Canaccord Genuity Group Inc. · TSX:CF
Canaccord Genuity — Investor Presentation (June 2019)
27 slides from Canaccord Genuity's investor presentation, June 2019
Slide 1: Canaccord Genuity Group Inc. Investor Presentation
Canaccord Genuity Group Inc. Investor Presentation JUNE, 2019
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: 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 5: Positioned for long-term success
Positioned for long-term success Focusing our business for long-term value creation Diversify Restructure & Refocus Balance business mix Sustainable, profitable growth 2010 to 2014 2015 - 2016 2017 - 2018 2019 and beyond • Redeploy capital across fewer • Expand global footprint • Align global busine
Slide 6: Creating shareholder value across our business
/ Creating shareholder value across our business Results for fiscal 2019 exceeding pace for fiscal 2018 Revenue Net Income1 C$ millions, fiscal years ended March 31 C$ millions, fiscal years ended March 31 $107.4 $81.7 $1,190.6 $49.2 $1,022.9 $879.5 $787.8 ($6.0) 2016 2017 2018 2019 2016 2017 2018 2
Slide 7: 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 • Increase specialization in existing areas of strength • Diversify revenue streams to impr
Slide 8: CG Wealth Management - Global
/ CG Wealth Management - Global Fully independent investment planning and wealth management services and solutions UK & Europe: London, Jersey, Overview Guernsey, Isle of Man, Blackpool, Lancaster, Llandudno, Norwich, Nottingham, Worcester, York • Increased client assets to over $65 billion from $33
Slide 9: Global Wealth Management: Goals
/ Global Wealth Management: Goals Trailing 12 months Mission 2022 To March 31, 2018 $65 bn $80 bn Client Client Assets Assets • Recruiting • Acquisitions & Tuck-ins • Expand geographic footprint $462 M $600 M Revenue Revenue • Increase fee-based contributions • Grow share of wallet 16% 20% Pre-tax P
Slide 10: Wealth Management – UK & Europe
/ Wealth Management – UK & Europe A Top 10 wealth manager in an industry where scale matters Client Assets C$ and GBP£, billions Focused on mass-affluent investors and intermediaries $46.4 $45.2 $43.8 $44.9 $44.2 Excellent model for the growth and business mix we aim to achieve in other $40.8 $4
Slide 11: Wealth Management: UK & Europe acquisitions track record
/ Wealth Management: UK & Europe Successful track record of integrating new businesses • Announced Q4 F2019; Closed May, 2019 • Wealth management, financial planning and select private client investment management services • Client portfolios valued at approximately £1 billion • January, 2019 • Expa
Slide 12: Wealth Management: Canada
/ Wealth Management: Canada On track to become leading independent Canadian wealth Client Assets management business C$ billions • Focused on mass affluent clients seeing wealth creation and wealth $20.7 $19.7 management $18.9 $18.3 • Scale, capabilities and economics give us competitive advantages
Slide 13: Wealth Management: Canada recruiting opportunity
/ 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 full-service retail brokerage segment represents $1.3 tn1 (C$, billions) in client assets.
Slide 14: Global Capital Markets: Goals
/ Global Capital Markets: Goals Moving toward delivering stability and sustainable profitability through market cycles Income (loss) before income taxes1 C$ millions, fiscal quarters $36.9 $34.8 $36.0 $31.7 $24.9 $13.2 $10.7 $7.0 ($3.2) $5.8 ($1.9) ($6.4) ($1.9) Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q
Slide 15: Canaccord Genuity in Canada
/ Canaccord Genuity in Canada Dominant independent investment bank on every measure U.S. Trading, Advisory, ECM and Corporate Access capabilities are Unparalleled origination and placement integral to Canaccord Genuity’s global capital markets platform capability #1 ranked Canadian equity underwri
Slide 16: Canaccord Genuity in the U.S.
/ Canaccord Genuity in the U.S. A significant and growing contributor to our global success U.S. Trading, Advisory, ECM and Corporate Access capabilities are integral to Canaccord Genuity’s global capital markets Strategic combination creates a top-tier platform mid-market M&A franchise • Aligned bu
Slide 17: Canaccord Genuity – Rest of the World
/ Canaccord Genuity – Rest of the World Global capabilities provide a significant competitive advantage in mid-market focus sectors Lean and focused Increasing global product Strong emphasis on Focused on increasing platform placement cross selling M&A in all our key markets Specialization in core E
Slide 18: 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 Fiscal 2019 Fiscal 2019 FOCUSED WHERE WE CAN BE MOST RELEVANT TO OUR CLIENTS Canada Commissions AND PROVIDE SUPERIOR RE
Slide 19: Stability
/ Stability Creating a lower risk business model with growing contributions from wealth management Revenue by business segment Fiscal 2019 EPS contribution by business segment1,2 Fiscal 2019 / Stable wealth 40% management 53% foundation enhances 47% earnings stability 60% throughout market cycles We
Slide 20: 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 21: Analyst Coverage
/ Analyst Coverage Cormark Securities TD Securities Inc. Jeff Fenwick Graham Ryding 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 analysts are theirs alone and do no
Slide 22: Financial highlights
Financial highlights Fourth quarter and fiscal 2019 Page 22
Slide 23: Fiscal fourth quarter and fiscal 2019 results
/ Fiscal fourth quarter and fiscal 2019 results Improved business mix contributing to earnings stability and growth • Q4/19 revenue of $284.8 million; Record fiscal 2019 revenue • Added 16 Investment Advisor teams in Canadian wealth of $1.2 billion management fiscal YTD • Acquisition of Petsky Pruni
Slide 24: Global Capital Markets
/ Global Capital Markets Revenue by Activity Pre-tax net income1 and profit margin1 C$ millions, fiscal quarters $40 25% 20% $200 $30 15% Pre-tax net income Pre-tax profit margin $150 $20 C$ millions 10% $100 $10 5% $0 $50 0% -$10 $0 -5% -$20 -10% Commissions & Fees Investment Banking Advisory Tradi
Slide 25: Global Wealth Management
/ Global Wealth Management Revenue by region Pre-tax net income1 and profit margin1 C$ millions $20 20% $120 18% 16% $15 Pre-tax profit margin 14% Pre-tax net income 12% C$ millions $80 $10 10% 8% 6% $40 $5 4% 2% $0 0% $0 Pre-tax net income Pre-tax profit margin UK & Europe Canada Sequential Y/Y Q4/
Slide 26: Expenses
/ Expenses Profitability growing faster than expenses as business activity increases Compensation ratio1 Non-compensation ratio1 62.8% 64.4% 64.4% 64.2% 34.1% 34.7% 34.2% 61.5% 61.5% 33.0% 59.8% 58.7% 60.7% 59.7% 59.1% 58.3% 31.3% 30.7% 28.6% 27.1% 27.6% 27.1% 25.1% 23.9% Q1/17 Q2/17 Q3/17 Q4/17 Q1/
Slide 27: 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 • Closed $133M convertible debenture offering1 in August 2018; Provides additional capital to invest in
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