Igm Financial Inc. · TSX:IGM
Igm Financial — Investor Presentation (October 2020)
24 slides from Igm Financial's investor presentation, Oct 8, 2020
Slide 1: IGM Financial Disclosure Enhancements
IGM Financial Disclosure Enhancements Emphasizing components of value and reflecting the evolution of business lines October 8, 2020
Slide 2: Caution Concerning Forward-looking Statements
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 provided to assist the reader in unde
Slide 3: Non-IFRS Financial Measures & Additional IFRS Measures
Non-IFRS Financial Measures & 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 shareholders; and • Other items, which includ
Slide 4: Documents Incorporated by Reference
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: 1. Documents related to IGM F
Slide 5: IGM Financial has Realigned our Three Reportable Segments
IGM Financial has Realigned our Three Reportable Segments so that Financial Reporting and Related Disclosures Better Characterize our Distinct Business Lines Wealth Management Asset Management Strategic Investments AUA 68% AUM 20% & Other 12% of EBIT $141B of EBIT of EBIT $120B Reflects the activiti
Slide 6: Changes Intended to Improve Transparency into Key Drivers of Each Business Line
The Changes are Intended to Improve Transparency into Key Drivers of Each Business Line and Help Stakeholders Understand and Assess Components of Value 1• A significant portion of economics reside in IGM’s wealth management businesses, which are focused on financial planning excellence 2• Mackenzie
Slide 7: Approach to New Segmented Disclosure as Introduced on Q2 Results Call
Approach to New Segmented Disclosure as Introduced on Q2 Results Call 1) Advisory fee transfer pricing framework established to Wealth Asset Strategic price IG Wealth and Canada Life relationships Management Management Investments & Segment Segment Other 2) IG Wealth to be recorded as a Mackenzie cl
Slide 8: Key Operating Metrics
Key Operating Metrics Example of New Disclosure for Monthly Results Releases (Q2/20) Legend: Wealth Asset Consol- = Key metrics Management Management idated Italicized = New Total $ millions Assets under management & advisement (as at June 30, 2020) Mutual funds 89,533 5,041 94,574 60,132 154,706 ET
Slide 9: Reconciliation of Changes to EBIT by Segment
Reconciliation of Changes to EBIT by Segment 2019 Adjusted EBIT ($MM) 1• Interest income Wealth from capital Management allocated to the 68% operating Segment of EBIT companies re- (previously classified from IG Wealth Management) “Corporate and Other” segment1 Asset 20% 2• Re-allocation of ~$50MM i
Slide 10: Segmented Earnings and Key Drivers
Segmented Earnings and Key Drivers Strategic Wealth Management Asset 1 New fee line items to Year ended December 31, 2019 Inv. & Elim IGM Mgmt reflect business evolution IG IPC Total Other at wealth managers Colour shading Average Assets under Management & Advisement ($B) towards advisory fees conve
Slide 11: New Presentation of Wealth Management & Asset Management Business Operations
New Presentation of Wealth Management & Asset Management Business Operations Compared to Prior Disclosure Presentation Year ended December 31, 2019 Management Administration Distribution Net Investment Proportionate Commission Non-commission $ millions Prior Fees Fees Fees Income & Other Share of As
Slide 12: Segment Reporting - Trended IGM
Segment Reporting - Trended IGM IGM Adjusted EBIT1 ($MM) IGM Adjusted EBIT Margin1,3 (% of AUM&A) 740 744 760 Advisory & business 718 708 707 development and sub- 1.54% 1.54% 1.54% 1.53% 1.49% 1.45% advisory fees 0.62% 0.65% 0.59% 0.61% 0.60% 289 0.58% 285 274 Share of Associates’ 286 277 262 Earnin
Slide 13: Segment Reporting - Trended Wealth Management
Segment Reporting - Trended Wealth Management (reflects IG Wealth and IPC) Average Assets ($B), Advisory and Product & Program Fee Rate (bps)2 $ Millions (unless otherwise noted):1 2019 2020 120.9 121.2 123.2 121.8 Wealth Management Q1 Q2 Q3 Q4 Q1 Q2 117.1 117.1 Other AUA Average Assets under advise
Slide 14: Segment Reporting - Trended IG Wealth Management
Segment Reporting - Trended IG Wealth Management Average Assets ($B), Advisory and Product & Program Fee Rate (bps)2 $ Millions (unless otherwise noted):1 2019 2020 93.8 94.1 95.8 94.9 IG Wealth Management Q1 Q2 Q3 Q4 Q1 Q2 90.5 91.2 Other AUA 3.7 3.7 3.8 4.0 3.5 4.2 Average Assets under advisement
Slide 15: IG Wealth Management's Better Gamma
Reminder: IG Wealth Management’s Better Gamma (better advice) Leads to 60-65% of Client Outcomes BET TER BETTER GAMMA BETA BETTER ALPHA 60-65% OF CLIENT OUTCOME 20-25% OF CLIENT OUTCOME 5-10% OF CLIENT OUTCOME Gamma – the value of all efforts that sit outside of investment portfolio Beta – the value
Slide 16: Segment Reporting - Trended Asset Management
Segment Reporting - Trended Asset Management Average AUM ($B), Net Asset Management Fees (bps)2 $ Millions (unless otherwise noted):1 2019 2020 135.7 139.8 139.2 140.2 138.5 135.6 Asset Management Q1 Q2 Q3 Q4 Q1 Q2 Sub-advisory AUM Assets under Management ($B) 72.2 73.6 72.9 73.0 71.4 68.3 to Wealth
Slide 17: Segment Overview – Strategic Investments as at June 30, 2020
Segment Overview – Strategic Investments as at June 30, 2020 • The Strategic Investments & Other segment has a fair value of $2.5B at June 30, 2020 Strategic Investments and Other Great-West Lifeco: China: _________Fintech:_________ Unallocated Total Capital 1 $ millions unless otherwise noted (TSX:
Slide 18: Q&A
Q&A IGM Financial – Disclosure Enhancements
Slide 19: Appendix
Appendix IGM Financial – Disclosure Enhancements
Slide 20: Chinese Mutual Fund Industry AUM Experiencing Strong Growth
Chinese Mutual Fund Industry AUM Experiencing Strong Growth Chinese Mutual Fund Industry Ending AUM Chinese Mutual Fund Industry Long-term Mutual (RMB Trillions)1 Fund Market Share (% at March 31, 2020)2 CAD/RMB = 5.206 16.6 16.8 Money market funds 14.7 13.7 13.3 13.6 Long-term funds 13.2 12.9 12.3
Slide 21: China AMC's Growth has Accelerated in 2020
China AMC’s Growth has Accelerated in 2020 China AMC Ending AUM1 CAD/RMB = 5.206 China AMC Net Earnings (RMB billions) (RMB millions) Very strong AUM growth over past Q2 earnings reflective four quarters 1,248 of growth in AUM 398 1,032 906 918 349 870 880 303 309 310 296 287 298 284 254 Q4/17 Q2/18
Slide 22: Wealthsimple has Consistently Experienced Strong Growth
Wealthsimple has Consistently Experienced Strong Growth AUA1 (CAD$ Billions) 7.1 Wealthsimple AUA of CAD $7.1B 5.0 increased 89% year-over-year1 3.8 2.6 2.1 1.4 Dec-17 Jun-18 Dec-18 Jun-19 Dec-19 Jun-20 Canadian Robo-advice Industry (per investor economics): Online Advice Expands Across Canada Robo-
Slide 23: Key Changes with New Disclosure Relative to Prior Disclosure
Key Changes with New Disclosure Relative to Prior Disclosure Restatement of IGM Financial Results (year ended December 31, 2019) Prior Disclosure New Disclosure Corporate & Other Wealth Mgmt Strategic IG Elimin- Asset Elimin- Mackenzie IGM IG Investments IGM Wealth IPC Other ations IPC Total Mgmt at
Slide 24: Glossary
Glossary Wealth management fees: Revenue earned by the Wealth Management segment for providing financial planning, investment advisory and related financial services. Specific sources of revenue include financial advisory fees, investment management and related administration fees, distribution reve