CI Financial Corp. today released audited financial results for the quarter and year ended December 31, 2012.
For the year ended December 31, 2012, average assets under management were $72.6 billion, an increase of 1% from the previous year. Gross sales of funds were $10.6 billion compared to $9.1 billion for the year ended December 31, 2011. CI’s net sales tripled year over year to $1.0 billion in fiscal 2012. In the last quarter of 2012 net sales doubled over the prior quarter, from $358 million to $724 million.
At December 31, 2012, ending assets under management were $75.7 billion, up 9% from $69.6 billion at December 31, 2011. In comparison, the S&P/TSX Composite and the DEX Universe Bond indexes increased 7% and 4%, respectively, from December 31, 2011 to December 31 2012. Positive market performance has resulted in CI’s assets under management reaching $78.8 billion at February 13, 2013, up 9% from the average assets under management for the year ended December 31, 2012.
For the fourth quarter of 2012, CI reported earnings per share of $0.34, up 10% from $0.31 per share in the fourth quarter of 2011 and up 6% from $0.32 per share in the third quarter of 2012.
For the year ended December 31, 2012, CI reported earnings per share of $1.24, down 5% from the previous year. Included in the 2011 results was $3.5 million in revenue from an insurance settlement, while 2012 results included an $18.8 millionnon-cash future tax provision resulting from the increase in the Ontario corporate tax rate imposed in early 2012. Adjusting for these items, the year-over-year decline in net income was less than 1%.
In addition, CI reported EBITDA per share for the fiscal year of $2.48, a 2% decrease from 2011. This compares to a decline of less than 1% in pre-tax operating earnings per share, which include adjustments for the items mentioned above. Pre-tax operating earnings per share for the fourth quarter of 2012 were up 4% from the prior quarter and up 5% from the fourth quarter of 2011.
CI successfully controlled discretionary spending, keeping expenses in line with the growth in assets under management. Selling, general and administrative (SG&A) expenses as a percentage of average assets under management were 0.39% in 2012, down slightly from 0.40% in the prior year.
CI generated $423.9 million in free cash flow during the year ended December 31, 2012 compared to $433.5 million in 2011. CI’s cash flow facilitated a reduction in net debt by $204.2 million, the payment of $269.2 million in dividends and the repurchase of 1.4 million shares at a cost of $30.5 million. As at January 31, 2013, CI had 283,192,638 shares outstanding.
The Board of Directors declared an increase in the monthly cash dividend from $0.08 to $0.085 per share payable on each of March 15, April 15 and May 15, 2013 to shareholders of record on February 28, March 31 and April 30, 2013, respectively. The monthly dividend represents a yield of 3.8% on CI’s closing share price of $26.82 on February 13, 2013.