Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil EL&P Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries CI Financial Reports Financial Results for the Third Quarter of 2022 By: CI Financial Corp. via Business Wire November 10, 2022 at 07:00 AM EST Diluted EPS of $0.08, adjusted EPS1 of $0.73 EBITDA of $117.1 million, adjusted EBITDA1 of $237.5 million Operating cash flow of $64.8 million, free cash flow1 of $151.5 million Total assets of $338.0 billion, up 1.3% over Q2 and up 7.9% year-over-year Repurchased 5.6 million shares for $79.8 million Paid quarterly dividend of $0.18 a share, totalling $34.6 million Acquired two RIAs in October, adding $17.9 billion in assets and increasing U.S. wealth management assets to approximately $167.8 billion All financial amounts in Canadian dollars at September 30, 2022, unless stated otherwise. Financial amounts for the quarter are unaudited. CI Financial Corp. (“CI”) (TSX: CIX, NYSE: CIXX) today released financial results for the quarter ended September 30, 2022. “CI continues to produce exceptional results in the face of difficult and turbulent market conditions,” said Kurt MacAlpine, CI Chief Executive Officer. “This performance is a result of CI’s transformation over the last three years into a larger, more diversified firm with more resilient and stable revenues and earnings power. At the same time, we continue to be disciplined in managing expenses, with comparable selling, general and administrative expenses declining from the previous quarter despite heightened inflationary pressures. “In asset management, CI’s Canadian retail businesses had net sales of $0.6 billion – an impressive achievement given the challenging markets,” Mr. MacAlpine said. “This compares to net redemptions of $11.8 billion for the overall Canadian investment fund industry. “This strength stems from the meaningful changes we have made to our asset management business, including transitioning from a legacy multi-boutique investment team model to a single, fully integrated modern asset management platform, significantly improving relative investment performance, building a more robust and diverse product lineup, and changing our approach to distribution and marketing. “Our Canadian wealth management business continues to experience strong net flows, reflecting the quality of our advisory businesses and illustrating how investors seek out the most qualified and credible advisors during challenging market and economic environments,” Mr. MacAlpine said. “We have made a major investment in building out capacity at CI Investor Services and are on track to convert over $14 billion in client assets to the CIIS custody platform in the first half of next year, enhancing the service experience for our advisors and driving revenue growth at the firm. “The growth and development of CI Private Wealth US continues at a robust pace. We recently completed the acquisitions of two high-quality, established RIAs, adding a combined US$13.0 billion in assets to our firm and significantly expanding our presence in the ultra-high-net-worth market in the Northeast. CIPW has hired a highly experienced chief operating officer in Lennie Gullan, who will lead the development of a harmonized operating platform with expanded capabilities and services across our U.S. business. “We continue to prepare for an IPO of the U.S. wealth management business and will submit a Form S-1 to the Securities and Exchange Commission this month,” Mr. MacAlpine said. CI also announced that it intends to delist its shares from the New York Stock Exchange at, or prior to, the IPO of the U.S. wealth management business such that it will trade exclusively on the Toronto Stock Exchange, while the U.S. business will trade exclusively on a U.S. exchange. The decision aligns the listings with the primary operational location of each business. Operating and financial data highlights [millions of dollars, except share amounts] As of and for the quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Total AUM and Client Assets: Asset Management AUM 114,196 116,065 136,271 144,247 139,380 Canada Wealth Management assets 73,976 74,128 78,957 80,633 76,859 U.S. Wealth Management assets 149,841 143,520 145,768 151,339 96,974 Total assets 338,014 333,712 360,996 376,219 313,213 Asset Management Net Inflows: Retail 640 (381 ) (861 ) 142 684 Institutional (21 ) (3,203 ) (264 ) (331 ) (126 ) Australia (377 ) (122 ) (305 ) 82 159 Closed Business (129 ) (160 ) (203 ) (195 ) (146 ) U.S. Asset Management (38 ) (195 ) 402 260 250 Total 75 (4,060 ) (1,231 ) (42 ) 821 IFRS Results Net income attributable to shareholders 14.9 156.2 138.1 123.7 43.8 Diluted earnings per share 0.08 0.81 0.70 0.62 0.22 Pretax income 37.8 219.0 185.8 175.1 82.4 Pretax margin 7.4 % 38.6 % 29.3 % 28.3 % 15.9 % Operating cash flow before the change in operating assets and liabilities 64.8 141.2 207.7 179.2 135.2 Adjusted Results Adjusted net income 135.9 149.1 166.8 171.0 159.2 Adjusted diluted earnings per share 0.73 0.78 0.85 0.86 0.79 Adjusted EBITDA 237.5 251.0 272.9 277.2 258.1 Adjusted EBITDA margin 43.0 % 44.5 % 46.5 % 47.7 % 47.0 % Free cash flow 151.5 176.4 201.6 187.1 180.9 Average shares outstanding 185,601,752 191,151,896 196,111,771 196,816,227 199,321,002 Ending shares outstanding 183,526,499 189,037,762 192,987,082 197,422,270 197,443,135 Total debt 3,949 3,688 3,530 3,776 3,408 Net debt 3,730 3,538 3,352 3,453 2,655 Net debt to adjusted EBITDA 4.0 3.5 3.0 3.1 2.6 Free cash flow, net debt, adjusted net income, adjusted earnings per share and adjusted EBITDA are not standardized earnings measures prescribed by IFRS. For further information, see “Non-IFRS Measures” note below. Financial highlights Net income declined to $14.9 million in the quarter from $156.2 million in the second quarter. Excluding non-operating items, adjusted net income declined to $135.9 million in the quarter from $149.1 million in the second quarter of 2022 due to lower revenues as a result of the decline in global financial asset values. Third quarter total net revenues declined 9.4% to $513.6 million in the quarter from $566.7 million in the second quarter of 2022. Excluding non-operating items, adjusted total net revenue fell 1.8% to $587.5 million, primarily driven by lower revenues from the Asset Management segment due to lower average AUM. Third quarter total expenses increased 36.9% to $475.8 million in the quarter from $347.7 million in the second quarter of 2022. Excluding non-operating items, adjusted total expenses were up 0.6% to $388.2 million, reflecting disciplined cost controls in a challenging operating environment, offset by the full quarter impact of acquisitions that closed during the second quarter. Capital allocation In the third quarter of 2022, CI repurchased 5.6 million shares at a cost of $79.8 million, for an average cost of $14.21 per share, and paid $34.6 million in dividends at a rate of $0.18 per share. The Board of Directors declared a quarterly dividend of $0.18 per share, payable on April 14, 2023 to shareholders of record on March 31, 2023. The annual dividend rate of $0.72 per share represented a yield of 5.3% on CI’s closing share price of $13.55 on November 9, 2022. Third quarter business highlights CI entered into a long-term strategic partnership with CGI, one of the world’s largest business and IT consulting firms, under which CGI will transform CI’s Canadian investment fund transfer agency operations into an industry-leading platform with enhanced capabilities. Under the agreement, CGI has assumed responsibility for managing CI’s proprietary transfer agency platform and related technology, operations and client services functions. As part of the partnership, CGI retained members of CI’s IT, operations and client services groups, who continue to support CI’s business at CGI. Reflecting CI’s strategic priority of modernizing its asset management business, CI Global Asset Management (“CI GAM”) continued its active pace of product innovation and development. CI GAM launched four new mandates during the third quarter focused on areas with high growth potential, including real assets, alternatives, and ESG. The new mandates were CI Auspice Broad Commodity ETF, CI Alternative Multi-Strategy Fund, CI Global Sustainable Infrastructure Fund and CI Global Green Bond Fund, with the latter two offered in both mutual fund and ETF series. Following quarter-end: CI completed the acquisitions of two registered investment advisor (“RIA”) firms in October, adding a combined total of approximately $17.9 billion in assets to CI Private Wealth US and increasing CI’s total U.S. wealth management assets to approximately $167.8 billion. They included: The Boston-based team and assets of Eaton Vance WaterOak Advisors (formerly Eaton Vance Investment Counsel). The team, which has been named CI Eaton Private Wealth, oversees $13.2 billion in client assets, primarily focused on serving ultra-high-net-worth families in New England with comprehensive wealth planning and investment management services. Inverness Counsel, LLC, a New York City-based RIA managing $4.8 billion and specializing in holistic financial and estate planning and investment advisory for a client base comprised of ultra-high-net-worth families. The firm has been rebranded CI Inverness Private Wealth. Leonard “Lennie” Gullan joined CI Private Wealth US as Executive Vice President and Chief Operating Officer, effective October 1, 2022. In this role, Mr. Gullan oversees the U.S. business’s daily operations, trading and technology, and leads the firm’s initiatives to integrate and transform operations, platforms and technologies across the CIPW businesses. He also assists in developing the firm’s strategic direction and identifying and evaluating acquisition opportunities. Mr. Gullan joins CIPW from Citadel, where he was a Managing Director and held a variety of senior leadership positions, including COO of Global Equities, and Chief Technology Officer and COO of Core Engineering. Most recently, he was responsible for leading Citadel’s strategic and transformational objectives. Prior to Citadel, he worked at McKinsey & Company, where he consulted for asset and wealth managers on a variety of strategic and M&A related topics. He is a graduate of the University of North Carolina at Chapel Hill and holds an MBA from the University of Chicago Booth School of Business. Several CI financial advisors in the United States and Canada were recognized in prestigious industry rankings: Seven CIPW US advisory teams were named to the Barron’s 2022 list of Top 100 RIA Firms. They included: CI BDF Private Wealth, CI Eaton Private Wealth, Dowling & Yahnke Wealth Advisors, Gofen and Glossberg, RegentAtlantic, RGT Wealth Advisors, and CI Segall Bryant & Hamill Private Wealth. In addition, Daniel Roe of Budros Ruhlin Roe was named to the Barron’s list of Top 100 Independent Advisors. Three advisory teams were named to the 2022 Forbes/SHOOK list of Top RIAs: CI Barrett Private Wealth, CI BDF Private Wealth, and RGT Wealth Advisors. Two advisors with CI Assante Wealth Management were named to the Globe and Mail’s list of Canada’s Top Wealth Advisors for 2022, a ranking developed by SHOOK Research, LLC. The advisors are Peter Pomponio of Dorval, Quebec, and Rob McClelland of Thornhill, Ontario. On November 1, 2002, CI GAM introduced two new global fixed-income mandates, providing Canadian investors with additional options for income and diversification: CI Global Investment Grade ETF and CI Global Bond Currency Neutral Fund, available in both mutual fund and ETF series. Analysts’ conference call CI will hold a conference call with analysts today at 9:00 a.m. EST, led by Chief Executive Officer Kurt MacAlpine and Chief Financial Officer Amit Muni. A live webcast of the call and slide presentation can be accessed here, or through the Investor Relations section of CI’s website. Alternatively, investors may listen to the discussion through the following numbers (access code: 442598): Canada toll-free: 1-833-950-0062 United States toll-free: 1-844-200-6205 United States (New York local): 1-646-904-5544 All other locations: 1-929-526-1599. A recording of the webcast will be archived on CI’s Investor Relations site. About CI Financial CI Financial Corp. is a diversified global asset and wealth management company operating primarily in Canada, the United States and Australia. Founded in 1965, CI has developed world-class portfolio management talent, extensive capabilities in all aspects of wealth planning, and a comprehensive product suite. CI operates in three segments: Asset Management, which includes the operations of CI Global Asset Management and Australia-based GSFM Pty Ltd. Canadian Wealth Management, which includes the operations of CI Assante Wealth Management, Aligned Capital Partners, CI Private Wealth (Canada), Northwood Family Office, CI Direct Investing and CI Investment Services. U.S. Wealth Management, which includes CI Private Wealth US, a national network of best-in-class wealth management teams. CI is headquartered in Toronto and listed on the Toronto Stock Exchange (TSX: CIX) and the New York Stock Exchange (NYSE: CIXX). To learn more, visit CI’s website or LinkedIn page. Barron’s publishes the Top RIA Firms and Top 100 Independent Advisors rankings every year. Advisors who wish to be ranked fill out a 102-question survey about their practice. Barron’s applies its rankings formula to the data to generate a ranking. The formula features three major categories of calculations: (1) Assets (2) Revenue (3) Quality of practice. In each of those categories, Barron’s does multiple subcalculations. Barron’s also considers a wide range of qualitative factors, including the advisors’ experience, their advanced degrees and industry designations, the size, shape, and diversity of their teams, their charitable and philanthropic work and, of course, their compliance records. For more information, visit Barron’s. The Forbes ranking of America’s Top RIA Firms, developed by SHOOK Research, is based on an algorithm of qualitative criteria, mostly gained through telephone, virtual and in-person due diligence interviews, and quantitative data. The algorithm weighs factors like revenue trends, assets under management, compliance records, industry experience and those that encompass best practices and approach to working with clients. Portfolio performance is not a criterion due to varying client objectives and lack of audited data. Neither Forbes nor SHOOK receive a fee in exchange for rankings. A full description of SHOOK’s methodology is available here. The Globe and Mail’s ranking of Canada’s Top Wealth Advisors was developed by SHOOK Research. Advisors are ranked based on the results of data provided during the nomination and research periods. The algorithm is based on a methodology that includes qualitative elements such as in-person, virtual and telephone due-diligence meetings that measure best practices, plus a review of compliance records. It also includes quantitative measures, such as client retention, industry experience and growth rates. Investment performance is not a criterion because client objectives and risk tolerance vary, and advisors rarely have audited performance reports. Advisors are nominated by their firms. Firms do not have any influence or impact on if or where advisors are ranked in Canada’s Top Wealth Advisors program. Neither the Globe and Mail nor SHOOK Research receive compensation in exchange for placement on the ranking. This year’s nomination and research periods took place between February and July 2022. For more information, please see www.SHOOKresearch.com. SHOOK is a registered trademark of SHOOK Research, LLC. Commissions, trailing commissions, management fees and expenses all may be associated with an investment in mutual funds and exchange-traded funds (ETFs). Please read the prospectus before investing. Important information about mutual funds and ETFs is contained in their respective prospectus. Mutual funds and ETFs are not guaranteed; their values change frequently, and past performance may not be repeated. You will usually pay brokerage fees to your dealer if you purchase or sell units of an ETF on recognized Canadian exchanges. If the units are purchased or sold on these Canadian exchanges, investors may pay more than the current net asset value when buying units of the ETF and may receive less than the current net asset value when selling them. This press release contains forward-looking statements concerning anticipated future events, results, circumstances, performance or expectations with respect to CI Financial Corp. (“CI”) and its products and services, including its business operations, strategy and financial performance and condition and its intention to conduct an IPO of its US wealth management business. Forward-looking statements are typically identified by words such as “believe”, “expect”, “foresee”, “forecast”, “anticipate”, “intend”, “estimate”, “goal”, “plan” and “project” and similar references to future periods, or conditional verbs such as “will”, “may”, “should”, “could” or “would”. These statements are not historical facts but instead represent management beliefs regarding future events, many of which by their nature are inherently uncertain and beyond management’s control. Although management believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, such statements involve risks and uncertainties. The material factors and assumptions applied in reaching the conclusions contained in these forward-looking statements include that CI will proceed with the IPO, that all outstanding acquisitions will be completed and their asset levels will remain stable, that the investment fund industry will remain stable and that interest rates will remain relatively stable. Factors that could cause actual results to differ materially from expectations include, among other things, general economic and market conditions, including interest and foreign exchange rates, global financial markets, the risk that the IPO may not occur in its expected timeframe or at all, changes in government regulations or in tax laws, industry competition, technological developments and other factors described or discussed in CI’s disclosure materials filed with applicable securities regulatory authorities from time to time. The foregoing list is not exhaustive and the reader is cautioned to consider these and other factors carefully and not to place undue reliance on forward-looking statements. Other than as specifically required by applicable law, CI undertakes no obligation to update or alter any forward-looking statement after the date on which it is made, whether to reflect new information, future events or otherwise. This communication is provided as a general source of information and should not be considered personal, legal, accounting, tax or investment advice, or construed as an endorsement or recommendation of any entity or security discussed. Individuals should seek the advice of professionals, as appropriate, regarding any particular investment. Investors should consult their professional advisors prior to implementing any changes to their investment strategies. CI Global Asset Management is a registered business name of CI Investments Inc. CONSOLIDATED STATEMENT OF INCOME For the three-month period ended September 30 2022 2021 [in thousands of Canadian dollars, except per share amounts] $ $ REVENUE Canada asset management fees 386,734 460,928 Trailer fees and deferred sales commissions (119,229 ) (143,401 ) Net asset management fees 267,505 317,527 Canada wealth management fees 129,189 132,467 U.S. wealth management fees 164,071 108,100 Other revenues 26,649 11,158 Foreign exchange (losses) (73,897 ) (50,264 ) Other gains (losses) 102 (1,102 ) Total net revenues 513,619 517,886 EXPENSES Selling, general and administrative 245,574 201,897 Advisor and dealer fees 98,293 103,367 Interest and lease finance 38,575 31,604 Amortization and depreciation 12,975 10,341 Amortization of intangible assets from acquisitions 27,725 16,420 Transaction, integration, restructuring and legal settlements 13,089 3,937 Change in fair value of contingent consideration 22,466 61,423 Other 17,094 6,495 Total expenses 475,791 435,484 Income before income taxes 37,828 82,402 Provision for (recovery of) income taxes Current 47,882 47,039 Deferred (24,413 ) (10,072 ) 23,469 36,967 Net income (loss) for the period 14,359 45,435 Net income (loss) attributable to non-controlling interests (523 ) 1,601 Net income (loss) attributable to shareholders 14,882 43,834 Basic earnings per share attributable to shareholders $ 0.08 $ 0.22 Diluted earnings per share attributable to shareholders $ 0.08 $ 0.22 Other comprehensive income, net of tax Exchange differences on translation of foreign operations 60,858 34,463 Total other comprehensive income, net of tax 60,858 34,463 Comprehensive income for the period 75,217 79,898 Comprehensive income attributable to non-controlling interests 2,024 2,471 Comprehensive income attributable to shareholders 73,193 77,427 CONSOLIDATED BALANCE SHEET As at As at September 30, 2022 December 31, 2021 [in thousands of Canadian dollars] $ $ ASSETS Current Cash and cash equivalents 220,438 230,779 Client and trust funds on deposit 1,383,306 1,199,904 Investments 37,590 131,772 Accounts receivable and prepaid expenses 276,884 272,962 Income taxes receivable 25,994 3,607 Total current assets 1,944,212 1,839,024 Capital assets, net 56,747 52,596 Right-of-use assets 145,762 142,606 Intangibles 6,653,020 6,185,237 Deferred income taxes 67,713 56,901 Other assets 415,913 383,187 Total assets 9,283,367 8,659,551 LIABILITIES AND EQUITY Current Accounts payable and accrued liabilities 316,157 369,081 Current portion of provisions and other financial liabilities 384,389 572,432 Redeemable non-controlling interests 640,816 — Dividends payable 66,070 71,072 Client and trust funds payable 1,390,562 1,202,079 Income taxes payable 3,531 19,035 Current portion of long-term debt 400,513 444,486 Current portion of lease liabilities 21,929 20,216 Total current liabilities 3,223,967 2,698,401 Long-term debt 3,548,199 3,331,552 Provisions and other financial liabilities 185,066 379,641 Deferred income taxes 481,384 480,777 Lease liabilities 155,770 153,540 Total liabilities 7,594,386 7,043,911 Equity Share capital 1,692,395 1,810,153 Contributed surplus 39,510 28,368 Deficit (118,247 ) (226,715 ) Accumulated other comprehensive income (loss) 45,682 (23,289 ) Total equity attributable to the shareholders of the Company 1,659,340 1,588,517 Non-controlling interests 29,641 27,123 Total equity 1,688,981 1,615,640 Total liabilities and equity 9,283,367 8,659,551 STATEMENT OF CASH FLOWS For the three-month period ended September 30 2022 2021 [in thousands of Canadian dollars] $ $ OPERATING ACTIVITIES (*) Net income for the period 14,359 45,435 Add (deduct) items not involving cash Other losses (gains) (102 ) 931 Change in fair value of contingent consideration 22,466 61,423 Contingent consideration recorded as compensation 8 3,789 4,196 Recognition of vesting of redeemable non-controlling interests 907 — Equity-based compensation 7,142 6,484 Amortization and depreciation 12,975 10,341 Amortization of intangible assets from acquisitions 27,725 16,420 Deferred income taxes (24,413 ) (10,072 ) Cash provided by operating activities before net change in operating assets and liabilities 64,848 135,158 Net change in operating assets and liabilities 38,412 47,337 Cash provided by operating activities 103,260 182,495 INVESTING ACTIVITIES Purchase of investments (503 ) (3,589 ) Proceeds on sale of investments 903 1,215 Additions to capital assets (4,061 ) (1,123 ) Decrease (increase) in other assets 42,829 (2,402 ) Additions to intangibles (2,449 ) (3,888 ) Cash paid to settle acquisition liabilities (27,063 ) (43,628 ) Acquisitions, net of cash acquired — (134,375 ) Cash provided by (used in) investing activities 9,656 (187,790 ) FINANCING ACTIVITIES Issuance of long-term debt 75,000 — Repurchase of share capital (79,422 ) (99,100 ) Payment of lease liabilities (5,864 ) (6,040 ) Net distributions to non-controlling interest (2,444 ) (745 ) Dividends paid to shareholders (34,592 ) (36,239 ) Cash used in financing activities (47,322 ) (142,124 ) Net increase (decrease) in cash and cash equivalents during the period 65,594 (147,419 ) Cash and cash equivalents, beginning of period 154,844 801,338 Cash and cash equivalents, end of period 220,438 653,919 (*) Included in operating activities are the following: Interest paid 12,919 10,887 Income taxes paid 70,687 39,215 ASSETS UNDER MANAGEMENT AND NET FLOWS [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning AUM 116.1 136.3 144.2 139.4 138.2 Gross inflows 4.9 4.8 4.9 5.2 5.1 Gross outflows (4.8 ) (8.7 ) (6.6 ) (5.5 ) (4.5 ) Net inflows/(outflows) 0.1 (3.9 ) (1.6 ) (0.3 ) 0.6 Acquisitions — — — — — Market moves and FX (2.0 ) (16.3 ) (6.3 ) 5.2 0.6 Ending AUM 114.2 116.1 136.3 144.2 139.4 Proprietary AUM 30.4 30.8 34.5 36.2 34.7 Non-proprietary AUM 83.7 85.2 101.7 108.1 104.7 Average assets under management 119.1 125.4 138.2 143.0 141.1 Annualized organic growth 0.4 % (11.4 ) % (4.6 ) % (0.9 ) % 1.6 % Gross management fee/average AUM 1.30 % 1.31 % 1.30 % 1.30 % 1.31 % Net management fee/average AUM 0.88 % 0.89 % 0.88 % 0.88 % 0.88 % Net Inflows Retail 0.6 (0.4 ) (0.9 ) 0.1 0.7 Institutional — (3.2 ) (0.3 ) (0.3 ) (0.1 ) Closed business (0.1 ) (0.2 ) (0.2 ) (0.2 ) (0.1 ) Total Canada net inflows 0.5 (3.7 ) (1.3 ) (0.4 ) 0.4 Australia (0.4 ) (0.1 ) (0.3 ) 0.1 0.2 Total net inflows/(outflows) 0.1 (3.9 ) (1.6 ) (0.3 ) 0.6 RETAIL (ex Closed Business) [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning AUM 95.1 108.4 114.6 110.4 109.1 Net Flows 0.6 (0.4 ) (0.9 ) 0.1 0.7 Market Move / FX (1.7 ) (12.9 ) (5.3 ) 4.1 0.6 Acquisitions ___ ___ ___ ___ 0.2 Ending AUM 94.0 95.1 108.4 114.6 110.4 Average AUM 97.9 101.4 109.6 113.8 111.8 INSTITUTIONAL [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning AUM 8.4 12.7 13.3 13.0 13.0 Net Flows 0.0 (3.2 ) (0.3 ) 0.3 (0.1 ) Market Move / FX (0.1 ) (1.1 ) (0.3 ) 0.6 0.1 Acquisitions ___ ___ ___ ___ ___ Ending AUM 8.3 8.4 12.7 13.3 13.0 Average AUM 8.6 10.2 12.9 13.2 13.3 AUSTRALIA [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning AUM 5.1 6.6 7.3 7.0 6.9 Net Flows (0.4 ) (0.1 ) (0.3 ) 0.1 0.1 Market Move / FX 0.0 (1.4 ) (0.4 ) 0.2 0.0 Acquisitions ___ ___ ___ ___ ___ Ending AUM 4.7 5.1 6.6 7.3 7.0 Average AUM 4.9 5.8 7.0 7.1 7.0 CLOSED BUSINESS [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning AUM 7.5 8.6 9.1 9.0 9.1 Net Flows (0.1 ) (0.2 ) (0.2 ) (0.2 ) (0.2 ) Market Move / FX (0.1 ) (0.9 ) (0.3 ) 0.3 (0.0 ) Acquisitions ___ ___ ___ ___ ___ Ending AUM 7.3 7.5 8.6 9.1 8.9 Average AUM 7.6 8.0 8.7 9.0 9.0 AUM BY ASSET CLASS [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Balanced 49.8 50.9 59.4 62.1 60.3 Equity 40.2 41.4 49.3 52.3 50.1 Fixed income 11.2 11.7 13.1 14.2 14.1 Alternatives 3.8 3.6 4.9 5.7 5.0 Cash/Other 4.5 3.4 3.0 2.7 2.8 Total Canada asset management 109.5 111.0 129.7 137.0 132.4 Australia 4.7 5.1 6.6 7.3 7.0 Total asset management segment 114.2 116.1 136.3 144.2 139.4 CANADA WEALTH MANAGEMENT CLIENT ASSETS [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning client assets 74.1 79.0 80.6 76.9 75.5 Acquisitions — 2.4 — — — Net flows and market move (0.2 ) (7.2 ) (1.7 ) 3.8 1.3 Ending client assets 74.0 74.1 79.0 80.6 76.9 Average client assets 76.0 77.7 79.0 78.9 77.0 Wealth management fees/average client assets 0.90 % 0.91 % 0.95 % 0.93 % 0.94 % U.S. WEALTH MANAGEMENT CLIENT ASSETS [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning billable client assets 138.8 141.2 146.4 96.1 82.9 Acquisitions — 7.1 1.1 49.3 10.1 Net flows and market move 6.2 (9.5 ) (6.3 ) 1.0 3.1 Ending billable client assets 144.9 138.8 141.2 146.4 96.1 Non-billable client assets 4.9 4.8 4.6 4.9 0.9 Total client assets 149.8 143.5 145.8 151.3 97.0 Fees/beginning billable client assets 0.47 % 0.48 % 0.46 % 0.50 % 0.52 % NON-IFRS MEASURES In an effort to provide additional information regarding our results as determined by IFRS, we also disclose certain non-IFRS information which we believe provides useful and meaningful information. Our management reviews these non-IFRS financial measurements when evaluating our financial performance and results of operations; therefore, we believe it is useful to provide information with respect to these non-IFRS measurements so as to share this perspective of management. Non-IFRS measurements do not have any standardized meaning, do not replace nor are superior to IFRS financial measurements and may not be comparable to similar measures presented by other companies. The non-IFRS financial measurements include: Adjusted net income and adjusted basic and diluted earnings per share Adjusted EBITDA and adjusted EBITDA margin Free cash flow Net debt. These non-IFRS measurements exclude the following revenues and expenses which we believe allows investors a consistent way to analyze our financial performance, allows for better analysis of core operating income and business trends and permits comparisons of companies within the industry, normalizing for different financing methods and levels of taxation: gains or losses related to foreign currency fluctuations on our cash balances costs related to our acquisitions including: amortization of intangible assets change in fair value of contingent consideration related advisory fees contingent consideration classified as compensation per IFRS restructuring charges including organizational expenses for the establishment of CIPW legal provisions for a class action related to market timing certain gains or losses in assets and investments costs related to issuing or retiring debt obligations expenses associated with CIPW redeemable units. Further explanations of these Non-IFRS measures can be found in the “Non-IFRS Measures” section of Management’s Discussion and Analysis dated November 10, 2022 available on SEDAR at www.sedar.com or at www.cifinancial.com. ADJUSTED NET INCOME AND ADJUSTED EARNINGS PER SHARE [millions of dollars, except per share amounts] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Sep. 30, 2021 Net Income 14.4 158.3 45.4 Amortization of intangible assets from acquisitions 27.7 27.4 16.8 Change in fair value of contingent consideration 22.5 (75.0) 61.4 Contingent consideration recorded as compensation 3.8 0.7 4.2 Non-controlling interest reclassification 1.0 0.9 — CIPW adjustments 11.5 3.1 — FX (gains)/losses 73.9 32.9 50.3 Transaction, integration, restructuring and legal 13.1 4.6 3.9 Other (gains)/losses — (1.2) — Trading and bad debt 8.0 — — Total adjustments1 161.5 (6.7) 136.6 Tax effect of adjustments (27.8) 5.6 (21.2) Less: Non-controlling interest 12.1 8.1 1.6 Adjusted net income 135.9 149.1 159.2 Adjusted earnings per share 0.73 0.78 0.80 Adjusted diluted earnings per share 0.73 0.78 0.79 1. Adjustment effects on income statement line items: bond redemption costs are included in other expense, CIPW adjustments and contingent consideration recorded as compensation are included in SG&A, amortization of intangible assets from acquisitions, change in fair value of contingent consideration, FX (gains)/losses, other (gains)/losses, and bond redemption costs are included in the line items of the same description. EBITDA, ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN [millions of dollars, except per share amounts] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Sep. 30, 2021 Pretax income 37.8 219.0 82.4 Amortization of intangible assets from acquisitions 27.7 27.4 16.9 Depreciation and other amortization 13.0 11.9 10.3 Interest and lease finance expense 38.6 36.2 31.6 EBITDA 117.1 294.6 141.3 Change in fair value of contingent consideration 22.5 (75.0 ) 61.4 Contingent consideration recorded as compensation 3.8 0.7 4.2 Non-controlling interest reclassification 1.0 0.9 — CIPW adjustments 11.5 3.1 — FX (gains)/losses 73.9 32.9 50.3 Transaction, integration, restructuring and legal 13.1 4.6 3.9 Other (gains)/losses — (1.2 ) — Trading and bad debt 8.0 — — Total adjustments 133.8 (34.1 ) 119.8 Non-controlling interest 13.4 9.5 3.0 Adjusted EBITDA 237.5 251.0 258.1 Reported net revenue 513.6 566.7 517.9 Less: FX gains/(losses) (73.9 ) (32.9 ) (50.3 ) Less: Non-Operating Other gains/(losses) — 1.2 — Less: NCI revenues 35.1 34.8 19.4 Adjusted net revenue 552.4 563.5 548.7 Adjusted EBITDA margin 43.0 % 44.5 % 47.0 % FREE CASH FLOW [millions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Sep. 30, 2021 Cash provided by operating activities 103.3 164.1 182.5 Net change in operating assets and liabilities 38.4 22.9 47.3 Operating cash flow before the change in operating assets and liabilities 64.8 141.2 135.2 FX (gains)/losses 73.9 32.9 50.3 Transaction, integration, restructuring and legal 13.1 4.6 3.9 Trading and bad debt 8.0 — — Total adjustments 95.0 37.5 54.2 Tax effect (recovery) of adjustments (14.1 ) (5.7 ) (5.9 ) Less: Non-controlling interest (5.8 ) (3.4 ) 2.6 Free cash flow 151.5 176.4 180.9 NET DEBT Quarters ended [millions of dollars] Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Current portion of long-term debt 400.5 314.6 225.3 444.5 74.2 Long-term debt 3,548.2 3,373.5 3,304.7 3,331.6 3,334.2 3,948.7 3,688.1 3,530.0 3,776.0 3,408.4 Less: Cash and short-term investments 220.4 154.8 186.1 230.8 653.9 Marketable securities 17.8 18.1 20.3 116.9 122.5 Add: Regulatory capital and non-controlling interests 19.9 22.4 28.8 25.0 23.1 Net Debt 3,730.3 3,537.5 3,352.4 3,453.4 2,655.1 Adjusted EBITDA 237.5 251.0 272.9 277.2 258.1 Adjusted EBITDA, annualized 942.1 1,006.9 1,106.6 1,099.8 1,024.1 Gross leverage (Gross debt/Annualized adjusted EBITDA) 4.2 3.7 3.2 3.4 3.3 Net leverage (Net debt/Annualized adjusted EBITDA) 4.0 3.5 3.0 3.1 2.6 SUMMARY OF QUARTERLY RESULTS [millions of dollars, except per share amounts] IFRS Results Adjusted Results For the quarters ended For the quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Revenues Asset management fees 386.7 404.3 437.6 464.9 460.9 386.7 404.3 437.6 464.9 460.9 Trailer fees and deferred sales commissions (119.2 ) (124.0 ) (135.3 ) (143.6 ) (143.4 ) (119.2 ) (124.0 ) (135.3 ) (143.6 ) (143.4 ) Net asset management fees 267.5 280.3 302.3 321.3 317.5 267.5 280.3 302.3 321.3 317.5 Canada wealth management fees 129.2 130.1 138.2 134.9 132.5 129.2 130.1 138.2 134.9 132.5 U.S. wealth management fees 164.1 168.9 164.5 120.9 108.1 164.1 168.9 164.5 120.9 108.1 Other revenues 26.6 21.2 21.6 27.3 11.2 26.6 21.2 21.6 27.3 11.2 FX gains/(losses) (73.9 ) (32.9 ) 11.5 3.1 (50.3 ) — — — — — Other gains/(losses) 0.1 (1.1 ) (4.4 ) 11.9 (1.1 ) 0.1 (2.3 ) (4.4 ) (4.9 ) (1.1 ) Total net revenues 513.6 566.7 633.8 619.3 517.9 587.5 598.3 622.3 599.4 568.2 Expenses Selling, general & administrative 245.6 238.0 259.3 214.6 201.9 230.3 234.2 227.9 212.5 197.7 Advisor and dealer fees 98.3 99.7 106.9 104.8 103.4 98.3 99.7 106.9 104.8 103.4 Other 17.1 4.7 3.6 5.7 6.5 8.1 3.8 2.7 5.7 6.5 Interest and lease finance expense 38.6 36.2 35.9 32.5 31.6 38.6 36.2 35.9 32.5 31.6 Depreciation and other amortization 13.0 11.9 11.4 10.9 10.3 13.0 11.9 11.4 10.4 10.0 Amortization of intangible assets from acquisitions 27.7 27.4 24.1 18.2 16.4 — — — — — Transaction, integration, restructuring and legal 13.1 4.6 3.8 13.6 3.9 — — — — — Change in fair value of contingent consideration 22.5 (75.0 ) 3.1 43.9 61.4 — — — — — Total expenses 475.8 347.7 448.0 444.2 435.5 388.2 386.0 384.8 365.9 349.2 Pretax income 37.8 219.0 185.8 175.1 82.4 199.3 212.3 237.5 233.4 219.0 Income tax expense 23.5 60.7 48.3 51.3 37.0 51.3 55.1 59.7 62.5 58.1 Net income 14.4 158.3 137.5 123.7 45.4 148.1 157.2 177.8 171.0 160.9 Non-controlling interest (0.5 ) 2.1 (0.6 ) — 1.6 12.1 8.1 10.9 — 1.6 Net income attributable to shareholders 14.9 156.2 138.1 123.7 43.8 135.9 149.1 166.8 171.0 159.2 Basic earnings per share 0.08 0.82 0.70 0.63 0.22 0.73 0.78 0.85 0.87 0.80 Diluted earnings per share 0.08 0.81 0.70 0.62 0.22 0.73 0.78 0.85 0.86 0.79 RESULTS OF OPERATIONS - ASSET MANAGEMENT SEGMENT [millions of dollars, except per share amounts] IFRS Results Adjusted Results For the quarters ended For the quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Revenues Asset management fees 390.9 408.9 442.5 469.6 465.6 390.9 408.9 442.5 469.6 465.6 Trailer fees and deferred sales commissions (126.8 ) (131.9 ) (143.9 ) (152.6 ) (152.4 ) (126.8 ) (131.9 ) (143.9 ) (152.6 ) (152.4 ) Net asset management fees 264.1 277.0 298.6 316.9 313.2 264.1 277.0 298.6 316.9 313.2 Canada wealth management fees — — — — — — — — — — US wealth and asset management fees — — — — — — — — — — Other revenues 6.6 5.6 10.2 19.9 3.2 6.6 5.6 10.2 19.9 3.2 FX gains/(losses) (74.4 ) (32.8 ) 11.4 (1.4 ) (19.0 ) — — — — — Other gains/(losses) 0.1 (1.1 ) (4.4 ) 12.0 (1.1 ) 0.1 (2.3 ) (4.4 ) (4.8 ) (1.1 ) Total net revenues 196.4 248.7 315.8 347.5 296.3 270.7 280.2 304.4 332.1 315.3 Expenses Selling, general & administrative 98.7 97.3 96.8 108.7 109.6 98.7 97.3 96.8 108.7 109.6 Advisor and dealer fees — — — — — — — — — — Other 7.2 — — (0.5 ) 1.6 — — — (0.5 ) 1.6 Interest and lease finance expense 1.0 1.0 1.0 0.5 0.5 1.0 1.0 1.0 0.5 0.5 Depreciation and other amortization 5.0 5.0 5.0 5.4 5.5 5.0 5.0 5.0 5.4 5.5 Amortization of intangible assets from acquisitions 0.6 0.6 0.6 0.6 0.6 — — — — — Transaction, integration, restructuring and legal 2.6 2.3 (0.9 ) 10.4 0.4 — — — — — Change in fair value of contingent consideration 3.2 (3.9 ) 4.0 14.2 1.9 — — — — — Total expenses 118.2 102.3 106.5 139.3 120.2 104.6 103.3 102.8 114.1 117.2 Pretax income 78.2 146.4 209.3 208.1 176.1 166.1 176.9 201.6 218.0 198.1 Non-IFRS adjustments Pretax income 78.2 146.4 209.3 208.1 176.1 166.1 176.9 201.6 218.0 198.1 Amortization of intangible assets from acquisitions 0.6 0.6 0.6 0.6 0.6 — — — — — Depreciation and other amortization 5.0 5.0 5.0 5.4 5.5 5.0 5.0 5.0 5.4 5.5 Interest and lease finance expense 1.0 1.0 1.0 0.5 0.5 1.0 1.0 1.0 0.5 0.5 EBITDA 84.7 153.0 215.9 214.7 182.7 172.1 183.0 207.6 223.9 204.1 Change in fair value of contingent consideration 3.2 (3.9 ) 4.0 14.2 1.9 — — — — — FX (gains)/losses 74.4 32.8 (11.4 ) 1.4 19.0 — — — — — Transaction, integration, restructuring and legal 2.6 2.3 (0.9 ) 10.4 0.4 — — — — — Other (gains)/losses — (1.2 ) — (16.8 ) — — — — — — Total adjustments 87.3 30.0 (8.3 ) 9.2 21.4 — — — — — Less: Non-controlling interest 0.1 0.3 0.4 0.1 0.5 0.1 0.3 0.4 0.1 0.5 Adjusted EBITDA 172.0 182.7 207.2 223.8 203.6 172.0 182.7 207.2 223.8 203.6 RESULTS OF OPERATIONS - CANADA WEALTH MANAGEMENT SEGMENT [millions of dollars, except per share amounts] IFRS Results Adjusted Results For the quarters ended For the quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Revenues Canada wealth management fees 171.7 175.6 185.7 184.3 181.7 171.7 175.6 185.7 184.3 181.7 Other revenues 25.5 21.3 17.1 16.0 14.8 25.5 21.3 17.1 16.0 14.8 FX gains/(losses) 0.5 — 0.1 0.8 0.7 — — — — — Other gains/(losses) — — — (0.1 ) — — — — (0.1 ) — Total net revenues 197.7 196.9 202.9 201.1 197.2 197.2 196.9 202.8 200.3 196.5 Expenses Selling, general & administrative 43.8 44.0 41.1 39.9 37.8 43.6 43.9 41.1 39.9 37.8 Advisor and dealer fees 132.4 135.9 145.6 145.2 143.5 132.4 135.9 145.6 145.2 143.5 Other 8.2 4.0 3.2 3.2 1.8 6.3 3.2 2.4 3.2 1.8 Interest and lease finance expense — (0.1 ) 0.2 0.2 0.2 — (0.1 ) 0.2 0.2 0.2 Depreciation and other amortization 3.2 2.8 2.5 2.3 2.4 3.2 2.8 2.5 2.3 2.4 Amortization of intangible assets from acquisitions 2.1 2.1 1.6 1.5 1.7 — — — — — Transaction, integration, restructuring and legal 0.3 0.4 0.8 0.1 0.1 — — — — — Change in fair value of contingent consideration (0.7 ) (0.6 ) — — — — — — — — Total expenses 189.3 188.5 195.0 192.6 187.5 185.6 185.6 191.7 191.0 185.7 Pretax income 8.4 8.4 7.9 8.5 9.7 11.6 11.4 11.1 9.3 10.8 Non-IFRS adjustments Pretax income 8.4 8.4 7.9 8.5 9.7 11.6 11.4 11.1 9.3 10.8 Amortization of intangible assets from acquisitions 2.1 2.1 1.6 1.6 1.8 — — — 0.1 0.1 Depreciation and other amortization 3.2 2.8 2.5 2.3 2.4 3.2 2.8 2.5 2.3 2.4 Interest and lease finance expense — (0.1 ) 0.2 0.2 0.2 — (0.1 ) 0.2 0.2 0.2 EBITDA 13.7 13.1 12.1 12.6 14.0 14.9 14.0 13.8 11.9 13.5 Change in fair value of contingent consideration (0.7 ) (0.6 ) — — — — — — — — Contingent consideration recorded as compensation (included in SG&A) 0.1 0.1 — — — — — — — — CIPW adjustments (included in SG&A) 0.1 0.1 — — — — — — — — FX (gains)/losses (0.5 ) — (0.1 ) (0.8 ) (0.7 ) — — — — — Transaction, integration, restructuring and legal 0.3 0.4 0.8 0.1 0.1 — — — — — NCI reclassification (included in Other) 1.0 0.9 0.9 — — — — — — — Total adjustments 1.2 0.8 1.6 (0.7 ) (0.6 ) — — — — — Less: Non-controlling interest 1.2 1.0 0.9 (1.5 ) 0.7 1.2 1.0 0.9 (1.5 ) 0.7 Adjusted EBITDA 13.7 13.0 12.9 13.5 12.8 13.7 13.0 12.9 13.5 12.8 RESULTS OF OPERATIONS - U.S. WEALTH MANAGEMENT SEGMENT [millions of dollars, except per share amounts] IFRS Results Adjusted Results For the quarters ended For the quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Revenues U.S. wealth management fees 164.1 168.9 164.5 120.9 108.1 164.1 168.9 164.5 120.9 108.1 Other revenues 4.2 4.5 4.8 1.3 2.6 4.2 4.5 4.8 1.3 2.6 FX gains/(losses) — — — 3.7 (31.9 ) — — — — — Total net revenues 168.2 173.4 169.2 125.9 78.8 168.3 173.5 169.2 122.2 110.7 Expenses Selling, general & administrative 117.7 112.8 136.9 80.8 68.8 102.6 109.2 105.5 78.7 64.6 Other 1.8 0.7 0.4 2.9 3.1 1.8 0.7 0.4 2.9 3.1 Interest and lease finance expense 0.7 0.6 0.5 0.4 0.4 0.7 0.6 0.5 0.4 0.4 Depreciation and other amortization 4.8 4.1 3.9 3.1 2.5 4.8 4.1 3.9 3.1 2.5 Amortization of intangible assets from acquisitions 25.0 24.7 21.9 16.1 14.1 — — — — — Transaction, integration, restructuring and legal 10.2 2.0 3.9 3.1 3.4 — — — — — Change in fair value of contingent consideration 20.0 (70.5 ) (0.9 ) 29.7 59.5 — — — — — Total expenses 180.1 74.4 166.5 136.1 151.7 109.8 114.6 110.3 85.2 70.5 Pretax income (11.9 ) 99.0 2.7 (10.2 ) (72.9 ) 58.4 58.9 59.0 37.0 40.2 Non-IFRS adjustments Pretax income (11.9 ) 99.0 2.7 (10.2 ) (72.9 ) 58.4 58.9 59.0 37.0 40.2 Amortization of intangible assets from acquisitions 25.0 24.7 21.9 16.5 14.4 — — — 0.5 0.3 Depreciation and other amortization 4.8 4.1 3.9 3.1 2.5 4.8 4.1 3.9 3.1 2.5 Interest and lease finance expense 0.7 0.6 0.5 0.4 0.4 0.7 0.6 0.5 0.4 0.4 EBITDA 18.6 128.4 29.1 9.9 (55.6 ) 63.9 63.5 63.4 41.0 43.4 Change in fair value of contingent consideration 20.0 (70.5 ) (0.9 ) 29.7 59.5 — — — — — Contingent consideration recorded as compensation (included in SG&A) 3.7 0.6 18.2 2.1 4.2 — — — — — CIPW adjustments (included in SG&A) 11.4 3.0 13.2 — — — — — — — FX (gains)/losses — — — (3.7 ) 31.9 — — — — — Transaction, integration, restructuring and legal 10.2 2.0 3.9 3.1 3.4 — — — — — Total adjustments 45.3 (64.9 ) 34.3 31.1 99.0 — — — — — Less: Non-controlling interest 12.1 8.2 10.9 1.0 1.7 12.1 8.2 10.9 1.0 1.7 Adjusted EBITDA 51.8 55.4 52.5 40.0 41.7 51.8 55.4 52.5 40.0 41.7 View source version on businesswire.com: https://www.businesswire.com/news/home/20221110005506/en/Contacts Investor Relations Jason Weyeneth, CFA Vice-President, Investor Relations & Strategy 416-681-8779 jweyeneth@ci.com Media Canada Murray Oxby Vice-President, Communications 416-681-3254 moxby@ci.com United States Jimmy Moock Managing Partner, StreetCred 610-304-4570 jimmy@streetcredpr.com ci@streetcredpr.com Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. 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CI Financial Reports Financial Results for the Third Quarter of 2022 By: CI Financial Corp. via Business Wire November 10, 2022 at 07:00 AM EST Diluted EPS of $0.08, adjusted EPS1 of $0.73 EBITDA of $117.1 million, adjusted EBITDA1 of $237.5 million Operating cash flow of $64.8 million, free cash flow1 of $151.5 million Total assets of $338.0 billion, up 1.3% over Q2 and up 7.9% year-over-year Repurchased 5.6 million shares for $79.8 million Paid quarterly dividend of $0.18 a share, totalling $34.6 million Acquired two RIAs in October, adding $17.9 billion in assets and increasing U.S. wealth management assets to approximately $167.8 billion All financial amounts in Canadian dollars at September 30, 2022, unless stated otherwise. Financial amounts for the quarter are unaudited. CI Financial Corp. (“CI”) (TSX: CIX, NYSE: CIXX) today released financial results for the quarter ended September 30, 2022. “CI continues to produce exceptional results in the face of difficult and turbulent market conditions,” said Kurt MacAlpine, CI Chief Executive Officer. “This performance is a result of CI’s transformation over the last three years into a larger, more diversified firm with more resilient and stable revenues and earnings power. At the same time, we continue to be disciplined in managing expenses, with comparable selling, general and administrative expenses declining from the previous quarter despite heightened inflationary pressures. “In asset management, CI’s Canadian retail businesses had net sales of $0.6 billion – an impressive achievement given the challenging markets,” Mr. MacAlpine said. “This compares to net redemptions of $11.8 billion for the overall Canadian investment fund industry. “This strength stems from the meaningful changes we have made to our asset management business, including transitioning from a legacy multi-boutique investment team model to a single, fully integrated modern asset management platform, significantly improving relative investment performance, building a more robust and diverse product lineup, and changing our approach to distribution and marketing. “Our Canadian wealth management business continues to experience strong net flows, reflecting the quality of our advisory businesses and illustrating how investors seek out the most qualified and credible advisors during challenging market and economic environments,” Mr. MacAlpine said. “We have made a major investment in building out capacity at CI Investor Services and are on track to convert over $14 billion in client assets to the CIIS custody platform in the first half of next year, enhancing the service experience for our advisors and driving revenue growth at the firm. “The growth and development of CI Private Wealth US continues at a robust pace. We recently completed the acquisitions of two high-quality, established RIAs, adding a combined US$13.0 billion in assets to our firm and significantly expanding our presence in the ultra-high-net-worth market in the Northeast. CIPW has hired a highly experienced chief operating officer in Lennie Gullan, who will lead the development of a harmonized operating platform with expanded capabilities and services across our U.S. business. “We continue to prepare for an IPO of the U.S. wealth management business and will submit a Form S-1 to the Securities and Exchange Commission this month,” Mr. MacAlpine said. CI also announced that it intends to delist its shares from the New York Stock Exchange at, or prior to, the IPO of the U.S. wealth management business such that it will trade exclusively on the Toronto Stock Exchange, while the U.S. business will trade exclusively on a U.S. exchange. The decision aligns the listings with the primary operational location of each business. Operating and financial data highlights [millions of dollars, except share amounts] As of and for the quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Total AUM and Client Assets: Asset Management AUM 114,196 116,065 136,271 144,247 139,380 Canada Wealth Management assets 73,976 74,128 78,957 80,633 76,859 U.S. Wealth Management assets 149,841 143,520 145,768 151,339 96,974 Total assets 338,014 333,712 360,996 376,219 313,213 Asset Management Net Inflows: Retail 640 (381 ) (861 ) 142 684 Institutional (21 ) (3,203 ) (264 ) (331 ) (126 ) Australia (377 ) (122 ) (305 ) 82 159 Closed Business (129 ) (160 ) (203 ) (195 ) (146 ) U.S. Asset Management (38 ) (195 ) 402 260 250 Total 75 (4,060 ) (1,231 ) (42 ) 821 IFRS Results Net income attributable to shareholders 14.9 156.2 138.1 123.7 43.8 Diluted earnings per share 0.08 0.81 0.70 0.62 0.22 Pretax income 37.8 219.0 185.8 175.1 82.4 Pretax margin 7.4 % 38.6 % 29.3 % 28.3 % 15.9 % Operating cash flow before the change in operating assets and liabilities 64.8 141.2 207.7 179.2 135.2 Adjusted Results Adjusted net income 135.9 149.1 166.8 171.0 159.2 Adjusted diluted earnings per share 0.73 0.78 0.85 0.86 0.79 Adjusted EBITDA 237.5 251.0 272.9 277.2 258.1 Adjusted EBITDA margin 43.0 % 44.5 % 46.5 % 47.7 % 47.0 % Free cash flow 151.5 176.4 201.6 187.1 180.9 Average shares outstanding 185,601,752 191,151,896 196,111,771 196,816,227 199,321,002 Ending shares outstanding 183,526,499 189,037,762 192,987,082 197,422,270 197,443,135 Total debt 3,949 3,688 3,530 3,776 3,408 Net debt 3,730 3,538 3,352 3,453 2,655 Net debt to adjusted EBITDA 4.0 3.5 3.0 3.1 2.6 Free cash flow, net debt, adjusted net income, adjusted earnings per share and adjusted EBITDA are not standardized earnings measures prescribed by IFRS. For further information, see “Non-IFRS Measures” note below. Financial highlights Net income declined to $14.9 million in the quarter from $156.2 million in the second quarter. Excluding non-operating items, adjusted net income declined to $135.9 million in the quarter from $149.1 million in the second quarter of 2022 due to lower revenues as a result of the decline in global financial asset values. Third quarter total net revenues declined 9.4% to $513.6 million in the quarter from $566.7 million in the second quarter of 2022. Excluding non-operating items, adjusted total net revenue fell 1.8% to $587.5 million, primarily driven by lower revenues from the Asset Management segment due to lower average AUM. Third quarter total expenses increased 36.9% to $475.8 million in the quarter from $347.7 million in the second quarter of 2022. Excluding non-operating items, adjusted total expenses were up 0.6% to $388.2 million, reflecting disciplined cost controls in a challenging operating environment, offset by the full quarter impact of acquisitions that closed during the second quarter. Capital allocation In the third quarter of 2022, CI repurchased 5.6 million shares at a cost of $79.8 million, for an average cost of $14.21 per share, and paid $34.6 million in dividends at a rate of $0.18 per share. The Board of Directors declared a quarterly dividend of $0.18 per share, payable on April 14, 2023 to shareholders of record on March 31, 2023. The annual dividend rate of $0.72 per share represented a yield of 5.3% on CI’s closing share price of $13.55 on November 9, 2022. Third quarter business highlights CI entered into a long-term strategic partnership with CGI, one of the world’s largest business and IT consulting firms, under which CGI will transform CI’s Canadian investment fund transfer agency operations into an industry-leading platform with enhanced capabilities. Under the agreement, CGI has assumed responsibility for managing CI’s proprietary transfer agency platform and related technology, operations and client services functions. As part of the partnership, CGI retained members of CI’s IT, operations and client services groups, who continue to support CI’s business at CGI. Reflecting CI’s strategic priority of modernizing its asset management business, CI Global Asset Management (“CI GAM”) continued its active pace of product innovation and development. CI GAM launched four new mandates during the third quarter focused on areas with high growth potential, including real assets, alternatives, and ESG. The new mandates were CI Auspice Broad Commodity ETF, CI Alternative Multi-Strategy Fund, CI Global Sustainable Infrastructure Fund and CI Global Green Bond Fund, with the latter two offered in both mutual fund and ETF series. Following quarter-end: CI completed the acquisitions of two registered investment advisor (“RIA”) firms in October, adding a combined total of approximately $17.9 billion in assets to CI Private Wealth US and increasing CI’s total U.S. wealth management assets to approximately $167.8 billion. They included: The Boston-based team and assets of Eaton Vance WaterOak Advisors (formerly Eaton Vance Investment Counsel). The team, which has been named CI Eaton Private Wealth, oversees $13.2 billion in client assets, primarily focused on serving ultra-high-net-worth families in New England with comprehensive wealth planning and investment management services. Inverness Counsel, LLC, a New York City-based RIA managing $4.8 billion and specializing in holistic financial and estate planning and investment advisory for a client base comprised of ultra-high-net-worth families. The firm has been rebranded CI Inverness Private Wealth. Leonard “Lennie” Gullan joined CI Private Wealth US as Executive Vice President and Chief Operating Officer, effective October 1, 2022. In this role, Mr. Gullan oversees the U.S. business’s daily operations, trading and technology, and leads the firm’s initiatives to integrate and transform operations, platforms and technologies across the CIPW businesses. He also assists in developing the firm’s strategic direction and identifying and evaluating acquisition opportunities. Mr. Gullan joins CIPW from Citadel, where he was a Managing Director and held a variety of senior leadership positions, including COO of Global Equities, and Chief Technology Officer and COO of Core Engineering. Most recently, he was responsible for leading Citadel’s strategic and transformational objectives. Prior to Citadel, he worked at McKinsey & Company, where he consulted for asset and wealth managers on a variety of strategic and M&A related topics. He is a graduate of the University of North Carolina at Chapel Hill and holds an MBA from the University of Chicago Booth School of Business. Several CI financial advisors in the United States and Canada were recognized in prestigious industry rankings: Seven CIPW US advisory teams were named to the Barron’s 2022 list of Top 100 RIA Firms. They included: CI BDF Private Wealth, CI Eaton Private Wealth, Dowling & Yahnke Wealth Advisors, Gofen and Glossberg, RegentAtlantic, RGT Wealth Advisors, and CI Segall Bryant & Hamill Private Wealth. In addition, Daniel Roe of Budros Ruhlin Roe was named to the Barron’s list of Top 100 Independent Advisors. Three advisory teams were named to the 2022 Forbes/SHOOK list of Top RIAs: CI Barrett Private Wealth, CI BDF Private Wealth, and RGT Wealth Advisors. Two advisors with CI Assante Wealth Management were named to the Globe and Mail’s list of Canada’s Top Wealth Advisors for 2022, a ranking developed by SHOOK Research, LLC. The advisors are Peter Pomponio of Dorval, Quebec, and Rob McClelland of Thornhill, Ontario. On November 1, 2002, CI GAM introduced two new global fixed-income mandates, providing Canadian investors with additional options for income and diversification: CI Global Investment Grade ETF and CI Global Bond Currency Neutral Fund, available in both mutual fund and ETF series. Analysts’ conference call CI will hold a conference call with analysts today at 9:00 a.m. EST, led by Chief Executive Officer Kurt MacAlpine and Chief Financial Officer Amit Muni. A live webcast of the call and slide presentation can be accessed here, or through the Investor Relations section of CI’s website. Alternatively, investors may listen to the discussion through the following numbers (access code: 442598): Canada toll-free: 1-833-950-0062 United States toll-free: 1-844-200-6205 United States (New York local): 1-646-904-5544 All other locations: 1-929-526-1599. A recording of the webcast will be archived on CI’s Investor Relations site. About CI Financial CI Financial Corp. is a diversified global asset and wealth management company operating primarily in Canada, the United States and Australia. Founded in 1965, CI has developed world-class portfolio management talent, extensive capabilities in all aspects of wealth planning, and a comprehensive product suite. CI operates in three segments: Asset Management, which includes the operations of CI Global Asset Management and Australia-based GSFM Pty Ltd. Canadian Wealth Management, which includes the operations of CI Assante Wealth Management, Aligned Capital Partners, CI Private Wealth (Canada), Northwood Family Office, CI Direct Investing and CI Investment Services. U.S. Wealth Management, which includes CI Private Wealth US, a national network of best-in-class wealth management teams. CI is headquartered in Toronto and listed on the Toronto Stock Exchange (TSX: CIX) and the New York Stock Exchange (NYSE: CIXX). To learn more, visit CI’s website or LinkedIn page. Barron’s publishes the Top RIA Firms and Top 100 Independent Advisors rankings every year. Advisors who wish to be ranked fill out a 102-question survey about their practice. Barron’s applies its rankings formula to the data to generate a ranking. The formula features three major categories of calculations: (1) Assets (2) Revenue (3) Quality of practice. In each of those categories, Barron’s does multiple subcalculations. Barron’s also considers a wide range of qualitative factors, including the advisors’ experience, their advanced degrees and industry designations, the size, shape, and diversity of their teams, their charitable and philanthropic work and, of course, their compliance records. For more information, visit Barron’s. The Forbes ranking of America’s Top RIA Firms, developed by SHOOK Research, is based on an algorithm of qualitative criteria, mostly gained through telephone, virtual and in-person due diligence interviews, and quantitative data. The algorithm weighs factors like revenue trends, assets under management, compliance records, industry experience and those that encompass best practices and approach to working with clients. Portfolio performance is not a criterion due to varying client objectives and lack of audited data. Neither Forbes nor SHOOK receive a fee in exchange for rankings. A full description of SHOOK’s methodology is available here. The Globe and Mail’s ranking of Canada’s Top Wealth Advisors was developed by SHOOK Research. Advisors are ranked based on the results of data provided during the nomination and research periods. The algorithm is based on a methodology that includes qualitative elements such as in-person, virtual and telephone due-diligence meetings that measure best practices, plus a review of compliance records. It also includes quantitative measures, such as client retention, industry experience and growth rates. Investment performance is not a criterion because client objectives and risk tolerance vary, and advisors rarely have audited performance reports. Advisors are nominated by their firms. Firms do not have any influence or impact on if or where advisors are ranked in Canada’s Top Wealth Advisors program. Neither the Globe and Mail nor SHOOK Research receive compensation in exchange for placement on the ranking. This year’s nomination and research periods took place between February and July 2022. For more information, please see www.SHOOKresearch.com. SHOOK is a registered trademark of SHOOK Research, LLC. Commissions, trailing commissions, management fees and expenses all may be associated with an investment in mutual funds and exchange-traded funds (ETFs). Please read the prospectus before investing. Important information about mutual funds and ETFs is contained in their respective prospectus. Mutual funds and ETFs are not guaranteed; their values change frequently, and past performance may not be repeated. You will usually pay brokerage fees to your dealer if you purchase or sell units of an ETF on recognized Canadian exchanges. If the units are purchased or sold on these Canadian exchanges, investors may pay more than the current net asset value when buying units of the ETF and may receive less than the current net asset value when selling them. This press release contains forward-looking statements concerning anticipated future events, results, circumstances, performance or expectations with respect to CI Financial Corp. (“CI”) and its products and services, including its business operations, strategy and financial performance and condition and its intention to conduct an IPO of its US wealth management business. Forward-looking statements are typically identified by words such as “believe”, “expect”, “foresee”, “forecast”, “anticipate”, “intend”, “estimate”, “goal”, “plan” and “project” and similar references to future periods, or conditional verbs such as “will”, “may”, “should”, “could” or “would”. These statements are not historical facts but instead represent management beliefs regarding future events, many of which by their nature are inherently uncertain and beyond management’s control. Although management believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, such statements involve risks and uncertainties. The material factors and assumptions applied in reaching the conclusions contained in these forward-looking statements include that CI will proceed with the IPO, that all outstanding acquisitions will be completed and their asset levels will remain stable, that the investment fund industry will remain stable and that interest rates will remain relatively stable. Factors that could cause actual results to differ materially from expectations include, among other things, general economic and market conditions, including interest and foreign exchange rates, global financial markets, the risk that the IPO may not occur in its expected timeframe or at all, changes in government regulations or in tax laws, industry competition, technological developments and other factors described or discussed in CI’s disclosure materials filed with applicable securities regulatory authorities from time to time. The foregoing list is not exhaustive and the reader is cautioned to consider these and other factors carefully and not to place undue reliance on forward-looking statements. Other than as specifically required by applicable law, CI undertakes no obligation to update or alter any forward-looking statement after the date on which it is made, whether to reflect new information, future events or otherwise. This communication is provided as a general source of information and should not be considered personal, legal, accounting, tax or investment advice, or construed as an endorsement or recommendation of any entity or security discussed. Individuals should seek the advice of professionals, as appropriate, regarding any particular investment. Investors should consult their professional advisors prior to implementing any changes to their investment strategies. CI Global Asset Management is a registered business name of CI Investments Inc. CONSOLIDATED STATEMENT OF INCOME For the three-month period ended September 30 2022 2021 [in thousands of Canadian dollars, except per share amounts] $ $ REVENUE Canada asset management fees 386,734 460,928 Trailer fees and deferred sales commissions (119,229 ) (143,401 ) Net asset management fees 267,505 317,527 Canada wealth management fees 129,189 132,467 U.S. wealth management fees 164,071 108,100 Other revenues 26,649 11,158 Foreign exchange (losses) (73,897 ) (50,264 ) Other gains (losses) 102 (1,102 ) Total net revenues 513,619 517,886 EXPENSES Selling, general and administrative 245,574 201,897 Advisor and dealer fees 98,293 103,367 Interest and lease finance 38,575 31,604 Amortization and depreciation 12,975 10,341 Amortization of intangible assets from acquisitions 27,725 16,420 Transaction, integration, restructuring and legal settlements 13,089 3,937 Change in fair value of contingent consideration 22,466 61,423 Other 17,094 6,495 Total expenses 475,791 435,484 Income before income taxes 37,828 82,402 Provision for (recovery of) income taxes Current 47,882 47,039 Deferred (24,413 ) (10,072 ) 23,469 36,967 Net income (loss) for the period 14,359 45,435 Net income (loss) attributable to non-controlling interests (523 ) 1,601 Net income (loss) attributable to shareholders 14,882 43,834 Basic earnings per share attributable to shareholders $ 0.08 $ 0.22 Diluted earnings per share attributable to shareholders $ 0.08 $ 0.22 Other comprehensive income, net of tax Exchange differences on translation of foreign operations 60,858 34,463 Total other comprehensive income, net of tax 60,858 34,463 Comprehensive income for the period 75,217 79,898 Comprehensive income attributable to non-controlling interests 2,024 2,471 Comprehensive income attributable to shareholders 73,193 77,427 CONSOLIDATED BALANCE SHEET As at As at September 30, 2022 December 31, 2021 [in thousands of Canadian dollars] $ $ ASSETS Current Cash and cash equivalents 220,438 230,779 Client and trust funds on deposit 1,383,306 1,199,904 Investments 37,590 131,772 Accounts receivable and prepaid expenses 276,884 272,962 Income taxes receivable 25,994 3,607 Total current assets 1,944,212 1,839,024 Capital assets, net 56,747 52,596 Right-of-use assets 145,762 142,606 Intangibles 6,653,020 6,185,237 Deferred income taxes 67,713 56,901 Other assets 415,913 383,187 Total assets 9,283,367 8,659,551 LIABILITIES AND EQUITY Current Accounts payable and accrued liabilities 316,157 369,081 Current portion of provisions and other financial liabilities 384,389 572,432 Redeemable non-controlling interests 640,816 — Dividends payable 66,070 71,072 Client and trust funds payable 1,390,562 1,202,079 Income taxes payable 3,531 19,035 Current portion of long-term debt 400,513 444,486 Current portion of lease liabilities 21,929 20,216 Total current liabilities 3,223,967 2,698,401 Long-term debt 3,548,199 3,331,552 Provisions and other financial liabilities 185,066 379,641 Deferred income taxes 481,384 480,777 Lease liabilities 155,770 153,540 Total liabilities 7,594,386 7,043,911 Equity Share capital 1,692,395 1,810,153 Contributed surplus 39,510 28,368 Deficit (118,247 ) (226,715 ) Accumulated other comprehensive income (loss) 45,682 (23,289 ) Total equity attributable to the shareholders of the Company 1,659,340 1,588,517 Non-controlling interests 29,641 27,123 Total equity 1,688,981 1,615,640 Total liabilities and equity 9,283,367 8,659,551 STATEMENT OF CASH FLOWS For the three-month period ended September 30 2022 2021 [in thousands of Canadian dollars] $ $ OPERATING ACTIVITIES (*) Net income for the period 14,359 45,435 Add (deduct) items not involving cash Other losses (gains) (102 ) 931 Change in fair value of contingent consideration 22,466 61,423 Contingent consideration recorded as compensation 8 3,789 4,196 Recognition of vesting of redeemable non-controlling interests 907 — Equity-based compensation 7,142 6,484 Amortization and depreciation 12,975 10,341 Amortization of intangible assets from acquisitions 27,725 16,420 Deferred income taxes (24,413 ) (10,072 ) Cash provided by operating activities before net change in operating assets and liabilities 64,848 135,158 Net change in operating assets and liabilities 38,412 47,337 Cash provided by operating activities 103,260 182,495 INVESTING ACTIVITIES Purchase of investments (503 ) (3,589 ) Proceeds on sale of investments 903 1,215 Additions to capital assets (4,061 ) (1,123 ) Decrease (increase) in other assets 42,829 (2,402 ) Additions to intangibles (2,449 ) (3,888 ) Cash paid to settle acquisition liabilities (27,063 ) (43,628 ) Acquisitions, net of cash acquired — (134,375 ) Cash provided by (used in) investing activities 9,656 (187,790 ) FINANCING ACTIVITIES Issuance of long-term debt 75,000 — Repurchase of share capital (79,422 ) (99,100 ) Payment of lease liabilities (5,864 ) (6,040 ) Net distributions to non-controlling interest (2,444 ) (745 ) Dividends paid to shareholders (34,592 ) (36,239 ) Cash used in financing activities (47,322 ) (142,124 ) Net increase (decrease) in cash and cash equivalents during the period 65,594 (147,419 ) Cash and cash equivalents, beginning of period 154,844 801,338 Cash and cash equivalents, end of period 220,438 653,919 (*) Included in operating activities are the following: Interest paid 12,919 10,887 Income taxes paid 70,687 39,215 ASSETS UNDER MANAGEMENT AND NET FLOWS [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning AUM 116.1 136.3 144.2 139.4 138.2 Gross inflows 4.9 4.8 4.9 5.2 5.1 Gross outflows (4.8 ) (8.7 ) (6.6 ) (5.5 ) (4.5 ) Net inflows/(outflows) 0.1 (3.9 ) (1.6 ) (0.3 ) 0.6 Acquisitions — — — — — Market moves and FX (2.0 ) (16.3 ) (6.3 ) 5.2 0.6 Ending AUM 114.2 116.1 136.3 144.2 139.4 Proprietary AUM 30.4 30.8 34.5 36.2 34.7 Non-proprietary AUM 83.7 85.2 101.7 108.1 104.7 Average assets under management 119.1 125.4 138.2 143.0 141.1 Annualized organic growth 0.4 % (11.4 ) % (4.6 ) % (0.9 ) % 1.6 % Gross management fee/average AUM 1.30 % 1.31 % 1.30 % 1.30 % 1.31 % Net management fee/average AUM 0.88 % 0.89 % 0.88 % 0.88 % 0.88 % Net Inflows Retail 0.6 (0.4 ) (0.9 ) 0.1 0.7 Institutional — (3.2 ) (0.3 ) (0.3 ) (0.1 ) Closed business (0.1 ) (0.2 ) (0.2 ) (0.2 ) (0.1 ) Total Canada net inflows 0.5 (3.7 ) (1.3 ) (0.4 ) 0.4 Australia (0.4 ) (0.1 ) (0.3 ) 0.1 0.2 Total net inflows/(outflows) 0.1 (3.9 ) (1.6 ) (0.3 ) 0.6 RETAIL (ex Closed Business) [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning AUM 95.1 108.4 114.6 110.4 109.1 Net Flows 0.6 (0.4 ) (0.9 ) 0.1 0.7 Market Move / FX (1.7 ) (12.9 ) (5.3 ) 4.1 0.6 Acquisitions ___ ___ ___ ___ 0.2 Ending AUM 94.0 95.1 108.4 114.6 110.4 Average AUM 97.9 101.4 109.6 113.8 111.8 INSTITUTIONAL [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning AUM 8.4 12.7 13.3 13.0 13.0 Net Flows 0.0 (3.2 ) (0.3 ) 0.3 (0.1 ) Market Move / FX (0.1 ) (1.1 ) (0.3 ) 0.6 0.1 Acquisitions ___ ___ ___ ___ ___ Ending AUM 8.3 8.4 12.7 13.3 13.0 Average AUM 8.6 10.2 12.9 13.2 13.3 AUSTRALIA [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning AUM 5.1 6.6 7.3 7.0 6.9 Net Flows (0.4 ) (0.1 ) (0.3 ) 0.1 0.1 Market Move / FX 0.0 (1.4 ) (0.4 ) 0.2 0.0 Acquisitions ___ ___ ___ ___ ___ Ending AUM 4.7 5.1 6.6 7.3 7.0 Average AUM 4.9 5.8 7.0 7.1 7.0 CLOSED BUSINESS [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning AUM 7.5 8.6 9.1 9.0 9.1 Net Flows (0.1 ) (0.2 ) (0.2 ) (0.2 ) (0.2 ) Market Move / FX (0.1 ) (0.9 ) (0.3 ) 0.3 (0.0 ) Acquisitions ___ ___ ___ ___ ___ Ending AUM 7.3 7.5 8.6 9.1 8.9 Average AUM 7.6 8.0 8.7 9.0 9.0 AUM BY ASSET CLASS [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Balanced 49.8 50.9 59.4 62.1 60.3 Equity 40.2 41.4 49.3 52.3 50.1 Fixed income 11.2 11.7 13.1 14.2 14.1 Alternatives 3.8 3.6 4.9 5.7 5.0 Cash/Other 4.5 3.4 3.0 2.7 2.8 Total Canada asset management 109.5 111.0 129.7 137.0 132.4 Australia 4.7 5.1 6.6 7.3 7.0 Total asset management segment 114.2 116.1 136.3 144.2 139.4 CANADA WEALTH MANAGEMENT CLIENT ASSETS [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning client assets 74.1 79.0 80.6 76.9 75.5 Acquisitions — 2.4 — — — Net flows and market move (0.2 ) (7.2 ) (1.7 ) 3.8 1.3 Ending client assets 74.0 74.1 79.0 80.6 76.9 Average client assets 76.0 77.7 79.0 78.9 77.0 Wealth management fees/average client assets 0.90 % 0.91 % 0.95 % 0.93 % 0.94 % U.S. WEALTH MANAGEMENT CLIENT ASSETS [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning billable client assets 138.8 141.2 146.4 96.1 82.9 Acquisitions — 7.1 1.1 49.3 10.1 Net flows and market move 6.2 (9.5 ) (6.3 ) 1.0 3.1 Ending billable client assets 144.9 138.8 141.2 146.4 96.1 Non-billable client assets 4.9 4.8 4.6 4.9 0.9 Total client assets 149.8 143.5 145.8 151.3 97.0 Fees/beginning billable client assets 0.47 % 0.48 % 0.46 % 0.50 % 0.52 % NON-IFRS MEASURES In an effort to provide additional information regarding our results as determined by IFRS, we also disclose certain non-IFRS information which we believe provides useful and meaningful information. Our management reviews these non-IFRS financial measurements when evaluating our financial performance and results of operations; therefore, we believe it is useful to provide information with respect to these non-IFRS measurements so as to share this perspective of management. Non-IFRS measurements do not have any standardized meaning, do not replace nor are superior to IFRS financial measurements and may not be comparable to similar measures presented by other companies. The non-IFRS financial measurements include: Adjusted net income and adjusted basic and diluted earnings per share Adjusted EBITDA and adjusted EBITDA margin Free cash flow Net debt. These non-IFRS measurements exclude the following revenues and expenses which we believe allows investors a consistent way to analyze our financial performance, allows for better analysis of core operating income and business trends and permits comparisons of companies within the industry, normalizing for different financing methods and levels of taxation: gains or losses related to foreign currency fluctuations on our cash balances costs related to our acquisitions including: amortization of intangible assets change in fair value of contingent consideration related advisory fees contingent consideration classified as compensation per IFRS restructuring charges including organizational expenses for the establishment of CIPW legal provisions for a class action related to market timing certain gains or losses in assets and investments costs related to issuing or retiring debt obligations expenses associated with CIPW redeemable units. Further explanations of these Non-IFRS measures can be found in the “Non-IFRS Measures” section of Management’s Discussion and Analysis dated November 10, 2022 available on SEDAR at www.sedar.com or at www.cifinancial.com. ADJUSTED NET INCOME AND ADJUSTED EARNINGS PER SHARE [millions of dollars, except per share amounts] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Sep. 30, 2021 Net Income 14.4 158.3 45.4 Amortization of intangible assets from acquisitions 27.7 27.4 16.8 Change in fair value of contingent consideration 22.5 (75.0) 61.4 Contingent consideration recorded as compensation 3.8 0.7 4.2 Non-controlling interest reclassification 1.0 0.9 — CIPW adjustments 11.5 3.1 — FX (gains)/losses 73.9 32.9 50.3 Transaction, integration, restructuring and legal 13.1 4.6 3.9 Other (gains)/losses — (1.2) — Trading and bad debt 8.0 — — Total adjustments1 161.5 (6.7) 136.6 Tax effect of adjustments (27.8) 5.6 (21.2) Less: Non-controlling interest 12.1 8.1 1.6 Adjusted net income 135.9 149.1 159.2 Adjusted earnings per share 0.73 0.78 0.80 Adjusted diluted earnings per share 0.73 0.78 0.79 1. Adjustment effects on income statement line items: bond redemption costs are included in other expense, CIPW adjustments and contingent consideration recorded as compensation are included in SG&A, amortization of intangible assets from acquisitions, change in fair value of contingent consideration, FX (gains)/losses, other (gains)/losses, and bond redemption costs are included in the line items of the same description. EBITDA, ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN [millions of dollars, except per share amounts] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Sep. 30, 2021 Pretax income 37.8 219.0 82.4 Amortization of intangible assets from acquisitions 27.7 27.4 16.9 Depreciation and other amortization 13.0 11.9 10.3 Interest and lease finance expense 38.6 36.2 31.6 EBITDA 117.1 294.6 141.3 Change in fair value of contingent consideration 22.5 (75.0 ) 61.4 Contingent consideration recorded as compensation 3.8 0.7 4.2 Non-controlling interest reclassification 1.0 0.9 — CIPW adjustments 11.5 3.1 — FX (gains)/losses 73.9 32.9 50.3 Transaction, integration, restructuring and legal 13.1 4.6 3.9 Other (gains)/losses — (1.2 ) — Trading and bad debt 8.0 — — Total adjustments 133.8 (34.1 ) 119.8 Non-controlling interest 13.4 9.5 3.0 Adjusted EBITDA 237.5 251.0 258.1 Reported net revenue 513.6 566.7 517.9 Less: FX gains/(losses) (73.9 ) (32.9 ) (50.3 ) Less: Non-Operating Other gains/(losses) — 1.2 — Less: NCI revenues 35.1 34.8 19.4 Adjusted net revenue 552.4 563.5 548.7 Adjusted EBITDA margin 43.0 % 44.5 % 47.0 % FREE CASH FLOW [millions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Sep. 30, 2021 Cash provided by operating activities 103.3 164.1 182.5 Net change in operating assets and liabilities 38.4 22.9 47.3 Operating cash flow before the change in operating assets and liabilities 64.8 141.2 135.2 FX (gains)/losses 73.9 32.9 50.3 Transaction, integration, restructuring and legal 13.1 4.6 3.9 Trading and bad debt 8.0 — — Total adjustments 95.0 37.5 54.2 Tax effect (recovery) of adjustments (14.1 ) (5.7 ) (5.9 ) Less: Non-controlling interest (5.8 ) (3.4 ) 2.6 Free cash flow 151.5 176.4 180.9 NET DEBT Quarters ended [millions of dollars] Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Current portion of long-term debt 400.5 314.6 225.3 444.5 74.2 Long-term debt 3,548.2 3,373.5 3,304.7 3,331.6 3,334.2 3,948.7 3,688.1 3,530.0 3,776.0 3,408.4 Less: Cash and short-term investments 220.4 154.8 186.1 230.8 653.9 Marketable securities 17.8 18.1 20.3 116.9 122.5 Add: Regulatory capital and non-controlling interests 19.9 22.4 28.8 25.0 23.1 Net Debt 3,730.3 3,537.5 3,352.4 3,453.4 2,655.1 Adjusted EBITDA 237.5 251.0 272.9 277.2 258.1 Adjusted EBITDA, annualized 942.1 1,006.9 1,106.6 1,099.8 1,024.1 Gross leverage (Gross debt/Annualized adjusted EBITDA) 4.2 3.7 3.2 3.4 3.3 Net leverage (Net debt/Annualized adjusted EBITDA) 4.0 3.5 3.0 3.1 2.6 SUMMARY OF QUARTERLY RESULTS [millions of dollars, except per share amounts] IFRS Results Adjusted Results For the quarters ended For the quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Revenues Asset management fees 386.7 404.3 437.6 464.9 460.9 386.7 404.3 437.6 464.9 460.9 Trailer fees and deferred sales commissions (119.2 ) (124.0 ) (135.3 ) (143.6 ) (143.4 ) (119.2 ) (124.0 ) (135.3 ) (143.6 ) (143.4 ) Net asset management fees 267.5 280.3 302.3 321.3 317.5 267.5 280.3 302.3 321.3 317.5 Canada wealth management fees 129.2 130.1 138.2 134.9 132.5 129.2 130.1 138.2 134.9 132.5 U.S. wealth management fees 164.1 168.9 164.5 120.9 108.1 164.1 168.9 164.5 120.9 108.1 Other revenues 26.6 21.2 21.6 27.3 11.2 26.6 21.2 21.6 27.3 11.2 FX gains/(losses) (73.9 ) (32.9 ) 11.5 3.1 (50.3 ) — — — — — Other gains/(losses) 0.1 (1.1 ) (4.4 ) 11.9 (1.1 ) 0.1 (2.3 ) (4.4 ) (4.9 ) (1.1 ) Total net revenues 513.6 566.7 633.8 619.3 517.9 587.5 598.3 622.3 599.4 568.2 Expenses Selling, general & administrative 245.6 238.0 259.3 214.6 201.9 230.3 234.2 227.9 212.5 197.7 Advisor and dealer fees 98.3 99.7 106.9 104.8 103.4 98.3 99.7 106.9 104.8 103.4 Other 17.1 4.7 3.6 5.7 6.5 8.1 3.8 2.7 5.7 6.5 Interest and lease finance expense 38.6 36.2 35.9 32.5 31.6 38.6 36.2 35.9 32.5 31.6 Depreciation and other amortization 13.0 11.9 11.4 10.9 10.3 13.0 11.9 11.4 10.4 10.0 Amortization of intangible assets from acquisitions 27.7 27.4 24.1 18.2 16.4 — — — — — Transaction, integration, restructuring and legal 13.1 4.6 3.8 13.6 3.9 — — — — — Change in fair value of contingent consideration 22.5 (75.0 ) 3.1 43.9 61.4 — — — — — Total expenses 475.8 347.7 448.0 444.2 435.5 388.2 386.0 384.8 365.9 349.2 Pretax income 37.8 219.0 185.8 175.1 82.4 199.3 212.3 237.5 233.4 219.0 Income tax expense 23.5 60.7 48.3 51.3 37.0 51.3 55.1 59.7 62.5 58.1 Net income 14.4 158.3 137.5 123.7 45.4 148.1 157.2 177.8 171.0 160.9 Non-controlling interest (0.5 ) 2.1 (0.6 ) — 1.6 12.1 8.1 10.9 — 1.6 Net income attributable to shareholders 14.9 156.2 138.1 123.7 43.8 135.9 149.1 166.8 171.0 159.2 Basic earnings per share 0.08 0.82 0.70 0.63 0.22 0.73 0.78 0.85 0.87 0.80 Diluted earnings per share 0.08 0.81 0.70 0.62 0.22 0.73 0.78 0.85 0.86 0.79 RESULTS OF OPERATIONS - ASSET MANAGEMENT SEGMENT [millions of dollars, except per share amounts] IFRS Results Adjusted Results For the quarters ended For the quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Revenues Asset management fees 390.9 408.9 442.5 469.6 465.6 390.9 408.9 442.5 469.6 465.6 Trailer fees and deferred sales commissions (126.8 ) (131.9 ) (143.9 ) (152.6 ) (152.4 ) (126.8 ) (131.9 ) (143.9 ) (152.6 ) (152.4 ) Net asset management fees 264.1 277.0 298.6 316.9 313.2 264.1 277.0 298.6 316.9 313.2 Canada wealth management fees — — — — — — — — — — US wealth and asset management fees — — — — — — — — — — Other revenues 6.6 5.6 10.2 19.9 3.2 6.6 5.6 10.2 19.9 3.2 FX gains/(losses) (74.4 ) (32.8 ) 11.4 (1.4 ) (19.0 ) — — — — — Other gains/(losses) 0.1 (1.1 ) (4.4 ) 12.0 (1.1 ) 0.1 (2.3 ) (4.4 ) (4.8 ) (1.1 ) Total net revenues 196.4 248.7 315.8 347.5 296.3 270.7 280.2 304.4 332.1 315.3 Expenses Selling, general & administrative 98.7 97.3 96.8 108.7 109.6 98.7 97.3 96.8 108.7 109.6 Advisor and dealer fees — — — — — — — — — — Other 7.2 — — (0.5 ) 1.6 — — — (0.5 ) 1.6 Interest and lease finance expense 1.0 1.0 1.0 0.5 0.5 1.0 1.0 1.0 0.5 0.5 Depreciation and other amortization 5.0 5.0 5.0 5.4 5.5 5.0 5.0 5.0 5.4 5.5 Amortization of intangible assets from acquisitions 0.6 0.6 0.6 0.6 0.6 — — — — — Transaction, integration, restructuring and legal 2.6 2.3 (0.9 ) 10.4 0.4 — — — — — Change in fair value of contingent consideration 3.2 (3.9 ) 4.0 14.2 1.9 — — — — — Total expenses 118.2 102.3 106.5 139.3 120.2 104.6 103.3 102.8 114.1 117.2 Pretax income 78.2 146.4 209.3 208.1 176.1 166.1 176.9 201.6 218.0 198.1 Non-IFRS adjustments Pretax income 78.2 146.4 209.3 208.1 176.1 166.1 176.9 201.6 218.0 198.1 Amortization of intangible assets from acquisitions 0.6 0.6 0.6 0.6 0.6 — — — — — Depreciation and other amortization 5.0 5.0 5.0 5.4 5.5 5.0 5.0 5.0 5.4 5.5 Interest and lease finance expense 1.0 1.0 1.0 0.5 0.5 1.0 1.0 1.0 0.5 0.5 EBITDA 84.7 153.0 215.9 214.7 182.7 172.1 183.0 207.6 223.9 204.1 Change in fair value of contingent consideration 3.2 (3.9 ) 4.0 14.2 1.9 — — — — — FX (gains)/losses 74.4 32.8 (11.4 ) 1.4 19.0 — — — — — Transaction, integration, restructuring and legal 2.6 2.3 (0.9 ) 10.4 0.4 — — — — — Other (gains)/losses — (1.2 ) — (16.8 ) — — — — — — Total adjustments 87.3 30.0 (8.3 ) 9.2 21.4 — — — — — Less: Non-controlling interest 0.1 0.3 0.4 0.1 0.5 0.1 0.3 0.4 0.1 0.5 Adjusted EBITDA 172.0 182.7 207.2 223.8 203.6 172.0 182.7 207.2 223.8 203.6 RESULTS OF OPERATIONS - CANADA WEALTH MANAGEMENT SEGMENT [millions of dollars, except per share amounts] IFRS Results Adjusted Results For the quarters ended For the quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Revenues Canada wealth management fees 171.7 175.6 185.7 184.3 181.7 171.7 175.6 185.7 184.3 181.7 Other revenues 25.5 21.3 17.1 16.0 14.8 25.5 21.3 17.1 16.0 14.8 FX gains/(losses) 0.5 — 0.1 0.8 0.7 — — — — — Other gains/(losses) — — — (0.1 ) — — — — (0.1 ) — Total net revenues 197.7 196.9 202.9 201.1 197.2 197.2 196.9 202.8 200.3 196.5 Expenses Selling, general & administrative 43.8 44.0 41.1 39.9 37.8 43.6 43.9 41.1 39.9 37.8 Advisor and dealer fees 132.4 135.9 145.6 145.2 143.5 132.4 135.9 145.6 145.2 143.5 Other 8.2 4.0 3.2 3.2 1.8 6.3 3.2 2.4 3.2 1.8 Interest and lease finance expense — (0.1 ) 0.2 0.2 0.2 — (0.1 ) 0.2 0.2 0.2 Depreciation and other amortization 3.2 2.8 2.5 2.3 2.4 3.2 2.8 2.5 2.3 2.4 Amortization of intangible assets from acquisitions 2.1 2.1 1.6 1.5 1.7 — — — — — Transaction, integration, restructuring and legal 0.3 0.4 0.8 0.1 0.1 — — — — — Change in fair value of contingent consideration (0.7 ) (0.6 ) — — — — — — — — Total expenses 189.3 188.5 195.0 192.6 187.5 185.6 185.6 191.7 191.0 185.7 Pretax income 8.4 8.4 7.9 8.5 9.7 11.6 11.4 11.1 9.3 10.8 Non-IFRS adjustments Pretax income 8.4 8.4 7.9 8.5 9.7 11.6 11.4 11.1 9.3 10.8 Amortization of intangible assets from acquisitions 2.1 2.1 1.6 1.6 1.8 — — — 0.1 0.1 Depreciation and other amortization 3.2 2.8 2.5 2.3 2.4 3.2 2.8 2.5 2.3 2.4 Interest and lease finance expense — (0.1 ) 0.2 0.2 0.2 — (0.1 ) 0.2 0.2 0.2 EBITDA 13.7 13.1 12.1 12.6 14.0 14.9 14.0 13.8 11.9 13.5 Change in fair value of contingent consideration (0.7 ) (0.6 ) — — — — — — — — Contingent consideration recorded as compensation (included in SG&A) 0.1 0.1 — — — — — — — — CIPW adjustments (included in SG&A) 0.1 0.1 — — — — — — — — FX (gains)/losses (0.5 ) — (0.1 ) (0.8 ) (0.7 ) — — — — — Transaction, integration, restructuring and legal 0.3 0.4 0.8 0.1 0.1 — — — — — NCI reclassification (included in Other) 1.0 0.9 0.9 — — — — — — — Total adjustments 1.2 0.8 1.6 (0.7 ) (0.6 ) — — — — — Less: Non-controlling interest 1.2 1.0 0.9 (1.5 ) 0.7 1.2 1.0 0.9 (1.5 ) 0.7 Adjusted EBITDA 13.7 13.0 12.9 13.5 12.8 13.7 13.0 12.9 13.5 12.8 RESULTS OF OPERATIONS - U.S. WEALTH MANAGEMENT SEGMENT [millions of dollars, except per share amounts] IFRS Results Adjusted Results For the quarters ended For the quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Revenues U.S. wealth management fees 164.1 168.9 164.5 120.9 108.1 164.1 168.9 164.5 120.9 108.1 Other revenues 4.2 4.5 4.8 1.3 2.6 4.2 4.5 4.8 1.3 2.6 FX gains/(losses) — — — 3.7 (31.9 ) — — — — — Total net revenues 168.2 173.4 169.2 125.9 78.8 168.3 173.5 169.2 122.2 110.7 Expenses Selling, general & administrative 117.7 112.8 136.9 80.8 68.8 102.6 109.2 105.5 78.7 64.6 Other 1.8 0.7 0.4 2.9 3.1 1.8 0.7 0.4 2.9 3.1 Interest and lease finance expense 0.7 0.6 0.5 0.4 0.4 0.7 0.6 0.5 0.4 0.4 Depreciation and other amortization 4.8 4.1 3.9 3.1 2.5 4.8 4.1 3.9 3.1 2.5 Amortization of intangible assets from acquisitions 25.0 24.7 21.9 16.1 14.1 — — — — — Transaction, integration, restructuring and legal 10.2 2.0 3.9 3.1 3.4 — — — — — Change in fair value of contingent consideration 20.0 (70.5 ) (0.9 ) 29.7 59.5 — — — — — Total expenses 180.1 74.4 166.5 136.1 151.7 109.8 114.6 110.3 85.2 70.5 Pretax income (11.9 ) 99.0 2.7 (10.2 ) (72.9 ) 58.4 58.9 59.0 37.0 40.2 Non-IFRS adjustments Pretax income (11.9 ) 99.0 2.7 (10.2 ) (72.9 ) 58.4 58.9 59.0 37.0 40.2 Amortization of intangible assets from acquisitions 25.0 24.7 21.9 16.5 14.4 — — — 0.5 0.3 Depreciation and other amortization 4.8 4.1 3.9 3.1 2.5 4.8 4.1 3.9 3.1 2.5 Interest and lease finance expense 0.7 0.6 0.5 0.4 0.4 0.7 0.6 0.5 0.4 0.4 EBITDA 18.6 128.4 29.1 9.9 (55.6 ) 63.9 63.5 63.4 41.0 43.4 Change in fair value of contingent consideration 20.0 (70.5 ) (0.9 ) 29.7 59.5 — — — — — Contingent consideration recorded as compensation (included in SG&A) 3.7 0.6 18.2 2.1 4.2 — — — — — CIPW adjustments (included in SG&A) 11.4 3.0 13.2 — — — — — — — FX (gains)/losses — — — (3.7 ) 31.9 — — — — — Transaction, integration, restructuring and legal 10.2 2.0 3.9 3.1 3.4 — — — — — Total adjustments 45.3 (64.9 ) 34.3 31.1 99.0 — — — — — Less: Non-controlling interest 12.1 8.2 10.9 1.0 1.7 12.1 8.2 10.9 1.0 1.7 Adjusted EBITDA 51.8 55.4 52.5 40.0 41.7 51.8 55.4 52.5 40.0 41.7 View source version on businesswire.com: https://www.businesswire.com/news/home/20221110005506/en/Contacts Investor Relations Jason Weyeneth, CFA Vice-President, Investor Relations & Strategy 416-681-8779 jweyeneth@ci.com Media Canada Murray Oxby Vice-President, Communications 416-681-3254 moxby@ci.com United States Jimmy Moock Managing Partner, StreetCred 610-304-4570 jimmy@streetcredpr.com ci@streetcredpr.com
Diluted EPS of $0.08, adjusted EPS1 of $0.73 EBITDA of $117.1 million, adjusted EBITDA1 of $237.5 million Operating cash flow of $64.8 million, free cash flow1 of $151.5 million Total assets of $338.0 billion, up 1.3% over Q2 and up 7.9% year-over-year Repurchased 5.6 million shares for $79.8 million Paid quarterly dividend of $0.18 a share, totalling $34.6 million Acquired two RIAs in October, adding $17.9 billion in assets and increasing U.S. wealth management assets to approximately $167.8 billion All financial amounts in Canadian dollars at September 30, 2022, unless stated otherwise. Financial amounts for the quarter are unaudited.
CI Financial Corp. (“CI”) (TSX: CIX, NYSE: CIXX) today released financial results for the quarter ended September 30, 2022. “CI continues to produce exceptional results in the face of difficult and turbulent market conditions,” said Kurt MacAlpine, CI Chief Executive Officer. “This performance is a result of CI’s transformation over the last three years into a larger, more diversified firm with more resilient and stable revenues and earnings power. At the same time, we continue to be disciplined in managing expenses, with comparable selling, general and administrative expenses declining from the previous quarter despite heightened inflationary pressures. “In asset management, CI’s Canadian retail businesses had net sales of $0.6 billion – an impressive achievement given the challenging markets,” Mr. MacAlpine said. “This compares to net redemptions of $11.8 billion for the overall Canadian investment fund industry. “This strength stems from the meaningful changes we have made to our asset management business, including transitioning from a legacy multi-boutique investment team model to a single, fully integrated modern asset management platform, significantly improving relative investment performance, building a more robust and diverse product lineup, and changing our approach to distribution and marketing. “Our Canadian wealth management business continues to experience strong net flows, reflecting the quality of our advisory businesses and illustrating how investors seek out the most qualified and credible advisors during challenging market and economic environments,” Mr. MacAlpine said. “We have made a major investment in building out capacity at CI Investor Services and are on track to convert over $14 billion in client assets to the CIIS custody platform in the first half of next year, enhancing the service experience for our advisors and driving revenue growth at the firm. “The growth and development of CI Private Wealth US continues at a robust pace. We recently completed the acquisitions of two high-quality, established RIAs, adding a combined US$13.0 billion in assets to our firm and significantly expanding our presence in the ultra-high-net-worth market in the Northeast. CIPW has hired a highly experienced chief operating officer in Lennie Gullan, who will lead the development of a harmonized operating platform with expanded capabilities and services across our U.S. business. “We continue to prepare for an IPO of the U.S. wealth management business and will submit a Form S-1 to the Securities and Exchange Commission this month,” Mr. MacAlpine said. CI also announced that it intends to delist its shares from the New York Stock Exchange at, or prior to, the IPO of the U.S. wealth management business such that it will trade exclusively on the Toronto Stock Exchange, while the U.S. business will trade exclusively on a U.S. exchange. The decision aligns the listings with the primary operational location of each business. Operating and financial data highlights [millions of dollars, except share amounts] As of and for the quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Total AUM and Client Assets: Asset Management AUM 114,196 116,065 136,271 144,247 139,380 Canada Wealth Management assets 73,976 74,128 78,957 80,633 76,859 U.S. Wealth Management assets 149,841 143,520 145,768 151,339 96,974 Total assets 338,014 333,712 360,996 376,219 313,213 Asset Management Net Inflows: Retail 640 (381 ) (861 ) 142 684 Institutional (21 ) (3,203 ) (264 ) (331 ) (126 ) Australia (377 ) (122 ) (305 ) 82 159 Closed Business (129 ) (160 ) (203 ) (195 ) (146 ) U.S. Asset Management (38 ) (195 ) 402 260 250 Total 75 (4,060 ) (1,231 ) (42 ) 821 IFRS Results Net income attributable to shareholders 14.9 156.2 138.1 123.7 43.8 Diluted earnings per share 0.08 0.81 0.70 0.62 0.22 Pretax income 37.8 219.0 185.8 175.1 82.4 Pretax margin 7.4 % 38.6 % 29.3 % 28.3 % 15.9 % Operating cash flow before the change in operating assets and liabilities 64.8 141.2 207.7 179.2 135.2 Adjusted Results Adjusted net income 135.9 149.1 166.8 171.0 159.2 Adjusted diluted earnings per share 0.73 0.78 0.85 0.86 0.79 Adjusted EBITDA 237.5 251.0 272.9 277.2 258.1 Adjusted EBITDA margin 43.0 % 44.5 % 46.5 % 47.7 % 47.0 % Free cash flow 151.5 176.4 201.6 187.1 180.9 Average shares outstanding 185,601,752 191,151,896 196,111,771 196,816,227 199,321,002 Ending shares outstanding 183,526,499 189,037,762 192,987,082 197,422,270 197,443,135 Total debt 3,949 3,688 3,530 3,776 3,408 Net debt 3,730 3,538 3,352 3,453 2,655 Net debt to adjusted EBITDA 4.0 3.5 3.0 3.1 2.6 Free cash flow, net debt, adjusted net income, adjusted earnings per share and adjusted EBITDA are not standardized earnings measures prescribed by IFRS. For further information, see “Non-IFRS Measures” note below. Financial highlights Net income declined to $14.9 million in the quarter from $156.2 million in the second quarter. Excluding non-operating items, adjusted net income declined to $135.9 million in the quarter from $149.1 million in the second quarter of 2022 due to lower revenues as a result of the decline in global financial asset values. Third quarter total net revenues declined 9.4% to $513.6 million in the quarter from $566.7 million in the second quarter of 2022. Excluding non-operating items, adjusted total net revenue fell 1.8% to $587.5 million, primarily driven by lower revenues from the Asset Management segment due to lower average AUM. Third quarter total expenses increased 36.9% to $475.8 million in the quarter from $347.7 million in the second quarter of 2022. Excluding non-operating items, adjusted total expenses were up 0.6% to $388.2 million, reflecting disciplined cost controls in a challenging operating environment, offset by the full quarter impact of acquisitions that closed during the second quarter. Capital allocation In the third quarter of 2022, CI repurchased 5.6 million shares at a cost of $79.8 million, for an average cost of $14.21 per share, and paid $34.6 million in dividends at a rate of $0.18 per share. The Board of Directors declared a quarterly dividend of $0.18 per share, payable on April 14, 2023 to shareholders of record on March 31, 2023. The annual dividend rate of $0.72 per share represented a yield of 5.3% on CI’s closing share price of $13.55 on November 9, 2022. Third quarter business highlights CI entered into a long-term strategic partnership with CGI, one of the world’s largest business and IT consulting firms, under which CGI will transform CI’s Canadian investment fund transfer agency operations into an industry-leading platform with enhanced capabilities. Under the agreement, CGI has assumed responsibility for managing CI’s proprietary transfer agency platform and related technology, operations and client services functions. As part of the partnership, CGI retained members of CI’s IT, operations and client services groups, who continue to support CI’s business at CGI. Reflecting CI’s strategic priority of modernizing its asset management business, CI Global Asset Management (“CI GAM”) continued its active pace of product innovation and development. CI GAM launched four new mandates during the third quarter focused on areas with high growth potential, including real assets, alternatives, and ESG. The new mandates were CI Auspice Broad Commodity ETF, CI Alternative Multi-Strategy Fund, CI Global Sustainable Infrastructure Fund and CI Global Green Bond Fund, with the latter two offered in both mutual fund and ETF series. Following quarter-end: CI completed the acquisitions of two registered investment advisor (“RIA”) firms in October, adding a combined total of approximately $17.9 billion in assets to CI Private Wealth US and increasing CI’s total U.S. wealth management assets to approximately $167.8 billion. They included: The Boston-based team and assets of Eaton Vance WaterOak Advisors (formerly Eaton Vance Investment Counsel). The team, which has been named CI Eaton Private Wealth, oversees $13.2 billion in client assets, primarily focused on serving ultra-high-net-worth families in New England with comprehensive wealth planning and investment management services. Inverness Counsel, LLC, a New York City-based RIA managing $4.8 billion and specializing in holistic financial and estate planning and investment advisory for a client base comprised of ultra-high-net-worth families. The firm has been rebranded CI Inverness Private Wealth. Leonard “Lennie” Gullan joined CI Private Wealth US as Executive Vice President and Chief Operating Officer, effective October 1, 2022. In this role, Mr. Gullan oversees the U.S. business’s daily operations, trading and technology, and leads the firm’s initiatives to integrate and transform operations, platforms and technologies across the CIPW businesses. He also assists in developing the firm’s strategic direction and identifying and evaluating acquisition opportunities. Mr. Gullan joins CIPW from Citadel, where he was a Managing Director and held a variety of senior leadership positions, including COO of Global Equities, and Chief Technology Officer and COO of Core Engineering. Most recently, he was responsible for leading Citadel’s strategic and transformational objectives. Prior to Citadel, he worked at McKinsey & Company, where he consulted for asset and wealth managers on a variety of strategic and M&A related topics. He is a graduate of the University of North Carolina at Chapel Hill and holds an MBA from the University of Chicago Booth School of Business. Several CI financial advisors in the United States and Canada were recognized in prestigious industry rankings: Seven CIPW US advisory teams were named to the Barron’s 2022 list of Top 100 RIA Firms. They included: CI BDF Private Wealth, CI Eaton Private Wealth, Dowling & Yahnke Wealth Advisors, Gofen and Glossberg, RegentAtlantic, RGT Wealth Advisors, and CI Segall Bryant & Hamill Private Wealth. In addition, Daniel Roe of Budros Ruhlin Roe was named to the Barron’s list of Top 100 Independent Advisors. Three advisory teams were named to the 2022 Forbes/SHOOK list of Top RIAs: CI Barrett Private Wealth, CI BDF Private Wealth, and RGT Wealth Advisors. Two advisors with CI Assante Wealth Management were named to the Globe and Mail’s list of Canada’s Top Wealth Advisors for 2022, a ranking developed by SHOOK Research, LLC. The advisors are Peter Pomponio of Dorval, Quebec, and Rob McClelland of Thornhill, Ontario. On November 1, 2002, CI GAM introduced two new global fixed-income mandates, providing Canadian investors with additional options for income and diversification: CI Global Investment Grade ETF and CI Global Bond Currency Neutral Fund, available in both mutual fund and ETF series. Analysts’ conference call CI will hold a conference call with analysts today at 9:00 a.m. EST, led by Chief Executive Officer Kurt MacAlpine and Chief Financial Officer Amit Muni. A live webcast of the call and slide presentation can be accessed here, or through the Investor Relations section of CI’s website. Alternatively, investors may listen to the discussion through the following numbers (access code: 442598): Canada toll-free: 1-833-950-0062 United States toll-free: 1-844-200-6205 United States (New York local): 1-646-904-5544 All other locations: 1-929-526-1599. A recording of the webcast will be archived on CI’s Investor Relations site. About CI Financial CI Financial Corp. is a diversified global asset and wealth management company operating primarily in Canada, the United States and Australia. Founded in 1965, CI has developed world-class portfolio management talent, extensive capabilities in all aspects of wealth planning, and a comprehensive product suite. CI operates in three segments: Asset Management, which includes the operations of CI Global Asset Management and Australia-based GSFM Pty Ltd. Canadian Wealth Management, which includes the operations of CI Assante Wealth Management, Aligned Capital Partners, CI Private Wealth (Canada), Northwood Family Office, CI Direct Investing and CI Investment Services. U.S. Wealth Management, which includes CI Private Wealth US, a national network of best-in-class wealth management teams. CI is headquartered in Toronto and listed on the Toronto Stock Exchange (TSX: CIX) and the New York Stock Exchange (NYSE: CIXX). To learn more, visit CI’s website or LinkedIn page. Barron’s publishes the Top RIA Firms and Top 100 Independent Advisors rankings every year. Advisors who wish to be ranked fill out a 102-question survey about their practice. Barron’s applies its rankings formula to the data to generate a ranking. The formula features three major categories of calculations: (1) Assets (2) Revenue (3) Quality of practice. In each of those categories, Barron’s does multiple subcalculations. Barron’s also considers a wide range of qualitative factors, including the advisors’ experience, their advanced degrees and industry designations, the size, shape, and diversity of their teams, their charitable and philanthropic work and, of course, their compliance records. For more information, visit Barron’s. The Forbes ranking of America’s Top RIA Firms, developed by SHOOK Research, is based on an algorithm of qualitative criteria, mostly gained through telephone, virtual and in-person due diligence interviews, and quantitative data. The algorithm weighs factors like revenue trends, assets under management, compliance records, industry experience and those that encompass best practices and approach to working with clients. Portfolio performance is not a criterion due to varying client objectives and lack of audited data. Neither Forbes nor SHOOK receive a fee in exchange for rankings. A full description of SHOOK’s methodology is available here. The Globe and Mail’s ranking of Canada’s Top Wealth Advisors was developed by SHOOK Research. Advisors are ranked based on the results of data provided during the nomination and research periods. The algorithm is based on a methodology that includes qualitative elements such as in-person, virtual and telephone due-diligence meetings that measure best practices, plus a review of compliance records. It also includes quantitative measures, such as client retention, industry experience and growth rates. Investment performance is not a criterion because client objectives and risk tolerance vary, and advisors rarely have audited performance reports. Advisors are nominated by their firms. Firms do not have any influence or impact on if or where advisors are ranked in Canada’s Top Wealth Advisors program. Neither the Globe and Mail nor SHOOK Research receive compensation in exchange for placement on the ranking. This year’s nomination and research periods took place between February and July 2022. For more information, please see www.SHOOKresearch.com. SHOOK is a registered trademark of SHOOK Research, LLC. Commissions, trailing commissions, management fees and expenses all may be associated with an investment in mutual funds and exchange-traded funds (ETFs). Please read the prospectus before investing. Important information about mutual funds and ETFs is contained in their respective prospectus. Mutual funds and ETFs are not guaranteed; their values change frequently, and past performance may not be repeated. You will usually pay brokerage fees to your dealer if you purchase or sell units of an ETF on recognized Canadian exchanges. If the units are purchased or sold on these Canadian exchanges, investors may pay more than the current net asset value when buying units of the ETF and may receive less than the current net asset value when selling them. This press release contains forward-looking statements concerning anticipated future events, results, circumstances, performance or expectations with respect to CI Financial Corp. (“CI”) and its products and services, including its business operations, strategy and financial performance and condition and its intention to conduct an IPO of its US wealth management business. Forward-looking statements are typically identified by words such as “believe”, “expect”, “foresee”, “forecast”, “anticipate”, “intend”, “estimate”, “goal”, “plan” and “project” and similar references to future periods, or conditional verbs such as “will”, “may”, “should”, “could” or “would”. These statements are not historical facts but instead represent management beliefs regarding future events, many of which by their nature are inherently uncertain and beyond management’s control. Although management believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, such statements involve risks and uncertainties. The material factors and assumptions applied in reaching the conclusions contained in these forward-looking statements include that CI will proceed with the IPO, that all outstanding acquisitions will be completed and their asset levels will remain stable, that the investment fund industry will remain stable and that interest rates will remain relatively stable. Factors that could cause actual results to differ materially from expectations include, among other things, general economic and market conditions, including interest and foreign exchange rates, global financial markets, the risk that the IPO may not occur in its expected timeframe or at all, changes in government regulations or in tax laws, industry competition, technological developments and other factors described or discussed in CI’s disclosure materials filed with applicable securities regulatory authorities from time to time. The foregoing list is not exhaustive and the reader is cautioned to consider these and other factors carefully and not to place undue reliance on forward-looking statements. Other than as specifically required by applicable law, CI undertakes no obligation to update or alter any forward-looking statement after the date on which it is made, whether to reflect new information, future events or otherwise. This communication is provided as a general source of information and should not be considered personal, legal, accounting, tax or investment advice, or construed as an endorsement or recommendation of any entity or security discussed. Individuals should seek the advice of professionals, as appropriate, regarding any particular investment. Investors should consult their professional advisors prior to implementing any changes to their investment strategies. CI Global Asset Management is a registered business name of CI Investments Inc. CONSOLIDATED STATEMENT OF INCOME For the three-month period ended September 30 2022 2021 [in thousands of Canadian dollars, except per share amounts] $ $ REVENUE Canada asset management fees 386,734 460,928 Trailer fees and deferred sales commissions (119,229 ) (143,401 ) Net asset management fees 267,505 317,527 Canada wealth management fees 129,189 132,467 U.S. wealth management fees 164,071 108,100 Other revenues 26,649 11,158 Foreign exchange (losses) (73,897 ) (50,264 ) Other gains (losses) 102 (1,102 ) Total net revenues 513,619 517,886 EXPENSES Selling, general and administrative 245,574 201,897 Advisor and dealer fees 98,293 103,367 Interest and lease finance 38,575 31,604 Amortization and depreciation 12,975 10,341 Amortization of intangible assets from acquisitions 27,725 16,420 Transaction, integration, restructuring and legal settlements 13,089 3,937 Change in fair value of contingent consideration 22,466 61,423 Other 17,094 6,495 Total expenses 475,791 435,484 Income before income taxes 37,828 82,402 Provision for (recovery of) income taxes Current 47,882 47,039 Deferred (24,413 ) (10,072 ) 23,469 36,967 Net income (loss) for the period 14,359 45,435 Net income (loss) attributable to non-controlling interests (523 ) 1,601 Net income (loss) attributable to shareholders 14,882 43,834 Basic earnings per share attributable to shareholders $ 0.08 $ 0.22 Diluted earnings per share attributable to shareholders $ 0.08 $ 0.22 Other comprehensive income, net of tax Exchange differences on translation of foreign operations 60,858 34,463 Total other comprehensive income, net of tax 60,858 34,463 Comprehensive income for the period 75,217 79,898 Comprehensive income attributable to non-controlling interests 2,024 2,471 Comprehensive income attributable to shareholders 73,193 77,427 CONSOLIDATED BALANCE SHEET As at As at September 30, 2022 December 31, 2021 [in thousands of Canadian dollars] $ $ ASSETS Current Cash and cash equivalents 220,438 230,779 Client and trust funds on deposit 1,383,306 1,199,904 Investments 37,590 131,772 Accounts receivable and prepaid expenses 276,884 272,962 Income taxes receivable 25,994 3,607 Total current assets 1,944,212 1,839,024 Capital assets, net 56,747 52,596 Right-of-use assets 145,762 142,606 Intangibles 6,653,020 6,185,237 Deferred income taxes 67,713 56,901 Other assets 415,913 383,187 Total assets 9,283,367 8,659,551 LIABILITIES AND EQUITY Current Accounts payable and accrued liabilities 316,157 369,081 Current portion of provisions and other financial liabilities 384,389 572,432 Redeemable non-controlling interests 640,816 — Dividends payable 66,070 71,072 Client and trust funds payable 1,390,562 1,202,079 Income taxes payable 3,531 19,035 Current portion of long-term debt 400,513 444,486 Current portion of lease liabilities 21,929 20,216 Total current liabilities 3,223,967 2,698,401 Long-term debt 3,548,199 3,331,552 Provisions and other financial liabilities 185,066 379,641 Deferred income taxes 481,384 480,777 Lease liabilities 155,770 153,540 Total liabilities 7,594,386 7,043,911 Equity Share capital 1,692,395 1,810,153 Contributed surplus 39,510 28,368 Deficit (118,247 ) (226,715 ) Accumulated other comprehensive income (loss) 45,682 (23,289 ) Total equity attributable to the shareholders of the Company 1,659,340 1,588,517 Non-controlling interests 29,641 27,123 Total equity 1,688,981 1,615,640 Total liabilities and equity 9,283,367 8,659,551 STATEMENT OF CASH FLOWS For the three-month period ended September 30 2022 2021 [in thousands of Canadian dollars] $ $ OPERATING ACTIVITIES (*) Net income for the period 14,359 45,435 Add (deduct) items not involving cash Other losses (gains) (102 ) 931 Change in fair value of contingent consideration 22,466 61,423 Contingent consideration recorded as compensation 8 3,789 4,196 Recognition of vesting of redeemable non-controlling interests 907 — Equity-based compensation 7,142 6,484 Amortization and depreciation 12,975 10,341 Amortization of intangible assets from acquisitions 27,725 16,420 Deferred income taxes (24,413 ) (10,072 ) Cash provided by operating activities before net change in operating assets and liabilities 64,848 135,158 Net change in operating assets and liabilities 38,412 47,337 Cash provided by operating activities 103,260 182,495 INVESTING ACTIVITIES Purchase of investments (503 ) (3,589 ) Proceeds on sale of investments 903 1,215 Additions to capital assets (4,061 ) (1,123 ) Decrease (increase) in other assets 42,829 (2,402 ) Additions to intangibles (2,449 ) (3,888 ) Cash paid to settle acquisition liabilities (27,063 ) (43,628 ) Acquisitions, net of cash acquired — (134,375 ) Cash provided by (used in) investing activities 9,656 (187,790 ) FINANCING ACTIVITIES Issuance of long-term debt 75,000 — Repurchase of share capital (79,422 ) (99,100 ) Payment of lease liabilities (5,864 ) (6,040 ) Net distributions to non-controlling interest (2,444 ) (745 ) Dividends paid to shareholders (34,592 ) (36,239 ) Cash used in financing activities (47,322 ) (142,124 ) Net increase (decrease) in cash and cash equivalents during the period 65,594 (147,419 ) Cash and cash equivalents, beginning of period 154,844 801,338 Cash and cash equivalents, end of period 220,438 653,919 (*) Included in operating activities are the following: Interest paid 12,919 10,887 Income taxes paid 70,687 39,215 ASSETS UNDER MANAGEMENT AND NET FLOWS [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning AUM 116.1 136.3 144.2 139.4 138.2 Gross inflows 4.9 4.8 4.9 5.2 5.1 Gross outflows (4.8 ) (8.7 ) (6.6 ) (5.5 ) (4.5 ) Net inflows/(outflows) 0.1 (3.9 ) (1.6 ) (0.3 ) 0.6 Acquisitions — — — — — Market moves and FX (2.0 ) (16.3 ) (6.3 ) 5.2 0.6 Ending AUM 114.2 116.1 136.3 144.2 139.4 Proprietary AUM 30.4 30.8 34.5 36.2 34.7 Non-proprietary AUM 83.7 85.2 101.7 108.1 104.7 Average assets under management 119.1 125.4 138.2 143.0 141.1 Annualized organic growth 0.4 % (11.4 ) % (4.6 ) % (0.9 ) % 1.6 % Gross management fee/average AUM 1.30 % 1.31 % 1.30 % 1.30 % 1.31 % Net management fee/average AUM 0.88 % 0.89 % 0.88 % 0.88 % 0.88 % Net Inflows Retail 0.6 (0.4 ) (0.9 ) 0.1 0.7 Institutional — (3.2 ) (0.3 ) (0.3 ) (0.1 ) Closed business (0.1 ) (0.2 ) (0.2 ) (0.2 ) (0.1 ) Total Canada net inflows 0.5 (3.7 ) (1.3 ) (0.4 ) 0.4 Australia (0.4 ) (0.1 ) (0.3 ) 0.1 0.2 Total net inflows/(outflows) 0.1 (3.9 ) (1.6 ) (0.3 ) 0.6 RETAIL (ex Closed Business) [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning AUM 95.1 108.4 114.6 110.4 109.1 Net Flows 0.6 (0.4 ) (0.9 ) 0.1 0.7 Market Move / FX (1.7 ) (12.9 ) (5.3 ) 4.1 0.6 Acquisitions ___ ___ ___ ___ 0.2 Ending AUM 94.0 95.1 108.4 114.6 110.4 Average AUM 97.9 101.4 109.6 113.8 111.8 INSTITUTIONAL [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning AUM 8.4 12.7 13.3 13.0 13.0 Net Flows 0.0 (3.2 ) (0.3 ) 0.3 (0.1 ) Market Move / FX (0.1 ) (1.1 ) (0.3 ) 0.6 0.1 Acquisitions ___ ___ ___ ___ ___ Ending AUM 8.3 8.4 12.7 13.3 13.0 Average AUM 8.6 10.2 12.9 13.2 13.3 AUSTRALIA [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning AUM 5.1 6.6 7.3 7.0 6.9 Net Flows (0.4 ) (0.1 ) (0.3 ) 0.1 0.1 Market Move / FX 0.0 (1.4 ) (0.4 ) 0.2 0.0 Acquisitions ___ ___ ___ ___ ___ Ending AUM 4.7 5.1 6.6 7.3 7.0 Average AUM 4.9 5.8 7.0 7.1 7.0 CLOSED BUSINESS [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning AUM 7.5 8.6 9.1 9.0 9.1 Net Flows (0.1 ) (0.2 ) (0.2 ) (0.2 ) (0.2 ) Market Move / FX (0.1 ) (0.9 ) (0.3 ) 0.3 (0.0 ) Acquisitions ___ ___ ___ ___ ___ Ending AUM 7.3 7.5 8.6 9.1 8.9 Average AUM 7.6 8.0 8.7 9.0 9.0 AUM BY ASSET CLASS [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Balanced 49.8 50.9 59.4 62.1 60.3 Equity 40.2 41.4 49.3 52.3 50.1 Fixed income 11.2 11.7 13.1 14.2 14.1 Alternatives 3.8 3.6 4.9 5.7 5.0 Cash/Other 4.5 3.4 3.0 2.7 2.8 Total Canada asset management 109.5 111.0 129.7 137.0 132.4 Australia 4.7 5.1 6.6 7.3 7.0 Total asset management segment 114.2 116.1 136.3 144.2 139.4 CANADA WEALTH MANAGEMENT CLIENT ASSETS [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning client assets 74.1 79.0 80.6 76.9 75.5 Acquisitions — 2.4 — — — Net flows and market move (0.2 ) (7.2 ) (1.7 ) 3.8 1.3 Ending client assets 74.0 74.1 79.0 80.6 76.9 Average client assets 76.0 77.7 79.0 78.9 77.0 Wealth management fees/average client assets 0.90 % 0.91 % 0.95 % 0.93 % 0.94 % U.S. WEALTH MANAGEMENT CLIENT ASSETS [billions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Beginning billable client assets 138.8 141.2 146.4 96.1 82.9 Acquisitions — 7.1 1.1 49.3 10.1 Net flows and market move 6.2 (9.5 ) (6.3 ) 1.0 3.1 Ending billable client assets 144.9 138.8 141.2 146.4 96.1 Non-billable client assets 4.9 4.8 4.6 4.9 0.9 Total client assets 149.8 143.5 145.8 151.3 97.0 Fees/beginning billable client assets 0.47 % 0.48 % 0.46 % 0.50 % 0.52 % NON-IFRS MEASURES In an effort to provide additional information regarding our results as determined by IFRS, we also disclose certain non-IFRS information which we believe provides useful and meaningful information. Our management reviews these non-IFRS financial measurements when evaluating our financial performance and results of operations; therefore, we believe it is useful to provide information with respect to these non-IFRS measurements so as to share this perspective of management. Non-IFRS measurements do not have any standardized meaning, do not replace nor are superior to IFRS financial measurements and may not be comparable to similar measures presented by other companies. The non-IFRS financial measurements include: Adjusted net income and adjusted basic and diluted earnings per share Adjusted EBITDA and adjusted EBITDA margin Free cash flow Net debt. These non-IFRS measurements exclude the following revenues and expenses which we believe allows investors a consistent way to analyze our financial performance, allows for better analysis of core operating income and business trends and permits comparisons of companies within the industry, normalizing for different financing methods and levels of taxation: gains or losses related to foreign currency fluctuations on our cash balances costs related to our acquisitions including: amortization of intangible assets change in fair value of contingent consideration related advisory fees contingent consideration classified as compensation per IFRS restructuring charges including organizational expenses for the establishment of CIPW legal provisions for a class action related to market timing certain gains or losses in assets and investments costs related to issuing or retiring debt obligations expenses associated with CIPW redeemable units. Further explanations of these Non-IFRS measures can be found in the “Non-IFRS Measures” section of Management’s Discussion and Analysis dated November 10, 2022 available on SEDAR at www.sedar.com or at www.cifinancial.com. ADJUSTED NET INCOME AND ADJUSTED EARNINGS PER SHARE [millions of dollars, except per share amounts] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Sep. 30, 2021 Net Income 14.4 158.3 45.4 Amortization of intangible assets from acquisitions 27.7 27.4 16.8 Change in fair value of contingent consideration 22.5 (75.0) 61.4 Contingent consideration recorded as compensation 3.8 0.7 4.2 Non-controlling interest reclassification 1.0 0.9 — CIPW adjustments 11.5 3.1 — FX (gains)/losses 73.9 32.9 50.3 Transaction, integration, restructuring and legal 13.1 4.6 3.9 Other (gains)/losses — (1.2) — Trading and bad debt 8.0 — — Total adjustments1 161.5 (6.7) 136.6 Tax effect of adjustments (27.8) 5.6 (21.2) Less: Non-controlling interest 12.1 8.1 1.6 Adjusted net income 135.9 149.1 159.2 Adjusted earnings per share 0.73 0.78 0.80 Adjusted diluted earnings per share 0.73 0.78 0.79 1. Adjustment effects on income statement line items: bond redemption costs are included in other expense, CIPW adjustments and contingent consideration recorded as compensation are included in SG&A, amortization of intangible assets from acquisitions, change in fair value of contingent consideration, FX (gains)/losses, other (gains)/losses, and bond redemption costs are included in the line items of the same description. EBITDA, ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN [millions of dollars, except per share amounts] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Sep. 30, 2021 Pretax income 37.8 219.0 82.4 Amortization of intangible assets from acquisitions 27.7 27.4 16.9 Depreciation and other amortization 13.0 11.9 10.3 Interest and lease finance expense 38.6 36.2 31.6 EBITDA 117.1 294.6 141.3 Change in fair value of contingent consideration 22.5 (75.0 ) 61.4 Contingent consideration recorded as compensation 3.8 0.7 4.2 Non-controlling interest reclassification 1.0 0.9 — CIPW adjustments 11.5 3.1 — FX (gains)/losses 73.9 32.9 50.3 Transaction, integration, restructuring and legal 13.1 4.6 3.9 Other (gains)/losses — (1.2 ) — Trading and bad debt 8.0 — — Total adjustments 133.8 (34.1 ) 119.8 Non-controlling interest 13.4 9.5 3.0 Adjusted EBITDA 237.5 251.0 258.1 Reported net revenue 513.6 566.7 517.9 Less: FX gains/(losses) (73.9 ) (32.9 ) (50.3 ) Less: Non-Operating Other gains/(losses) — 1.2 — Less: NCI revenues 35.1 34.8 19.4 Adjusted net revenue 552.4 563.5 548.7 Adjusted EBITDA margin 43.0 % 44.5 % 47.0 % FREE CASH FLOW [millions of dollars] Quarters ended Sep. 30, 2022 Jun. 30, 2022 Sep. 30, 2021 Cash provided by operating activities 103.3 164.1 182.5 Net change in operating assets and liabilities 38.4 22.9 47.3 Operating cash flow before the change in operating assets and liabilities 64.8 141.2 135.2 FX (gains)/losses 73.9 32.9 50.3 Transaction, integration, restructuring and legal 13.1 4.6 3.9 Trading and bad debt 8.0 — — Total adjustments 95.0 37.5 54.2 Tax effect (recovery) of adjustments (14.1 ) (5.7 ) (5.9 ) Less: Non-controlling interest (5.8 ) (3.4 ) 2.6 Free cash flow 151.5 176.4 180.9 NET DEBT Quarters ended [millions of dollars] Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Current portion of long-term debt 400.5 314.6 225.3 444.5 74.2 Long-term debt 3,548.2 3,373.5 3,304.7 3,331.6 3,334.2 3,948.7 3,688.1 3,530.0 3,776.0 3,408.4 Less: Cash and short-term investments 220.4 154.8 186.1 230.8 653.9 Marketable securities 17.8 18.1 20.3 116.9 122.5 Add: Regulatory capital and non-controlling interests 19.9 22.4 28.8 25.0 23.1 Net Debt 3,730.3 3,537.5 3,352.4 3,453.4 2,655.1 Adjusted EBITDA 237.5 251.0 272.9 277.2 258.1 Adjusted EBITDA, annualized 942.1 1,006.9 1,106.6 1,099.8 1,024.1 Gross leverage (Gross debt/Annualized adjusted EBITDA) 4.2 3.7 3.2 3.4 3.3 Net leverage (Net debt/Annualized adjusted EBITDA) 4.0 3.5 3.0 3.1 2.6 SUMMARY OF QUARTERLY RESULTS [millions of dollars, except per share amounts] IFRS Results Adjusted Results For the quarters ended For the quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Revenues Asset management fees 386.7 404.3 437.6 464.9 460.9 386.7 404.3 437.6 464.9 460.9 Trailer fees and deferred sales commissions (119.2 ) (124.0 ) (135.3 ) (143.6 ) (143.4 ) (119.2 ) (124.0 ) (135.3 ) (143.6 ) (143.4 ) Net asset management fees 267.5 280.3 302.3 321.3 317.5 267.5 280.3 302.3 321.3 317.5 Canada wealth management fees 129.2 130.1 138.2 134.9 132.5 129.2 130.1 138.2 134.9 132.5 U.S. wealth management fees 164.1 168.9 164.5 120.9 108.1 164.1 168.9 164.5 120.9 108.1 Other revenues 26.6 21.2 21.6 27.3 11.2 26.6 21.2 21.6 27.3 11.2 FX gains/(losses) (73.9 ) (32.9 ) 11.5 3.1 (50.3 ) — — — — — Other gains/(losses) 0.1 (1.1 ) (4.4 ) 11.9 (1.1 ) 0.1 (2.3 ) (4.4 ) (4.9 ) (1.1 ) Total net revenues 513.6 566.7 633.8 619.3 517.9 587.5 598.3 622.3 599.4 568.2 Expenses Selling, general & administrative 245.6 238.0 259.3 214.6 201.9 230.3 234.2 227.9 212.5 197.7 Advisor and dealer fees 98.3 99.7 106.9 104.8 103.4 98.3 99.7 106.9 104.8 103.4 Other 17.1 4.7 3.6 5.7 6.5 8.1 3.8 2.7 5.7 6.5 Interest and lease finance expense 38.6 36.2 35.9 32.5 31.6 38.6 36.2 35.9 32.5 31.6 Depreciation and other amortization 13.0 11.9 11.4 10.9 10.3 13.0 11.9 11.4 10.4 10.0 Amortization of intangible assets from acquisitions 27.7 27.4 24.1 18.2 16.4 — — — — — Transaction, integration, restructuring and legal 13.1 4.6 3.8 13.6 3.9 — — — — — Change in fair value of contingent consideration 22.5 (75.0 ) 3.1 43.9 61.4 — — — — — Total expenses 475.8 347.7 448.0 444.2 435.5 388.2 386.0 384.8 365.9 349.2 Pretax income 37.8 219.0 185.8 175.1 82.4 199.3 212.3 237.5 233.4 219.0 Income tax expense 23.5 60.7 48.3 51.3 37.0 51.3 55.1 59.7 62.5 58.1 Net income 14.4 158.3 137.5 123.7 45.4 148.1 157.2 177.8 171.0 160.9 Non-controlling interest (0.5 ) 2.1 (0.6 ) — 1.6 12.1 8.1 10.9 — 1.6 Net income attributable to shareholders 14.9 156.2 138.1 123.7 43.8 135.9 149.1 166.8 171.0 159.2 Basic earnings per share 0.08 0.82 0.70 0.63 0.22 0.73 0.78 0.85 0.87 0.80 Diluted earnings per share 0.08 0.81 0.70 0.62 0.22 0.73 0.78 0.85 0.86 0.79 RESULTS OF OPERATIONS - ASSET MANAGEMENT SEGMENT [millions of dollars, except per share amounts] IFRS Results Adjusted Results For the quarters ended For the quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Revenues Asset management fees 390.9 408.9 442.5 469.6 465.6 390.9 408.9 442.5 469.6 465.6 Trailer fees and deferred sales commissions (126.8 ) (131.9 ) (143.9 ) (152.6 ) (152.4 ) (126.8 ) (131.9 ) (143.9 ) (152.6 ) (152.4 ) Net asset management fees 264.1 277.0 298.6 316.9 313.2 264.1 277.0 298.6 316.9 313.2 Canada wealth management fees — — — — — — — — — — US wealth and asset management fees — — — — — — — — — — Other revenues 6.6 5.6 10.2 19.9 3.2 6.6 5.6 10.2 19.9 3.2 FX gains/(losses) (74.4 ) (32.8 ) 11.4 (1.4 ) (19.0 ) — — — — — Other gains/(losses) 0.1 (1.1 ) (4.4 ) 12.0 (1.1 ) 0.1 (2.3 ) (4.4 ) (4.8 ) (1.1 ) Total net revenues 196.4 248.7 315.8 347.5 296.3 270.7 280.2 304.4 332.1 315.3 Expenses Selling, general & administrative 98.7 97.3 96.8 108.7 109.6 98.7 97.3 96.8 108.7 109.6 Advisor and dealer fees — — — — — — — — — — Other 7.2 — — (0.5 ) 1.6 — — — (0.5 ) 1.6 Interest and lease finance expense 1.0 1.0 1.0 0.5 0.5 1.0 1.0 1.0 0.5 0.5 Depreciation and other amortization 5.0 5.0 5.0 5.4 5.5 5.0 5.0 5.0 5.4 5.5 Amortization of intangible assets from acquisitions 0.6 0.6 0.6 0.6 0.6 — — — — — Transaction, integration, restructuring and legal 2.6 2.3 (0.9 ) 10.4 0.4 — — — — — Change in fair value of contingent consideration 3.2 (3.9 ) 4.0 14.2 1.9 — — — — — Total expenses 118.2 102.3 106.5 139.3 120.2 104.6 103.3 102.8 114.1 117.2 Pretax income 78.2 146.4 209.3 208.1 176.1 166.1 176.9 201.6 218.0 198.1 Non-IFRS adjustments Pretax income 78.2 146.4 209.3 208.1 176.1 166.1 176.9 201.6 218.0 198.1 Amortization of intangible assets from acquisitions 0.6 0.6 0.6 0.6 0.6 — — — — — Depreciation and other amortization 5.0 5.0 5.0 5.4 5.5 5.0 5.0 5.0 5.4 5.5 Interest and lease finance expense 1.0 1.0 1.0 0.5 0.5 1.0 1.0 1.0 0.5 0.5 EBITDA 84.7 153.0 215.9 214.7 182.7 172.1 183.0 207.6 223.9 204.1 Change in fair value of contingent consideration 3.2 (3.9 ) 4.0 14.2 1.9 — — — — — FX (gains)/losses 74.4 32.8 (11.4 ) 1.4 19.0 — — — — — Transaction, integration, restructuring and legal 2.6 2.3 (0.9 ) 10.4 0.4 — — — — — Other (gains)/losses — (1.2 ) — (16.8 ) — — — — — — Total adjustments 87.3 30.0 (8.3 ) 9.2 21.4 — — — — — Less: Non-controlling interest 0.1 0.3 0.4 0.1 0.5 0.1 0.3 0.4 0.1 0.5 Adjusted EBITDA 172.0 182.7 207.2 223.8 203.6 172.0 182.7 207.2 223.8 203.6 RESULTS OF OPERATIONS - CANADA WEALTH MANAGEMENT SEGMENT [millions of dollars, except per share amounts] IFRS Results Adjusted Results For the quarters ended For the quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Revenues Canada wealth management fees 171.7 175.6 185.7 184.3 181.7 171.7 175.6 185.7 184.3 181.7 Other revenues 25.5 21.3 17.1 16.0 14.8 25.5 21.3 17.1 16.0 14.8 FX gains/(losses) 0.5 — 0.1 0.8 0.7 — — — — — Other gains/(losses) — — — (0.1 ) — — — — (0.1 ) — Total net revenues 197.7 196.9 202.9 201.1 197.2 197.2 196.9 202.8 200.3 196.5 Expenses Selling, general & administrative 43.8 44.0 41.1 39.9 37.8 43.6 43.9 41.1 39.9 37.8 Advisor and dealer fees 132.4 135.9 145.6 145.2 143.5 132.4 135.9 145.6 145.2 143.5 Other 8.2 4.0 3.2 3.2 1.8 6.3 3.2 2.4 3.2 1.8 Interest and lease finance expense — (0.1 ) 0.2 0.2 0.2 — (0.1 ) 0.2 0.2 0.2 Depreciation and other amortization 3.2 2.8 2.5 2.3 2.4 3.2 2.8 2.5 2.3 2.4 Amortization of intangible assets from acquisitions 2.1 2.1 1.6 1.5 1.7 — — — — — Transaction, integration, restructuring and legal 0.3 0.4 0.8 0.1 0.1 — — — — — Change in fair value of contingent consideration (0.7 ) (0.6 ) — — — — — — — — Total expenses 189.3 188.5 195.0 192.6 187.5 185.6 185.6 191.7 191.0 185.7 Pretax income 8.4 8.4 7.9 8.5 9.7 11.6 11.4 11.1 9.3 10.8 Non-IFRS adjustments Pretax income 8.4 8.4 7.9 8.5 9.7 11.6 11.4 11.1 9.3 10.8 Amortization of intangible assets from acquisitions 2.1 2.1 1.6 1.6 1.8 — — — 0.1 0.1 Depreciation and other amortization 3.2 2.8 2.5 2.3 2.4 3.2 2.8 2.5 2.3 2.4 Interest and lease finance expense — (0.1 ) 0.2 0.2 0.2 — (0.1 ) 0.2 0.2 0.2 EBITDA 13.7 13.1 12.1 12.6 14.0 14.9 14.0 13.8 11.9 13.5 Change in fair value of contingent consideration (0.7 ) (0.6 ) — — — — — — — — Contingent consideration recorded as compensation (included in SG&A) 0.1 0.1 — — — — — — — — CIPW adjustments (included in SG&A) 0.1 0.1 — — — — — — — — FX (gains)/losses (0.5 ) — (0.1 ) (0.8 ) (0.7 ) — — — — — Transaction, integration, restructuring and legal 0.3 0.4 0.8 0.1 0.1 — — — — — NCI reclassification (included in Other) 1.0 0.9 0.9 — — — — — — — Total adjustments 1.2 0.8 1.6 (0.7 ) (0.6 ) — — — — — Less: Non-controlling interest 1.2 1.0 0.9 (1.5 ) 0.7 1.2 1.0 0.9 (1.5 ) 0.7 Adjusted EBITDA 13.7 13.0 12.9 13.5 12.8 13.7 13.0 12.9 13.5 12.8 RESULTS OF OPERATIONS - U.S. WEALTH MANAGEMENT SEGMENT [millions of dollars, except per share amounts] IFRS Results Adjusted Results For the quarters ended For the quarters ended Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Sep. 30, 2022 Jun. 30, 2022 Mar. 31, 2022 Dec. 31, 2021 Sep. 30, 2021 Revenues U.S. wealth management fees 164.1 168.9 164.5 120.9 108.1 164.1 168.9 164.5 120.9 108.1 Other revenues 4.2 4.5 4.8 1.3 2.6 4.2 4.5 4.8 1.3 2.6 FX gains/(losses) — — — 3.7 (31.9 ) — — — — — Total net revenues 168.2 173.4 169.2 125.9 78.8 168.3 173.5 169.2 122.2 110.7 Expenses Selling, general & administrative 117.7 112.8 136.9 80.8 68.8 102.6 109.2 105.5 78.7 64.6 Other 1.8 0.7 0.4 2.9 3.1 1.8 0.7 0.4 2.9 3.1 Interest and lease finance expense 0.7 0.6 0.5 0.4 0.4 0.7 0.6 0.5 0.4 0.4 Depreciation and other amortization 4.8 4.1 3.9 3.1 2.5 4.8 4.1 3.9 3.1 2.5 Amortization of intangible assets from acquisitions 25.0 24.7 21.9 16.1 14.1 — — — — — Transaction, integration, restructuring and legal 10.2 2.0 3.9 3.1 3.4 — — — — — Change in fair value of contingent consideration 20.0 (70.5 ) (0.9 ) 29.7 59.5 — — — — — Total expenses 180.1 74.4 166.5 136.1 151.7 109.8 114.6 110.3 85.2 70.5 Pretax income (11.9 ) 99.0 2.7 (10.2 ) (72.9 ) 58.4 58.9 59.0 37.0 40.2 Non-IFRS adjustments Pretax income (11.9 ) 99.0 2.7 (10.2 ) (72.9 ) 58.4 58.9 59.0 37.0 40.2 Amortization of intangible assets from acquisitions 25.0 24.7 21.9 16.5 14.4 — — — 0.5 0.3 Depreciation and other amortization 4.8 4.1 3.9 3.1 2.5 4.8 4.1 3.9 3.1 2.5 Interest and lease finance expense 0.7 0.6 0.5 0.4 0.4 0.7 0.6 0.5 0.4 0.4 EBITDA 18.6 128.4 29.1 9.9 (55.6 ) 63.9 63.5 63.4 41.0 43.4 Change in fair value of contingent consideration 20.0 (70.5 ) (0.9 ) 29.7 59.5 — — — — — Contingent consideration recorded as compensation (included in SG&A) 3.7 0.6 18.2 2.1 4.2 — — — — — CIPW adjustments (included in SG&A) 11.4 3.0 13.2 — — — — — — — FX (gains)/losses — — — (3.7 ) 31.9 — — — — — Transaction, integration, restructuring and legal 10.2 2.0 3.9 3.1 3.4 — — — — — Total adjustments 45.3 (64.9 ) 34.3 31.1 99.0 — — — — — Less: Non-controlling interest 12.1 8.2 10.9 1.0 1.7 12.1 8.2 10.9 1.0 1.7 Adjusted EBITDA 51.8 55.4 52.5 40.0 41.7 51.8 55.4 52.5 40.0 41.7 View source version on businesswire.com: https://www.businesswire.com/news/home/20221110005506/en/
Investor Relations Jason Weyeneth, CFA Vice-President, Investor Relations & Strategy 416-681-8779 jweyeneth@ci.com Media Canada Murray Oxby Vice-President, Communications 416-681-3254 moxby@ci.com United States Jimmy Moock Managing Partner, StreetCred 610-304-4570 jimmy@streetcredpr.com ci@streetcredpr.com