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Sprott Inc
Symbol SII
Shares Issued 253,804,511
Close 2019-11-07 C$ 2.71
Recent Sedar Documents

Sprott earns $5.7-million in Q3

2019-11-08 07:16 ET - News Release

Mr. Peter Grosskopf reports

SPROTT ANNOUNCES 2019 THIRD QUARTER RESULTS

Sprott Inc. has released its financial results for the three months ended Sept. 30, 2019.

Financial overview (three-month results):

  • Assets under management (AUM) were $11.3-billion as at Sept. 30, 2019, up $700,000 (6 per cent) from June 30, 2019.
  • Total net revenues (net of commission expenses, trailer fees and subadviser fees, carried interest and performance fee payouts) were $23.2-million, reflecting an increase of $7.7-million (50 per cent) from the quarter ended Sept. 30, 2018.
  • Total expenses (excluding commission expenses, trailer fees and subadviser fees, carried interest and performance fee payouts) were $15.5-million, reflecting an increase of $2.1-million (15 per cent) from the quarter ended Sept. 30, 2018.
  • Net income was $5.7-million (two cents per share), reflecting an increase of $3.7-million from the quarter ended Sept. 30, 2018.
  • Adjusted base EBITDA (earnings before interest, taxes, depreciation and amortization) was $10.0-million (four cents per share), an increase of $300,000 (4 per cent) from the quarter ended Sept. 30, 2018.

Significant events:

  • Sprott and Tocqueville Asset Management entered into a definitive agreement regarding the sale of Tocqueville's gold strategy assets to Sprott Asset Management.
  • The acquisition is expected to close in January, 2020, and will add approximately $2.2-billion to Sprott's AUM.
  • Lead portfolio manager John Hathaway and portfolio managers Douglas Groh and Ryan McIntyre will join Sprott upon closing of the transaction.

"Strong precious metals prices and improved investor sentiment contributed to increases in our AUM and adjusted base EBITDA during the third quarter of 2019," said Peter Grosskopf, chief executive officer of Sprott. "In the current climate of artificially low interest rates and accommodative monetary policy, we believe precious metals have become a mandatory portfolio diversification asset. The acquisition of the Tocqueville gold strategies will add meaningful scale to Sprott's managed equities segment and provide additional operating leverage to the gold price going forward."

                         ASSETS UNDER MANAGEMENT (THREE-MONTH RESULTS)
                                       (in millions) 

                            AUM June 30,       Net  Market value            AUM Sept. 30,
                                    2019   inflows       changes    Other            2019

Exchange-listed products
Physical trusts                   $7,714       $92          $570       $-          $8,376
ETFs                                 301         4             9        -             314
                                   8,015        96           579        -           8,690
Lending (decrease)                   646        53            12     (125)            586
Managed equities
In-house                             586         2             4        -             592
Subadvised (decrease)                511       (10)           34        -             535
                                   1,097        (8)           38        -           1,127
Other                                913         -            11        -             924
Total (decrease)                  10,671       141           640     (125)         11,327

Dividends

On Nov. 7, 2019, a dividend of three cents per common share was declared for the quarter ended Sept. 30, 2019.

Normal course issuer bid

The Toronto Stock Exchange has approved the notice of the company's intention to make a normal course issuer bid (NCIB). Pursuant to the terms of the NCIB, Sprott may purchase its own common shares for cancellation through the facilities of the TSX at the prevailing market price of the shares. It is expected that the maximum number of shares, which may be purchased by Sprott during the NCIB, will not exceed 6,345,112, being approximately 2.5 per cent of 253,804,511 (representing the number of issued and outstanding shares as of Oct. 31, 2019). The average daily trading volume of the shares on the TSX for the six-month period ended Oct. 31, 2019, was 281,130. Under the rules of the TSX, Sprott is entitled to repurchase during the same trading day on the TSX up to 25 per cent of the ADTV of the shares, being 70,282 shares, except where such purchases are made in accordance with the block purchase exemption under applicable TSX policy. Sprott will effect purchases at varying times commencing on Nov. 15, 2019, and ending on Nov. 14, 2020.

In addition to providing shareholders liquidity, Sprott believes that the shares have been trading in a price range which does not adequately reflect the value of such shares in relation to Sprott's business and its future prospects.

Under its prior NCIB that commenced on Nov. 15, 2018, and was suspended in November, 2019, Sprott previously sought and received approval from the TSX to repurchase up to 12,633,752 shares. Sprott did not purchase any shares pursuant to its previously authorized NCIB.

Conference call and webcast

A conference call and webcast will be held today, Nov. 8, 2019, at 9 a.m. Eastern Time to discuss the company's financial results for the third quarter of 2019. To participate in the call, please dial 855-458-4215 10 minutes prior to the scheduled start of the call and provide conference ID 3763979. A taped replay of the conference call will be available until Friday, Nov. 15, 2019, by calling 855-859-2056, reference No. 3763979. The conference call will be webcast live at the company's website.

About Sprott Inc.

Sprott is an alternative asset manager and a global leader in precious metal and real asset investments.

We seek Safe Harbor.

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