TORONTO, Aug. 13, 2018 (GLOBE NEWSWIRE) -- Sprott Inc. (TSX: SII) (“Sprott” or the “Company”) today announced its financial results for the three months ended June 30, 2018.
Financial Overview for the quarter-ended June 30, 2018:
- Assets Under Management (“AUM”) were $11.1 billion as at June 30, 2018, compared to $11.6 billion as at March 31, 2018.
- Total net revenues (net of commission expenses, trailer fees and sub-advisor fees, carried interest and performance fee payouts) were $23.5 million, flat compared to the quarter ended June 30, 2017.
- Total expenses (excluding commission expenses, trailer fees and sub-advisor fees, carried interest and performance fee payouts) were $17.0 million, reflecting a decrease of $7.9 million (32%) from the quarter ended June 30, 2017.
- Net income was $5.9 million ($0.02 per share), reflecting an increase of $9.5 million from the quarter ended June 30, 2017.
- On a normalized basis (taking into account the 2017 sale of non-core diversified assets) Adjusted Base EBITDA from core businesses increased by $3.4 million (47%) from the quarter ended June 30, 2017 to $10.7 million ($0.04) per share
- Investable capital stood at $195 million as at June 30, 2018, compared to $293 million as at December 31, 2017, reflecting a decrease of $98 million, due primarily to the purchase of Central Fund of Canada assets in January of this year.
"The second quarter of 2018 was steady both in terms of our financial performance and ongoing investment in new growth initiatives," said Peter Grosskopf, CEO of Sprott. "The Company's profitability continues to improve due largely to growth in our Exchange Listed Products business from the acquisition of Central Fund of Canada Ltd., as well as additional capital calls in our Private Resource Lending funds. On a normalized basis, Adjusted Base EBITDA increased by more than 40% during the quarter and more than 50% in the first half of the year."
Assets Under Management
3 months results
| In millions $ | AUM Mar. 31, 2018 | Net Sales & Capital Calls | Market Value Change | Acquisitions & Divestitures | AUM Jun. 30, 2018 | |||||
| Exchange Listed Products | ||||||||||
| - Physical Trusts | 8,603 | (272 | ) (1) | (199 | ) | — | 8,132 | |||
| - ETFs | 411 | (11 | ) | (2 | ) | — | 398 | |||
| 9,014 | (283 | ) | (201 | ) | — | 8,530 | ||||
| Alternative Asset Management | ||||||||||
| - In-house | 399 | (6 | ) | 13 | — | 406 | ||||
| - Sub-advised | 656 | (44 | ) | (9 | ) | — | 603 | |||
| 1,055 | (50 | ) | 4 | — | 1,009 | |||||
| Private Resource Investments | ||||||||||
| - Managed Companies | 625 | — | (22 | ) | — | 603 | ||||
| - Fixed Term LPs | 312 | — | (20 | ) | — | 292 | ||||
| - Separately Managed Accounts | 303 | — | — | — | 303 | |||||
| - Private Resource Lending LPs | 282 | 78 | 29 | — | 389 | |||||
| 1,522 | 78 | (13 | ) | — | 1,587 | |||||
| Total | 11,591 | (255 | ) | (210 | ) | — | 11,126 | |||
(1) Total CFCL units acquired on January 16, 2018 were 252 million. For the 3 months ended June 30, 2018,14 million units ($201 million or 6%) were redeemed.
Dividends
On August 9, 2018, a dividend of $0.03 per common share was declared for the quarter ended June 30, 2018.
Conference Call and Webcast
A conference call and webcast will be held today, August 13, 2018 at 10:00 am ET to discuss the Company's financial results. To participate in the call, please dial (855) 458-4215 ten minutes prior to the scheduled start of the call and provide conference ID3799887. A taped replay of the conference call will be available until Monday, August 20, 2018 by calling (855) 859-2056, reference number 3799887. The conference call will be webcast live at www.sprott.com and https://edge.media-server.com/m6/p/mxe8u74r
*Non-IFRS Financial Measures
This press release includes financial terms (including AUM, EBITDA, adjusted base EBITDA and net sales) that the Company utilizes to assess the financial performance of its business that are not measures recognized under International Financial Reporting Standards (“IFRS”). These non-IFRS measures should not be considered alternatives to performance measures determined in accordance with IFRS and may not be comparable to similar measures presented by other issuers. For additional information regarding the Company's use of non-IFRS measures, including the calculation of these measures, please refer to the “Non-IFRS Financial Measures” section of the Company's Management's Discussion and Analysis and its financial statements available on the Company's website at www.sprottinc.com and on SEDAR at www.sedar.com.
Forward-Looking Statements
Certain statements in this press release contain forward-looking information (collectively referred to herein as the "Forward-Looking Statements") within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify Forward-Looking Statements. In particular, but without limiting the forgoing, this press release contains Forward-Looking Statements pertaining to: (i) the Company’s profitability continuing to improve due largely to growth in our Exchange Listed Products business from the acquisition of Central Fund of Canada Ltds., as well as strong capital deployments from our Private Resource Lending funds; and (ii) the declaration, payment and designation of dividends.
Although the Company believes that the Forward-Looking Statements are reasonable, they are not guarantees of future results, performance or achievements. A number of factors or assumptions have been used to develop the Forward-Looking Statements, including: (i) the impact of increasing competition in each business in which the Company operates will not be material; (ii) quality management will be available; (iii) the effects of regulation and tax laws of governmental agencies will be consistent with the current environment; and (iv) those assumptions disclosed herein under the heading "Significant Accounting Judgments and Estimates" in the Company’s MD&A for the period ended June 30, 2018. Actual results, performance or achievements could vary materially from those expressed or implied by the Forward-Looking Statements should assumptions underlying the Forward-Looking Statements prove incorrect or should one or more risks or other factors materialize, including: (i) difficult market conditions; (ii) poor investment performance; (iii) failure to continue to retain and attract quality staff; (iv) employee errors or misconduct could result in regulatory sanctions or reputational harm; (v) performance fee fluctuations; (vi) changes in the investment management industry; (vii) failure to implement effective information security policies, procedures and capabilities; (viii) lack of investment opportunities; (ix) risks related to regulatory compliance; (x) failure to manage risks appropriately; (xi) failure to deal appropriately with conflicts of interest; (xii) competitive pressures; (xiii) corporate growth may be difficult to sustain and may place significant demands on existing administrative, operational and financial resources; (xiv) failure to successfully implement succession planning; (xv) foreign exchange risk relating to the relative value of the U.S. dollar; (xvi) litigation risk; (xvii) failure to develop effective business resiliency plans; (xviii) failure to obtain or maintain sufficient insurance coverage on favourable economic terms; (xix) historical financial information is not necessarily indicative of future performance; (xx) the market price of common shares of the Company may fluctuate widely and rapidly; (xxi) risks relating to the Company’s investment products; (xxii) risks relating to the Company's proprietary investments; (xxiii) risks relating to the Company's lending business; (xxiv) risks relating to the Company’s merchant bank and advisory business; (xxv) those risks described under the heading "Risk Factors" in the Company’s annual information form dated March 2, 2018; and (xxvi) those risks described under the headings "Managing Risk: Financial" and "Managing Risk: Non-Financial" in the Company’s MD&A for the period ended June 30, 2018. In addition, the payment of dividends is not guaranteed and the amount and timing of any dividends payable by the Company will be at the discretion of the Board of Directors of the Company and will be established on the basis of the Company’s earnings, the satisfaction of solvency tests imposed by applicable corporate law for the declaration and payment of dividends, and other relevant factors. The Forward-Looking Statements speak only as of the date hereof, unless otherwise specifically noted, and the Company does not assume any obligation to publicly update any Forward-Looking Statements, whether as a result of new information, future events or otherwise, except as may be expressly required by applicable Canadian securities laws.
About Sprott
Sprott is an alternative asset manager and a global leader in precious metal and real asset investments. Through its subsidiaries in Canada, the US and Asia, the Corporation is dedicated to providing investors with best-in-class investment strategies that include Exchange Listed Products, Alternative Asset Management and Private Resource Investments. The Corporation also operates Merchant Banking and Brokerage businesses in both Canada and the US. Sprott is based in Toronto with offices in New York, Carlsbad and Vancouver and its common shares are listed on the Toronto Stock Exchange under the symbol (TSX:SII). For more information, please visit www.sprott.com.
Investor contact information:
Glen Williams
Managing Director
Investor Relations and Corporate Communications
(416) 943-4394
gwilliams@sprott.com
Source: Sprott Inc.