Q4 Revenue up 33%, earnings up 13% over Q4 2004
Assets under management increase 18% over 2004
TORONTO, March 9 /CNW/ - Saxon Financial Inc. (TSX:SFI), the investment
management firm that operates Saxon Mutual Funds, released today its financial
results for the fourth quarter and year ended December 31, 2005. The company
continued its strong performance with a 33% growth in revenue and a 13%
increase in net income in the fourth quarter compared with the fourth quarter
of 2004, when it was still a private company. Saxon's assets under management
grew 18% over the year, reaching $11 billion.
"From both the top- and bottom-line perspectives, Saxon delivered strong
performance in a year of growth, expansion and investment in the future," said
Allan Smith, President and CEO of Saxon Financial. "By making smart
investments for our clients and ourselves, we've grown all three lines of
business: not just Saxon's acclaimed mutual funds, but also significant
institutional asset management mandates and record performance in our private
client business."
2005 was a year of milestones for Saxon. These included becoming a public
company, celebrating the 20th anniversary of the highly respected Saxon Mutual
Fund family, and earning industry-wide recognition for three of Saxon funds at
the 2005 Canadian Investment Awards.
Highlights: A year of growth, expansion & investment
Since the Company went public on the Toronto Stock Exchange on July 7,
2005, the numbers below compare the fourth quarter and year-end results of
Saxon, the public company, to Saxon as a private company in 2004.
The 2005 results include the higher costs of running a public company and
some unique expenses: for example, Saxon incented its employees in June -
before going public - by issuing the employees, shares in the company,
resulting in a non-tax-deductible expense of $0.8 million against earnings.
The following table summarizes Saxon's fourth-quarter and year-end
results, with additional lines for EBITDA, net income and earnings per diluted
share that have been adjusted to exclude the June 2005 special charge.
<<
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Financial Highlights Three months ended Year ended
(in $thousands, except per December 31, December 31,
share data) 2005 2004 2005 2004
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Revenue(1) $ 10,396 $ 7,828 $ 38,072 $ 28,288
EBITDA(2) $ 4,521 $ 4,197 $ 17,608 $ 15,139
EBITDA (adjusted) $ 4,521 $ 4,197 $ 18,363 $ 15,139
Net income $ 2,922 $ 2,583 $ 10,784 $ 9,470
Net income (adjusted) $ 2,922 $ 2,583 $ 11,539 $ 9,470
Earnings per diluted share $ 0.21 $ 0.21 $ 0.83 $ 0.76
Earnings per diluted share
(adjusted) $ 0.21 $ 0.21 $ 0.89 $ 0.76
(1) "Revenue" refers to management and other fee revenue and excludes
investment income.
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(2) "EBITDA" is defined as earnings before investment and other income,
interest expense, income taxes, depreciation, amortization and non-
controlling interest. EBITDA is not an earnings measure recognized by
Canadian GAAP and does not have a standardized meaning prescribed by
Canadian GAAP. Therefore, EBITDA may not be comparable to similar
measures presented by other issuers.
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Highlights included:
- Saxon's assets under management climbed to $11 billion at the close
of 2005, representing an increase of 18% or $1.7 billion this year,
compared with a $1.4 billion increase in 2004. From assets under
management of $2.5 billion in 2000, Saxon's AUM has increased at a
compound annual growth rate of 34%.
- Saxon's Q4 revenue was $10.4 million, a 33% increase over the fourth
quarter of 2004. For the year ended December 31, revenue was 35%
higher than it was for 2004, totaling $38.1 million versus last
year's $28.3 million.
- Saxon's net income for the quarter was $2.9 million, up 13% over the
same period in 2004, in which Saxon was a private company. Comparing
year-end earnings, 2005 net income reached $10.8 million, an
improvement of 14% over 2004. Expenses included both new public
company costs and strategic investments in the company's future made
in 2005.
- Saxon Mutual Funds continued to earn recognition from investors and
industry peers alike. As the funds marked their 20th anniversary,
three of them earned recognition at the Canadian Investment Awards:
Saxon Balanced Fund was the 2005 Canadian Balanced Fund of the Year,
while Saxon Small Cap and Saxon World Growth were named category
finalists in Canadian Small Cap Equity and Global Equity fund
categories.
- Saxon Mutual Funds marked 59 consecutive months of positive net sales
on December 31st, and this streak continues in 2006. Saxon remains
one of the few firms in Canada that can claim such a track record of
enduring investor confidence.
"Looking back on 2005, the Saxon team delivered the best of both worlds
for clients and shareholders alike," said Smith. "Saxon offers a legacy of
stability and a future of opportunity by providing superior, long-term
investment performance."
For detailed financial statements, including management's discussion and
analysis, please refer to Saxon's website at www.saxonfinancial.ca.
Conference call
Saxon will host a conference call to discuss these results on Thursday,
March 9, 2006, at 11:00 am EST. Please dial 416-340-8010, or toll-free
866-540-8136 to participate and enter pass code 3176776 followed by the number
sign. For further information, please refer to Saxon's website.
About Saxon Financial (www.saxonfinancial.ca)
Saxon Financial Inc. is one of Canada's most respected value-style
investment management firms. The company has three principal lines of
business: Saxon Funds Management Limited, which manages a family of high-
performing, low-fee mutual funds; Howson Tattersall Investment Counsel
Limited, an institutional asset management business; and Howson Tattersall
Private Asset Management Inc., a private client asset management business.
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