Mr. James O'Sullivan reports

IGM FINANCIAL REPORTS THIRD QUARTER EARNINGS

IGM Financial Inc. today released earnings results for the third quarter of 2023.

IGM highlights

• Net earnings of $209.8-million or 88 cents per share compared with $216.1-million or 91 cents per share in 2022.
• Assets under management and advisement of $253.4-billion, down 3.0 per cent from the prior quarter and up 6.4 per cent from the third quarter of 2022.
• IGM Financial's assets under management and advisement including strategic investments were $400.0-billion as at Sept. 30, 2023, compared with $402.8-billion at June 30, 2023, and $302.1-billion at Sept. 30, 2022. This is a new measure introduced in the second quarter and reflects the importance of these high-growth investments and their contribution to IGM's value.
• Net outflows were $549-million compared with net outflows of $342-million in 2022.

"Strong earnings contributions from IG Wealth and Mackenzie combined with ongoing discipline in expense management drove this quarter's results," said James O'Sullivan, president and chief executive officer of IGM Financial. "We believe the business is positioned for long-term growth with our three drivers of growth in wealth management including IG Wealth, Rockefeller Capital and Wealthsimple, and in asset management including Mackenzie Investments, ChinaAMC and Northleaf."

Net earnings available to common shareholders for the third quarter of 2023 were $209.8-million or 88 cents per share compared with $216.1-million or 91 cents per share in 2022.

Net earnings available to common shareholders for the nine months ended Sept. 30, 2023, were $729.3-million or $3.06 per share compared with $642.5-million or $2.68 per share in 2022. Adjusted net earnings available to common shareholders, excluding other items (1), for the nine-month period of 2023 were $621.8-million or $2.61 per share compared with $642.5-million or $2.68 per share in 2022.

Wealth management

Reflects the activities of operating companies that are principally focused on providing financial planning and related services to Canadian households, and includes the activities of IG Wealth Management and Investment Planning Counsel (IPC), which has been reclassified as discontinued operations.

Net earnings in the third quarter of 2023 were $117.8-million, an increase of 6.7 per cent compared with the third quarter of 2022, and represented 56.1 per cent of IGM's adjusted net earnings available to common shareholders.

Assets under advisement at Sept. 30, 2023, were $144.5-billion, a decrease of 2.2 per cent from $147.8-billion at June 30, 2023, and an increase of 8.4 per cent from $133.3-billion at Sept. 30, 2022.

IG Wealth Management

Assets under advisement at Sept. 30, 2023, were $114.2-billion, a decrease of 2.2 per cent from $116.8-billion at June 30, 2023, and an increase of 8.7 per cent from $105.0-billion at Sept. 30, 2022.

Quarterly net client outflows were $17-million, compared with net client inflows of $406-million in the third quarter of 2022.

Quarterly gross client inflows were $3.1-billion, up 11.9 per cent from $2.8-billion in 2022.

Asset management

Reflects the activities of operating companies primarily focused on providing investment management services, and represents the operations of Mackenzie Investments.

Net earnings in the third quarter of 2023 were $56.5-million, a decrease of 3.4 per cent compared with the third quarter of 2022, and represented 26.9 per cent of IGM's adjusted net earnings available to common shareholders.

Total assets under management were $186.3-billion, a decrease of 3.6 per cent from $193.3-billion at June 30, 2023, and an increase of 3.2 per cent from $180.5-billion at Sept. 30, 2022. Third party assets under management were $112.0-billion at Sept. 30, 2023, a decrease of 3.9 per cent from June 30, 2023, and an increase of 3.1 per cent from Sept. 30, 2022.

Investment fund net redemptions were $699-million compared with net redemptions of $680-million in the third quarter of 2022.

Mutual fund gross sales were $1.5-billion, up 17.3 per cent from the third quarter of 2022.

ETF business -- ETF assets under management totalled $12.5-billion at Sept. 30, 2023, down from $12.9-billion at June 30, 2023, and up from $11.5-billion at Sept. 30, 2022. Excluding investment in ETFs by IGM's managed products, ETF assets under management were $5.1-billion at Sept. 30, 2023, compared with $5.2-billion at June 30, 2023, and $5.0-billion at Sept. 30, 2022.

Strategic investments and other

Represents the key strategic investments made by the company, including China Asset Management Co. Ltd. (ChinaAMC), Great-West Lifeco Inc. (Lifeco), Rockefeller Capital Management (Rockefeller), Northleaf Capital Group Ltd. (Northleaf), Wealthsimple Financial Corp. (Wealthsimple) and Portage Ventures LPs, as well as unallocated capital.

On Jan. 12, 2023, the company closed the previously announced transaction to acquire Power Corp. of Canada's 13.9-per-cent interest in ChinaAMC, increasing the company's overall investment in ChinaAMC to 27.8 per cent, and to sell a portion of the company's investment in Lifeco, reducing it from 4.0 per cent to 2.4 per cent.

Great-West Lifeco Inc. -- The company's proportionate share of Lifeco's third quarter estimated earnings was $12.7-million (2) compared with $27.6-million in the third quarter of 2022. This included a reduction of $8.0-million to adjust second quarter earnings to the actual earnings disclosed by Lifeco.

China Asset Management Co. Ltd. -- The company's proportionate share of ChinaAMC's third quarter earnings was $24.6-million compared with $14.7-million in the third quarter of 2022.

Dividends

The board of directors has declared a dividend of 56.25 cents per share on the company's common shares which is payable on Jan. 31, 2024, to shareholders of record on Dec. 29, 2023.

(1) Other items in 2023 consisted of:

• Restructuring and other charges of $76.2-million after tax ($103.3-million pretax) recorded in the second quarter resulting from streamlining and simplifying the business to more effectively align with business priorities. The charge includes the company's changes to the organizational structure to advance the growing needs of the business, digital transformation by retiring duplicate systems and modernizing information technology, and an effort to consolidate its real estate footprint to better reflect client and adviser needs.
• A gain on the sale of a portion of the company's investment in Lifeco of $168.6-million after tax ($172.9-million pretax) consisting of $174.8-million recorded in the first quarter and a decrease of $6.2-million that was recorded on a prospective basis in the second quarter.
• Lifeco IFRS 17 adjustment of $15.1-million, recorded in the second quarter, representing a change of estimate which has been recorded on a prospective basis.

(2) The company recorded its proportionate share of third quarter Lifeco earnings using consensus analysts' earnings estimates as Lifeco is reporting quarterly earnings after the company.

Third quarter webcast and conference call

IGM Financial's third quarter 2023 results conference call and webcast will be held on Thursday, Nov. 2, 2023, at 8 a.m. ET. The webcast and conference call can be accessed respectively through the company website or you may register to obtain a calendar booking with your dial-in numbers, PIN and webcast links. Alternatively, dial 1-800-319-4610 or 1-416-915-3239.

The most recent consolidated financial statements and management's discussion and analysis (MD&A) of operating results are available on IGM Financial's website.

About IGM Financial Inc.

IGM Financial is one of Canada's leading diversified wealth and asset management companies with approximately $253-billion in total assets under management and advisement at Sept. 30, 2023. The company provides a broad range of financial planning and investment management services to help more than two million Canadians meet their financial goals. Its activities are carried out principally through IG Wealth Management, Mackenzie Investments and Investment Planning Counsel. IGM Financial is a member of the Power Corp. group of companies.

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