Home Page
12:10:00 EST Sun 23 Nov 2014
Enter Symbol
or Name
USA
CA



Sprott Inc
Symbol C : SII
Shares Issued 247,927,055
Close 2013-11-13 C$ 2.86
Recent Sedar Documents

Sprott earns $13.5-million in Q3

2013-11-14 07:27 ET - News Release

Mr. Peter Grosskopf reports

SPROTT INC. ANNOUNCES 2013 THIRD QUARTER RESULTS

Sprott Inc. has released its financial results for the three and nine months ended Sept. 30, 2013.

Third quarter 2013 overview

  • Assets under management (AUM) were $7.3-billion as at Sept. 30, 2013, compared with $10.3-billion as at Sept. 30, 2012, and $7.1-billion as at June 30, 2013.
  • Assets under administration (AUA) were $2.6-billion as at Sept. 30, 2013, compared with $4.0-billion as at Sept. 30, 2012, and $2.6-billion as at June 30, 2013.
  • Management fees were $19.5-million, a decrease of 30.9 per cent compared with the three months ended Sept. 30, 2012.
  • EBITDA (earnings before interest, taxes, depreciation and amortization) was $5.9-million (three cents per share), compared with $10.5-million (six cents per share) for the three months ended Sept. 30, 2012, a decrease of 44.0 per cent.
  • Net income was $13.5-million (six cents per share) for the three months ended Sept. 30, 2013, compared with net income of $11.0-million (seven cents per share) for the three months ended Sept. 30, 2012.
  • The company completed its acquisition of Sprott Resource Lending Corp.
  • The company launched a new offshore global mining fund with Zijin Mining Group Co. Ltd.
  • The company reported positive net sales for the third quarter.

Subsequent events

  • The company named Steve Yuzpe chief executive officer of Sprott Resource Corp.

"Throughout 2013 we have taken steps to improve our investment management processes," said Peter Grosskopf, chief executive officer of Sprott. "Going forward, our portfolios will be more actively managed, more concentrated and focused on limiting downside risk while maintaining strong upside potential. We will continue to diversify our Canadian platform through the addition of new products and investment capabilities. We will also look for opportunities to more efficiently leverage our platform by increasing our managed asset base through new products and acquisitions.

"During the third quarter, we completed the acquisition of Sprott Resource Lending Corp. in a transaction that further strengthens our balance sheet and gives us the ability to relaunch our resource lending strategy in a structure that will be more attractive to institutional investors," said Steven Rostowsky, chief financial officer of Sprott. "We currently have close to $350-million in available capital that will be deployed for various growth initiatives including seeding and launching new funds such as our new offshore fund with Zijin, the pending Sprott Resource Lending LP, and other products under review."

                                  FINANCIAL HIGHLIGHTS
                                (In millions of dollars)

                                   For the three months ended   For the nine months ended
                                                    Sept. 30,                   Sept. 30,        
                                             2013        2012          2013          2012

AUM, beginning of period                   $7,147      $8,485         $9,931       $9,137
Net sales (redemptions)                        24         449          (393)          836
Business acquisition (loss)                 (188)         429          (188)          429
Market value appreciation
(depreciation) of portfolios                  353         940        (2,014)         (99)
AUM, end of period                          7,336      10,303          7,336       10,303
                                                                                                            

Assets under management

At Sept. 30, 2013, AUM decreased by 28.8 per cent to $7.3-billion from $10.3-billion at Sept. 30, 2012. Net sales for the three months ended Sept. 30, 2013, were $24.5-million. Average AUM for the three months ended Sept. 30, 2013, was $7.4-billion compared with $9.3-billion for the three months ended Sept. 30, 2012, a decrease of 20.6 per cent.

Income statement

Total revenues for the three months ended Sept. 30, 2013, increased by 12.3 per cent to $40.2-million from $35.8-million for the three months ended Sept. 30, 2012. For the nine months ended Sept. 30, 2013, total revenues decreased by 21.6 per cent to $84.3-million from $107.6-million in the nine months ended Sept. 30, 2012.

For the three months ended Sept. 30, 2013, management fees decreased by 30.9 per cent to $19.5-million from $28.2-million in the three months ended Sept. 30, 2012. For the nine months ended Sept. 30, 2013, management fees decreased by 25.1 per cent to $66.9-million from $89.3-million in the nine months ended Sept. 30, 2012. The decrease in management fees is primarily attributable to both the lower average AUM for the three and nine months ended Sept. 30, 2013, as well as the change in composition of the company's AUM with lower fee products comprising a greater percentage of AUM.

Gross performance fees for the three and nine months ended Sept. 30, 2013, were $900,000 and $2.4-million, respectively, representing an increase of $800,000 and $2.2-million over the corresponding periods in 2012.

Commission revenue for three months ended Sept. 30, 2013, decreased by $900,000 to $1.5-million from $2.4-million during the three months ended Sept. 30, 2012. For the nine months ended Sept. 30, 2013, commission revenue decreased by $5.2-million to $5-million from $10.2-million compared with nine months ended Sept. 30, 2012.

Interest income increased substantially for the three and nine months ended Sept. 30, 2013, to $3.3-million and $5-million from $700,000 and $2-million for the three and nine months ended Sept. 30, 2012, respectively. This is a result of the acquisition of SRLC which business is lending to companies in the mining and energy sectors.

Gains from proprietary investments, which include investments in products that Sprott manages, certain other resource-related stocks and warrants, fixed income securities, foreclosed properties, and bullion, totalled $1.3-million, compared with $3.8-million in the three months ended Sept. 30, 2012. For the nine months ended Sept. 30, 2013, losses from proprietary investments totalled $11.2-million, compared with gains of $4.1-million during the nine months ended Sept. 30, 2012.

Total expenses for the three months ended Sept. 30, 2013, were $30.4-million, an increase of $9.5-million or 45.5 per cent compared with $20.9-million for the three months ended Sept. 30, 2012. Total expenses for the nine months ended Sept. 30, 2013, were $80.8-million, an increase of 14.9 per cent from $70.3-million in the nine months ended Sept. 30, 2012.

EBITDA for the three months ended Sept. 30, 2013, was $5.9-million, representing a decrease of $4.6-million or 44.0 per cent compared with the three months ended Sept. 30, 2012. For the nine months ended Sept. 30, 2013, EBITDA decreased by 34.2 per cent to $24.4-million from $37.1-million in the nine months ended Sept. 30, 2012.

Net income for the three months ended Sept. 30, 2013, was $13.5-million (six cents per share) compared with net income of $11.0-million (seven cents per share) for the three months ended Sept. 30, 2012. Net income for the nine months ended Sept. 30, 2013, was $8.9-million (five cents per share), compared with net income of $28.7-million (17 cents per share) for the nine months ended Sept. 30, 2012.

Dividends

On Aug. 7, 2013, a dividend of three cents per common share was declared for the quarter ended June 30, 2013. On Nov. 12, 2013, a dividend of three cents per common share was declared for the quarter ended Sept. 30, 2013.

Conference call and webcast

A conference call and webcast will be held today, Thursday, Nov. 14, 2013, at 10 a.m. Eastern Time to discuss the company's financial results. To participate in the call, please dial 416-764-8688 or 1-888-390-0546 10 minutes prior to the scheduled start of the call. A taped replay of the conference call will be available until Thursday, Nov. 21, 2013, by calling 416-764-8677 or 1-888-390-0541, reference No. 98714867. The conference call will be webcast live at the company's website.

We seek Safe Harbor.

© 2014 Canjex Publishing Ltd. All rights reserved.