months ended September 30 ($ Millions) ($ Millions) Mut
Slide 25: Mackenzie Investment Performance
Mackenzie Investment Performance 68% of mutual fund assets managed by Mackenzie reside in funds with a 3, 4 or 5 star Morningstar rating. 1 Morningstar Ratings – Proportion of Morningstar-Rated Assets As at September 30, 2015 42% 40% 35% 32% 28% Mackenzie 23% All Morningstar-Rated 1 & 2 Stars 3 St
Slide 26: Mackenzie Investment Performance
Mackenzie Investment Performance Over 50% of mutual fund assets managed by Mackenzie reside in funds with first or second quartile rankings over the five and ten year periods. 1 Mackenzie Mutual Funds in First or Second Quartile Proportion of Assets 58% 58% 52% 43% June 30, 2015 34% 34% 34% Septem
Slide 27: Mackenzie Assets Under Management
Mackenzie Assets Under Management The average balance of mutual fund assets under management was 0.2% lower during Q3, 2015 relative to Q3, 2014. Average Assets Under Management ($ Billions) 73.6 71.7 71.2 69.8 62.2 Institutional, sub- 1 advised & other 49.3 48.3 50.5 50.6 49.2 Mutual funds Q3/14
Slide 28: Mackenzie Operating Segment – EBIT
Mackenzie Operating Segment – EBIT Mackenzie’s Earnings before Interest and Taxes were $54.5 million during Q3, 2015. Earnings before Interest & Taxes ($ Millions) 69.2 56.9 53.0 54.0 54.5 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 28
Slide 29: Mackenzie Operating Segment – EBIT
Mackenzie Operating Segment – EBIT Mackenzie’s Earnings before Interest and Taxes were $54.5 million during Q3, 2015. Three months ended September 30 ($ Millions, unless otherwise indicated) 2014 2015 Change Average assets under management ($ billions) Total 71.2 62.2 (12.6%) Mutual funds 49.3 49.
Slide 30: Mackenzie Developments
Mackenzie Developments 1. Brand & Advertising • During October, launched a new brand identity that reflects the company’s values, goals and strengths, including its unique heritage as a firm committed to innovation and thought leadership. 2. Investment Management • During August, the Mackenzie Syste
Slide 31: Highlights, Mackenzie Investments, Investors Group
1. Highlights 2. Mackenzie Investments 3. Investors Group 31
Slide 32: Investors Group Consultant Network
Investors Group Consultant Network Investors Group had a Consultant network of 5,221 at September 30, 2015. This represents the highest level in the history of the company. Number of Investors Group Consultants As at December 31 (unless otherwise indicated) Record 5,221 High 5,145 5,156 5,176 5,01
Slide 33: Investors Group Mutual Fund Gross Sales
Investors Group Mutual Fund Gross Sales Investors Group had gross sales of $1.8 billion during Q3, 2015 and $6.1 billion year to date. Three months ended September 30 Nine months ended September 30 ($ Millions) ($ Millions) Up 5.0% Record Up 8.0% Record High High 6,069 1,810 5,621 1,723 2014 2015
Slide 34: 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 8.4% at September 30, 2015, well below the industry average. 1 Quarterly Annualized Redemption Rate on Long Term Redemption Rate on Long Term Mutual Funds Mutual Funds
Slide 35: Investors Group Mutual Fund Net Sales
Investors Group Mutual Fund Net Sales Investors Group had net sales of $139 million during the third quarter and $754 million year to date. Three months ended September 30 Nine months ended September 30 ($ Millions) ($ Millions) Up $53 million Up $297 million 139 754 86 457 2014 2015 2014 2015 35
Slide 36: Investors Group LTM Mutual Fund Sales
Investors Group LTM Mutual Fund Sales Investors Group has experienced continuing sales momentum. Mutual Fund Gross Sales and Redemptions (Last Twelve Month Trailing - $ Billions) Redemption Rate 8.5 Record 15% Gross Sales ($B) High 8.0 14% Redemptions ($B) 7.5 13% Redemption rate on 7.0 12% long-t
Slide 37: Investors Group Client Experience
Investors Group Client Experience The median Investors Group client return was approximately negative 0.9% year to date. Investors Group added multi-period account rate of return reporting to most client statements for June 30, 2015, two full years ahead of its CRM2 deadline. Investors Group Cli
Slide 38: Investors Group Client Experience Survey
Investors Group Client Experience Survey Ongoing surveys of our clients indicate a strong appreciation of the value of advice and service provided by our Consultants. New Clients Existing Clients Twelve months ended September 30, 2015 Twelve months ended September 30, 2015 96% 96% 93% 93% 91% 92%
Slide 39: Investors Group Insurance and Mortgage Distribution
Investors Group Insurance and Mortgage Distribution Investors Group individual insurance product sales increased by 10.9% year to date 2015 and mortgage fundings declined in part due to a complementary offering in Solutions Banking. New Annualized Insurance Premiums Mortgage Fundings Nine months e
Slide 40: Investors Group Mutual Fund Assets Under Management
Investors Group Mutual Fund Assets Under Management The average balance of mutual fund assets under management was 3.0% higher during Q3, 2015 relative to Q3, 2014. Average Assets Under Management ($ Billions) 75.5 76.8 75.4 73.1 72.5 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 40
Slide 41: Investors Group Operating Segment – EBIT
Investors Group Operating Segment – EBIT Investors Group’s Earnings before Interest & Taxes decreased by 8.0% during Q3, 2015 relative to Q3, 2014. 1 Earnings before Interest & Taxes ($ Millions) 207.1 196.9 190.7 189.9 190.6 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 1. Please refer to slide 4 for a discussio
Slide 42: Investors Group Operating Segment – EBIT
Investors Group Operating Segment – EBIT Investors Group’s Earnings before Interest & Taxes were $190.6 million during Q3, 2015. Three months ended September 30 ($ Millions, unless otherwise indicated) 2014 2015 Change Average mutual fund assets under management ($ billions) 73.1 75.4 3.0% Revenue
Slide 43: Investors Group Highlights
Investors Group Highlights 1. Brand & Advertising • Enhancing brand through newly launched Investors Group national advertising campaign focused on memorable events, with the tagline: “Invest in Life”. • Refreshed Investors Group website highlights the six elements of our financial plans (Investment
Slide 44: Investor Day 2015
IGM Financial Investor Day INVESTOR DAY 2015 Upcoming Event: IGM Financial’s inaugural Investor Day • November 20, 2015 in Toronto, Canada – registration & continental breakfast begins 7:30am local time • Opportunity to hear from IGM Financial and operating company leadership on short-term and long-