Canaccord Genuity Group Inc. · TSX:CF
Canaccord Genuity — Q2 2017 Earnings Presentation
25 slides from Canaccord Genuity's earnings presentation, November 2016
Slide 1: Fiscal second quarter 2017
Fiscal second quarter 2017 INVESTOR PRESENTATION | November 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: Our vision for Canaccord Genuity remains consistent
Our vision for Canaccord Genuity remains consistent 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 mar
Slide 4: Commitment to Stronger Bottom Line Performance
Commitment to Stronger Bottom Line Performance Our key priorities to create long term shareholder value have not changed 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 fo
Slide 5: Fiscal second quarter 2017 highlights
Fiscal second quarter 2017 highlights Delivering on our commitments Create Expense Drive Stability Management performance Diversify revenue streams Quarterly operating Increase net income Q2 principal trading revenues increased 53% y/y expenses1 reduced by focus in all business Increasing scale
Slide 6: Enhance Operating Efficiency
Enhance Operating Efficiency On track to permanently reduce certain operating costs H2 2016 H1 2017 Fiscal 2017 outlook2 $17 million in restructuring costs Targeted $10 million savings in G&A, Reducing Toronto office space footprint communications, technology and will deliver annual savings of
Slide 7: 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 Top Canadian underwriter by n
Slide 8: Drive Business Unit Performance in the US
Drive Business Unit Performance in the US Strategically strengthening our US operations to enhance our global platform Strengthened core teams and sector coverage in alignment with global efforts Benefiting from investments made last year in HCIT, REITs and Industrials Investment M&A contribut
Slide 9: 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 Outlook for capital raising activity was uncertain following EU referendum result Differentiated global offering provides competitive advantage post UK referendum resul
Slide 10: Drive Business Unit Performance in Asia-Pacific
Drive Business Unit Performance in Asia-Pacific Investments to strengthen Australian operations now driving performance in the region Diversified business covering core sectors Q2 Investment banking revenue increased 288% y/y Metals & Mining capability delivering results in resource sector tur
Slide 11: $60 million investment to fund growth in Canadian Wealth Management
$60 million investment to fund growth in Canadian Wealth Management Well positioned to become leading independent in Canada The Offering Strategic Rationale $60 million private placement of convertible Unique and immediate opportunity to increase assets under management unsecured debentures of Canac
Slide 12: Drive Business Unit Performance in Canadian Wealth Management
Drive Business Unit Performance in Canadian Wealth Management Determined resolve and aggressive response to challenging markets and industry upheaval Client Assets – (C$/£ billions) Fee-based Revenue as a Percentage of Wealth Management Revenue Canada ‐ Canaccord Genuity fiscal quarters $11.0 $10.8
Slide 13: Continue to Drive Results in UK & Europe Wealth Management
Continue to Drive Results in UK & Europe Wealth Management Important asset with significant value creation opportunities Client Assets – (C$ billions)1 Fee-based Revenue as a Percentage of Wealth Management Revenue UK & Europe- Canaccord Genuity fiscal quarters $24.5 $22.8 $22.9 $22.8 $22.4 $23.2 69
Slide 14: Stability
Stability Significantly reduce volatility in our earnings model Fiscal Second Quarter 2017 Capital Markets Revenue Focused diversification strategy Breakdown Global platform provides opportunities to benefit from activity C$ Millions in all our geographies Sales & Trading desks coordinated acros
Slide 15: Alignment with Shareholders
Alignment with Shareholders Equity participation by Executives, Employees and Board of Directors Compensation linked to successful delivery of strategic objectives • President & CEO compensated primarily in Common shares Surrendered full amount of F2016 stock award in connection with CEO appointme
Slide 16: 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 Connect People to Performance bank, we differentiate ourselves every day by providing a truly global perspective, 1 We are whic
Slide 17: 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 18: 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 Closed $60 million privat
Slide 19: Canaccord Genuity Group Inc.: Financial Snapshot
Canaccord Genuity Group Inc.: Financial Snapshot CANACCORD GENUITY GROUP INC.: GLOBAL MEASURES Key Metrics F2014 F2015 F2016 Q2/16 Q2/17 Gross Revenue $855,244 $880,763 $787,805 $190,602 $193,602 Total expenses1 $770,587 $827,458 $793,8621 $186,2261 $190,6951 Incentive Compensation $413,289 $455,480
Slide 20: Canaccord Genuity Global Capital Markets: Financial Snapshot
Canaccord Genuity Global Capital Markets: Financial Snapshot CANACCORD GENUITY: GLOBAL MEASURES Key Metrics (C$, Excluding significant FY2016 Q2/161 Q1/17 1 Q2/17 1 items - non-IFRS) Gross Revenue1 $532.3 mil $126.5 mil $140.6 mil $127.0 mil Income (loss) (before intersegment allocations and income
Slide 21: Canaccord Genuity Wealth Management: Financial Snapshot
Canaccord Genuity Wealth Management: Financial Snapshot Canada¹: Wealth Management Key Metrics FY2016 Q2/16 Q1/17 Q2/17 (C$, Excluding significant items)2 Gross Revenue $108.2M $26.2M $29.5M $29.7 Income (loss) (before intersegment allocations and income $12.2M $3.5M $3.6M $4.5M taxes) Income (loss)
Slide 22: Q2/17 Financial Performance
Q2/17 Financial Performance Revenue Net Income1 (C$ millions) (C$ millions) $254 $29.1 $230 $246 $236 $231 $232 $24.0 $218 $214 $20.5 $21.2 $20.7 $187 $187 $191 $201 $206 $15.6 $166 $182 $194 $13.3 $163 $183 $11.8 $8.8 $8.1 $5.9 $6.7 $1.9 $2.0 ($2.1) ($16.3) ($14.3) ($19.1) Diluted EPS1 Book Value (
Slide 23: Strong focus on cost containment
Strong focus on cost containment Continuing to explore additional expense reduction measures Operating expenses1 - $C thousands $98.5 $93.5 $93.5 $92.6 $91.3 $86.4 $86.6 Q4/2015 Q1/2016 Q2/2016 Q3/2016 Q4/2016 Q1/2017 Q2/17 1. Operating expenses exclude significant items and incentive compensation T
Slide 24: Fiscal 2016 Financial Performance
Fiscal 2016 Financial Performance Revenue Net Income1 (C$ millions) (C$ millions) $880.8 $114.1 $803.6 $797.1 $855.2 $756.9 $787.8 $731.5 $93.0 $604.9 $81.2 $79.3 $577.5 $68.8 $477.7 $42.0 $39.3 $25.6 $25.2 ($1.4) ($6.0) FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY06 FY07 FY08 FY09 FY10 FY11
Slide 25: 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
Canaccord Genuity Group — Q2 2017 Earnings Presentation on 6ix