Canaccord Genuity Group Inc. · TSX:CF
Canaccord Genuity — Q3 2016 Earnings Presentation
27 slides from Canaccord Genuity's earnings presentation, February 2016
Slide 1: Fiscal third quarter 2016 Investor Presentation
Fiscal third quarter 2016 INVESTOR PRESENTATION | February 2016 To us there are no foreign markets.™ To us there are no foreign markets.™
Slide 2: Caution Regarding Forward Looking Statements
Caution Regarding Forward Looking Statements This document may contain certain “forward-looking information” (as defined under applicable securities laws). These statements relate to future events or future performance and include management’s expectations, beliefs, plans, estimates, intentions, and
Slide 3: Vision for Canaccord Genuity
Vision for Canaccord Genuity Focused, Independent Mid-market Investment Bank With a Stable Wealth Management Business MID-MARKET COMPETITOR LEAN AND AGILE STABLE Shareholder Value Creation NEW CULTURE LOCAL & GLOBAL PLATFORM SHAREHOLDER ALIGNMENT To us there are no foreign markets.™ Page 3
Slide 4: Plan for Stronger Bottom Line Performance
Plan for Stronger Bottom Line Performance Initiatives to create long term shareholder value 1 Enhance Operating Efficiency 2 Improve Alignment 3 Drive Individual Business Unit Performance 4 Create Stability 5 Establish New Culture 6 Net Income Focus To us there are no foreign markets.™ Page 4
Slide 5: What We Have Announced Today
What We Have Announced Today Positioning our business for the future Independent investment bank with stable wealth management business Strategic focus Lean, agile organization Globally focused on key sectors Over $30 million in expected annualized savings announced today Initiatives to Re
Slide 6: Goodwill
Goodwill Effectively driven by a mark-to-market test at what we perceive to be the bottom of a cycle Goodwill impairment charges of $321 million during the quarter • Related to all capital markets business units and other assets UK & Europe $106.9 million • Pretax profit of $38 million in F2014 but
Slide 7: Enhance Operating Efficiency
Enhance Operating Efficiency How we are reducing certain operating costs Q3/16 Q4/16 Fiscal 2017 $4 million in restructuring costs $14 million in restructuring costs $10 million savings in G&A, communications & technology, and trading Headcount reductions of 25 Headcount reductions of 100
Slide 8: Improve Alignment
Improve Alignment Fully accountable leadership team represents all regions and businesses Dan Daviau President and Chief Executive Officer Canaccord Genuity Group Inc. Alexis de Rosnay Brad Kotush SEVP, Global Head of Investment Chief Financial & Risk Officer Banking Canaccord Genuity Group Inc. Dri
Slide 9: Improving Alignment
Improving Alignment Focus on core global sectors is complemented by regional sector coverage Fiscal 2016 YTD, % of Revenue Fiscal 2015, % of Revenue Media & Metals & Other Mining Media & Telecom 6% Other Metals & 4% Energy Telecom 5% 2% 1% Mining 4% GLOBAL 14% Financials Financials 8% 10% Energy Inf
Slide 10: Improving Alignment: Capital Markets Revenue Breakdown
Improving Alignment Fiscal 2016 Year-to-date Capital Markets Revenue Breakdown C$ Million $393.6 ASIA-PACIFIC & Fiscal 2016 $26.3 OTHER YTD Opportunity 6.7% (C$ millions) $112.9 • Total cross border commissions in our core geographies is UK & EUROPE COMMISSIONS a ~$2bn market 28.7% & PRINCIPAL $178.
Slide 11: Drive Business Unit Performance in Canada
Drive Business Unit Performance in Canada Clearly establish Canaccord Genuity as the dominant independent Canadian investment bank Successfully recruiting into our strategic sectors Realigned our natural resource focus and leadership (Energy and Mining) Investment Realigned leadership and sect
Slide 12: Drive Business Unit Performance in the US
Drive Business Unit Performance in the US US operations integral to our global mid-market platform Broadened select teams to align with global efforts Investment Debt Financing & Restructuring capability to expand opportunities Banking Established sponsor coverage Minneapolis Boston New York C
Slide 13: Drive Business Unit Performance in the UK & Europe
Drive Business Unit Performance in the UK & Europe A leaner, more focused mid-market securities and investment banking business Better integrated into global platform, strong M&A capability across continental Europe Investment Mid-market strengths in alignment with global efforts Dublin Banking
Slide 14: Drive Business Unit Performance in Asia-Pacific
Drive Business Unit Performance in Asia-Pacific Leverage strength of successful Australian business to grow our share in the region Diversified business covering core sectors– 85% of revenue from non-resource sectors Investment Consistently ranked Top Independent Investment Bank in Australia Bei
Slide 15: Drive Business Unit Performance in Canadian Wealth Management
Drive Business Unit Performance in Canadian Wealth Management Determined resolve and aggressive response to challenging markets and industry upheaval Client Assets – (C$ billions)2 Fee-based Revenue as a Percentage of Wealth Management Revenue Canada - Canaccord Genuity Fiscal Quarters 46.6% 45.3% $
Slide 16: Continue to Drive Results in UK & Europe Wealth Management
Continue to Drive Results in UK & Europe Wealth Management Important asset with significant value creation opportunities Client Assets – (C$ billions)2 Fee-based Revenue as a Percentage of Wealth Management Revenue UK & Europe- Canaccord Genuity Fiscal Quarters 69.1% 71.0% 68.7%70.0% 66.6% $24.5 62.
Slide 17: Stability
Stability Significantly reduce volatility in our earnings model Focused diversification strategy Global platform provides opportunities to benefit from activity in all our geographies M&A, Advisory and Restructuring practice Well positioned to continue benefiting from domestic and cross-bord
Slide 18: A Strong Culture to Drive our Success
A Strong Culture to Drive our Success We must perform to our full potential in any market How we interact with each other is critical to our culture. As a global investment bank, we differentiate ourselves every day by providing a truly global perspective, Connect People to Performance 1 We are whic
Slide 19: Canaccord Genuity presents a compelling opportunity
Canaccord Genuity presents a compelling opportunity If we deliver on our mission to be the dominant independent investment bank and wealth management firm Opportunity If we successfully execute our plan … Net Income* (C$ million) Basis for Illustration* $1,100 to Capital Markets $1,800 Canada $60 ~
Slide 20: Alignment with Shareholders
Alignment with Shareholders Equity participation by Executives, Employees and Board of Directors Transparent compensation structure • President & CEO compensated primarily in Common shares • 1.5 million stock award will be offset against cash compensation over the next 5 years • Total equity interes
Slide 21: Financial performance
Financial performance Capital Metrics, Quarterly Performance, Annual Performance Canaccord Genuity – Financial snapshot Wealth Management – Financial snapshot To us there are no foreign markets.™
Slide 22: Solid Capital Position
Solid Capital Position Well capitalized for continued investment in key priorities Able to support increasing business activities and invest in opportunities to capture additional market share Strong, liquid balance sheet Prepared for evolving regulatory environment (in C$ millions, except for
Slide 23: Q3/16 Financial Performance
Q3/16 Financial Performance Revenue Net Income1 (C$ millions) (C$ millions) $254 $246 $29.1 $230 $231 $236 $232 $218 $214 $24.0 $20.5 $21.2 $20.7 $187 $187 $183 $191 $15.6 $178 $163 $166 $182 $10.6 $11.8 $8.8 $13.3 $148 $5.9 $6.7 $2.1 $1.9 ($16.3) ($14.3) ($19.1) Diluted EPS1 Book Value (C$) per dil
Slide 24: Fiscal 2015 Financial Performance
Fiscal 2015 Financial Performance Revenue Net Income1 (C$ millions) (C$ millions) $114.1 $881 $855 $804 $797 $93.0 $757 $732 $81.2 $79.3 $583 $578 $605 $68.8 $478 $39.3 $42.0 $25.2 $25.6 ($1.4) FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 Dilute
Slide 25: Canaccord Genuity Global Capital Markets: Financial Snapshot
Canaccord Genuity Global Capital Markets: Financial Snapshot CANACCORD GENUITY: GLOBAL MEASURES Key Metrics (C$, Excluding significant items - non-IFRS) FY2015 Q2/161 Q3/161 Gross Revenue1 $613.1 mil $126.5 mil $122.1 mil Income (loss) $56.2 mil $3.7 mil $(14.7 )mil (before intersegment allocations
Slide 26: Canaccord Genuity Wealth Management: Financial Snapshot
Canaccord Genuity Wealth Management: Financial Snapshot CANADA¹: WEALTH MANAGEMENT Key Metrics (C$, Excluding significant items – non IFRS) FY2015 Q2/16 Q3/16 Gross Revenue $125.3 mil $26.2 mil $25.6 mil Income (loss) $10.4 mil $3.5 mil $2.2 mil (before intersegment allocations and income taxes) Inc
Slide 27: Disclaimer
Disclaimer This material is provided for information purposes only and is intended for distribution in those jurisdictions where subsidiaries of Canaccord Genuity Group Inc. (together, “Canaccord Genuity”) are registered as advisors or dealers in securities. Any distribution or dissemination of this
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