Canaccord Genuity Group reported its global wealth management operations earned record quarterly revenue of $200.1m and record revenue of $773.4m for the fiscal year, up 9.2% compared to fiscal 2023, in its financial results for the fourth quarter and fiscal year ended March 31, 2024.
Total client assets in the global wealth management business reached a new record of $103.9bn, an increase of 8.0% from Q4/23 reflecting year-over-year increases of 7.2% in the UK & Crown Dependencies, 18.4% in Australia, and 7.6% in Canada.
All dollar amounts are stated in thousands of Canadian dollars.
Dan Daviau (pictured), president & CEO of Canaccord Genuity Group said: "Our wealth management businesses continue to deliver outstanding results and have been the primary driver of our resilience throughout the fourth quarter and fiscal year.
"Results in our capital markets businesses outside of Australia continued to reflect subdued activity across our industry and core mid-market sectors, but we are encouraged by improving activity levels and looking forward to delivering on a strong pipeline of mandates as risk appetite improves.
"We also took important steps to improve employee alignment with our shareholders and advance our governance to guide the long-term strategy and operations of the company."
Fourth quarter revenue of $409.0m was a decrease of 5.0% year-over-year and an increase of 5.1% sequentially
Fiscal 2024 revenue of $1.5bn was down 2.1% year-over-year
Fourth quarter net income before taxes excluding significant items(1) of $39.1m, was an increase of 139.2% when compared to Q4/23 results ($14.4m on an IFRS basis and a year-over-year increase of 164.6% )
Fiscal 2024 net income before taxes excluding significant items was $133.2m, an increase of 5.8% year-over-year ($57.1m on an IFRS basis compared to a net loss before taxes of $34.4m in the prior year)
Drilling down into Canaccord Genuity Wealth Management, revenue for the fiscal year amounted to $773.4m, an increase of 9.2% compared to the prior year and a new record for this division.
Excluding significant items, pre-tax net income decreased by 7.8% year-over year to $34.0m for the fourth quarter and increased by 11.7% to $140.5m for the fiscal year. On an IFRS basis, pre-tax net income decreased by 6.1% and increased by 20.9% for the fourth quarter and fiscal 2024 compared to the same period in the prior year. Profitability was impacted by higher interest costs and increased development costs and general and administrative expenses incurred to support a number of growth initiatives.
Wealth management operations in the UK & Crown Dependencies generated record quarterly revenue of $105.5m for the fourth quarter and record full-year revenue of $411.5m for the fiscal year, increases of 1.7% and 19.7% respectively, mainly due to higher interest income. Net income excluding significant items was $26.6m before taxes in Q4/24, a slight increase of 0.9% year-over-year. For the year ended March 31, 2024 net income before taxes and excluding significant items increased by 17.9% compared to fiscal 2023 to $101.5m.
Canaccord Genuity Wealth Management (North America) generated $77.6m in revenue for the fourth quarter and $298.0m for the fiscal year, decreases of 1.1% and 1.4% respectively. Revenue for the year was impacted by reduced investment banking and new issue activity in fiscal 2024 compared to fiscal 2023. Partially offsetting the reduced investment banking revenue was an increase in interest revenue for fiscal 2024 primarily because of higher interest rates. Fourth quarter interest income decreased by 13.8% year over year and 10.0% sequentially. Excluding significant items net income before taxes for this business was $6.7m in Q4/24 and $35.7m for fiscal 2024, decreases of 38.4% and 9.5% compared to the respective periods in the prior year.
Wealth management operations in Australia generated $17.0m in revenue for the fourth quarter and $63.9m for the fiscal year, increases of 13.8% and 2.3% respectively. Excluding significant items net income before taxes for this business was $0.7m in Q4/24 and $3.2m for the fiscal year, compared to a pre-tax loss of $0.4m and pre-tax income of $0.1m for the comparative periods last year.
Client assets in North America were $38.4 billion as at March 31, 2024, an increase of 5.8% from $36.3 billion at the end of the previous quarter and an increase of 7.6% from $35.7 billion at March 31, 2023.
Client assets in the UK & Crown Dependencies were $59.1bn (£34.6bn) as at March 31, 2024, an increase of 4.1% from $56.8bn (£33.7bn) at the end of the previous quarter, and an increase of 7.2% from $55.1bn (£33.0bn) at March 31, 2023.
Client assets held in its investment management platforms in Australia were $6.4bn (AUD$ 7.3bn) as at March 31, 2024, an increase of 5.1% from $6.1bn (AUD$ 6.8bn) as at December 31, 2023 and an increase of 18.4% from $5.4bn (AUD$ 6.0bn) at March 31, 2023. In addition to client assets held in our investment management platforms, client assets totalling $13.8bn (AUD$ 15.6bn) are also held in non-managed accounts.
Globally, Canaccord Genuity Capital Markets earned revenue of $202.9m for the fourth fiscal quarter, representing a decrease of 10.3% from Q4/23, largely due to reduced advisory fees revenue reflecting the more difficult environment for completions although the pipeline of announced mandates remains robust. Its combined global capital markets businesses contributed revenue of $683.2m for the fiscal year, a year-over-year decrease of 13.8%.
