-
Earned net income of $1.1 million, on an adjusted basis1
For further information about GMP Capital Inc., our results for first
quarter 2013 and the meaning of certain references, this earnings
release should be read in conjunction with our unaudited interim
condensed consolidated financial statements as at and for the three
months ended March 31, 2013 (First Quarter 2013 Financial Statements)
and our management's discussion and analysis for the three months ended
March 31, 2013 (First Quarter 2013 MD&A), which can be accessed on our
website at gmpcapital.com and on SEDAR at sedar.com. Unless otherwise indicated, all dollar amounts are expressed in
Canadian dollars and have been taken from our First Quarter 2013
Financial Statements prepared in accordance with International
Financial Reporting Standards (IFRS).
TORONTO, May 3, 2013 /CNW/ - GMP Capital Inc. (GMP) (TSX: GMP) today
reported revenue of $48.8 million in first quarter 2013, down 26.1%
compared with the same period a year ago. GMP recorded a net loss of
$0.4 million and a diluted loss per share of $0.02 in first quarter
2013 compared with net income of $0.2 million and a diluted loss per
share $0.04 in first quarter 2012. Excluding specified items1, net income1 was $1.1 million in first quarter 2013 and diluted earnings per share
(EPS)1 was nil.
"As major shareholders ourselves, senior management is fully cognizant
of the near-term impact of the ongoing malaise in global markets. That
said, our role as managers is to focus our efforts where they can have
lasting impact. Our firm's capital and liquidity position remains
extremely strong and we have never been broader in scope or more
diversified as a business," said Harris Fricker, Chief Executive
Officer, GMP. "Our franchise has proven itself sustainable through a
prolonged and severe downturn and we remain confident in our ability to
outperform in better markets."
FINANCIAL HIGHLIGHTS
First Quarter 2013 versus First Quarter 2012
-
Revenue of $48.8 million compared with $66.1 million
-
Net loss of $0.4 million compared with net income of $0.2 million
-
Diluted loss per share of $0.02 compared with $0.04
-
Return on common equity (ROE)1 was negative 2.3% compared with negative 3.7%
-
Excluding specified items, net income was $1.1 million, diluted EPS was
nil and ROE was 0.1% compared with net income of $4.4 million, diluted
EPS of $0.03 and ROE of 3.1%
Commenting further, Mr. Fricker said, "Our deep-rooted
relationship-based culture remains one of our key competitive
advantages. As always, we will remain focused on our clients, helping
them effectively manage through these uncertain times."
FIRST QUARTER 2013 BUSINESS SEGMENT HIGHLIGHTS
Capital Markets
-
Revenue of $42.1 million - a decrease of 29% compared with first quarter
2012 primarily due to lower investment banking revenue and lower
commission revenue. Partly offsetting these decreases was higher
returns on principal transactions, which included an increase in net
gains on client-related fixed income trading activity.
-
Expenses of $42.2 million - a decrease of 26% compared with first
quarter 2012 primarily due to lower compensation costs commensurate
with lower revenue generation.
-
Loss before income taxes of $0.1 million in first quarter 2013 compared
with income before income taxes of $1.9 million in first quarter 2012.
GMP Securities L.P. highlights:
-
Participated in 53 underwriting transactions completed in Canada during
first quarter 2013, valued at $4.5 billion, of which we led or co-led
10 of these transactions valued at $0.7 billion. Source: FPinfomart.
-
Ranked sixth in the dollar value of common equity underwriting
transactions completed in Canada during first quarter 2013 for which we
were lead or co-lead. Source: FPinfomart.
-
Continued to build momentum in debt underwriting reporting a
year-over-year increase in both participation and transactions we led
or co-led compared with first quarter 2012.
Wealth Management
-
The Wealth Management segment consists of GMP's non-controlling
ownership interest in Richardson GMP Limited (Richardson GMP) and
commencing this quarter, GMP Investment Management L.P. (GMP IM).
-
Wealth Management reported income before income taxes of $1.5 million in
first quarter 2013 compared with a near break-even result in first
quarter 2012, driven largely by dividend income of $1.4 million
recognized this quarter by GMP on its preferred share investment in
Richardson GMP following dividend declarations by Richardson GMP.
GMP's share of Richardson GMP's net income was $0.4 million in first
quarter 2013 compared with a net loss of $0.1 million in the same
period last year.
Richardson GMP highlights:
-
Earned net income of $1.9 million in first quarter 2013 - up $1.6
million compared with first quarter 2012.
-
Ended first quarter 2013 with assets under administration1 of $15.1 billion, up $1.2 billion or 9% compared with first quarter
2012, and 115 investment advisory teams, up from 108 teams in the same
period a year ago.
GMP IM highlights:
-
GMP IM ended first quarter 2013 with assets under management1 of $0.7 billion, up 15% compared with first quarter 2012.
-
Subsequent to quarter end, GMP completed the sale of the majority of the
advisory contracts related to GMP IM's assets under management to Fiera
Capital Corporation for cash consideration of $10.8 million.
___________________________
1 Considered to be a non-GAAP financial measure. This measure does not
have any standardized meaning prescribed by generally accepted
accounting principles (GAAP) under IFRS and is therefore unlikely to be
comparable to similar measures presented by other issuers. This data
should be read in conjunction with the "Non-GAAP Measures" section at
the end of this press release and the "Presentation of Financial
Information and Non-GAAP Measures" section in the First Quarter 2013
MD&A.
DIVIDENDS
On May 2, 2013, the board of directors of GMP (Board of Directors)
declared a quarterly cash dividend of $0.05 per common share, and a
quarterly cash dividend of $0.3438 per Cumulative 5-Year Rate Reset
Preferred Share, Series B, each payable on June 30, 2013. In the event
that the payment date is not a business day, dividends shall be paid on
the next succeeding day that is a business day, to the respective
shareholders of record on June 10, 2013.
CONFERENCE CALL
GMP executives will host the conference call and audio webcast today at
9 a.m. (ET) to discuss GMP's first quarter 2013 results, followed by a
question-and-answer session for analysts and institutional investors.
Interested parties are invited to access the conference call on a
listen-only basis by dialing 416-644-3414 or 1-800-814-4859 (toll free)
or via live audio webcast at http://www.gmpcapital.com/investor. A recording of the conference call will be available until Friday,
May 10, 2013, by dialing 416-640-1917 or 1-877-289-8525 (toll free) and
entering access code 4610154#. The webcast will be archived at http://www.gmpcapital.com/investor.
NON-GAAP MEASURES
Consistent with GMP's management framework, management uses certain
financial measures to assess GMP's financial performance, which are not
generally accepted accounting principle (GAAP) measures under IFRS.
These measures do not have any standardized meaning prescribed by GAAP
and are therefore unlikely to be comparable to similar measures
presented by other issuers. Non-GAAP measures should not be considered
as alternatives to net income or comparable metrics determined in
accordance with IFRS as indicators of GMP's performance, liquidity,
cash flows and profitability. For further information, refer to the
"Presentation of Financial Information and Non-GAAP Measures" section
in First Quarter 2013 MD&A.
The table below provides a reconciliation of GMP's reported results to
its adjusted measures:
($000, except as otherwise noted)
|
|
|
|
|
|
Q1 2013
|
|
|
Q1 2012
|
Reported Results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss before income taxes
|
|
|
|
|
|
|
|
|
(343)
|
|
|
|
|
|
|
(133)
|
|
Income tax expense (benefit)
|
|
|
|
|
|
|
|
|
79
|
|
|
|
|
|
|
(344)
|
|
Net (loss) income
|
|
|
|
|
|
|
|
|
(422)
|
|
|
|
|
|
|
211
|
|
Net loss attributable to common shareholders
|
|
|
|
|
|
|
|
|
(1,476)
|
|
|
|
|
|
|
(2,288)
|
|
Reported Measures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share (dollars):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
$
|
|
|
(0.02)
|
|
|
|
$
|
|
|
(0.04)
|
|
Diluted ¹
|
|
|
|
|
|
$
|
|
|
(0.02)
|
|
|
|
$
|
|
|
(0.04)
|
|
ROE ²
|
|
|
|
|
|
|
|
|
(2.3)
|
%
|
|
|
|
|
|
(3.7)
|
%
|
Pre-Tax Impact of Adjusting Items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retention shares
|
|
|
|
|
|
|
|
|
998
|
|
|
|
|
|
|
1,744
|
|
|
Restructuring costs
|
|
|
|
|
|
|
|
|
1,376
|
|
|
|
|
|
|
4,414
|
|
Impact of adjusting items on loss before income taxes
|
|
|
|
|
|
|
|
|
2,374
|
|
|
|
|
|
|
6,158
|
|
After-Tax Impact of Adjusting Items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retention shares
|
|
|
|
|
|
|
|
|
558
|
|
|
|
|
|
|
975
|
|
|
Restructuring costs
|
|
|
|
|
|
|
|
|
995
|
|
|
|
|
|
|
3,254
|
|
Impact of adjusting items on net income
|
|
|
|
|
|
|
|
|
1,553
|
|
|
|
|
|
|
4,229
|
|
Adjusted Results ²
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes
|
|
|
|
|
|
|
|
|
2,031
|
|
|
|
|
|
|
6,025
|
|
Net income
|
|
|
|
|
|
|
|
|
1,131
|
|
|
|
|
|
|
4,440
|
|
Net income attributable to common shareholders
|
|
|
|
|
|
|
|
|
77
|
|
|
|
|
|
|
1,941
|
|
Adjusted Measures ²
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per common share (dollars):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
$
|
|
|
—
|
|
|
|
$
|
|
|
0.03
|
|
|
Diluted ¹
|
|
|
|
|
|
$
|
|
|
—
|
|
|
|
$
|
|
|
0.03
|
|
ROE
|
|
|
|
|
|
|
|
|
0.1
|
%
|
|
|
|
|
|
3.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1.
|
|
In the case of a net loss, the effect of GMP's common share options and
warrants on
diluted net loss per common share will be anti-dilutive; therefore,
basic and diluted net
loss per common share will be the same.
|
2.
|
|
Return on common equity, adjusted results and adjusted measures are
considered to
be non-GAAP financial measures. These measures do not have any
standardized
meaning prescribed by GAAP under IFRS and are therefore unlikely to be
comparable
to similar measures presented by other issuers.
|
|
|
|
FORWARD-LOOKING INFORMATION
This press release contains "forward-looking information" as defined
under applicable Canadian securities laws. This information includes,
but is not limited to, statements concerning our 2013 objectives, our
strategies to achieve those objectives, as well as statements made with
respect to management's beliefs, plans, estimates, projections and
intentions, and similar statements concerning anticipated future
events, results, circumstances, performance or expectations that are
not historical facts. Forward-looking information generally can be
identified by the use of forward-looking terminology such as "outlook",
"objective", "may", "will", "expect", "intend", "estimate",
"anticipate", "believe", "should", "plans" or "continue", or similar
expressions suggesting future outcomes or events. Such forward-looking
information reflects management's current beliefs and is based on
information currently available to management.
Forward-looking information is not a guarantee of future performance and
is subject to numerous risks and uncertainties, including those
described in this press release. GMP's primary business activities are
both competitive and subject to various risks. These risks include
market, credit, liquidity, operational and legal and regulatory risks
and other risk factors including, without limitation: variation in the
market value of securities, volatility and liquidity of equity and
fixed income trading markets, volume of new financings and mergers and
acquisitions (M&A), dependence on key personnel and sustainability of
fees. Other factors, such as general economic conditions, including
interest rate and exchange rate fluctuations, may also have an effect
on GMP's results of operations. Many of these risks and uncertainties
can affect GMP's actual results and could cause its actual results to
differ materially from those expressed or implied in any
forward-looking information disclosed by management or on its behalf.
For a description of additional risks that could cause our actual
results to materially differ from our current expectations, see "Risk
Management" in the 2012 Annual MD&A and the First Quarter 2013 MD&A and
"Risk Factors" in GMP's 2013 Annual Information Form dated March 13,
2013. These risks and uncertainties are not the only ones facing GMP
together with its consolidated operations controlled by it and its
predecessors (GMP Group). Additional risks and uncertainties not
currently known to us or that we currently consider immaterial may also
impair the operations of the GMP Group. Material assumptions or
factors underlying the forward-looking information contained in this
press release are set out in the "Business Environment and Market
Outlook" section of the First Quarter 2013 MD&A and include, without
limitation: sluggish global economic recovery, persistent European
sovereign debt issues, weak commodity prices, slowing growth in China,
slow European growth, weak demand for commodities. Although
forward-looking information contained in this press release is based
upon what management believes are reasonable assumptions, there can be
no assurance that actual results will be consistent with this
forward-looking information. Certain statements included in this press
release may be considered a "financial outlook" for purposes of
applicable Canadian securities laws, and as such the financial outlook
may not be appropriate for purposes other than this press release. The
forward-looking information contained in this press release is made as
of the date of this press release, and should not be relied upon as
representing GMP's views as of any date subsequent to the date of this
press release. Except as required by applicable law, management and
GMP's Board of Directors undertake no obligation to publicly update or
revise any forward-looking information, whether as a result of new
information, future events or otherwise.
ABOUT GMP CAPITAL INC.
GMP Capital Inc. (GMP) is a leading independent diversified financial
services firm headquartered in Toronto, Canada, providing a wide range
of financial products and services to a global client base that
includes corporate clients, institutional investors and high-net-worth
individuals in two integrated reporting segments. The Capital Markets
segment provides investment banking, including advisory and
underwriting services, institutional sales and trading and research
through offices located in Toronto, Montreal, Calgary, New York, Miami,
Dallas, London, Perth and Sydney. The Capital Markets segment conducts
its business through the following operating entities: GMP Securities
L.P., GMP Securities, LLC, Griffiths McBurney Corp., GMP Securities
Europe LLP and GMP Securities Australia Pty Limited. Wealth Management
consists of GMP's non-controlling ownership interest in Richardson GMP
Limited and the investment management and alternative investment
products provided by GMP Investment Management L.P. Richardson GMP
Limited is a full-service independent firm focused on providing
exclusive and comprehensive wealth management and investment services
delivered by an experienced team of investment professionals. GMP is
listed on the Toronto Stock Exchange under the symbol "GMP". For
further information, please visit our corporate website at gmpcapital.com.
SOURCE: GMP Capital Inc.
GMP Capital Inc.
Rocco Colella, Director, Investor Relations
145 King Street West, Suite 300, Toronto, Ontario M5H 1J8
Tel: (416) 941-0894; Fax: (416) 943-6175
rcolella@gmpcapital.com or investorrelations@gmpcapital.com