CI Financial Reports Financial Results for the First Quarter of 2022

Rhea-AI Summary

CI Financial Corp. (NYSE: CIXX) reported strong financial results for Q1 2022, including a diluted EPS of $0.70 and adjusted EPS of $0.85. The company achieved a pre-tax income of $186 million and an adjusted EBITDA of $273 million, with cash flow from operations reaching $207 million. CI reduced its debt by $246 million and maintained robust free cash flow of $201 million. The firm is expanding its wealth management segment, particularly in the U.S. and Canada, with plans to acquire three registered investment advisors managing over $21 billion in assets.

Positive

• Diluted EPS increased to $0.70; adjusted EPS of $0.85.
• Total assets rose to $361 billion, a 54% year-over-year increase.
• Record free cash flow of $201 million or $1.02 per share.
• Expansion in wealth management, focusing on ultra-high-net-worth segments.
• Successfully reduced debt by $246 million.

Negative

• Adjusted net income slightly declined to $166.8 million from $171.0 million in the prior quarter.
• Total net revenues grew only 2.3% quarter-over-quarter, indicating slower growth.

• Diluted EPS of $0.70 or adjusted EPS¹ of $0.85
• Pre-tax income of $186 million, adjusted EBITDA¹ of $273 million
• Operating cash flow of $207 million, record free cash flow¹ of $201 million or $1.02 per share
• Total assets of $361 billion, a year-over-year increase of 54%
• Net flow positive as a company on the strength of U.S. and Canadian wealth management
• Reached agreements to acquire three RIAs with over $21 billion in combined assets
• Expanded Canadian ultra-high-net-worth wealth management with acquisition of Northwood Family Office
• $246 million reduction in debt
• Paid quarterly dividend of $0.18 a share, totalling $35.5 million

All financial amounts in Canadian dollars at March 31, 2022, unless stated otherwise. Financial amounts for the quarter are unaudited.

TORONTO--(BUSINESS WIRE)-- CI Financial Corp. (“CI”) (TSX: CIX, NYSE: CIXX) today released financial results for the quarter ended March 31, 2022.

“Achieving these strong results during a period of high economic and market uncertainty demonstrates the strength and resilience of our business model,” said Kurt MacAlpine, CI Chief Executive Officer. “Over the past two-and-a-half years, we have transformed and diversified the company, with wealth management now accounting for over 60% of our assets and U.S. wealth management becoming our largest business line by assets. These changes have made CI a larger, stronger firm and are having an increasingly positive impact on our revenues and earnings each quarter.

“The changes we made to our investment management platform continue to pay off – our investment performance relative to our peers is the highest in years and the redemptions in our mutual fund products were 50% lower than in the first quarter of 2021.”

“In Canadian wealth management, we acquired the country’s leading multi-family office in Northwood Family Office Ltd.” Mr. MacAlpine said. “The common theme in our most recent acquisitions is that they are all high-quality wealth management firms focused on the very attractive ultra-high-net-worth segment.”

“We continue to execute on our strategy and achieved significant milestones in U.S. wealth management during the first quarter. We launched the CI Private Wealth partnership, which will be key to driving the profitable growth of that business, and we reached agreements to acquire three registered investment advisors with more than $21 billion in client assets.

“We continue to take a balanced approach to allocating capital between dividends, share repurchases and debt reduction. During the quarter, we prioritized deleveraging and reduced debt by $246 million while also repurchasing shares and paying our regular dividend.”

Starting this quarter, CI has expanded its segment reporting to three segments and changed its income statement format. As CI’s strategy has rapidly evolved over the past two years, the company has reached a level of scale in its U.S. business that warrants separate disclosures and greater visibility into the performance of the business. CI has also expanded its asset management segment disclosures to provide more insight around the composition of assets under management. While prior periods have been restated to conform with the new presentation format, there is no change to consolidated financial results.

Operating and financial data highlights

FINANCIAL AND OPERATING HIGHLIGHTS
[millions of dollars, except share amounts]		As of and for the quarters ended
		Mar. 31, 2022			Dec. 31, 2021			Sep. 30, 2021			Jun. 30, 2021			Mar. 31, 2021
Total AUM and Client Assets:
Asset Management AUM		136,271			144,247			139,380			138,187			132,626
Canada Wealth Management assets		78,957			80,633			76,859			75,521			71,066
U.S. Business assets		145,768			151,339			96,974			83,764			31,013
Total assets		360,996			376,219			313,213			297,472			234,704
Asset Management Net Inflows:
Retail		(861	)		142			684			530			(601	)
Institutional		(264	)		(331	)		(126	)		(360	)		(390	)
Australia		(305	)		82			159			(33	)		46
Closed Business		(203	)		(195	)		(146	)		(194	)		(222	)
U.S. Asset Management		402			260			250			413			284
Total		(1,231	)		(42	)		821			356			(883	)
IFRS Results
Net income		137.5			123.7			45.4			118.4			124.8
Diluted earnings per share		0.70			0.63			0.22			0.58			0.60
Pretax income		185.8			175.1			82.4			166.6			162.2
Pretax margin		29.3	%		28.3	%		15.9	%		31.7	%		31.9	%
Cash flow from operating activities		207.7			179.2			135.2			158.1			177.8
Adjusted Results1
Adjusted net income		166.8			171.0			159.2			153.0			151.6
Adjusted diluted earnings per share		0.85			0.86			0.79			0.74			0.72
Adjusted EBITDA		272.9			277.2			258.1			242.3			236.3
Adjusted EBITDA margin		46.4	%		47.7	%		47.0	%		48.4	%		50.2	%
Free cash flow		201.6			187.1			180.9			164.1			155.6
Average shares outstanding		196,111,771			196,816,227			199,321,002			203,039,536			207,476,125
Ending shares outstanding		192,987,082			197,422,270			197,443,135			201,327,517			203,944,785
Total debt		3,530			3,776			3,408			3,350			2,201
Net debt		3,352			3,453			2,655			2,461			1,856
Net debt to adjusted EBITDA		3.0			3.1			2.6			2.5			1.9

1. Free cash flow, net debt, adjusted net income, adjusted earnings per share and adjusted EBITDA are not standardized earnings measures prescribed by IFRS. For further information, see “Non-IFRS Measures” note below.

Financial highlights

Net income grew to $137.5 million in the quarter from $123.7 million in the fourth quarter. Excluding non-operating items, adjusted net income declined slightly to $166.8 million in the quarter from $171.0 million in the fourth quarter of 2021 as higher earnings in our U.S. Wealth Management segment due to recent acquisitions were offset by lower earnings primarily from our Asset Management segment.

First quarter total net revenues grew 2.3% to $633.8 million in the quarter from $619.3 million in the fourth quarter of 2021. Excluding non-operating items, adjusted total net revenue increased 3.8% to $622.3 million, primarily driven by higher revenues from our U.S. Wealth Management segment due to recent acquisitions, partly offset by lower management fees from our Asset Management segment due to lower average AUM.

First quarter total expenses increased 1.0% to $448.0 million in the quarter from $444.2 million in the fourth quarter of 2021. Excluding non-operating items, adjusted total expenses increased 5.1% to $384.8 million primarily due to acquisitions in our U.S. Wealth Management segment.

Capital allocation

In the first quarter of 2022, CI repurchased 4.5 million shares at a cost of $92.0 million, for an average cost of $20.21 per share, and paid $35.5 million in dividends at a rate of $0.18 per share. In addition, the company reduced debt by $246 million.

The Board of Directors declared a quarterly dividend of $0.18 per share, payable on October 14, 2022 to shareholders of record on September 30, 2022. The annual dividend rate of $0.72 per share represented a yield of 4.8% on CI’s closing share price of $14.68 on May 11, 2022.

First quarter business highlights

• CI Private Wealth US, LLC (“CIPW”) is the entity through which CI holds its interests in its U.S. RIAs. CIPW is structured as a limited liability company in which CI is majority owner. Certain employees of CIPW and its affiliates subscribed for membership interests in the firm which interests were issued effective January 1, 2022. This unique model aligns the interests of all member partners and incentivizes them to collaborate, realize synergies, and drive the profitable growth of the firm as a whole.
• CI agreed to acquire three U.S. registered investment advisors (“RIAs”) with combined assets of approximately $21.6 billion. They include:
  • Certain assets of Eaton Vance WaterOak Advisors, formerly Eaton Vance Investment Counsel (“EVIC”). The Boston-based EVIC team joining CI acts as advisor on behalf of families, endowments, foundations and other institutions. The transaction is expected to be completed in the fourth quarter of 2022.
  • Corient Capital Partners, LLC, of Newport Beach, California, which serves ultra-high-net-worth individuals and families across the United States. This transaction was completed on April 29, 2022.
  • Galapagos Partners, LP of Houston, a multi-family office serving wealthy families and individuals. This transaction also closed on April 29, 2022.
• CI agreed to acquire Toronto-based Northwood Family Office Ltd. (“Northwood”), Canada’s leading multi-family office. The transaction was completed on April 1, 2022. Northwood manages and co-ordinates the integrated financial, investment and personal affairs of wealthy Canadian and global families and oversees approximately $2.2 billion of investment assets.
• In February 2022, Euromoney announced that Northwood has been ranked as the #1 family office in both Canada and North America in the prestigious Euromoney Private Banking and Wealth Management Survey for 2022.
• CI expanded its capabilities in digital assets with the acquisition of a minority stake in Newton Crypto Ltd., a Canadian crypto asset trading platform.
• CI Global Asset Management (“CI GAM”) continued to broaden its ETF lineup with the launch of several thematic ETFs: CI Galaxy Multi-Crypto ETF, CI Bio-Revolution ETF and CI Digital Security ETF.
• CI GAM received securityholder approval for the merger of 21 mutual funds and six exchange-traded funds into other CI GAM investment funds. The mergers, which were implemented on April 8, 2022, were an important step in modernizing CI’s asset management business as they reduced product duplication and simplified the lineup for CI GAM’s advisor and investor clients.

Following quarter-end:

• CI announced its intention to sell up to 20% of its U.S. wealth management business via a U.S. initial public offering (“IPO”). CI stated that it intends to use the net proceeds from the IPO to pay down debt, and that a final decision on the IPO size, conditions and timing is pending and will be subject to market conditions.
• CI subsidiary CI Private Wealth US, LLC applied for a charter to establish and operate a South Dakota trust company. Once chartered, the trust company will offer administrative trust solutions through CI’s U.S. wealth management platform.
• Products introduced by CI GAM included CI Galaxy Blockchain ETF, CI Galaxy Metaverse ETF and CI Floating Rate Income Fund (ETF Series).

Analysts’ conference call

CI will hold a conference call with analysts today at 9:00 a.m. EDT, led by Chief Executive Officer Kurt MacAlpine and Chief Financial Officer Amit Muni. A live webcast of the call and slide presentation can be accessed here, or through the Investor Relations section of CI’s website. Alternatively, investors may listen to the discussion through the following numbers (access code: 581835):

• Canada toll-free: 1-833-950-0062
• United States toll-free: 1-844-200-6205
• United States (New York local): 1-646-904-5544.
• All other locations: 1-929-526-1599.

About CI Financial

CI Financial Corp. is an integrated global wealth and asset management company. CI’s primary asset management businesses are CI Global Asset Management (CI Investments Inc.) and GSFM Pty Ltd., and it operates in Canadian wealth management through CI Assante Wealth Management (Assante Wealth Management (Canada) Ltd.), CI Private Counsel LP, Aligned Capital Partners Inc., Northwood Family Office Ltd., CI Direct Investing (WealthBar Financial Services Inc.), and CI Investment Services Inc.

CI’s U.S. wealth management businesses consist of Barrett Asset Management, LLC, Balasa Dinverno Foltz LLC, Bowling Portfolio Management LLC, Brightworth, LLC, BRR OpCo, LLC (Budros, Ruhlin & Roe), The Cabana Group, LLC, Corient Capital Partners, LLC, CPWM, LLC (Columbia Pacific Wealth Management), Congress Wealth Management LLC, Dowling & Yahnke, LLC, Doyle Wealth Management, LLC, Galapagos Partners, LP, Gofen & Glossberg, LLC, Matrix Capital Advisors, LLC, McCutchen Group LLC, OCM Capital Partners, LLC, Portola Partners Group LLC, Radnor Financial Advisors, LLC, RegentAtlantic Capital, LLC, The Roosevelt Investment Group, LLC, RGT Wealth Advisors, LLC, R.H. Bluestein & Co., Segall Bryant & Hamill, LLC, Stavis & Cohen Private Wealth, LLC, and Surevest LLC.

CI is listed on the Toronto Stock Exchange under CIX and on the New York Stock Exchange under CIXX. Further information is available at www.cifinancial.com.

Commissions, trailing commissions, management fees and expenses all may be associated with an investment in mutual funds and exchange-traded funds (ETFs). Please read the prospectus before investing. Important information about mutual funds and ETFs is contained in their respective prospectus. Mutual funds and ETFs are not guaranteed; their values change frequently, and past performance may not be repeated. You will usually pay brokerage fees to your dealer if you purchase or sell units of an ETF on recognized Canadian exchanges. If the units are purchased or sold on these Canadian exchanges, investors may pay more than the current net asset value when buying units of the ETF and may receive less than the current net asset value when selling them.

This press release contains forward-looking statements concerning anticipated future events, results, circumstances, performance or expectations with respect to CI Financial Corp. (“CI”) and its products and services, including its business operations, strategy and financial performance and condition and its intention to conduct an IPO of its US wealth management business. Forward-looking statements are typically identified by words such as “believe”, “expect”, “foresee”, “forecast”, “anticipate”, “intend”, “estimate”, “goal”, “plan” and “project” and similar references to future periods, or conditional verbs such as “will”, “may”, “should”, “could” or “would”. These statements are not historical facts but instead represent management beliefs regarding future events, many of which by their nature are inherently uncertain and beyond management’s control. Although management believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, such statements involve risks and uncertainties. The material factors and assumptions applied in reaching the conclusions contained in these forward-looking statements include that CI will proceed with the IPO, that all outstanding acquisitions will be completed and their asset levels will remain stable, that the investment fund industry will remain stable and that interest rates will remain relatively stable. Factors that could cause actual results to differ materially from expectations include, among other things, general economic and market conditions, including interest and foreign exchange rates, global financial markets, the risk that the IPO may not occur in its expected timeframe or at all, changes in government regulations or in tax laws, industry competition, technological developments and other factors described or discussed in CI’s disclosure materials filed with applicable securities regulatory authorities from time to time. The foregoing list is not exhaustive and the reader is cautioned to consider these and other factors carefully and not to place undue reliance on forward-looking statements. Other than as specifically required by applicable law, CI undertakes no obligation to update or alter any forward-looking statement after the date on which it is made, whether to reflect new information, future events or otherwise.

This communication is provided as a general source of information and should not be considered personal, legal, accounting, tax or investment advice, or construed as an endorsement or recommendation of any entity or security discussed. Individuals should seek the advice of professionals, as appropriate, regarding any particular investment. Investors should consult their professional advisors prior to implementing any changes to their investment strategies.

CI Global Asset Management is a registered business name of CI Investments Inc.

CONSOLIDATED STATEMENT OF INCOME
For the three-month period ended March 31
[in thousands of Canadian dollars, except per share amounts]		2022 $				2021 $
REVENUE Canada asset management fees			437,623				425,122
Trailer fees and deferred sales commissions			(135,289	)			(132,700	)
Net asset management fees			302,334				292,422
Canada wealth management fees			138,246				119,570
U.S. wealth management fees			164,479				44,688
Other revenues			21,646				26,684
Foreign exchange gains			11,469				20,201
Other gains (losses)			(4,424	)			4,136
Total net revenues			633,750				507,701
EXPENSES Selling, general and administrative			259,633				151,889
Advisor and dealer fees			106,908				95,092
Interest and lease finance			35,876				21,322
Amortization and depreciation			11,376				10,029
Amortization of intangible assets from acquisitions			24,083				9,554
Transaction, integration, restructuring and legal settlements			3,800				854
Change in fair value of contingent consideration			3,088				22,209
Other			3,226				34,603
Total expenses			447,990				345,552
Income before income taxes			185,760				162,149
Provision for income taxes Current			47,741				49,636
Deferred			511				(12,275	)
			48,252				37,361
Net income for the period			137,508				124,788
Net income (loss) attributable to non-controlling interests			(639	)			613
Net income attributable to shareholders			138,147				124,175
Basic earnings per share attributable to shareholders		$	0.70			$	0.60
Diluted earnings per share attributable to shareholders		$	0.70			$	0.59
Other comprehensive loss, net of tax Exchange differences on translation of foreign operations			(6,721	)			(15,953	)
Total other comprehensive loss, net of tax			(6,721	)			(15,953	)
Comprehensive income for the period			130,787				108,835
Comprehensive income (loss) attributable to non-controlling interests			(1,052	)			294
Comprehensive income attributable to shareholders			131,839				108,541

 

CONSOLIDATED BALANCE SHEET
[in thousands of Canadian dollars]		As at March 31, 2022 $			As at December 31, 2021 $
ASSETS
Current
Cash and cash equivalents		186,051			230,779
Client and trust funds on deposit		1,347,616			1,199,904
Investments		35,311			131,772
Accounts receivable and prepaid expenses		275,167			272,962
Income taxes receivable		3,607			3,607
Total current assets		1,847,752			1,839,024
Capital assets, net		52,676			52,596
Right-of-use assets		136,827			142,606
Intangibles		6,113,366			6,185,237
Deferred income taxes		60,162			56,901
Other assets		452,646			383,187
Total assets		8,663,429			8,659,551
LIABILITIES AND EQUITY
Current
Accounts payable and accrued liabilities		303,990			369,081
Current portion of provisions and other financial liabilities		293,951			572,432
Redeemable non-controlling interests		564,064			—
Dividends payable		69,475			71,072
Client and trust funds payable		1,363,874			1,202,079
Income taxes payable		13,621			19,035
Current portion of long-term debt		225,268			444,486
Current portion of lease liabilities		19,617			20,216
Total current liabilities		2,853,860			2,698,401
Long-term debt		3,304,702			3,331,552
Provisions and other financial liabilities		246,998			379,641
Deferred income taxes		478,849			480,777
Lease liabilities		148,253			153,540
Total liabilities		7,032,662			7,043,911
Equity
Share capital		1,777,507			1,810,153
Contributed surplus		31,018			28,368
Deficit		(172,743	)		(226,715	)
Accumulated other comprehensive loss		(29,352	)		(23,289	)
Total equity attributable to the shareholders of the Company		1,606,430			1,588,517
Non-controlling interests		24,337			27,123
Total equity		1,630,767			1,615,640
Total liabilities and equity		8,663,429			8,659,551

STATEMENT OF CASH FLOWS

[in thousands of Canadian dollars]		2022 $			2021 $
OPERATING ACTIVITIES (*)
Net income for the period		137,508			124,788
Add (deduct) items not involving cash
Other gains (losses)		4,424			(4,214	)
Change in fair value of contingent consideration		3,088			22,209
Contingent consideration recorded as compensation		18,210			—
Recognition of vesting of redeemable non-controlling interests		3,926			—
Equity-based compensation		4,536			3,008
Amortization and depreciation		35,459			19,583
Deferred income taxes		511			(12,275	)
Loss on repurchases of long-term debt		—			24,708
Cash provided by operating activities before net change in operating assets and liabilities		207,662			177,807
Net change in operating assets and liabilities		(52,856	)		11,869
Cash provided by operating activities		154,806			189,676
INVESTING ACTIVITIES
Purchase of investments		(30	)		(104	)
Proceeds on sale of investments		94,659			—
Additions to capital assets		(3,311	)		(1,881	)
Increase in other assets		2,148			1,905
Additions to intangibles		(1,564	)		(3,615	)
Cash paid to settle acquisition liabilities		(18,288	)		—
Acquisitions, net of cash acquired		(5,729	)		(2,314	)
Cash provided by (used in) investing activities		67,885			(6,009	)
FINANCING ACTIVITIES
Repayment of long-term debt		(297,500	)		(549,695	)
Issuance of long-term debt		80,000			331,836
Repurchase of long-term debt		—			(45,953	)
Repurchase of share capital		(91,038	)		(112,744	)
Payment of lease liabilities		(5,210	)		(3,934	)
Redeemable non-controlling interest		83,330			—
Net distributions to non-controlling interests		(1,489	)		(512	)
Dividends paid to shareholders		(35,511	)		(37,869	)
Cash used by financing activities		(267,418	)		(418,871	)
Net decrease in cash and cash equivalents during the period		(44,727	)		(235,204	)
Cash and cash equivalents, beginning of period		230,778			483,598
Cash and cash equivalents, end of period		186,051			248,394
(*) Included in operating activities are the following:
Interest paid		9,665			18,983
Income taxes paid		52,277			44,855

ASSETS UNDER MANAGEMENT AND NET FLOWS
[billions of dollars]		Quarters ended
		Mar. 31, 2022			Dec. 31, 2021			Sep. 30, 2021			Jun. 30, 2021			Mar. 31, 2021
Beginning AUM		144.2			139.4			138.2			132.6			129.6
Gross inflows		4.9			5.2			5.1			6.1			5.7
Gross outflows		6.6			5.5			4.5			6.1			6.9
Net inflows/(outflows)		(1.6	)		(0.3	)		0.6			(0.1	)		(1.2	)
Acquisitions		—			—			—			0.2			—
Market move and FX		(6.3	)		5.2			0.6			5.5			4.2
Ending AUM		136.3			144.2			139.4			138.2			132.6
Proprietary AUM		34.5			36.2			34.7			34.5			32.7
Non-proprietary AUM		101.8			108.0			104.7			103.7			99.9
Average assets under management		138.2			143.0			141.1			135.9			131.6
Annualized organic growth		(4.6	) %		(0.9	) %		1.6	%		(0.2	) %		(3.7	) %
Gross management fee/average AUM		1.30	%		1.30	%		1.31	%		1.31	%		1.32	%
Net management fee/average AUM		0.88	%		0.88	%		0.88	%		0.88	%		0.89	%
Net Inflows
Retail		(0.9	)		0.1			0.7			0.5			(0.6	)
Institutional		(0.3	)		(0.3	)		(0.1	)		(0.4	)		(0.4	)
Closed business		(0.2	)		(0.2	)		(0.1	)		(0.2	)		(0.2	)
Total Canada net inflows		(1.3	)		(0.4	)		0.4			—			(1.2	)
Australia		(0.3	)		0.1			0.2			—			—
Total net inflows/(outflows)		(1.6	)		(0.3	)		0.6			(0.1	)		(1.2	)

RETAIL (ex Closed Business)
[billions of dollars]		Quarters ended
		Mar. 31, 2022			Dec. 31, 2021		Sep. 30, 2021		Jun. 30, 2021		Mar. 31, 2021
Beginning AUM		114.6			110.4		109.1		103.9		95.1
Net Flows		(0.9	)		0.1		0.7		0.5		(0.6	)
Market Move / FX		(5.3	)		4.1		0.6		4.5		9.4
Acquisitions		___			___		0.2		___		___
Ending AUM		108.4			114.6		110.4		109.1		103.9
Average AUM		109.6			113.8		111.8		106.8		102.8

INSTITUTIONAL
[billions of dollars]		Quarters ended
		Mar. 31, 2022			Dec. 31, 2021		Sep. 30, 2021			Jun. 30, 2021			Mar. 31, 2021
Beginning AUM		13.3			13.0		13.0			12.7			12.6
Net Flows		(0.3	)		0.3		(0.1	)		(0.4	)		(0.4	)
Market Move / FX		(0.3	)		0.6		0.1			0.7			0.5
Acquisitions		___			___		___			___			___
Ending AUM		12.7			13.3		13.0			13.0			12.7
Average AUM		12.9			13.2		13.3			13.0			12.8

AUSTRALIA
[billions of dollars]		Quarters ended
		Mar. 31, 2022			Dec. 31, 2021		Sep. 30, 2021		Jun. 30, 2021			Mar. 31, 2021
Beginning AUM		7.3			7.0		6.9		7.1			7.0
Net Flows		(0.3	)		0.1		0.1		(0.0	)		0.0
Market Move / FX		(0.4	)		0.2		0.0		(0.2	)		0.1
Acquisitions		___			___		___		___			___
Ending AUM		6.6			7.3		7.0		6.9			7.1
Average AUM		7.0			7.1		7.0		7.1			7.1

CLOSED BUSINESS
[billions of dollars]		Quarters ended
		Mar. 31, 2022			Dec. 31, 2021			Sep. 30, 2021			Jun. 30, 2021			Mar. 31, 2021
Beginning AUM		9.1			9.0			9.1			8.9			8.9
Net Flows		(0.2	)		(0.2	)		(0.2	)		(0.2	)		(0.2	)
Market Move / FX		(0.3	)		0.3			(0.0	)		0.4			0.3
Acquisitions		___			___			___			___			___
Ending AUM		8.6			9.1			8.9			9.1			8.9
Average AUM		8.7			9.0			9.0			9.0			8.9

AUM BY ASSET CLASS
[billions of dollars]		Quarters ended
		Mar. 31, 2022		Dec. 31, 2021		Sep. 30, 2021		Jun. 30, 2021		Mar. 31, 2021
Balanced		59.4		62.1		60.3		60.3		58.5
Equity		49.3		52.3		50.1		49.8		46.9
Fixed income		13.1		14.2		14.1		13.9		13.3
Alternatives		4.9		5.7		5.0		4.3		3.6
Cash/Other		3.0		2.7		2.8		2.9		3.2
Total Canada asset management		129.7		137.0		132.4		131.3		125.5
Australia		6.6		7.3		7.0		6.9		7.1
Total asset management segment		136.3		144.2		139.4		138.2		132.6

CANADA WEALTH MANAGEMENT CLIENT ASSETS
[billions of dollars]		Quarters ended
		Mar. 31, 2022			Dec. 31, 2021			Sep. 30, 2021			Jun. 30, 2021			Mar. 31, 2021
Beginning client assets		80.6			76.9			75.5			71.1			67.3
Acquisitions		—			—			—			—			—
Net flows and market move		(1.7	)		3.8			1.3			4.5			3.8
Ending client assets		79.0			80.6			76.9			75.5			71.1
Average client assets		79.0			78.9			77.0			73.1			68.8
Wealth management fees/average client assets		0.95	%		0.93	%		0.94	%		0.91	%		0.97	%

U.S. WEALTH MANAGEMENT CLIENT ASSETS
[billions of dollars]		Quarters ended
		Mar. 31, 2022			Dec. 31, 2021			Sep. 30, 2021			Jun. 30, 2021			Mar. 31, 2021
Beginning billable client assets		146.4			96.1			82.9			30.7			29.0
Acquisitions		1.1			49.3			10.1			49.5			0.0
Net flows and market move		(6.3	)		1.0			3.1			2.7			1.7
Ending billable client assets		141.2			146.4			96.1			82.9			30.7
Unbillable client assets		4.6			4.9			0.9			0.8			0.4
Total client assets		145.8			151.3			97.0			83.8			31.0
Fees/beginning billable client assets1		0.46	%		0.50	%		0.52	%		0.71	%		0.63	%
12Q/21 adjusted for the timing of Segall Bryant & Hamill acquisition

NON-IFRS MEASURES

In an effort to provide additional information regarding our results as determined by IFRS, we also disclose certain non-IFRS information which we believe provides useful and meaningful information. Our management reviews these non-IFRS financial measurements when evaluating our financial performance and results of operations; therefore, we believe it is useful to provide information with respect to these non-IFRS measurements so as to share this perspective of management. Non-IFRS measurements do not have any standardized meaning, do not replace nor are superior to IFRS financial measurements and may not be comparable to similar measures presented by other companies. The non-IFRS financial measurements include:

• Adjusted net income and adjusted basic and diluted earnings per share
• Adjusted EBITDA and adjusted EBITDA margin
• Free cash flow
• Net debt.

These non-IFRS measurements exclude the following revenues and expenses which we believe allows investors a consistent way to analyze our financial performance, allows for better analysis of core operating income and business trends and permits comparisons of companies within the industry, normalizing for different financing methods and levels of taxation:

• gains or losses related to foreign currency fluctuations on our cash balances
• costs related to our acquisitions including:
  • amortization of intangible assets
  • change in fair value of contingent consideration
  • related advisory fees
  • contingent consideration classified as compensation per IFRS
• restructuring charges including organizational expenses for the establishment of CIPW
• legal provisions for a class action related to market timing
• certain gains or losses in assets and investments
• costs related to issuing or retiring debt obligations
• expenses associated with CIPW redeemable units.

Further explanations of these Non-IFRS measures can be found in the “Non-IFRS Measures” section of Management’s Discussion and Analysis dated May 12, 2022 available on SEDAR at www.sedar.com or at www.cifinancial.com.

ADJUSTED NET INCOME AND ADJUSTED EARNINGS PER SHARE
[millions of dollars, except per share amounts]		Quarters ended
		Mar. 31, 2022			Dec. 31, 2021			Mar. 31, 2021
Net Income		137.5			123.7			124.8
Amortization of intangible assets from acquisitions		24.1			18.7			9.9
Change in fair value of contingent consideration		3.1			43.9			22.2
Contingent consideration recorded as compensation		—			2.1			—
CIPW adjustments		32.2			—			—
FX (gains)/losses		(11.5	)		(3.1	)		(20.2	)
Transaction, integration, restructuring and legal		3.8			13.6			0.8
Other (gains)/losses		—			(16.8	)		7.1
Bond redemption costs		—			—			24.7
Total adjustments1		51.7			58.4			44.5
Tax effect of adjustments		(11.5	)		(11.1	)		(17.0	)
Less: Non-controlling interest		10.9			—			0.7
Adjusted net income		166.8			171.0			151.6
Adjusted earnings per share		0.85			0.87			0.73
Adjusted diluted earnings per share		0.85			0.86			0.72
1Adjustment effects on income statement line items: bond redemption costs are included in other expense, CIPW adjustments and contingent consideration recorded as compensation are included in SG&A, amortization of intangible assets from acquisitions, change in fair value of contingent consideration, FX (gains)/losses, other (gains)/losses, and bond redemption costs are included in the line items of the same description.

EBITDA, ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN
[millions of dollars, except per share amounts]		Quarters ended
		Mar. 31, 2022			Dec. 31, 2021			Mar. 31, 2021
Pretax income		185.8			175.1			162.2
Amortization of intangible assets from acquisitions		24.1			18.7			9.9
Depreciation and other amortization		11.4			10.9			10.0
Interest and lease finance expense		35.9			32.5			21.3
EBITDA		257.1			237.2			203.4
Change in fair value of contingent consideration		3.1			43.9			22.2
Contingent consideration recorded as compensation		18.2			2.1			—
CIPW adjustments		3.9			—			—
FX (gains)/losses		(11.5	)		(3.1	)		(20.2	)
Transaction, integration, restructuring and legal		3.8			13.6			0.8
Other (gains)/losses		—			(16.8	)		7.1
Bond redemption costs		—			—			24.7
Total adjustments		17.5			39.6			34.6
Non-controlling interest		1.8			(0.4	)		1.7
Adjusted EBITDA		272.9			277.2			236.3
Reported net revenue		633.8			619.3			507.7
Less: FX gains/(losses)		11.5			3.1			20.2
Less: Non-Operating Other gains/(losses)		—			16.8			—
Less: NCI revenues		34.5			17.9			17.0
Adjusted net revenue		587.8			581.5			470.5
Adjusted EBITDA margin		46.4	%		47.7	%		50.2	%

FREE CASH FLOW
[millions of dollars]		Quarters ended
		Mar. 31, 2022			Dec. 31, 2021			Mar. 31, 2021
Cash provided by operating activities		154.8			163.7			189.7
Net change in operating assets and liabilities		52.9			15.5			(11.8	)
Operating cash flow before the change in operating assets and liabilities		207.7			179.2			177.8
FX (gains)/losses		(11.5	)		(3.1	)		(20.2	)
Transaction, integration, restructuring and legal		3.8			13.6			0.8
Other (gains)/losses		—			—			7.1
Total adjustments		(7.7	)		10.5			(12.3	)
Tax effect (recovery) of adjustments		1.2			(2.6	)		(8.3	)
Less: Non-controlling interest		(0.4	)		—			1.7
Free cash flow		201.6			187.1			155.6

NET DEBT
		Quarters ended
[millions of dollars]		Mar. 31, 2022		Dec. 31, 2021		Sep. 30, 2021		Jun. 30, 2021		Mar. 31, 2021
Current portion of long-term debt		225.3		444.5		74.2		—		—
Long-term debt		3,304.7		3,331.6		3,350.2		3,350.2		2,200.9
		3,530.0		3,776.0		3,408.4		3,350.2		2,200.9
Less:
Cash and short-term investments		186.1		230.8		653.9		801.3		248.4
Marketable securities		20.4		116.9		122.5		121.1		122.0
Add:
Regulatory capital and non-controlling interests		28.8		25.0		23.1		33.4		25.9
Net Debt		3,352.3		3,453.4		2,655.1		2,461.2		1,856.4
Adjusted EBITDA		272.9		277.2		258.1		242.3		236.3
Adjusted EBITDA, annualized		1,106.8		1,099.8		1,024.1		971.9		958.3
Gross leverage (Gross debt/Annualized adjusted EBITDA)		3.2		3.4		3.3		3.4		2.3
Net leverage (Net debt/Annualized adjusted EBITDA)		3.0		3.1		2.6		2.5		1.9

SUMMARY OF QUARTERLY RESULTS
[millions of dollars, except per share amounts]	IFRS Results											Adjusted Results
	For the quarters ended											For the quarters ended
	Mar. 31, 2022		Dec. 31, 2021		Sep. 30, 2021		Jun. 30, 2021		Mar. 31, 2021			Mar. 31, 2022		Dec. 31, 2021		Sep. 30, 2021		Jun. 30, 2021		Mar. 31, 2021
Revenues
Asset management fees	437.6		464.9		460.9		441.1		425.1			437.6		464.9		460.9		441.1		425.1
Trailer fees and deferred sales commissions	(135.3	)	(143.6	)	(143.4	)	(137.7	)	(132.7	)		(135.3	)	(143.6	)	(143.4	)	(137.7	)	(132.7	)
Net asset management fees	302.3		321.3		317.5		303.5		292.4			302.3		321.3		317.5		303.5		292.4
Canada wealth management fees	138.2		134.9		132.5		119.9		119.6			138.2		134.9		132.5		119.9		119.6
U.S. wealth management fees	164.5		120.9		108.1		71.4		44.7			164.5		120.9		108.1		71.4		44.7
Other revenues	21.6		27.3		11.2		18.0		26.7			21.6		27.3		11.2		18.0		26.7
FX gains/(losses)	11.5		3.1		(50.3	)	8.2		20.2			—		—		—		—		—
Other gains/(losses)	(4.4	)	11.9		(1.1	)	3.8		4.1			(4.4	)	(4.9	)	(1.1	)	2.5		11.2
Total net revenues	633.8		619.3		517.9		524.7		507.7			622.3		599.4		568.2		515.2		494.6
Expenses
Selling, general & administrative	259.6		214.6		201.9		173.9		151.9			241.4		212.5		197.7		173.0		151.9
Advisor and dealer fees	106.9		104.8		103.4		93.4		95.1			106.9		104.8		103.4		93.4		95.1
Other	3.2		5.7		6.5		5.3		34.6			(10.8	)	5.7		6.5		5.0		9.9
Interest and lease finance expense	35.9		32.5		31.6		24.2		21.3			35.9		32.5		31.6		24.2		21.3
Depreciation and other amortization	11.4		10.9		10.3		9.7		10.0			11.4		10.4		10.0		9.4		9.7
Amortization of intangible assets from acquisitions	24.1		18.2		16.4		11.7		9.6			—		—		—		—		—
Transaction, integration, restructuring and legal	3.8		13.6		3.9		17.5		0.8			—		—		—		—		—
Change in fair value of contingent consideration	3.1		43.9		61.4		22.4		22.2			—		—		—		—		—
Total expenses	448.0		444.2		435.5		358.2		345.6			384.8		365.9		349.2		305.1		287.9
Pretax income	185.8		175.1		82.4		166.6		162.2			237.5		233.4		219.0		210.1		206.7
Income tax expense	48.3		51.3		37.0		48.2		37.4			59.7		62.5		58.1		56.4		54.3
Net income	137.5		123.7		45.4		118.4		124.8			177.8		171.0		160.9		153.8		152.4
Non-controlling interest	(0.6	)	—		1.6		0.8		0.6			10.9		—		1.6		0.8		0.7
Net income attributable to shareholders	138.1		123.7		43.8		117.6		124.2			166.8		171.0		159.2		153.0		151.6
Basic earnings per share	0.70		0.63		0.22		0.58		0.60			0.85		0.87		0.80		0.75		0.73
Diluted earnings per share	0.70		0.62		0.22		0.57		0.59			0.85		0.86		0.79		0.74		0.72

RESULTS OF OPERATIONS - ASSET MANAGEMENT SEGMENT
[millions of dollars, except per share amounts]	IFRS Results											Adjusted Results
	For the quarters ended											For the quarters ended
	Mar. 31, 2022		Dec. 31, 2021		Sep. 30, 2021		Jun. 30, 2021		Mar. 31, 2021			Mar. 31, 2022		Dec. 31, 2021		Sep. 30, 2021		Jun. 30, 2021		Mar. 31, 2021
Revenues
Asset management fees	442.5		469.6		465.6		445.5		429.2			442.5		469.6		465.6		445.5		429.2
Trailer fees and deferred sales commissions	(143.9	)	(152.6	)	(152.4	)	(146.3	)	(141.1	)		(143.9	)	(152.6	)	(152.4	)	(146.3	)	(141.1	)
Net asset management fees	298.6		316.9		313.2		299.3		288.2			298.6		316.9		313.2		299.3		288.2
Other revenues	10.2		19.9		3.2		12.2		20.8			10.2		19.9		3.2		12.2		20.8
FX gains/(losses)	11.4		(1.4	)	(19.0	)	1.2		8.2			—		—		—		—		—
Other gains/(losses)	(4.4	)	12.0		(1.1	)	3.8		4.2			(4.4	)	(4.8	)	(1.1	)	2.5		4.2
Total net revenues	315.8		347.5		296.3		316.5		321.4			304.4		332.1		315.3		313.9		313.2
Expenses
Selling, general & administrative	96.8		108.7		109.6		104.9		102.8			96.8		108.7		109.6		104.9		102.8
Other	—		(0.5	)	1.6		0.2		0.3			—		(0.5	)	1.6		0.2		0.3
Interest and lease finance expense	1.0		0.5		0.5		0.6		0.6			1.0		0.5		0.5		0.6		0.6
Depreciation and other amortization	5.0		5.6		5.5		5.5		6.7			5.0		5.6		5.5		5.5		6.7
Amortization of intangible assets from acquisitions	0.6		0.6		0.6		0.6		0.5			—		—		—		—		—
Transaction, integration, restructuring and legal	(0.9	)	10.4		0.4		14.6		0.1			—		—		—		—		—
Change in fair value of contingent consideration	4.0		14.2		1.9		10.0		—			—		—		—		—		—
Total expenses	106.5		139.4		120.2		136.4		111.1			102.8		114.2		117.2		111.1		110.4
Pretax income	209.3		208.0		176.1		180.1		210.3			201.6		217.9		198.1		202.8		202.8
Non-IFRS adjustments
Pretax income	209.3		208.0		176.1		180.1		210.3			201.6		217.9		198.1		202.8		202.8
Amortization of intangible assets from acquisitions	0.6		0.6		0.6		0.6		0.5			—		—		—		—		—
Depreciation and other amortization	5.0		5.6		5.5		5.5		6.7			5.0		5.6		5.5		5.5		6.7
Interest and lease finance expense	1.0		0.5		0.5		0.6		0.6			1.0		0.5		0.5		0.6		0.6
EBITDA	215.9		214.7		182.7		186.7		218.1			207.6		223.9		204.1		208.8		210.0
Change in fair value of contingent consideration	4.0		14.2		1.9		10.0		—			—		—		—		—		—
FX (gains)/losses	(11.4	)	1.4		19.0		(1.2	)	(8.2	)		—		—		—		—		—
Transaction, integration, restructuring and legal	(0.9	)	10.4		0.4		14.6		0.1			—		—		—		—		—
Other (gains)/losses	—		(16.8	)	—		(1.4	)	—			—		—		—		—		—
Total adjustments	(8.3	)	9.2		21.4		22.1		(8.1	)		—		—		—		—		—
Less: Non-controlling interest	0.4		0.1		0.5		0.2		—			0.4		0.1		0.5		0.2		—
Adjusted EBITDA	207.2		223.8		203.6		208.6		210.0			207.2		223.8		203.6		208.6		210.0

RESULTS OF OPERATIONS - CANADA WEALTH MANAGEMENT SEGMENT
[millions of dollars, except per share amounts]	IFRS Results											Adjusted Results
	For the quarters ended											For the quarters ended
	Mar. 31, 2022		Dec. 31, 2021		Sep. 30, 2021		Jun. 30, 2021		Mar. 31, 2021			Mar. 31, 2022	Dec. 31, 2021		Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021
Revenues
Canada wealth management fees	185.7		184.3		181.7		166.5		164.4			185.7	184.3		181.7	166.5	164.4
Other revenues	17.1		16.0		14.8		13.9		13.9			17.1	16.0		14.8	13.9	13.9
FX gains/(losses)	0.1		0.8		0.7		0.7		1.2			—	—		—	—	—
Other gains/(losses)	—		(0.1	)	—		—		—			—	(0.1	)	—	—	—
Total net revenues	202.9		201.1		197.2		181.1		179.5			202.8	200.3		196.5	180.4	178.3
Expenses
Selling, general & administrative	41.4		39.9		37.8		35.7		34.6			41.4	39.9		37.8	35.7	34.6
Advisor and dealer fees	145.6		145.2		143.5		131.3		131.4			145.6	145.2		143.5	131.3	131.4
Other	2.9		3.2		1.8		1.3		8.5			2.9	3.2		1.8	1.3	1.4
Interest and lease finance expense	0.2		0.2		0.2		0.1		0.1			0.2	0.2		0.2	0.1	0.1
Depreciation and other amortization	2.5		2.3		2.4		2.5		2.4			2.5	2.3		2.4	2.5	2.4
Amortization of intangible assets from acquisitions	1.6		1.5		1.7		1.3		1.0			—	—		—	—	—
Transaction, integration, restructuring and legal	0.8		0.1		0.1		—		0.5			—	—		—	—	—
Change in fair value of contingent consideration	—		—		—		—		—			—	—		—	—	—
Total expenses	195.0		192.6		187.5		172.3		178.4			192.6	191.0		185.7	171.0	169.8
Pretax income	7.9		8.5		9.7		8.8		1.1			10.2	9.3		10.8	9.5	8.5
Non-IFRS adjustments
Pretax income	7.9		8.5		9.7		8.8		1.1			10.2	9.3		10.8	9.5	8.5
Amortization of intangible assets from acquisitions	1.6		1.6		1.8		1.4		1.1			—	0.1		0.1	0.1	0.1
Depreciation and other amortization	2.5		2.3		2.4		2.5		2.4			2.5	2.3		2.4	2.5	2.4
Interest and lease finance expense	0.2		0.2		0.2		0.1		0.1			0.2	0.2		0.2	0.1	0.1
EBITDA	12.1		12.6		14.0		12.8		4.6			12.9	11.9		13.5	12.2	11.0
FX (gains)/losses	(0.1	)	(0.8	)	(0.7	)	(0.7	)	(1.2	)		—	—		—	—	—
Transaction, integration, restructuring and legal	0.8		0.1		0.1		—		0.5			—	—		—	—	—
Other (gains)/losses	—		—		—		—		7.1			—	—		—	—	—
Total adjustments	0.8		(0.7	)	(0.6	)	(0.6	)	6.4			—	—		—	—	—
Less: Non-controlling interest	—		(1.5	)	0.7		0.5		0.3			—	(1.5	)	0.7	0.5	0.3
Adjusted EBITDA	12.9		13.5		12.8		11.6		10.7			12.9	13.5		12.8	11.6	10.7

RESULTS OF OPERATIONS - U.S. WEALTH MANAGEMENT SEGMENT
[millions of dollars, except per share amounts]	IFRS Results											Adjusted Results
	For the quarters ended											For the quarters ended
	Mar. 31, 2022		Dec. 31, 2021		Sep. 30, 2021		Jun. 30, 2021		Mar. 31, 2021			Mar. 31, 2022	Dec. 31, 2021	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021
Revenues
U.S. wealth management fees	164.5		120.9		108.1		71.4		44.7			164.5	120.9	108.1	71.4	44.7
Other revenues	4.8		1.3		2.6		0.9		0.5			4.8	1.3	2.6	0.9	0.5
FX gains/(losses)	—		3.7		(31.9	)	6.3		10.7
Other gains/(losses)	—		—		—		—		(0.1	)		—	—	—	—	(0.1	)
Total net revenues	169.2		125.9		78.8		78.6		55.9			169.2	122.2	110.7	72.3	45.2
Expenses
Selling, general & administrative	136.9		80.8		68.8		46.9		27.3			114.8	78.7	64.6	46.0	27.3
Advisor and dealer fees	—		—		—		—		—			—	—	—	—	—
Other	0.4		2.9		3.1		3.5		1.1			0.4	2.9	3.1	3.5	1.1
Interest and lease finance expense	0.5		0.4		0.4		0.2		0.1			0.5	0.4	0.4	0.2	0.1
Depreciation and other amortization	3.9		3.1		2.5		1.7		1.0			3.9	3.1	2.5	1.7	1.0
Amortization of intangible assets from acquisitions	21.9		16.1		14.1		9.8		8.0
Transaction, integration, restructuring and legal	3.9		3.1		3.4		2.9		0.2
Change in fair value of contingent consideration	(0.9	)	29.7		59.5		12.4		22.2			—	—	—	—	—
Total expenses	166.5		136.1		151.7		77.4		59.9			119.6	85.2	70.5	51.4	29.5
Pretax income	2.7		(10.2	)	(72.9	)	1.2		(4.0	)		49.7	37.0	40.2	20.9	15.7
Non-IFRS adjustments
Pretax income	2.7		(10.2	)	(72.9	)	1.2		(4.0	)		49.7	37.0	40.2	20.9	15.7
Amortization of intangible assets from acquisitions	21.9		16.5		14.4		10.1		8.3			—	0.5	0.3	0.3	0.3
Depreciation and other amortization	3.9		3.1		2.5		1.7		1.0			3.9	3.1	2.5	1.7	1.0
Interest and lease finance expense	0.5		0.4		0.4		0.2		0.1			0.5	0.4	0.4	0.2	0.1
EBITDA	29.1		9.9		(55.6	)	13.2		5.4			54.1	41.0	43.4	23.1	17.0
Change in fair value of contingent consideration	(0.9	)	29.7		59.5		12.4		22.2			—	—	—	—	—
Contingent consideration recorded as compensation	18.2		2.1		4.2		0.9		—			—	—	—	—	—
CIPW adjustments	3.9		—		—		—		—			—	—	—	—	—
FX (gains)/losses	—		(3.7	)	31.9		(6.3	)	(10.7	)		—	—	—	—	—
Transaction, integration, restructuring and legal	3.9		3.1		3.4		2.9		0.2			—	—	—	—	—
Total adjustments	25.0		31.1		99.0		9.9		11.6			—	—	—	—	—
Less: Non-controlling interest	1.3		1.0		1.7		1.0		1.4			1.3	1.0	1.7	1.0	1.4
Adjusted EBITDA	52.8		40.0		41.7		22.1		15.6			52.8	40.0	41.7	22.1	15.6

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20220512005469/en/

Investor Relations

Jason Weyeneth, CFA

Vice-President, Investor Relations & Strategy

416-681-8779

jweyeneth@ci.com

Media

Canada

Murray Oxby

Vice-President, Communications

416-681-3254

moxby@ci.com

United States

Jimmy Moock

Managing Partner, StreetCred

610-304-4570

jimmy@streetcredpr.com

ci@streetcredpr.com

Source: CI Financial Corp.

FAQ

What were CI Financial's earnings per share for Q1 2022?

CI Financial reported a diluted EPS of $0.70 and an adjusted EPS of $0.85 for Q1 2022.

How much debt did CI Financial reduce in Q1 2022?

CI Financial reduced its debt by $246 million during Q1 2022.

What is the total asset value for CI Financial as of March 31, 2022?

As of March 31, 2022, CI Financial's total assets amounted to $361 billion.

What acquisitions did CI Financial make in Q1 2022?

CI Financial agreed to acquire three registered investment advisors with over $21 billion in combined assets.

What were CI Financial's total net revenues in Q1 2022?

Total net revenues for CI Financial in Q1 2022 were $633.8 million.