VANCOUVER, May 17, 2011 /PRNewswire/ -- Canaccord Financial
Inc. (TSX: CF & AIM: CF.) generated record revenue and net
income during its 2011 fiscal year. Revenue for the twelve months
ended March 31, 2011 was $803.6 million, an all-time high and up 39% from
$577.5 million a year ago. Net income
for fiscal 2011 was a record $98.2
million, up 155% from fiscal 2010, and diluted earnings per
share were $1.20, a 74% increase over
last year. Excluding acquisition-related items(1), net income
during fiscal 2011 was $112.6
million, up 168% or $70.6
million compared to fiscal 2010, and diluted earnings per
share for fiscal 2011 were $1.38,
compared to $0.76 the previous
year.
Canaccord Financial Inc.'s revenue for the three months ended
March 31, 2011 was $247.6 million, up 73% from $143.1 million the same quarter a year ago. Net
income for the fourth quarter was $40.9
million, up 445% compared to the same quarter last year.
Diluted earnings per share were $0.48, a 243% increase compared to $0.14 in the fourth quarter of fiscal 2010.
Excluding acquisition-related items(1), net income during
Canaccord's fourth quarter was $41.9
million, or $0.50 per diluted
share.
"Fiscal 2011 was a pivotal year for Canaccord. We not only
achieved exceptional results throughout much of our business, we
also built broader capabilities, captured market share and
established an important presence in Asia," noted Paul
Reynolds, President and CEO of Canaccord Financial Inc. "The
results of these initiatives had positive impacts in all of our
geographies and divisions. Globally, revenue and net income grew to
all-time record levels, largely due to our expanded capital markets
team and our deep domain knowledge of resource sectors. While in
Canaccord Wealth Management, our Advisors were able to leverage our
growing sector coverage and the dynamic market environment to drive
significant revenue gains and deliver a strong contribution to our
bottom line."
Fiscal 2011 vs. fiscal 2010
(Twelve months ended March 31,
2011 vs. twelve months ended March
31, 2010)
- Record revenue of $803.6
million, up 39.2% or $226.1
million from $577.5
million
- Expenses of $663.2 million, up
26.1% or $137.3 million from
$525.9 million
- Record net income of $98.2
million, up 155.1% or $59.7
million compared to net income of $38.5 million
- Return on equity (ROE) of 14.0%, up from 9.8%([1])([2])
- Diluted EPS of $1.20 compared to
diluted EPS of $0.69 in the prior
year
Excluding acquisition-related expense items(1)( [3])
- Expenses of $645.3 million, up
23.9% or $124.4 million from
$520.9 million
- Net income of $112.6 million, up
168.1% or $70.6 million compared to
net income of $42.0 million
- ROE of 16.1%, up from 10.7%(1)(2)
- Diluted EPS of $1.38 compared to
diluted EPS of $0.76 in the prior
year
Fourth quarter 2011 vs. Fourth quarter 2010
- Revenue of $247.6 million, up
73.0% or $104.5 million from
$143.1 million
- Expenses of $189.8 million, up
37.8% or $52.1 million from
$137.7 million
- Net income of $40.9 million, up
445.3% or $33.4 million compared to
net income of $7.5 million
- ROE of 22.4%, up from 7.6%(1)(2)
- Diluted EPS of $0.48 compared to
diluted EPS of $0.14
Excluding acquisition-related expense items(1)(3)
- Expenses of $188.9 million, up
42.4% or $56.2 million from
$132.7 million
- Net income of $41.9 million, up
277.5% or $30.8 million compared to
net income of $11.1 million
- ROE of 22.4%, up from 11.1% (1)(2)
- Diluted EPS of $0.50 compared to
diluted EPS of $0.21
Fourth quarter 2011 vs. Third quarter 2011
- Revenue of $247.6 million, down
2.8% or $7.2 million from
$254.8 million
- Expenses of $189.8 million, down
1.8% or $3.5 million from
$193.3 million
- Net income of $40.9 million,
down 4.2% or $1.8 million compared to
net income of $42.7 million
- ROE of 22.4%, down from 24.2%(1)(2)
- Diluted EPS of $0.48 compared to
diluted EPS of $0.51 in the third
quarter of 2011
Excluding acquisition-related expense items (1)(3)
- Expenses of $188.9 million, down
0.9% or $1.8 million from
$190.7 million
- Net income of $41.9 million,
down 7.5% or $3.4 million compared to
net income of $45.3 million
- ROE of 22.4%, down from 25.1%(1)(2)
- Diluted EPS of $0.50 compared to
diluted EPS of $0.54 in the third
quarter of 2011
Financial condition at end of FOURTH quarter 2011 vs. FOURTH
quarter 2010
- Cash and cash equivalents balance of $954.1 million, up $222.2
million from $731.9
million
- Working capital of $412.9
million, up $54.3 million from
$358.6 million
- Total shareholders' equity of $756.5
million, up $354.8 million
from $401.7 million
- Book value per diluted common share for the period end was
$8.79, up 26.3% or $1.83 from $6.96(1)
- On May 17, 2011 the Board of
Directors approved a quarterly dividend of $0.10 per share payable on June 15, 2011 with a record date of June 3, 2011
SUMMARY OF OPERATIONS
Corporate
- On January 17, 2011, Canaccord
completed its acquisition of The Balloch Group Limited. Canaccord's
operations in Asia were launched
as Canaccord Genuity Asia
- On January 17, 2011, Canaccord
Financial Inc. welcomed Howard
Balloch to its Board of Directors
- Mr. Balloch was the founder and president of The Balloch Group
Limited, and is now the Chairman of Canaccord Genuity Asia
Capital Markets
- Canaccord Genuity recorded $51.2
million of net income before taxes during Q4/11([4])
- Canaccord Genuity led 39 transactions globally to raise total
proceeds of $1.7 billion([5]) during
fiscal Q4/11
- Canaccord Genuity participated in a total of 119 transactions
globally to raise total proceeds of $3.0
billion(5) during fiscal Q4/11
- During fiscal Q4/11, Canaccord Genuity led or co-led the
following transactions:
- C$213.0 million for Keegan
Resources Inc. on the TSX
- GBP205.0 million for Petra
Diamonds Ltd. on AIM
- C$181.1 million for Canaco
Resources Inc. on the TSX
- C$172.5 million for Griffiths
Energy International (non-exchange listed)
- US$133.0 million for Bellzone
Mining PLC on AIM
- US$123.8 million for Triangle
Petroleum Corporation on the AMEX
- US$91.2 million for Amarin Corp.
on the NASDAQ
- US$90.2 million for Abraxas
Petroleum on the NASDAQ
- C$86.2 million for Valeura
Energy Inc. on the TSX Venture
- C$58.2 million for GLG Life Tech
Corporation on the TSX
- C$57.6 million for Canacol
Energy Ltd. on the TSXVenture
- US$50.0 million for Voyager Oil
& Gas on the AMEX
- C$42.4 million for MBAC
Fertilizer Corp. on the TSX
- C$40.3 million for Goldgroup
Mining Inc. on the TSX
- C$39.6 million for Hyperion
Exploration Corp. on the TSX Venture
- C$39.0 million for Claymore
Silver Bullion Fund on the TSX
- C$36.4 million for Forbes &
Manhattan Coal Corp. on the TSX
- C$36.0 million for Crocotta
Energy Inc. on the TSX
- C$35.0 million for Petrodorado
Energy Ltd. on the TSX Venture
- C$34.5 million for Pure
Industrial Real Estate Trust on the TSX Venture
- C$34.5 million for Quetzel
Energy Ltd. on the TSX Venture
- Canaccord Genuity broke into the top 20 investment banks
worldwide, tied for 17th based on total equity underwriting fees
during calendar 2010, according to the April edition of Bloomberg
Markets. Canaccord Genuity advanced 15 places from the year earlier
([6])
- Canaccord Genuity was ranked 17th in Thomson Reuters' Global
Equity Fees league table for the first calendar quarter of 2011
(Canaccord's fiscal fourth quarter of 2011)
- Canaccord Genuity completed 3 Private Investment in Public
Equity (PIPE) transactions in the United
States that raised US$174.4
million in proceeds during fiscal Q4/11(5)
- Canaccord Genuity generated record advisory revenue of
$25.7 million during fiscal Q4/11,
above the previous record last quarter and 209% higher than the
same quarter last year
- During fiscal Q4/11, Canaccord Genuity advised on the
following M&A transactions:
- Levon Resources Ltd. on its acquisition of Valley High
Ventures Ltd.
- ArPetrol Inc. on its consolidation with ArPetrol Ltd.
- Dalsa Corporation on its acquisition by Teledyne Technologies
Inc.
- Pediment Gold Corp. on its merger with Argonaut Gold Inc.
- CyDex Pharmaceuticals, Inc. on its acquisition by Ligand
Pharmaceuticals Inc.
- Innovectra Corporation on its acquisition by ImmersiFind
Inc.
- Rivermine, Inc. on its acquisition by Emptoris, Inc.
- Curamik Electronics GmbH on its acquisition by Rogers
Corporation
- During the quarter, Canaccord Genuity advised Newport Income
Fund on its recapitalization
- Three US-based Canaccord Genuity research analysts received
top two rankings for their sector coverage by the Wall Street
Journal's 'Best on the Street 2011' rankings, which were published
in April 2011
- Paul Mansky ranked first for
his coverage in the Computers & Office Equipment sector
category
- Scott Van Winkle ranked first
for his coverage in the Food & Tobacco sector category
- Jason Mills ranked second for
his coverage in the Medical Equipment & Supplies sector
category
Wealth Management
- Canaccord Wealth Management recorded $9.2 million of net income before taxes during
Q4/11(4)
- Assets under administration of $17.0
billion, up 31.8% from $12.9
billion at the end of Q4/10, and up 6.3% from $16.0 billion at the end of Q3/11(1)
- Assets under management of $546
million, up 22.7% from $445
million at the end of Q4/10, and up 6.2% from $514 million at the end of Q3/11(1)
- As at March 31, 2011, Canaccord
had 271 Advisory Teams([7]), down one from 272 Advisory Teams as of
December 31, 2010 and down 32 from
303 Advisory Teams as of March 31,
2010
- This decrease is largely due to the conversion of corporate
branches to the Independent Wealth Management (IWM) platform, where
each branch is led by one Investment Advisor (IA) and is counted as
one Advisory Team, and an ongoing strategic review of our Wealth
Management division
- On January 1, 2011, Canaccord
Wealth Management's Simcoe,
Ontario branch converted to the IWM platform
- Canaccord Wealth Management welcomed two new branches to the
IWM platform:
- On January 21, 2011, Canaccord
Wealth Management welcomed a new Burlington, Ontario branch
- On March 7, 2011, Canaccord
Wealth Management welcomed a new Calgary,
Alberta branch
Subsequent to March 31, 2011
- On April 1, 2011, Canaccord
Wealth Management's corporate Ottawa branch converted to the IWM platform,
and on May 11, 2011, the division
added a new Kitchener, Ontario
branch
- Canaccord Wealth Management now has 32 offices across
Canada, including 18 branches on
the IWM platform
- On April 15, 2011, Canaccord
Financial Inc. shareholders approved changes to the Company's
articles to clarify the rights, privileges, restrictions and
conditions attached to the shares of the Company and to alter the
authorized capital of the Company by creating an additional class
of preferred shares. The amendments provide the Company with a
wider range of financing options
Non-GAAP Measures
Non-GAAP measures presented include assets under administration,
assets under management, book value per diluted common share,
return on equity and figures that exclude acquisition-related
expense items. Management believes that these non-GAAP measures
will allow for a better evaluation of the operating performance of
Canaccord's business and facilitate meaningful comparison of
results in the current period to those in prior periods and future
periods. Figures that exclude acquisition-related expense items
provide useful information by excluding certain items that may not
be indicative of Canaccord's core operating results. A limitation
of utilizing these figures that exclude acquisition-related expense
items is that the GAAP accounting effects of the
acquisition-related expense items do in fact reflect the underlying
financial results of Canaccord's business and these effects should
not be ignored in evaluating and analyzing Canaccord's financial
results. Therefore, management believes that Canaccord's GAAP
measures of financial performance and the respective non-GAAP
measures should be considered together.
Acquisition-related expense items in the fourth quarter 2011
include $0.9 million of amortization
of intangible assets in connection with the acquisition of Genuity
Capital Markets. Acquisition-related expense items during the year
ended March 31, 2011 include
$11.0 million for acquisition-related
costs and $5.1 million for the
amortization of intangible assets related to the acquisition of
Genuity Capital Markets, and $1.8
million costs incurred for the acquisition of The Balloch
Group Limited.
ACCESS TO QUARTERLY RESULTS INFORMATION:
Interested investors, the media and others can view Canaccord's
fourth quarter and fiscal 2011 year results and supplementary
financial information at:
http://www.canaccordfinancial.com/EN/IR
QUARTERLY CONFERENCE CALL AND WEBCAST:
Interested parties are invited to listen to Canaccord's fourth
quarter and fiscal 2011 results conference call with analysts and
institutional investors, via a live webcast or a toll free number.
The conference call is scheduled for Wednesday, May 18, 2011 at 5:00 a.m. (Pacific Time), 8:00 a.m. (Eastern Time) and 1:00p.m. (UK Time). At that time, senior
executives will comment on the results for the fourth quarter and
fiscal 2011 year, and respond to questions from analysts and
institutional investors.
The conference call may be accessed live and archived on a
listen-only basis via the internet at:
http://www.canaccordfinancial.com/EN/NewsEvents/Pages/Events.aspx
Analysts and institutional investors can call in via telephone
at:
- 647-427-7450 (within Toronto)
- 1-888-231-8191 (toll free outside Toronto)
- 0-800-051-7107 (toll free from the United Kingdom)
- 10-800-714-1191 (toll free from Northern China)
- 10-800-140-1195 (toll free from Southern China)
Please request to participate in Canaccord Financial's Q4/11
earnings call and enter passcode 59939918.
A replay of the conference call can be accessed after
8:00 a.m. (Pacific Time),
11:00 a.m. (Eastern Time) and
4:00 p.m. (UK Time) on May 18, 2011 until July 1,
2011 at 416-849-0833 or 1-800-642-1687 by entering passcode
59939918.
ABOUT CANACCORD FINANCIAL INC.:
Through its principal subsidiaries, Canaccord Financial Inc. is
a leading independent, full-service financial services firm, with
operations in two principal segments of the securities industry:
wealth management and global capital markets. Since its
establishment in 1950, Canaccord has been driven by an unwavering
commitment to building lasting client relationships. We achieve
this by generating value for our individual, institutional and
corporate clients through comprehensive investment solutions,
brokerage services and investment banking services. Canaccord has
46 offices worldwide, including 32 Wealth Management offices
located across Canada. Canaccord
Genuity, the international capital markets division, operates in
Canada, the U.S., the U.K.,
China and Barbados.
Canaccord Financial Inc. is publicly traded under the symbol CF
on the TSX and the symbol CF. on AIM, a market operated by the
London Stock Exchange.
---------------------------------
[1] See non-GAAP measures
[2] ROE is presented on an annualized basis. Quarterly ROE is
calculated by dividing the annualized net income for the three
month period over the average shareholders' equity for the quarter.
ROE for a fiscal year is calculated by dividing the net income for
the year over the average shareholders' equity.
[3] Acquisition-related expense items are related to the
acquisition of Genuity Capital Markets and The Balloch Group
Limited. See non-GAAP measures.
[4] Net income before taxes for Canaccord Genuity and Canaccord
Wealth Management includes certain Corporate and Other costs such
as certain trade processing, research and other expenses that have
been incurred to support the activities within these divisions.
Costs that are not allocable to such divisions include executive
incentive compensation and certain administrative support, foreign
exchange gains and losses and net interest.
[5] Source: Placement Tracker. Includes placements for companies
incorporated in Canada and the
US
[6] Bloomberg Markets. April
2011.
[7] Advisory Teams are normally comprised of one or more
Investment Advisors (IAs) and their assistants and associates, who
together manage a shared set of client accounts. Advisory Teams
that are led by, or only include, an IA who has been licenced for
less than three years are not included in our Advisory Team count,
as it typically takes a new IA approximately three years to build
an average sized book.
FOR FURTHER INFORMATION, CONTACT:
North American media:
Scott Davidson
Managing Director, Global Head of Marketing & Communications
Phone: +1-416-869-3875
Email: scott.davidson@canaccord.com
Investor relations inquiries:
Jamie Kokoska
Manager, Investor Relations & Communications
Phone: +1-416-869-3891
Email: jamie.kokoska@canaccord.com
London media:
Bobby Morse or Ben Romney
Buchanan Communications (London)
Phone: +44(0)207-466-5000
Email: bobbym@buchanan.uk.com
Nominated Adviser and Joint Broker:
Marc Milmo or Carl Holmes
Charles Stanley Securities
Phone: +44(0)20-7149-6764
Email: marc.milmo@csysecurities.com
Joint Broker:
Oliver Hearsey or Nick Triggs
Keefe, Bruyette & Woods Limited
Phone: +44(0)20-7663-5400
Email: ohearsey@kbw.com