IGM Financial Inc. · TSX:IGM
IGM Financial — Q1 2017 Earnings Presentation
32 slides from IGM Financial's earnings presentation, May 5, 2017
Slide 1: IGM Financial Q1, 2017 Results
IGM FINANCIAL Q1, 2017 Results May 5th, 2017
Slide 2: Conference Call Participants
IGM Financial Q1 Analyst Call Conference Call Participants Paul W. Hancock Kevin E. Regan Jeffrey R. Carney Barry S. McInerney Vice-President, Executive Vice- President & CEO, President & CEO, Finance and Investor President & CFO, IGM Financial and Mackenzie Relations, IGM Financial President & CEO,
Slide 3: Caution Concerning Forward Looking Statements
IGM Financial Q1 Analyst Call 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 provide
Slide 4: Non-IFRS Financial Measures and Additional IFRS Measures
IGM Financial Q1 Analyst Call 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: – Adjusted net earnings available to common shareholder
Slide 5: Documents Incorporated by Reference
IGM Financial Q1 Analyst Call 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:
Slide 6: Agenda
IGM Financial IGM Financial Q1 Analyst Q1 Analyst Call Agenda Agenda Call 1 IGM Financial Highlights 2 Investors Group 3 Mackenzie Investments 6
Slide 7: IGM Financial Q1 Performance
IGM Financial IGM Financial Q1 Analyst Q1 Analyst Call IGM Financial Q1 2017 Q1Performance Financial 2017 Performance Call Net Earnings ($MM) $177.1 • Net earnings were $177.1MM in the $167.0 quarter compared to $167.0MM in Q1 2016 • Earnings per share of $0.74 in the quarter versus $0.69 in Q1 2016
Slide 8: IGM Financial Q1 Performance
IGM Financial IGM Financial Q1 Analyst Q1 Analyst Call IGM Financial Q1 2017 Q1Performance Financial 2017 Performance Call Average Investment Fund AUM ($B) $124.4 $139.6 • Average investment fund AUM of $139.6B, compared to $124.4B last 1Q/16 1Q/17 year Mutual Fund Gross Sales ($MM) $4,370 $6,010 •
Slide 9: Industry Operating Environment
IGM Financial Q1 Analyst Call Industry Operating Environment Industry and Asset Flows Long Term Mutual Total Mutual Fund Fund Assets Net Sales Q1/17 vs Q4/16 Q1/17 vs Q1/16 4.1% $6.0B Industry Flows by Channel Advice Channel1 Deposit Takers Q1/17 vs Q1/16 Q1/17 vs Q1/16 Gross Sales 15.0% Gross Sales
Slide 10: IGM Highlights – Appointment of IGM Officers
IGM Financial Q1 Analyst Call IGM Highlights – Appointment of IGM Officers Accelerating our transformation and innovation with new IGM executive roles focused on expansion of our shared service models leveraging best practices, talents, and resources across our group of companies • Appointment of Mi
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Slide 12: Investors Group Q1 Highlights
IGM Financial Q1 Analyst Call Investors Group Q1 Highlights Investors Group is off to a strong start in 2017! Strong sales growth • Mutual Fund gross sales up 29% reaching all time high of $2.9B • Mutual fund net sales rose 91% to $890MM, best Q1 since 2007 Record high mutual fund AUM of $83.9B • Hi
Slide 13: Mutual Fund Flows
IGM Financial Q1 Analyst Call Mutual Fund Flows Mutual Fund Gross Sales Mutual Fund Net Sales $ Billions $ Millions 3.0 2.93 1,000 890 • Gross sales during the 2.27 800 quarter of $2.9B, up 29% 2.0 600 467 compared to last year and 400 an all time high 1.0 200 - 0 • Net sales of $890MM in the Q1/16
Slide 14: Consultant Network
IGM Financial Q1 Analyst Call Consultant Network Consultant Network Composition (Number of Consultants) Associates & RD's Recruits (<4 years) 1 Consultant Practices (>4 years) 5,321 5,366 5,380 931 957 4,947 904 4,754 • Q4 2016 recruiting criteria 4,417 4,435 4,423 968 1,010 tightened to enhance pro
Slide 15: High Net Worth Solutions
IGM Financial Q1 Analyst Call High Net Worth Solutions HNW Mutual Fund Series Assets1 • $34.9B in high net worth series assets accounting for $34.9B 41.6% of mutual fund AUM, up +23% $3.3B Unbundled from 37.8% at Q1 2016 fee structures $28.4B growth of $1.6B $8.1B +110% • $11.4B of AUM in unbundled
Slide 16: High Net Worth Solutions
IGM Financial Q1 Analyst Call High Net Worth Solutions Gross Sales of High Net Worth Solutions ($ millions) 1,200 Series J (HNW Bundled) 1,095 • $1.1B in quarterly gross sales, Series U (HNW Unbundled) 1,000 iProfile (HNW Unbundled) up 100% relative to Q1 2016 +100% 746 800 549 • Unbundled fee struc
Slide 17: Managed Solutions Products
IGM Financial Q1 Analyst Call Managed Solutions Products1 Managed Solutions Share of Long Term Fund Gross Sales and Assets • Broad selection of products 70% with a variety of asset 65% allocation strategies 60% Share of Long Term 50% Gross Sales • 25% increase in managed solutions AUM compared to 40
Slide 18: Investment Performance
IGM Financial Q1 Analyst Call Investment Performance Client Account Rate of Return Experience (%) Quarterly 8 • Median client account rate of 6 4 90% of client return was 2.1% during the 3.5 2 1.3 2.2 2.1 accounts had first quarter and 10.0% over returns within - this range the last 12 months (2) (4
Slide 19: Insurance and Mortgage Operations
IGM Financial Q1 Analyst Call Insurance and Mortgage Operations New Annualized Insurance Premiums (Three months ended March 31 - $ Millions) 23.5 • New individual insurance Group Insurance 18.0 product sales increased Individual 34.7% in Q1 2017 compared 13.9 18.7 Insurance to Q1 2016 2016 2017 • Mo
Slide 20: Average Mutual Fund AUM & Fee Rates
IGM Financial Q1 Analyst Call Average Mutual Fund AUM & Fee Rates 208.8 208.9 208.6 208.2 • Q1 2017 average mutual 206.3 fund AUM increased 3.8% compared to Q4 2016 82.8 78.1 79.7 • Fee rate declined due to 75.8 previously announced 73.5 reduction in no-load pricing which came into effect in 2017 •
Slide 21: Investors Group EBIT
IGM Financial Q1 Analyst Call Investors Group EBIT ($ Millions, unless otherwise indicated) Change Relative to: • EBIT for the quarter up 9.6% Q1/16 Q4/16 Q1/17 Prior Year Prior Quarter compared to Q1 2016 • Distribution fees and non- Average mutual fund AUM ($ Billions) 73.5 79.7 82.8 12.5% 3.8% Re
Slide 22: Mackenzie – Confidence in a Changing World
rN MACKENZIE CONFIDENCE IN A CHANGING WORLD 22
Slide 23: Mackenzie Q1 Highlights
IGM Financial Q1 Analyst Call Mackenzie Q1 Highlights Mackenzie is off to a strong start in 2017! Significant momentum in mutual fund sales with AUM reaching record high of $52.9B • Mutual fund gross sales of $2.55B1, up 38% from Q1 2016 • Mutual fund net sales of $381MM1, best result since 2006 Str
Slide 24: Investment Fund Flows
IGM Financial Q1 Analyst Call Investment Fund Flows Quarterly Investment Fund Flows1 Mutual Fund Gross Sales Investment Fund Net Sales • Mutual fund gross sales up $ Billions $ Millions 38.4% compared to Q1 2016 3.0 2.55 600 444 2.0 1.84 400 • Investment fund net sales of 200 $444MM, up $642MM 1.0 0
Slide 25: Mutual Fund Gross Sales by Asset Class
IGM Financial Q1 Analyst Call Mutual Fund Gross Sales by Asset Class Total Mutual Fund Gross Sales • 38.4% growth in gross sales (Three months ended March 31 - $ Millions) compared to 10% growth in 2016 2017 $ Change % Change advice channel excluding IGM Financial Money market 109 109 (1) (0.9%) Inc
Slide 26: Total Net Sales
IGM Financial Q1 Analyst Call Total Net Sales 1,2,3 Total Net Sales1,2,3 (Three months ended March 31 - $ Millions) 2016 2017 $ Change • Mutual fund net sales driven by strong flows into balanced Money market 30 26 (4) funds Income-oriented (194) (24) 170 Balanced • Total net sales of $733MM in Symm
Slide 27: Expanding our Suite of ETFs
IGM Financial Q1 Analyst Call Expanding our Suite of ETFs Mackenzie ETF AUM $447MM • $447MM of ETF AUM in 20171 Exclusive retail partnership in Canada with $256MM • Launch of two new ETFs TOBAM, an award-winning global asset manager based in expands Mackenzie ETF France suite of products to 11 $234M
Slide 28: Investment Performance – Mutual Funds
IGM Financial Q1 Analyst Call Investment Performance – Mutual Funds Mackenzie Mutual Funds in First or Second Quartile1 (Proportion of Assets) 72% 72% 57% 55% December 31, 2016 March 31, 2017 40% 37% 34% 36% 1 Year 3 Year 5 Year 10 Year Morningstar Ratings – Proportion of Morningstar-Rated Assets1 (
Slide 29: Investment Boutiques – Performance & Flows
IGM Financial Q1 Analyst Call Investment Boutiques – Performance & Flows Mutual MutualFund FundAssets by Morningstar Assets RatingRating by Morningstar ($ millions) ($ millions) 10,000 4 or 5 Stars 3 Stars 1 or 2 Stars Not Rated 7,500 5,000 2,500 0 % 4 or 5 0% 15% 90% 84% 68% 34% 0% 44% 79% 54% 3% 1
Slide 30: Average Total AUM & Fee Rates
IGM Financial Q1 Analyst Call Average Total AUM & Fee Rates Annualized Net 76.5 76.8 76.9 77.3 77.1 Revenue Rate (bps)1 • Q1 2017 change in average AUM versus Q4 2016: − Mutual funds up 3.3% 63.5 63.8 65.2 59.8 60.8 Average Total AUM ($B) − Institutional2 down 2.7% ETFs and Institutional2 − Proporti
Slide 31: Mackenzie EBIT
IGM Financial Q1 Analyst Call Mackenzie EBIT ($ Millions, unless otherwise indicated) • EBIT up 14% compared to Change Relative to: Prior Prior Q1/16 Q4/16 Q1/17 Year Quarter Q1 2016 Average AUM ($ Billions): Total Mutual funds 59.8 46.7 63.8 50.5 65.2 52.2 9.0% 11.7% 2.1% 3.3% • Total net revenue u
Slide 32: Q&A
ISM, Q&A 32