Canaccord Genuity Group Inc. · TSX:CF
Canaccord Genuity — Investor Presentation (February 2021)
33 slides from Canaccord Genuity's investor presentation, February 2021
Slide 1: Canaccord Genuity Group Inc. Investor Presentation
Canaccord Genuity Group Inc. Investor Presentation FEBRUARY 2021
Slide 2: Forward looking statements and non-IFRS measures
Forward looking statements and non-IFRS measures This document may contain ‘‘forward-looking statements’’ (as defined under applicable securities laws). These statements relate to future events or future performance and reflect management’s expectations, beliefs, plans, estimates, intentions and sim
Slide 3: Driven to deliver superior client outcomes
/ Driven to deliver superior client outcomes / Driven to strengthen employee engagement / Driven to become more profitable / Driven to increase shareholder value Page 3
Slide 4: Covid-19 Response
Covid-19 Response Acted swiftly to protect our employees, clients and communities Preparedness Early Response Outlook Business model is centred on stability Rapidly transitioned >90% of employees to Committed to our longer-term strategic priorities • Limits reliance on any single industry or secure,
Slide 5: Covid-19 Business Impact
Covid-19 Business Impact Identifying the clients who need us most and aggressively adding value for them Remarkably strong new issue environment Trading and Specialty desks outperformed • Innovative solutions to help small- and mid- • Record volumes with no technology cap companies access public mar
Slide 6: Financial Highlights
Financial Highlights Broad capabilities drive revenue and earnings stability through market cycles Pre-tax Net Diluted Revenue Income1,2 EPS1 Q3 Fiscal 2021 $533.1 M $110.6 M $0.62 3 months ended +73.1% y/y +256.6% y/y +169.6% y/y December 31 Earnings growth is outpacing revenue growth YTD Fiscal 20
Slide 7: Overview of Canaccord Genuity Group Inc.
Overview of Canaccord Genuity Group Inc. A leading independent financial services firm with a global presence WEALTH MANAGEMENT CAPITAL MARKETS HOW WE Comprehensive wealth management DIFFERENTIATE Provides leading investment banking, solutions to help individual investors, equity research and sales
Slide 8: Positioned for long-term success
Positioned for long-term success Building upon our strategy of long-term value creation Diversify Restructure & Refocus Balance business mix Sustainable, profitable growth 2010 to 2014 2015 - 2016 2017 - 2018 2019 and beyond • Expand global footprint • Align global business leaders • Significantly g
Slide 9: Creating shareholder value across our business
/ Creating shareholder value across our business Balanced business mix contiributed to a solid quarterly performance Revenue - C$ millions Net Income1,2 - C$ millions Fiscal years ended March 31 Fiscal years ended March 31 Q3 and nine months ended December 31 Q3 and nine months ended December 31 $53
Slide 10: Strategic vision
/ Strategic vision Build a dominant independent Wealth Management and Capital Markets business • Add scale through acquisitions and recruiting • Drive significant margin improvement and increase profitability • Continue to enhance the brand • Grow recurring revenues from fee-based services • Increas
Slide 11: CG Wealth Management - Global
/ CG Wealth Management - Global Fully independent investment planning and wealth management services and solutions UK & Europe: London, Jersey, Guernsey, Isle of Man, Blackpool, Overview Lancaster, Llandudno, Norwich, Nottingham, Southampton, • Increased client assets to $85 billion from $33 billion
Slide 12: CG Wealth Management: Client assets performing well
CG Wealth Management: Client assets performing well Recurring fee-based revenue provides stability through market cycles CG Wealth Management - UK & Europe CG Wealth Management - North America Q4/19 Q1/20 Q2/20 Q3/20 Q4/20 Q1/21 Q2/21 Q3/21 Q4/19 Q1/20 Q2/20 Q3/20 Q4/20 Q1/21 Q2/21 Q3/21 FTSE 100 AU
Slide 13: Global Wealth Management: Goals
/ Global Wealth Management: Goals We have surpassed our Mission 2022 objectives At Dec 31, 2018 At December 31, 2020 $60 bn $80 bn Client $85 bn Assets1 Client Assets Recruiting End of fiscal quarter Acquisitions & Tuck-ins Increase inflows and share of wallet $254 M $600 M $464 M Revenue1 Rev
Slide 14: Wealth Management – UK & Europe
/ Wealth Management – UK & Europe A Top-10 wealth manager in an industry where scale matters Client Assets C$ and GBP£, billions Focused on mass-affluent investors and intermediaries $51.8 Capable of delivering steady net income growth and stable profit margins $44.9 $46.4 $45.2 $45.6 $48.1 $45.
Slide 15: Significant transaction in UK Wealth Management Business
/ Significant transaction in UK Wealth Management Business $210 M net proceeds to be used by the Company for corporate purposes to optimize shareholder value Transaction details $1.7 bn CF Total Enterprise Value Convertible $130 • HPS Investment Partners, LLC to invest £122.5 million (C$217M)1,2 in
Slide 16: Wealth Management: UK & Europe acquisitions track record
/ Wealth Management: UK & Europe Successful track record of integrating new businesses • Announced Q4 F2019; Closed May, 2019 • Wealth management, financial planning and select private client investment management services • Client portfolios valued at approximately £1 billion • January 2019 • Expan
Slide 17: Wealth Management: Canada
/ Wealth Management: Canada A leading independent Canadian wealth management business Client Assets C$ billions • Focused on mass affluent clients seeking wealth creation and wealth management $29.3 • Scale, capabilities and economics provide competitive advantages in attracting established IA teams
Slide 18: Wealth Management: Canada recruiting environment
/ Wealth Management: Canada Recruiting environment increasingly favourable as banks increase limitations on IAs Significant opportunity to grow market share of full-service retail brokerage assets / Canada’s retail brokerage industry represents $4.4 tn1 in client (C$, billions) assets, with the full
Slide 19: Wealth Management: Australia
/ Wealth Management: Australia Increasing the scale of our wealth management business and Client Assets C$ billions expanding CG’s national footprint in Australia $4.2 • Total client assets in comprehensive investment management platform $3.7 increased 13% y/y $4.2 billion at December 31, 2020 $3.4
Slide 20: Global Capital Markets: Goals
/ Global Capital Markets: Goals Moving toward delivering stability and sustainable profitability through market cycles Income (loss) before income taxes - Adjusted1 C$ millions, fiscal quarters $92.5 $42.9 $36.0 $34.4 $31.7 $24.9 $20.4 $13.2 $8.8 $16.0 $14.5 $10.7 Q4/18 Q1/19 Q2/19 Q3/19 Q4/19 Q1/20
Slide 21: Canaccord Genuity in Canada
/ Canaccord Genuity in Canada Dominant independent investment bank on every measure Unparalleled origination and placement A top-ranked Canadian equity underwriter1 and the only non-bulge firm in capability the top 10 Calendar 2019 and 2020 ranked 1st for volume of transactions Canadian Equity T
Slide 22: Canaccord Genuity in the U.S.
/ Canaccord Genuity in the U.S. A significant and growing contributor to our global success Trading, Advisory, ECM and Corporate Access capabilities are integral to CG’s global capital markets platform Strategic combination creates a top-tier mid-market M&A franchise • Aligned business focused in ke
Slide 23: Canaccord Genuity – Rest of the World
/ Canaccord Genuity – Rest of the World Global capabilities provide a significant competitive advantage in mid-market focus sectors Strong emphasis on Lean and focused Increasing global product Focused on increasing cross-selling platform placement M&A in our key markets Increased trading flow Speci
Slide 24: Remain Agile
/ Remain Agile Independence allows us to adjust our business mix and stay competitive as client demands change Capital markets revenue by region Capital markets revenue by activity Q3 2021 Q3 2021 FOCUSED WHERE WE CAN BE Commissions MOST RELEVANT TO OUR CLIENTS Trading and fees AND PROVIDE SUPERIOR
Slide 25: Stability
/ Stability Creating a lower risk business model with growing contributions from wealth management Revenue by business segment EPS contribution by business segment - Adjusted1,2 9M Fiscal 2021 YTD 9M Fiscal 2021 YTD / Stable wealth 60% 36% management foundation enhances 64% earnings stability 40% th
Slide 26: (TSX:CF): An Excellent Investment Proposition
/ (TSX:CF): An Excellent Investment Proposition Committed to driving value for clients, employees and shareholders Shares are attractively valued Driving earnings power by transforming business mix and growing global wealth management Creating a more predictable business with consistency of earnings
Slide 27: Analyst Coverage
/ Analyst Coverage Echelon Wealth Cormark Securities TD Securities Inc. Jeff Fenwick Graham Ryding Partners Rob Goff Canaccord Genuity Group Inc. is followed by the analysts listed above. Please note that any opinions, estimates or forecasts regarding Canaccord Genuity's performance made by these an
Slide 28: Financial highlights Q3 Fiscal 2021
Financial highlights Q3 Fiscal 2021 Page 28
Slide 29: Fiscal third quarter 2021 results
/ Fiscal third quarter 2021 results Improved business mix contributing to earnings stability and growth • Q3/21 record revenue of $533.1 million, up 73.1% year-over- • 32% of Q3/21 fiscal year-to-date adjusted earnings per share1 year contributed by global wealth management business • Record quarter
Slide 30: Global Capital Markets
/ Global Capital Markets Revenue by Activity Pre-tax net income1 and profit margin1 C$ millions, fiscal quarters $100 30% $350 $90 $80 25% $300 $70 Pre-tax profit margin 20% Pre-tax net income $250 $60 C$ millions $200 $50 15% $150 $40 $30 10% $100 $20 5% $50 $10 $0 $0 0% Commissions & Fees Investme
Slide 31: Global Wealth Management
/ Global Wealth Management Revenue by region1 Pre-tax net income2 and profit margin2 C$ millions $40 25% $180 $35 20% $30 $150 Pre-tax profit margin Pre-tax net income $25 15% C$ millions $120 $20 $90 $15 10% $60 $10 5% $30 $5 $0 0% $0 UK & Europe Canada Australia Pre-tax net income Pre-tax profit m
Slide 32: Expenses
/ Expenses Disciplined expense management as business activity increases Compensation ratio1 Non-compensation ratio1 66.9% 64.2% 60.7% 61.5% 62.2% 61.7% 30.7% 31.2% 59.7% 59.1% 59.9% 60.6% 29.9% 58.7% 58.3% 9M fiscal 2021 28.6% 29.3% 27.6% 28.3% compensation 27.1% ratio reflects an 25.1% increase in
Slide 33: 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 protects ability to compete efficiently • Prepared for evolving regulato
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