Stock Name: SII
Amount: CAD 0.03
Announcement Date: 09/08/2012
Record Date: 16/05/2012
Dividend Detail:
TORONTO, Aug. 9, 2012 /CNW/ - Sprott Inc. (TSX: SII) ("Sprott" or the
"Company") today announced its financial results for the three and six
months ended June��30, 2012.
Q2 2012 Overview
Assets Under Management ("AUM") were $8.5 billion as at June��30, 2012,
compared to $9.3 billion as at June��30, 2011 and $9.7 billion as at
March��31, 2012
Assets Under Administration ("AUA") were $3.8 billion as at June��30,
2012, compared to $5.3 billion as of June��30, 2011
Management Fees were $28.1 million, a decrease of 24.6% compared with
the three months ended June��30, 2011
Base EBITDA was $10.4 million ($0.06 per share) compared with $18.1
million ($0.11 per share) for the three months ended June��30, 2011, a
decrease of 42.6%
EBITDA was $6.4 million ($0.04 per share), compared with $14.6 million
($0.09 per share) for the three months ended June��30, 2011, a decrease
of 56.0%
Net income was $0.7 million ($0.00 per share) for the three months ended
June��30, 2012, a decrease of 90.2% from $7.5 million ($0.04 per share)
in the comparable quarter of 2011
Launched the Sprott Enhanced Equity Class and Sprott Enhanced Balanced
Fund
Subsequent events:
Finalized acquisition of Toscana Capital Corporation and Toscana Energy
Corporation (collectively, the "Toscana Companies")
Closed�� acquisition of Flatiron Capital Management Partners ("Flatiron")
Completed US $220 million follow-on offering of Sprott Physical Silver
Trust Units
Launched the Sprott Flatiron Yield Trust
"We continue to build our business and recently completed the
acquisitions of Flatiron and the Toscana Companies," said Peter
Grosskopf, CEO of Sprott Inc. "Together, these transactions further
diversify our investment capabilities and product offerings�� through
the addition of top convertible arbitrage and energy yield specialists,
allowing us to launch value-added yield products that are currently in
high demand."
"Our investment performance was disappointing through the first six
months of the year and this negatively impacted our financial results,"
continued Mr. Grosskopf. "While our macro-economic assessment has been
accurate, this has yet to manifest itself in improved performance for
most of our funds. It appears likely that central banks will again, and
possibly on a continuous basis, be mandated to intervene in the markets
in an effort to stimulate growth. We therefore remain committed to our
current positioning and believe that both our precious metals positions
and our lower-volatility strategies will outperform in the second half
of the year."
�� | For the three months ended | For the six months ended | ||||||
�� | June 30, | June 30, | ||||||
($ in millions) | 2012 | 2011 | 2012 | 2011 | ||||
�� | �� | �� | �� | �� | ||||
AUM, beginning of period | 9,683 | �� | 9,678 | �� | 9,137 | �� | 8,545 | �� |
Net sales (redemptions) | (158 | ) | 565 | �� | 387 | �� | 825 | �� |
Business acquisition | ��� | �� | ��� | �� | ��� | �� | 695 | �� |
Market value depreciation of portfolios | (1,040 | ) | (951 | ) | (1,039 | ) | (773 | ) |
AUM, end of period | 8,485 | �� | 9,292 | �� | 8,485 | �� | 9,292 | �� |
Assets Under Management
At June��30, 2012, AUM decreased by 8.7% to $8.5 billion, from $9.3
billion at June��30, 2011. Net redemptions for the three months ended
June��30, 2012 were $158 million, which together with $1.0 billion in
market value depreciation resulted in the $1.2 billion decrease in AUM
for the quarter.
Average AUM for the three months ended June��30, 2012 was $9.0 billion
compared with $9.9 billion for the three months ended June��30, 2011, a
decrease of 9.3%.
Income Statement
Total revenue for the three months ended June��30, 2012 decreased by
30.2% to $27.4 million, from $39.3 million in 2011.�� For the six months
ended June 30, 2012, total revenue decreased by 8.9% to $71.8 million
from $78.8 million in the first six months of 2011.
Management fees decreased by 24.6% during the quarter to $28.1 million,
from $37.2 million for the three months ended June��30, 2011 as average
AUM decreased over the prior year period. For the first six months of
2012, management fees decreased by 16.1% to $61.1 million from $72.8
million in the first half of 2011.�� The decrease in management fees is
attributable to both the lower average AUM for the three and six-month
periods ended June 30, 2012 as well as an increase in lower margin
offerings such as the physical bullion trusts and fixed-income
products.
Losses from proprietary investments, which include investments in funds
that Sprott manages, an investment in Sprott Resource Lending Corp.,
certain other resource-related stocks and warrants, and bullion,
totaled $4.0 million for the three months ended June��30, 2012,
essentially the same as the quarter ended June��30, 2011. For the six
months ended June 30, 2012, gains from proprietary investments totaled
$0.3 million, compared with losses of $3.6 million during the first six
months of 2011.
Commission revenue for the three months ended June��30, 2012, was $2.1
million compared to $4.9 million during the three months ended June��30,
2011. For the six months ended June 30, 2012, commission revenue
decreased by $0.1 million to $7.8 million from $7.9 million during the
prior year period.
Other income increased by $0.7 million in the three months ended
June��30, 2012 to $1.3 million from $0.6 million in the second quarter
of 2011. For the six months ended June 30, 2012, other income increased
by $1.6 million to $2.6 million from $1.0 million during the prior year
period.
Total expenses for the three months ended June��30, 2012 were $26.2
million, a decrease of $1.9 million or 6.6%, from $28.1 million during
the same period last year . Total expenses for the first six months of
2012 were $49.4 million, a decrease of 6.1% from $52.6 million in the
six months ended June 30, 2011.
Base EBITDA, which excludes the impact of income taxes and certain
non-cash expenses and gains or losses on proprietary investments,
decreased by 42.6% to $10.4 million ($0.06 per share) for the three
months ended June��30, 2012, compared with $18.1 million ($0.11 per
share) in the second quarter of 2011. For the six months ended June 30,
2012, Base EBITDA decreased by 24.3% to $26.5 million from $35.1
million in the first half of 2011.
Net income for the three months ended June��30, 2012 decreased by 90.2%
to $0.7 million ($0.00 per share) from $7.5 million ($0.04 per share)
in the second quarter of 2011. Net income for the first six months of
2011 was $17.7 million ($0.10 per share), a 2.2% decrease as compared
with the $18.1 million ($0.11 per share) earned during the first half
of 2011.
Dividends
On May 8,�� 2012, a dividend of $0.03 per common share was declared for
the quarter ended March 31, 2012. This dividend was paid on June 1,
2012 to shareholders of record at the close of business on May 18,
2012.
In August 2012, a dividend of $0.03 per common share was declared for
the quarter ended June 30, 2012.
Conference Call and Webcast
A conference call and webcast will be held today, Thursday, August 9,
2012, at 10:00am ET to discuss the Company's financial results. To
participate in the call, please dial 647-427-7450 or 1-888-231-8191 ten
minutes prior to the scheduled start of the call. A taped replay of the
conference call will be available until Thursday, August 16, 2012 by
calling 416-849-0833 or 1-855-859-2056, reference number 12659963. The
conference call will be webcast live at www.sprottinc.com and www.newswire.ca.
*Non-IFRS Financial Measures
This press release includes financial terms (including AUM, EBITDA, Base
EBITDA, Cash Flow from Operations and net sales) that the Company
utilizes to assess the financial performance of its business that are
not measures recognized under International Financial Reporting
Standards ("IFRS"). These non-IFRS measures should not be considered
alternatives to performance measures determined in accordance with IFRS
and may not be comparable to similar measures presented by other
issuers. For additional information regarding the Company's use of
non-IFRS measures, including the calculation of these measures, please
refer to the "Non-IFRS Financial Measures" section of the Company's
Management's Discussion and Analysis and its financial statements
available on the Company's website at www.sprottinc.com and on SEDAR at www.sedar.com.
Forward-Looking Statements
This release contains "forward-looking statements" which reflect the
current expectations of the Company. These statements reflect
management's current beliefs with respect to future events and are
based on information currently available to management. Forward-looking
statements involve significant known and unknown risks, uncertainties
and assumptions. Many factors could cause actual results, performance
or achievements to be materially different from any future results,
performance or achievements that may be expressed or implied by such
forward-looking statements including, without limitation, those listed
under the heading "Risk Factors" in the Company's annual information
form dated March 27, 2012. Should one or more of these risks or
uncertainties materialize, or should assumptions underlying the
forward-looking statements prove incorrect, actual results, performance
or achievements could vary materially from those expressed or implied
by the forward-looking statements contained in this release. Although
the forward-looking statements contained in this release are based upon
what the Company believes to be reasonable assumptions, the Company
cannot assure investors that actual results, performance or
achievements will be consistent with these forward-looking statements.
These forward-looking statements are made as of the date of this
release and the Company does not assume any obligation to update or
revise them to reflect new events or circumstances.
About Sprott Inc.
Sprott Inc. is a leading independent asset manager dedicated to
achieving superior returns for its clients over the long term. The
Company currently operates through four business units: Sprott Asset
Management LP, Sprott Private Wealth LP, Sprott Consulting LP, and
Sprott U.S. Holdings Inc.�� Sprott Asset Management is the investment
manager of the Sprott family of mutual funds and hedge funds and
discretionary managed accounts; Sprott Private Wealth provides wealth
management services to high net worth individuals; and Sprott
Consulting provides management, administrative and consulting services
to other companies. Sprott U.S. Holdings Inc. includes Sprott Global
Resource Investments Ltd, Sprott Asset Management USA Inc., and
Resource Capital Investments Corporation. Sprott Inc. is headquartered
in Toronto, Canada, and is listed on the Toronto Stock Exchange under
the symbol "SII". For more information on Sprott Inc., please visit www.sprottinc.com.
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SOURCE: Sprott Inc.
For further information:
Investor contact information:
Glen Williams
Director of Communications
Sprott Inc.
(416) 943-4394
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