AGF Management Limited Reports Fourth Quarter and Fiscal Year 2021 Financial Results

TORONTO, Jan. 26, 2022 (GLOBE NEWSWIRE) —

• Reported diluted earnings per share of $0.19
• Mutual fund gross sales of $914 million for the fourth quarter of 2021, an improvement of 35% year-over-year
• Mutual fund net sales of $352 million for the quarter
• Total assets under management and fee-earning assets¹ of $42.6 billion

AGF Management Limited (AGF or the Company) (TSX: AGF.B) today announced financial results for the fourth quarter and fiscal year ended November 30, 2021.

AGF reported total assets under management and fee-earning assets¹ of $42.6 billion compared to $43.4 billion as at August 31, 2021 and $38.3 billion as at November 30, 2020.

“As we marked our second fiscal year-end of the pandemic, we have continued to work effectively and execute against our long-term strategy and stated goals, including the growth of our private alternatives business and securing key hires intended to help us accelerate our growth,” said Kevin McCreadie, Chief Executive Officer and Chief Investment Officer, AGF. “Over the course of the year we built terrific sales momentum and delivered risk-adjusted performance, while providing our clients with an essential service.”

“Critical to advancing our strategy we will continue to strategically deploy capital to effectively secure our place as an alternatives provider of choice for our clients while looking to maintain, and build upon, the positive sales momentum we have experienced over this past year,” added McCreadie.

AGF’s mutual fund gross sales were $914 million for the quarter compared to $679 million in the comparative period, a 35% improvement year over year. AGF’s gross sales have continued to outpace the industry. Year over year, retail mutual fund gross sales² improved by 39% compared to 18% for the industry³. AGF’s mutual funds net sales improved $264 million year-over-year, with total net sales of $352 million in Q4 2021, compared to $88 million in Q4 2020.

Mutual fund sales momentum has continued into the first quarter of 2022, with net sales of $115 million as at January 21, 2022, compared to net sales of $104 million for the same time last year. Mutual fund gross sales were up 3% year-over-year.

“This year, we returned retail sales to net inflows, experiencing year-over-year improvements across all channels with strong flows into multiple categories,” said Judy Goldring, President and Head of Global Distribution, AGF.

“I believe this success is the result of evolving our client base across channels and providing products that are responsive to market trends, while addressing growing interest in private alternatives, fee-based series and separately managed accounts.”

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¹ Fee-earning assets represents assets in which AGF has carried interest ownership and earns recurring fees but does not have ownership interest in the managers.
² Retail mutual fund gross sales are calculated as reported mutual fund gross sales less non-recurring institutional gross sales in excess of $5 million invested in our mutual funds.
³ Long-term funds.

Key Business Highlights:

• On November 22, 2021, AGF announced the evolution of its long-standing relationship with PFSL Investments Canada Ltd. (PFSL) with the establishment of a new multi-year product and services distribution arrangement being named as one of only two asset management firms set to initially launch on PFSL’s evolving distribution platform.
• In December, AGF announced that Ash Lawrence will be joining AGF in a new role as Senior Vice-President & Head of Alternatives and as a member of the Executive Management Team. Ash’s leadership combined with AGF’s scale and strong balance sheet position the firm well to strategically deploy capital, and build on its strong momentum, to accelerate the growth of its alternatives business.
• AGF appointed Ian Clarke to its Board of Directors. He is an accomplished leader bringing a wealth of unique experiences in strategic planning, business operations, risk management assessment and corporate transactions that complement the experiences of our current directors.
• During the quarter, Arlette Edmunds also joined AGF in the role of Chief Human Resources Officer bringing experience and tenure to support the evolution of the workplace, including AGF’s focus on advancing its diversity, equity and inclusion agenda.
• AGF finalized an agreement with Vestmark and had its separately managed account (SMA) models approved to be added to the Envestnet platform, providing U.S. clients access to in-demand SMA strategies as the firm continues to expand its offerings and client-base in the U.S.
• AGF became a founding participant in Climate Engagement Canada (CEC) – a finance-led initiative that aims to drive dialogue between the financial community and Canadian corporations to promote a just transition to a net zero economy.
• AGF also joined CDP’s 2021 Science-Based Targets campaign calling on the world’s highest impact companies to urgently set science-based emissions reduction targets in line with 1.5°C warming scenarios. CDP is a not-for-profit charity that runs the global disclosure system for investors, companies, cities, states, and regions to manage their environmental impacts.
• In support of AGF’s continued advocacy for gender equality, the firm became a corporate sponsor of 100 Women in Finance (100WF).

For further information on AGF’s pandemic response plan statement visit AGF.com.

Financial Highlights:

• Management, advisory, administration fees and deferred sales charges were $114.6 million and $438.5 million for the three months and year ended November 30, 2021, compared to $97.5 million and $380.7 million in prior year comparative periods. The increase in revenue is attributable to higher net sales, increase in AUM and a higher average revenue rate as a result of product mix.
• The continued trend of net sales, combined with improved financial results, resulted in higher variable selling, general and administrative costs in the three and twelve months ended November 30, 2021. Selling, general and administrative costs were $49.9 million and $195.1 million for the three months and year ended November 30, 2021, compared to $43.1 million and $174.7 million in prior year comparative periods.
• Adjusted EBITDA before commissions for the three months and year ended November 30, 2021, excluding EBITDA from S&WHL which was sold in 2020, improved 12.3% and 27.8% to $35.5 million and $127.7 million, compared to $31.6 million and $99.9 million in the prior year comparative periods.
• Deferred selling commissions (DSC) for the three months and year ended November 30, 2021 increased to $15.3 million and $62.6 million, compared to $10.3 million and $42.0 million in the prior year comparative periods, driven by higher gross sales.
• Net income for the three months and year ended November 30, 2021 was $13.8 million ($0.19 diluted EPS) and $39.3 million ($0.55 diluted EPS), compared to $110.4 million ($1.43 diluted EPS) and $173.9 million ($2.22 diluted EPS) in the prior year comparative periods. Excluding earnings from S&WHL and one-time items, adjusted diluted earnings per share was $0.19 and $0.42 in the comparative prior year periods.
• EPS in the quarter of $0.19 reflects growth in top line revenue, which was offset in the period by higher DSC and performance-based compensation incurred related to sales growth.