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16-05-2025
- Business
- Yahoo
Strathcona Resources Ltd. Announces Intention to Commence Take-Over Bid to Acquire MEG Energy Corp.
CALGARY, AB, May 15, 2025 /PRNewswire/ - Strathcona Resources Ltd. ("Strathcona") announced today that it intends to commence a take-over bid for MEG Energy Corp. (TSX: MEG) ("MEG"), pursuant to which Strathcona will offer (the "Offer") to acquire all of the issued and outstanding common shares of MEG ("MEG Shares"), not already owned by Strathcona or its affiliates, for 0.62 of a common share of Strathcona ("Strathcona Shares") and $4.10 in cash per MEG Share. Based on the closing share price of the Strathcona Shares on the Toronto Stock Exchange (the "TSX") on May 15, 2025, the Offer represents total consideration of $23.27 per MEG Share (82.4% Strathcona Shares and 17.6% cash), reflecting a 9.3% premium based on the closing price of the MEG Shares on the TSX on May 15, 2025. The Offer will not be subject to any financing condition, with the cash consideration payable under the Offer expected to be funded pursuant to a bridge financing commitment from a syndicate of lenders (the "Bridge Financing Commitment"), subject to the terms and conditions of such financing. At the time the Offer is commenced, Waterous Energy Fund ("WEF"), currently the holder of 79.6% of the Strathcona Shares, intends to, through Waterous Energy Fund III ("WEF III"), commit to further increase its investment in Strathcona and subscribe for an additional 21.4 million Strathcona Shares through the use of subscription receipts. Upon completion of the Offer, Strathcona expects to have approximately 379 million Strathcona Shares outstanding and approximately $1.5 billion in net debt1. The combined business is expected to be owned approximately 56.5% by existing holders of Strathcona Shares ("Strathcona Shareholders"), approximately 37.8% by existing holders of MEG Shares ("MEG Shareholders") and approximately 5.6% by WEF III. WEF is expected to hold a combined approximately 51% ownership position, inclusive of its existing Strathcona Shares and those expected to be issued to WEF III pursuant to the WEF III Equity Investment (as defined below). _______________________________ 1 A non-GAAP financial measure which does not have a standardized meaning prescribed by the IFRS® Accounting Standards (the "Accounting Standards"). See the "Non-GAAP Financial Measures and Ratios" section of this news release. Strategic Rationale for the Offer Complementary, High-Quality Assets of Scale: The combination of Strathcona and MEG would unify two 100+ Mbbls/d heavy oil "pure plays" with near identical netbacks and reserve life indexes, both focused on SAGD oil sands development. The combination would create Canada's fifth largest oil producer and fourth largest SAGD producer, with among the largest proved oil reserves in North America. The combined business is expected to possess the scale and balance sheet metrics required to achieve an investment grade credit rating. Significant Accretion for Both MEG and Strathcona Shareholders: The combination of Strathcona and MEG is expected to provide significant accretion per share to both MEG Shareholders and Strathcona Shareholders on key metrics, including funds flow per share, funds flow less sustaining capital expenditures per share, net asset value per share and production per share, while being leverage neutral to current MEG Shareholders. Meaningful and Achievable Synergies: Strathcona has identified $175 million in annual synergy opportunities, including $50 million in overhead reduction opportunities, $25 million in interest savings opportunities and $100 million in operating synergy opportunities ($75 million in capital expenditures and $25 million in operating costs). The PV-10 of the aggregate operating synergy opportunities is estimated at greater than $2.50/Strathcona Share, based on proved (1P) and proved plus probable (2P) reserves. MEG Shareholders and Strathcona Shareholders are encouraged to review a presentation describing the benefits of the Offer, which has been posted on Strathcona's website at Background to the Offer During the first and second quarters of 2025, Strathcona acquired approximately 23.4 million MEG Shares through open market purchases, representing approximately 9.20% of the issued and outstanding MEG Shares as of May 5, 2025 or approximately 9.98% assuming completion in full of MEG's current normal course issuer bid. On April 28, 2025, Strathcona made a formal written combination proposal to the board of directors of MEG (the "MEG Board"), with the same consideration as the Offer. On May 13, 2025, the chairman of the MEG Board responded and indicated that the MEG Board was not interested in pursuing a combination with Strathcona. Strathcona respects the MEG Board's right to dismiss any offer made for MEG, and it has no reason to believe that its decision to dismiss Strathcona's proposal was not made in good faith based on its view of what is best for MEG Shareholders. However, Strathcona believes the benefits of a combination of Strathcona and MEG are significant enough that MEG Shareholders should have the opportunity to decide for themselves. Strathcona expects to file the formal offer to purchase and take‐over bid circular for the Offer in the next two weeks. Strathcona remains ready and willing to engage with the MEG Board regarding a strategic combination. To the extent the MEG Board determines it to be prudent, as the second largest MEG Shareholder, Strathcona would also support a strategic alternatives process for MEG to determine if a superior transaction is available. Strathcona would be willing to participate constructively and in good faith in such a process, including signing a mutual confidentiality agreement to share non-public information, provided it is not required to sign a standstill agreement. Approvals The Offer has been unanimously approved by the Board of Directors of Strathcona. Offer Details Full details of the Offer will be included in the formal offer to purchase and take‐over bid circular, which will be filed with the applicable Canadian securities regulatory authorities and available under MEG's profile on SEDAR+ at Strathcona will request a list of securityholders from MEG at the commencement of the Offer and expects to mail the formal offer to purchase and take‐over bid circular to MEG Shareholders as soon as practicable, and in any event within two business days, after receipt of such list. In connection with the Offer, Strathcona expects to file relevant materials with the U.S. Securities and Exchange Commission (the "SEC"), including a registration statement on Form F-10 (a "Registration Statement") under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), which will include the formal offer to purchase and take‐over bid circular and other documents related to the Offer. The Offer will be open for acceptance for at least 105 days following the commencement of the Offer, unless the Offer is extended, accelerated or withdrawn by Strathcona in accordance with its terms and applicable law. The Offer is intended to constitute a "Permitted Bid" for purposes of MEG's shareholder rights plan (the "Shareholder Rights Plan"), which was most recently approved by MEG Shareholders on May 1, 2023. The Offer is expected to be subject to the satisfaction or, where permitted, waiver of certain conditions, including, without limitation: (a) there having been validly deposited under the Offer and not withdrawn more than 50% of the outstanding MEG Shares (and associated rights under the Shareholder Rights Plan), excluding any MEG Shares beneficially owned, or over which control or direction is exercised, by Strathcona or by any person acting jointly or in concert with Strathcona, which condition cannot be waived by Strathcona; (b) there having been validly deposited under the Offer and not withdrawn MEG Shares (and associated rights under the Shareholder Rights Plan) which represent, together with the MEG Shares held by Strathcona, at least 66⅔% of the outstanding MEG Shares (on a fully-diluted basis); (c) no material adverse change having occurred in respect of the business, affairs, assets, operations or prospects of MEG; (d) all required governmental, regulatory and stock exchange approvals, or expiry, waiver or termination of any waiting or suspension period imposed, with respect to the Offer, including, without limitation, pursuant to the Competition Act (Canada) and the United States Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the approval of the TSX with respect to the issuance and listing of the Strathcona Shares issuable pursuant to the Offer, having been obtained; (e) the Registration Statement having become effective under the U.S. Securities Act and not becoming subject to a stop order or a proceeding seeking a stop order; (f) MEG not having taken certain actions that could reasonably be expected to reduce the anticipated economic value to Strathcona of the Offer or impair the ability of Strathcona to proceed with the Offer; (g) Strathcona having obtained the requisite approval of the Strathcona Shareholders with respect to the issuance of the Strathcona Shares under the Offer pursuant to the rules of the TSX; and (h) other customary conditions. The Offer will not be subject to any due diligence or financing conditions, including in respect of the Bridge Financing Commitment or the WEF III Equity Investment. Subject to TSX approval, Strathcona expects to obtain the requisite approval of Strathcona Shareholders with respect to the issuance of Strathcona Shares pursuant to the Offer by delivery of a written consent of WEF, which holds approximately 79.6% of the issued and outstanding Strathcona Shares as of the date hereof. If the conditions of the Offer are satisfied or, where permitted, waived at the expiry time of the Offer and Strathcona takes up and pays for the MEG Shares validly deposited under the Offer, Strathcona intends to acquire any MEG Shares not deposited under the Offer through a compulsory acquisition pursuant to the Business Corporations Act (Alberta), if available, or to propose an amalgamation, statutory arrangement or other transaction for the purpose of MEG becoming, directly or indirectly, a wholly-owned subsidiary or affiliate of Strathcona, in each case for consideration per Common Share at least equal in value to and in the same form as the consideration paid by Strathcona per Common Share under the Offer. The exact timing and details of any such transaction will depend upon a number of factors, including, without limitation, the number of MEG Shares acquired pursuant to the Offer. This news release is not a substitute for the Registration Statement, the formal offer to purchase and take-over bid circular or any other relevant documents filed with the applicable Canadian securities regulatory authorities or the SEC. MEG Shareholders and other interested parties are urged to read the Registration Statement, the formal offer to purchase and take-over bid circular, all documents incorporated by reference therein, all other applicable documents and any amendments or supplements to any such documents when they become available, because they will contain important information about Strathcona, MEG and the Offer. When they become available, the Registration Statement, formal offer to purchase and take-over bid circular and other materials filed by Strathcona with the SEC will be available electronically without charge at the SEC's website at When available, the Registration Statement, formal offer to purchase and take-over bid circular, documents incorporated by reference therein and other relevant documents may also be obtained on request without charge from Strathcona by email at info@ or by phone at (403) 930-3000 or Laurel Hill Advisory Group, the information agent for the Offer, by email at assistance@ or by phone at 1-877-452-7184 (Toll-Free), and will also be available electronically at Readers are cautioned that Strathcona may determine, in its sole discretion, not to make the Offer if: (a) MEG implements or attempts to implement defensive tactics in relation to the Offer; (b) Strathcona discovers or otherwise identifies information suggesting that the business, affairs, assets, operations or prospects of MEG have been impaired or discovers or otherwise identifies other undisclosed material adverse information concerning MEG; (c) MEG determines to engage with Strathcona to negotiate the terms of a combination transaction and MEG and Strathcona determine to undertake that transaction utilizing a structure other than a take-over bid, such as an arrangement; or (d) a material adverse change has occurred in the business, affairs, assets, operations or prospects of MEG prior to commencement of the Offer. Accordingly, there can be no assurance that the Offer will be made or that the final terms of the Offer will be as set out in this news release. WEF III Equity Investment Details In connection with the Offer being formally made, WEF III intends to subscribe for and commit to purchase 21.4 million subscription receipts of Strathcona ("Strathcona Subscription Receipts") representing approximately, but not equal to or greater than, 10% of the Strathcona Shares issued and outstanding immediately prior to the commencement of the Offer (the "WEF III Equity Investment"). The subscription price of the Strathcona Subscription Receipts and other terms and conditions of the WEF III Equity Investment will be determined prior to commencement of the Offer in accordance with the rules of the TSX, through negotiations between WEF III and a special committee comprised of independent directors of Strathcona (the "Special Committee") that has been established in connection with the WEF III Equity Investment. Strathcona expects that the subscription price for the Strathcona Subscription Receipts under the WEF III Equity Investment will be determined in accordance with the rules of the TSX with reference to the five-day volume weighted average price of the Strathcona Shares on the TSX prior to the date of commencement of the Offer. Each Strathcona Subscription Receipt is expected to entitle WEF III to receive, automatically upon the take-up of MEG Shares deposited under the initial deposit period for the Offer, one Strathcona Share. The proceeds of the WEF III Equity Investment will be held in escrow by a subscription receipt agent and released to, or at the direction of, Strathcona concurrently upon Strathcona taking up MEG Shares at the expiration of the initial deposit period for the Offer, and will be used by Strathcona to reduce a portion of the amount committed under the Bridge Financing Commitment. In the event that Strathcona withdraws or terminates the Offer and has not entered into a definitive agreement to acquire MEG, the proceeds of the WEF III Equity Investment will be returned to WEF III. The completion of the WEF III Equity Investment will be subject to the satisfaction or waiver of certain customary conditions to be negotiated by the Special Committee and WEF III and is expected to be completed no later than 45 days from the commencement of the Offer. The Offer will not be conditional on the closing of the WEF III Equity Investment. Advisors Scotiabank and TD Securities are acting as exclusive financial advisors to Strathcona in connection with the Offer. Blake, Cassels & Graydon LLP and Skadden, Arps, Slate, Meagher & Flom LLP are acting as legal counsel to Strathcona in connection with the Offer. The Special Committee has engaged Torys LLP to act as its legal counsel in connection with the WEF III Equity Investment. Strathcona has also engaged Laurel Hill Advisory Group to act as strategic communications advisor and information agent in connection with the Offer. MEG Shareholders may contact Laurel Hill Advisory Group by email at assistance@ or by phone at 1-877-452-7184 (Toll-Free). About Strathcona Strathcona is one of North America's fastest growing oil producers with operations focused on thermal oil and enhanced oil recovery. Strathcona is built on an innovative approach to growth achieved through the consolidation and development of long-life oil and gas assets. The Strathcona Shares are listed on the Toronto Stock Exchange (TSX: SCR). Website addresses are provided for informational purposes only and no information contained on, or accessible from, such websites is incorporated by reference in this news release unless expressly incorporated by reference. No Offer or Solicitation This news release is for informational purposes only and does not constitute an offer to buy or sell, or a solicitation of an offer to sell or buy, any securities. The Offer to acquire MEG Shares and issue Strathcona Shares in connection therewith will be made solely by, and subject to the terms and conditions set out in, the formal offer to purchase and take-over bid circular and accompanying letter of transmittal and notice of guaranteed delivery. The formal offer to purchase and take-over bid circular will contain important information about the Offer and should be read in its entirety by MEG Shareholders. Cautionary Statement Respecting Information of MEG Strathcona has not had access to the non-public books and records of MEG and Strathcona is not in a position to independently assess or verify certain of the information in MEG's publicly filed documents, including its financial statements and reserves disclosures. MEG has not reviewed this news release and has not confirmed the accuracy and completeness of the information in respect of MEG contained herein. As a result, all information regarding MEG included herein has been taken from, or is based upon, publicly available information filed by MEG with the applicable securities regulatory authorities in Canada prior to the date hereof and other public sources. While Strathcona has no reason to believe that such publicly available information is inaccurate or incomplete, or contains any untrue statement of a material fact or omits to state a material fact that is required to be stated or that is necessary to make a statement not misleading in light of the circumstances in which it was made, Strathcona does not assume any responsibility for the accuracy or completeness of any such information or for any failure by MEG to disclose events or facts which may have occurred or which may affect the significance or accuracy of any such information but which are unknown to Strathcona. Production and Reserves Information MEG's oil and gas reserves and Strathcona's oil and gas reserves estimates have been prepared in accordance with National Instrument 51‑101 – Standards for Disclosure for Oil and Gas Activities ("NI 51-101"), which prescribes oil and gas disclosure standards for Canadian public issuers engaged in oil and gas activities that differ from the oil and gas disclosure standards of the SEC under Subpart 1200 of Regulation S-K. NI 51-101 permits oil and gas issuers, in their filings with the applicable securities regulatory authorities in Canada, to disclose proved, probable and possible reserves, and to disclose reserves and production on a gross basis before deducting royalties. The SEC definitions of proved and probable reserves are different than the definitions contained in NI 51‑101. Therefore, MEG's and Strathcona's proved and probable reserves may not be comparable to those disclosed by U.S. companies in reports filed with the SEC. Moreover, as permitted by NI 51‑101, Strathcona has determined and disclosed its reserves and the related net present value of future net revenue from its reserves in its NI 51‑101 compliant reserves disclosure using forecast prices and costs. In contrast, the SEC requires that reserves and related future net revenue be estimated based on historical 12‑month average prices rather than forecast prices, but permits the optional disclosure of revenue estimates based on different price and cost criteria, including standardized future prices or management's own forecasts. Consequently, the oil and gas reserves estimates of MEG and Strathcona that are prepared in accordance with NI 51‑101 are not comparable to oil and gas reserve estimates provided by U.S. companies in their filings with the SEC. All production is presented on a gross basis (as defined in NI 51-101) unless otherwise stated. Oil and Gas Metrics This news release contains metrics commonly used in the crude oil and natural gas industry, including "net asset value per share" and "reserves life index". These terms do not have a standardized meaning and may not be comparable to similar measures presented by other companies, and therefore should not be used to make such comparisons. Readers are cautioned as to the reliability of oil and gas metrics used in this news release. Management of Strathcona uses these oil and gas metrics for its own performance measurements and to provide investors with measures to compare Strathcona's projected performance over time; however, such measures are not reliable indicators of Strathcona's future performance, which may not compare to Strathcona's performance in previous periods, and therefore should not be unduly relied upon. Non-GAAP Financial Measures and Ratios This news release makes reference to certain financial measures and ratios that are not recognized measures under generally accepted accounting principles ("GAAP") and do not have a standardized meaning prescribed by the Accounting Standards. Non-GAAP financial measures and ratios are used internally by management to assess the performance of Strathcona. They also provide investors with meaningful metrics to assess Strathcona's performance compared to other companies in the same industry. However, Strathcona's use of these terms may not be comparable to similarly defined measures presented by other companies. Readers are cautioned that these measures should not be construed as an alternative to financial measures determined in accordance with GAAP and these measures should not be considered to be more meaningful than GAAP measures in evaluating the Strathcona's performance. "Net Debt" and "Net Debt (Post Montney Disposition and HRT Acquisition)" are used by management to analyze leverage and liquidity. Net Debt is calculated as debt less cash and cash equivalents. Net Debt (Post Montney Disposition and HRT Acquisition) reflects Net Debt after giving effect to the disposition of Strathcona's Montney assets and the acquisition by Strathcona of the Hardisty Rail Terminal. The following table summarizes the Net Debt and Net Debt (Post Montney Disposition and HRT Acquisition), as applicable, of Strathcona, MEG and the combined business as at March 31, 2025:As at March 31, 2025 ($ millions) Strathcona MEG Combined Company Debt 2,899 857 3,756 Cash and cash equivalents — (88) (88) Marketable securities (482) — (482) Unamortized debt costs 21 6 27 Net Debt 2,438 775 3,213 Adjustment for Montney asset disposition(1) (2,607) — (2,607) Adjustment for HRT acquisition 45 — 45 Net Debt (Post Montney Disposition and HRT Acquisition) (123) 775 652 (1) Assumes cash and share disposition proceeds of $2,691.5 million are used to repay $2,607.2 million of debt and $84.3 million of other obligations as of 3/31/2025 relating to an asset-backed financing agreement pertaining to certain facility processing interests. Forward-Looking Information This news release contains certain "forward-looking information" within the meaning of applicable Canadian securities laws and "forward-looking statements" within the meaning of applicable U.S. securities laws (collectively, "forward-looking information") and are prospective in nature. Forward-looking information is not based on historical facts, but rather on current expectations and projections about future events, and is therefore subject to risks and uncertainties that could cause actual results to differ materially from the future results expressed or implied by the forward-looking information. Often, but not always, forward-looking information can be identified by the use of forward-looking words such as "believes", "plans", "expects", "intends" and "anticipates", or variations of such words, and phrases or statements that certain actions, events or results "may", "could", "should", "would", "might" or "will" be taken, occur or be achieved. Forward-looking information contained in this news release includes, but is not limited to, statements relating to: the expected benefits of the Offer and the combination of Strathcona and MEG, both to the MEG Shareholders and the Strathcona Shareholders; the anticipated strategic, operational and financial benefits that may result from the combination of Strathcona and MEG, including, but not limited to: the size and scale of the combined company, including the combined company's expected production and reserves; the expected per-share accretion to both MEG Shareholders and Strathcona Shareholders, including improved funds flow per share, funds flow less sustaining capital expenditures per share, net asset value per share and production per share; the expected potential cost synergies identified by Strathcona in connection with the combination of MEG and Strathcona, including the categories and amounts thereof, including with respect to overhead, interest, capital expenditures and operating costs, among others, and the related benefits thereof; the combined company achieving an investment grade credit rating; and other anticipated strategic, operational and financial benefits that may result from the combination of Strathcona and MEG; the pro forma debt of the combined company and its expected net debt to EBITDA ratio; the expected pro forma ownership of the combined company by the MEG Shareholders and the Strathcona Shareholders, including WEF and WEF III; Strathcona's intention to make the Offer, including the terms thereof, including the consideration to be offered by Strathcona thereto, and the filing of formal offer to purchase and take‐over bid circular in connection therewith; the conditions that the Offer will be subject to and possible reasons that the Offer would not be made by Strathcona; Strathcona's intentions with respect to the financing of the cash consideration payable under the Offer, including the expected reduction of the Bridge Financing Commitment by virtue of the WEF III Equity Investment; expectations with respect to the terms of the WEF III Equity Investment, including the subscription price for, and other terms of, the Strathcona Subscription Receipts thereunder and the timing thereof, including the timing of completion thereof; the treatment of the proceeds of the WEF III Equity Investment; the receipt of the requisite approval of Strathcona Shareholders with respect to the issuance of Strathcona Shares pursuant to the Offer by delivery of a written consent of WEF; the filing of the Registration Statement and other materials with the SEC; Strathcona's intention to request a list of MEG's securityholders from MEG; the expected mailing of the formal offer to purchase and take-over bid circular; and Strathcona's intention to acquire any MEG Shares not deposited under the Offer through a statutory compulsory acquisition, if available, or a subsequent transaction for the purpose of MEG becoming, directly or indirectly, a wholly-owned subsidiary or affiliate of Strathcona, including the consideration expected to be offered thereunder. Although Strathcona believes that the expectations reflected by the forward-looking information presented in this news release are reasonable, the forward-looking information is based on assumptions and factors concerning future events that may prove to be inaccurate. Those assumptions and factors are based on information currently available to Strathcona about itself and MEG and the businesses in which they operate. Information used in developing forward-looking information has been acquired from various sources, including third party consultants, suppliers and regulators, among others. The material assumptions used to develop the forward-looking information herein include, but are not limited to: the ability of Strathcona to complete the combination of Strathcona and MEG, pursuant to the Offer or otherwise, integrate Strathcona's and MEG's respective businesses and operations and realize the anticipated strategic, operational and financial benefits synergies from the acquisition of MEG by Strathcona; the conditions of the Offer will be satisfied on a timely basis in accordance with their terms; the anticipated synergies and other anticipated benefits of the Offer will be realized in a manner consistent with Strathcona's expectations; future production rates and estimates of capital and operating costs of the combined company; the combined company's reserves volumes and the net present values thereof; anticipated timing and results of capital expenditures of the combined company; MEG's public disclosure is accurate and that MEG has not failed to publicly disclose any material information respecting MEG, its business, operations, assets, material agreements or otherwise; there will be no material changes to laws and regulations adversely affecting Strathcona's or MEG's operations; and the impact of the current economic climate and financial, political and industry conditions on Strathcona's and MEG's operations will remain consistent with Strathcona's current expectations. All figures and descriptions provided in this news release related to the Offer, including with respect to the consideration payable under the Offer, the reasons for the Offer, the potential benefits to the MEG Shareholders and expected pro forma effects, are based on and assume the following: (a) Strathcona's and MEG's respective dividends, liquidity, debt, credit ratings, debt costs and assets (including reserves and resources) will not change from May 15, 2025, in the case of Strathcona, and from what Strathcona has ascertained from MEG's public filings on SEDAR+ up to and including May 15, 2025, in the case of MEG, and, in the case of reserves and contingent resources, as applicable, those reported by Strathcona and MEG in their respective most recent annual information forms for the year ended December 31, 2024; (b) approximately 254.4 million MEG Shares will be issued and outstanding immediately prior to the date of the Offer and 2.6 million MEG Shares will be issuable pursuant to the exercise, exchange or conversion, as applicable, of the securities of MEG that are exercisable or exchangeable for or convertible into MEG Shares (other than rights under the Shareholder Rights Plan) outstanding immediately prior to the date of the Offer; (c) that all of the MEG Shares will be deposited under the Offer pursuant to the terms thereof or acquired by Strathcona pursuant to a statutory compulsory acquisition, if available, or a subsequent transaction for the purpose of MEG becoming, directly or indirectly, a wholly-owned subsidiary or affiliate of Strathcona; and (d) no other MEG Shares or Strathcona Shares will be issued before the successful completion of the Offer. Assumptions have also been made with respect to future oil and gas prices, differentials and future foreign exchange and interest rates. Although Strathcona believes that the assumptions made and the expectations represented by such statements or information are reasonable, there can be no assurance that the forward-looking information herein will prove to be accurate. Because actual results or outcomes could differ materially from those expressed in any forward-looking information, readers should not place undue reliance on any such forward-looking information. By its nature, forward-looking information is based on assumptions and involves known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by such forward-looking information. In particular, there are certain risks related to the consummation of the Offer and the combination of Strathcona and MEG, and the business and operations of MEG and Strathcona (including the business and operations that are currently being conducted and undertaken by Strathcona and those that are expected to be conducted and undertaken by Strathcona upon consummation of the Offer) including, but not limited to: changes in general economic conditions in Canada, the United States and elsewhere; changes in operating conditions (including as a result of weather patterns); the volatility of prices for oil and natural gas and other commodities; commodity supply and demand; fluctuations in foreign exchange and interest rates; changes or proposed changes in applicable tariff rates; availability of financial resources and/or third-party financing; availability of equipment, materials and personnel; defaults by counterparties under commercial arrangements to which MEG or Strathcona (or any of their respective subsidiaries) is a party; an inability to procure regulatory approvals in a timely manner or on terms satisfactory to Strathcona; new or changing laws and regulations (domestic and foreign); the risk of failure to satisfy the conditions to the Offer; and the risk that the anticipated synergies and other benefits of the Offer may not be realized. In addition, readers are cautioned that the actual results of Strathcona following the successful completion of the Offer may differ materially from the expectations expressed herein as a result of a number of additional risks and uncertainties. Some of these risks, uncertainties and other factors are similar to those faced by other oil and gas companies and some are unique to Strathcona. Strathcona's annual information form for the year ended December 31, 2024 and other documents filed by Strathcona with the applicable Canadian securities regulatory authorities (available under Strathcona's profile on SEDAR+ at further describe risks, material assumptions and other factors that could influence actual results. This news release contains information that may constitute a financial outlook about the prospective financial performance, financial position or cash flows of the company resulting from the combination of Strathcona and MEG, all of which is subject to the same assumptions, risk factors, limitations and qualifications as set forth above. Any financial outlook included in this news release has been prepared by, and is the responsibility of, management of Strathcona. Readers are cautioned that the assumptions used in the preparation of such financial outlook, although considered reasonable, and reflecting the best estimates and judgments and assumptions that are reasonable in the circumstances, at the time of preparation, may prove to be imprecise or inaccurate and, as such, undue reliance should not be placed on such financial outlook. The actual results, performance and achievements of the combined company could differ materially from those expressed in, or implied by, such financial outlook. Strathcona has included such financial outlook in order to provide readers with a more complete perspective on the combined company's future operations and management's current expectations relating to the combined company's future performance following completion of the Offer. Readers are cautioned that such information may not be appropriate for other purposes. Management approved the financial outlook contained herein as of the date of this news release. The forward-looking information contained in this news release is provided as of the date hereof and Strathcona does not undertake any obligation to update or to revise any of the forward-looking information included herein, except as required by applicable securities laws. The forward-looking information contained in this news release is expressly qualified by this cautionary statement. View original content to download multimedia: SOURCE Strathcona Resources Ltd. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Cision Canada
14-05-2025
- Business
- Cision Canada
Yellow Pages Limited Reports First Quarter 2025 Financial and Operating Results and Declares a Cash Dividend (1) Français
, May 14, 2025 /CNW/ - Yellow Pages Limited (TSX: Y) (the "Company"), a leading Canadian digital media and marketing company, released its operating and financial results today for the quarter ended March 31, 2025. "Our first quarter results show continued steady progress toward revenue stability, good profitability, and a strong cash balance," said David A. Eckert, CEO of Yellow Pages Limited. Eckert commented on the key developments: Progress toward revenue stability."For the fifth consecutive quarter, we report a favorable 'bending of the revenue curve' in Q1, as our rate of change in revenue was better than the change reported for the previous quarter." Solid quarterly earnings. "Our Adjusted EBITDA 2 for the quarter was 23.4% of revenue, even with our continued investments in revenue initiatives, including the steady continued expansion of our sales force." Strong cash balance. "Despite certain significant, seasonal cash disbursements during the quarter, cash still stood at approximately $49 million at the end of April." Sherilyn King, President of Yellow Pages Limited, added, "We continue to be very pleased with our progress on metrics underlying our revenue generation, including the size of our sales force, the continued deceleration of the customer count decline rate, fueled by new customer acquisitions and stable renewal rates, and strong average spend per customer. We believe these fundamentals bode well for our medium- and long-term future. Also, our Board has once again declared a dividend of $0.25 per common share, to be paid on June 16, 2025 to shareholders of record as of May 27, 2025." Financial Highlights (In thousands of Canadian dollars, except percentage information and per share information) (1) The dividend will be designated as an eligible dividend pursuant to subsection 89(14) of the Income Tax Act (Canada) and any applicable provincial legislation pertaining to eligible dividends. (2) Adjusted EBITDA is equal to Income from operations before depreciation and amortization and restructuring and other charges (defined herein as Adjusted EBITDA), as shown in Yellow Pages Limited's interim condensed consolidated statements of income. Adjusted EBITDA, Adjusted EBITDA margin, CAPEX, Adjusted EBITDA less CAPEX and Adjusted EBITDA less CAPEX margin are non-GAAP financial measures and do not have any standardized meaning under IFRS ® Accounting Standards. Therefore, they are unlikely to be comparable to similar measures presented by other public companies. Refer to the section on Non-GAAP financial measures at the end of this document for more details. First Quarter of 2025 Results Total Revenues decreased 7.6% year-over-year and amounted to $50.8 million for the three-month period ended March 31, 2025, an improvement from the decrease of 8.1% reported last quarter. Adjusted EBITDA less CAPEX 1 totalled $11.4 million and the EBITDA less CAPEX margin 1 was 22.5%. Net income amounted to $5.0 million, or to $0.35 diluted income per share. F inancial Results for the First Quarter of 2025 Total revenues for the first quarter ended March 31, 2025 decreased by 7.6% year-over-year and amounted to $50.8 million as compared to $55.0 million for the same period last year. The decrease in revenues is mainly due to the decline of our higher margin digital media and print products and to a lesser extent to our lower margin digital services products, thereby creating pressure on our gross profit margins. Total digital revenues decreased 6.8% year-over-year and amounted to $40.7 million for the three-month period ended March 31, 2025 compared to $43.7 million for the same period last year. The revenue decline is mainly attributable to a decrease in digital customer count, partially offset by an increase in the average spend per customer. Total print revenues decreased 10.5% year-over-year and amounted to $10.1 million for the three-month period ended March 31, 2025. The revenue decline is mainly due to the decrease in the number of print customers while the spend per customer has improved year-over-year driven by price increases. The decline rate for total revenues, digital revenues and print revenues all improved year-over-year. The improvement of the revenue decline rates was mainly due to the deceleration of the customer count decline rate, fueled by an increase in new customer acquisitions, while renewal rates remained relatively stable and an increase in average spend per customer, due in part to price increases. Adjusted EBITDA 1 decreased to $11.9 million or 23.4% of revenues in the first quarter ended March 31, 2025, relative to $15.3 million or 27.8% of revenues for the same period last year. The decrease in Adjusted EBITDA and Adjusted EBITDA margin 1 for the three-month period ended March 31, 2025 is the result of revenue pressures, the ongoing investments in our tele-sales force capacity, and the impact of the Company's share price on cash settled stock-based compensation expense, partially offset by optimization in cost of sales, reductions in other operating costs including reductions in our workforce and associated employee expenses. The revaluation of cash settled stock-based compensation liabilities resulted in a recovery of $1.3 million for the three-month period ended March 31, 2025 compared to a recovery of $1.9 million for the same period last year. Revenue pressures from product mix and investments in our tele-sales force capacity, partially offset by continued optimization and cost reductions, will continue to cause pressure on margins in upcoming quarters. Adjusted EBITDA less CAPEX decreased by $2.9 million to $11.4 million during the first quarter of 2025, compared to $14.3 million during the same period last year. The decrease in Adjusted EBITDA less CAPEX and Adjusted EBITDA less CAPEX margin for the three-month period ended March 31, 2025 is driven by the decrease in Adjusted EBITDA, partially offset by a decrease in CAPEX spend year-over-year. Net income for the three-month period ended March 31, 2025 amounted to $5.0 million as compared to net income of $8.4 million for the same period last year. The decrease is mainly due to lower Adjusted EBITDA and the increase in restructuring and other charges, partially offset by the decrease in income taxes. Cash flows from operating activities decreased by $2.2 million to $3.3 million for the three-month period ended March 31, 2025 from $5.5 million for the same period last year. The decrease is mainly due to lower Adjusted EBITDA of $3.4 million partially offset by a decrease in funding of post-employment benefit plans of $1.5 million. (1) Adjusted EBITDA is equal to Income from operations before depreciation and amortization and restructuring and other charges (defined herein as Adjusted EBITDA), as shown in Yellow Pages Limited's interim condensed consolidated statements of income. Adjusted EBITDA, Adjusted EBITDA margin, CAPEX, Adjusted EBITDA less CAPEX, Adjusted EBITDA less CAPEX margin are non-GAAP financial measures and do not have any standardized meaning under IFRS Accounting Standards. Therefore, they are unlikely to be comparable to similar measures presented by other public companies. Refer to the section on Non-GAAP financial measures at the end of this document for more details. Conference Call & Webcast Yellow Pages Limited will hold an analyst and media call and simultaneous webcast at 8:30 a.m. (Eastern Time) on May 14, 2025 to discuss first quarter 2025 results. The call may be accessed by dialing 416-695-6725 within the Toronto area, or 1-866-696-5910 outside of Toronto, Passcode 4418135#. Please be prepared to join the conference at least 5 minutes prior to the conference start time. The call will be simultaneously webcast on the Company's website at: The conference call will be archived in the Investors section of the site at: About Yellow Pages Limited Yellow Pages Limited (TSX: Y) is a Canadian digital media and marketing company that creates opportunities for buyers and sellers to interact and transact in the local economy. Yellow Pages holds some of Canada's leading local online properties including Canada411 and The Company also holds the YP, Canada411 and 411 mobile applications and Yellow Pages print directories. For more information visit Caution Concerning Forward-Looking Statements T his press release contains forward-looking statements about the objectives, strategies, financial conditions and results of operations and businesses of YP (including, without limitation, payment of a cash dividend per share per quarter to its common shareholders). These statements are forward-looking as they are based on our current expectations, as at May 13, 2025, about our business and the markets we operate in, and on various estimates and assumptions. Our actual results could materially differ from our expectations if known or unknown risks affect our business, or if our estimates or assumptions turn out to be inaccurate. As a result, there is no assurance that any forward-looking statements will materialize. Risks that could cause our results to differ materially from our current expectations are discussed in section 5 of our May 13, 2025 Management's Discussion and Analysis. We disclaim any intention or obligation to update any forward-looking statements, except as required by law, even if new information becomes available, as a result of future events or for any other reason. Non-GAAP Financial Measures A djusted EBITDA and Adjusted EBITDA margin In order to provide a better understanding of the results, the Company uses the terms Adjusted EBITDA and Adjusted EBITDA margin. Adjusted EBITDA is equal to Income from operations before depreciation and amortization and restructuring and other charges (defined herein as Adjusted EBITDA), as shown in Yellow Pages Limited's interim condensed consolidated statements of income. Adjusted EBITDA margin is defined as the percentage of Adjusted EBITDA to revenues. Adjusted EBITDA and Adjusted EBITDA margin are not performance measures defined under IFRS Accounting Standards and are not considered an alternative to income from operations or net income in the context of measuring Yellow Pages performance. Adjusted EBITDA and Adjusted EBITDA margin do not have a standardized meaning under IFRS Accounting Standards and are therefore not likely to be comparable to similar measures used by other publicly traded companies. Adjusted EBITDA and Adjusted EBITDA margin should not be used as exclusive measures of cash flow since they do not account for the impact of working capital changes, income taxes, interest payments, pension funding, capital expenditures, debt principal reductions and other sources and uses of cash, which are disclosed on page 10 of our May 13, 2025 MD&A. Management uses Adjusted EBITDA and Adjusted EBITDA margin to evaluate the performance of its business as it reflects its ongoing profitability. Management believes that certain investors and analysts use Adjusted EBITDA and Adjusted EBITDA margin to measure a company's ability to service debt and to meet other payment obligations or as common measurement to value companies in the media and marketing solutions industry as well as to evaluate the performance of a business. A djusted EBITDA less CAPEX and Adjusted EBITDA less CAPEX margin The Company also uses Adjusted EBITDA less CAPEX, which is defined as Adjusted EBITDA, as defined above, less CAPEX which we define as additions to intangible assets and additions to property and equipment as reported in the Investing Activities section of the Company's consolidated statements of cash flows. Adjusted EBITDA less CAPEX margin is defined as the percentage of Adjusted EBITDA less CAPEX to revenues. Adjusted EBITDA less CAPEX and Adjusted EBITDA less CAPEX margin are non-GAAP financial measures and do not have any standardized meaning under IFRS Accounting Standards. Therefore, are unlikely to be comparable to similar measures presented by other publicly traded companies. We use Adjusted EBITDA less CAPEX and Adjusted EBITDA less CAPEX margin to evaluate the performance of our business as it reflects cash generated from business activities. We believe that certain investors and analysts use Adjusted EBITDA less CAPEX and Adjusted EBITDA less CAPEX margin to evaluate the performance of businesses in our industry. The most comparable financial measure under IFRS Accounting Standards to Adjusted EBITDA less CAPEX is Income from operations before depreciation and amortization and restructuring and other charges (defined above as Adjusted EBITDA) as shown in Yellow Pages Limited's interim condensed consolidated statements of income. Refer to table below for reconciliation of Adjusted EBITDA less CAPEX. For the three-month periods March 31, 2025 2024 Income from operations before depreciation and amortization and restructuring and other charges (Adjusted EBITDA) $ 11,885 $ 15,297 CAPEX 473 986 Total Adjusted EBITDA less CAPEX $ 11,412 $ 14,311 SOURCE Yellow Pages Limited
Yahoo
14-05-2025
- Business
- Yahoo
Yellow Pages Limited Reports First Quarter 2025 Financial and Operating Results and Declares a Cash Dividend (1)
MONTREAL, May 14, 2025 /CNW/ - Yellow Pages Limited (TSX: Y) (the "Company"), a leading Canadian digital media and marketing company, released its operating and financial results today for the quarter ended March 31, 2025. "Our first quarter results show continued steady progress toward revenue stability, good profitability, and a strong cash balance," said David A. Eckert, CEO of Yellow Pages Limited. Eckert commented on the key developments: Progress toward revenue stability. "For the fifth consecutive quarter, we report a favorable 'bending of the revenue curve' in Q1, as our rate of change in revenue was better than the change reported for the previous quarter." Solid quarterly earnings. "Our Adjusted EBITDA2 for the quarter was 23.4% of revenue, even with our continued investments in revenue initiatives, including the steady continued expansion of our sales force." Strong cash balance. "Despite certain significant, seasonal cash disbursements during the quarter, cash still stood at approximately $49 million at the end of April." Sherilyn King, President of Yellow Pages Limited, added, "We continue to be very pleased with our progress on metrics underlying our revenue generation, including the size of our sales force, the continued deceleration of the customer count decline rate, fueled by new customer acquisitions and stable renewal rates, and strong average spend per customer. We believe these fundamentals bode well for our medium- and long-term future. Also, our Board has once again declared a dividend of $0.25 per common share, to be paid on June 16, 2025 to shareholders of record as of May 27, 2025." Financial Highlights(In thousands of Canadian dollars, except percentage information and per share information) Yellow Pages Limited For the three-month periodsended March 31,2025 2024 Revenues $50,808 $54,971 Adjusted EBITDA2 $11,885 $15,297 Adjusted EBITDA margin2 23.4 % 27.8 % Income before income taxes $6,661 $11,369 Net income $4,963 $8,395 Basic income per share $0.37 $0.62 Diluted income per share $0.35 $0.61 CAPEX2 $473 $986 Adjusted EBITDA less CAPEX2 $11,412 $14,311 Adjusted EBITDA less CAPEX margin2 22.5 % 26.0 % Cash flows from operating activities $3,278 $5,454(1) The dividend will be designated as an eligible dividend pursuant to subsection 89(14) of the Income Tax Act (Canada) and any applicable provincial legislation pertaining to eligible dividends. (2) Adjusted EBITDA is equal to Income from operations before depreciation and amortization and restructuring and other charges (defined herein as Adjusted EBITDA), as shown in Yellow Pages Limited's interim condensed consolidated statements of income. Adjusted EBITDA, Adjusted EBITDA margin, CAPEX, Adjusted EBITDA less CAPEX and Adjusted EBITDA less CAPEX margin are non-GAAP financial measures and do not have any standardized meaning under IFRS® Accounting Standards. Therefore, they are unlikely to be comparable to similar measures presented by other public companies. Refer to the section on Non-GAAP financial measures at the end of this document for more details. First Quarter of 2025 Results Total Revenues decreased 7.6% year-over-year and amounted to $50.8 million for the three-month period ended March 31, 2025, an improvement from the decrease of 8.1% reported last quarter. Adjusted EBITDA less CAPEX1 totalled $11.4 million and the EBITDA less CAPEX margin1 was 22.5%. Net income amounted to $5.0 million, or to $0.35 diluted income per share. Financial Results for the First Quarter of 2025 Total revenues for the first quarter ended March 31, 2025 decreased by 7.6% year-over-year and amounted to $50.8 million as compared to $55.0 million for the same period last year. The decrease in revenues is mainly due to the decline of our higher margin digital media and print products and to a lesser extent to our lower margin digital services products, thereby creating pressure on our gross profit margins. Total digital revenues decreased 6.8% year-over-year and amounted to $40.7 million for the three-month period ended March 31, 2025 compared to $43.7 million for the same period last year. The revenue decline is mainly attributable to a decrease in digital customer count, partially offset by an increase in the average spend per customer. Total print revenues decreased 10.5% year-over-year and amounted to $10.1 million for the three-month period ended March 31, 2025. The revenue decline is mainly due to the decrease in the number of print customers while the spend per customer has improved year-over-year driven by price increases. The decline rate for total revenues, digital revenues and print revenues all improved year-over-year. The improvement of the revenue decline rates was mainly due to the deceleration of the customer count decline rate, fueled by an increase in new customer acquisitions, while renewal rates remained relatively stable and an increase in average spend per customer, due in part to price increases. Adjusted EBITDA1 decreased to $11.9 million or 23.4% of revenues in the first quarter ended March 31, 2025, relative to $15.3 million or 27.8% of revenues for the same period last year. The decrease in Adjusted EBITDA and Adjusted EBITDA margin1 for the three-month period ended March 31, 2025 is the result of revenue pressures, the ongoing investments in our tele-sales force capacity, and the impact of the Company's share price on cash settled stock-based compensation expense, partially offset by optimization in cost of sales, reductions in other operating costs including reductions in our workforce and associated employee expenses. The revaluation of cash settled stock-based compensation liabilities resulted in a recovery of $1.3 million for the three-month period ended March 31, 2025 compared to a recovery of $1.9 million for the same period last year. Revenue pressures from product mix and investments in our tele-sales force capacity, partially offset by continued optimization and cost reductions, will continue to cause pressure on margins in upcoming quarters. Adjusted EBITDA less CAPEX decreased by $2.9 million to $11.4 million during the first quarter of 2025, compared to $14.3 million during the same period last year. The decrease in Adjusted EBITDA less CAPEX and Adjusted EBITDA less CAPEX margin for the three-month period ended March 31, 2025 is driven by the decrease in Adjusted EBITDA, partially offset by a decrease in CAPEX spend year-over-year. Net income for the three-month period ended March 31, 2025 amounted to $5.0 million as compared to net income of $8.4 million for the same period last year. The decrease is mainly due to lower Adjusted EBITDA and the increase in restructuring and other charges, partially offset by the decrease in income taxes. Cash flows from operating activities decreased by $2.2 million to $3.3 million for the three-month period ended March 31, 2025 from $5.5 million for the same period last year. The decrease is mainly due to lower Adjusted EBITDA of $3.4 million partially offset by a decrease in funding of post-employment benefit plans of $1.5 million. (1) Adjusted EBITDA is equal to Income from operations before depreciation and amortization and restructuring and other charges (defined herein as Adjusted EBITDA), as shown in Yellow Pages Limited's interim condensed consolidated statements of income. Adjusted EBITDA, Adjusted EBITDA margin, CAPEX, Adjusted EBITDA less CAPEX, Adjusted EBITDA less CAPEX margin are non-GAAP financial measures and do not have any standardized meaning under IFRS Accounting Standards. Therefore, they are unlikely to be comparable to similar measures presented by other public companies. Refer to the section on Non-GAAP financial measures at the end of this document for more Call & Webcast Yellow Pages Limited will hold an analyst and media call and simultaneous webcast at 8:30 a.m. (Eastern Time) on May 14, 2025 to discuss first quarter 2025 results. The call may be accessed by dialing 416-695-6725 within the Toronto area, or 1-866-696-5910 outside of Toronto, Passcode 4418135#. Please be prepared to join the conference at least 5 minutes prior to the conference start time. The call will be simultaneously webcast on the Company's website at: The conference call will be archived in the Investors section of the site at: About Yellow Pages Limited Yellow Pages Limited (TSX: Y) is a Canadian digital media and marketing company that creates opportunities for buyers and sellers to interact and transact in the local economy. Yellow Pages holds some of Canada's leading local online properties including Canada411 and The Company also holds the YP, Canada411 and 411 mobile applications and Yellow Pages print directories. For more information visit Caution Concerning Forward-Looking Statements This press release contains forward-looking statements about the objectives, strategies, financial conditions and results of operations and businesses of YP (including, without limitation, payment of a cash dividend per share per quarter to its common shareholders). These statements are forward-looking as they are based on our current expectations, as at May 13, 2025, about our business and the markets we operate in, and on various estimates and assumptions. Our actual results could materially differ from our expectations if known or unknown risks affect our business, or if our estimates or assumptions turn out to be inaccurate. As a result, there is no assurance that any forward-looking statements will materialize. Risks that could cause our results to differ materially from our current expectations are discussed in section 5 of our May 13, 2025 Management's Discussion and Analysis. We disclaim any intention or obligation to update any forward-looking statements, except as required by law, even if new information becomes available, as a result of future events or for any other reason. Non-GAAP Financial Measures Adjusted EBITDA and Adjusted EBITDA margin In order to provide a better understanding of the results, the Company uses the terms Adjusted EBITDA and Adjusted EBITDA margin. Adjusted EBITDA is equal to Income from operations before depreciation and amortization and restructuring and other charges (defined herein as Adjusted EBITDA), as shown in Yellow Pages Limited's interim condensed consolidated statements of income. Adjusted EBITDA margin is defined as the percentage of Adjusted EBITDA to revenues. Adjusted EBITDA and Adjusted EBITDA margin are not performance measures defined under IFRS Accounting Standards and are not considered an alternative to income from operations or net income in the context of measuring Yellow Pages performance. Adjusted EBITDA and Adjusted EBITDA margin do not have a standardized meaning under IFRS Accounting Standards and are therefore not likely to be comparable to similar measures used by other publicly traded companies. Adjusted EBITDA and Adjusted EBITDA margin should not be used as exclusive measures of cash flow since they do not account for the impact of working capital changes, income taxes, interest payments, pension funding, capital expenditures, debt principal reductions and other sources and uses of cash, which are disclosed on page 10 of our May 13, 2025 MD&A. Management uses Adjusted EBITDA and Adjusted EBITDA margin to evaluate the performance of its business as it reflects its ongoing profitability. Management believes that certain investors and analysts use Adjusted EBITDA and Adjusted EBITDA margin to measure a company's ability to service debt and to meet other payment obligations or as common measurement to value companies in the media and marketing solutions industry as well as to evaluate the performance of a business. Adjusted EBITDA less CAPEX and Adjusted EBITDA less CAPEX margin The Company also uses Adjusted EBITDA less CAPEX, which is defined as Adjusted EBITDA, as defined above, less CAPEX which we define as additions to intangible assets and additions to property and equipment as reported in the Investing Activities section of the Company's consolidated statements of cash flows. Adjusted EBITDA less CAPEX margin is defined as the percentage of Adjusted EBITDA less CAPEX to revenues. Adjusted EBITDA less CAPEX and Adjusted EBITDA less CAPEX margin are non-GAAP financial measures and do not have any standardized meaning under IFRS Accounting Standards. Therefore, are unlikely to be comparable to similar measures presented by other publicly traded companies. We use Adjusted EBITDA less CAPEX and Adjusted EBITDA less CAPEX margin to evaluate the performance of our business as it reflects cash generated from business activities. We believe that certain investors and analysts use Adjusted EBITDA less CAPEX and Adjusted EBITDA less CAPEX margin to evaluate the performance of businesses in our industry. The most comparable financial measure under IFRS Accounting Standards to Adjusted EBITDA less CAPEX is Income from operations before depreciation and amortization and restructuring and other charges (defined above as Adjusted EBITDA) as shown in Yellow Pages Limited's interim condensed consolidated statements of income. Refer to table below for reconciliation of Adjusted EBITDA less CAPEX. Adjusted EBITDA less CAPEX(In thousands of Canadian dollars, except percentage information) For the three-month periods March 31, 2025 2024 Income from operations before depreciation and amortization and restructuring and other charges (Adjusted EBITDA) $ 11,885 $ 15,297 CAPEX473986 Total Adjusted EBITDA less CAPEX $ 11,412 $ 14,311 SOURCE Yellow Pages Limited View original content:
Yahoo
13-05-2025
- Business
- Yahoo
Flagship Communities Real Estate Investment Trust Announces First Quarter 2025 Results
Not for distribution to U.S. newswire services or dissemination in the United States. TORONTO, May 13, 2025 (GLOBE NEWSWIRE) -- Flagship Communities Real Estate Investment Trust ('Flagship' or the 'REIT') (TSX: MHC.U; today released its first quarter 2025 results. The financial results of the REIT are prepared in accordance with IFRS® Accounting Standards ('IFRS') as issued by the International Accounting Standards Board (the 'IASB'). Results are shown in U.S. dollars, unless otherwise noted. First Quarter 2025 Results Rental revenue and related income was $24.8 million, an increase of 24.4% compared to $19.9 million. Same Community Revenue1 was $22.5 million, up 12.9% compared to $19.9 million. Net income and comprehensive income was $10.5 million compared to $11.1 million, a decrease of 6.0%. Net Operating Income ('NOI') was $16.4 million, up 23.0% compared to $13.3 million. Same Community NOI1 was $15.1 million, an increase of 12.9% compared to $13.3 million. NOI Margin1 was 66.2% compared to 67.0%. Same Community NOI Margin1 was 67.0%, unchanged from the prior period. FFO adjusted per unit (diluted)2 was $0.342 compared to $0.325, an increase of $0.017 per unit, or 5.2%. Adjusted funds from operations ('AFFO') adjusted per unit (diluted)2 was $0.310 compared to $0.285 which was an increase of $0.025 per unit, or 8.8%. Rent Collections1 were 99.7%, the same as in the prior period. As at March 31, 2025 NAV1 and NAV per Unit1 were $689.5 million and $27.44, respectively, compared to $670.8 million and $26.71 as at December 31, 2024, respectively. Debt to Gross Book Value1 was 37.5% compared to 38.1% as at December 31, 2024. Total portfolio Occupancy was 84.4%, up from 83.5% as at December 31, 2024. Same Community1 Occupancy was 84.9%, a 1.0% increase from 83.9% as at December 31, 2024. Subsequent to Year-End Published its fifth annual Environmental, Social and Governance ('ESG') report, which described Flagship's corporate governance and sustainability commitments, including two new initiatives, the installation of flock camera security systems and storm shelters, aimed at enhancing the safety and security of residents. Awarded the 2025 National Community Operator of the Year by the Manufactured Housing Institute and Community Impact Project of the Year for Flagship's Suburban Pointe community. 1See 'Other Real Estate Industry Metrics'2See 'Non-IFRS Financial Measures' 'Following a record year for Flagship in 2024, we have carried that momentum into the first quarter of 2025,' said Kurt Keeney, President and CEO. 'We delivered another quarter of strong Same Community metric growth and successfully completed a refinancing at attractive terms. We also continue to advance our lot expansion strategy and have begun clearing land for a lot expansion in Elsmere, Kentucky, which will include a new amenities package that is expected to be accretive to the existing community.' Financial Summary ($000s except per share amounts) For the threemonths endedMar. 31, 2025 For the three months ended Mar. 31, 2024 Variance Rental revenue and related income 24,781 19,920 24.4% Same Community Revenue1 22,487 19,920 12.9% Acquisitions Revenue1 2,294 - n/a Net income and comprehensive income 10,459 11,124 (6.0)% NOI, total portfolio 16,403 13,337 23.0% Same Community NOI1 15,060 13,337 12.9% Acquisitions NOI1 1,343 - n/a NOI Margin1, total portfolio 66.2% 67.0% (1.2)% Same Community NOI Margin1 67.0% 67.0% - Acquisitions NOI Margin1 58.5% 0.0% n/a FFO2 8,352 4,354 91.8% FFO per unit2 0.332 0.206 61.2% FFO adjusted2 8,580 6,877 24.8% FFO adjusted per unit2 0.342 0.325 5.2% AFFO2 7,572 3,497 116.5% AFFO per unit2 0.301 0.165 82.4% AFFO Payout Ratio2 51.2% 89.0% (42.5%) AFFO adjusted2 7,800 6,020 29.6% AFFO adjusted per unit2 0.310 0.285 8.8% AFFO adjusted Payout Ratio2 49.7% 51.7% (3.9%) Weighted average units (basic) 19,402,056 15,492,056 3,910,000 Weighted average units (Diluted) 25,121,258 21,147,279 3,973,979 See 'Other Real Estate Industry Metrics' See 'Non-IFRS Financial Measures' Financial Overview Rental revenue and related income in the first quarter of 2025 was $24.8 million, up 24.4% compared to the same period last year. This increase was primarily driven by Acquisitions as well as lot rent increases and Occupancy increases across the REIT's portfolio. Same Community Revenue for the first quarter of 2025 was $22.5 million, approximately $2.6 million higher than the same period last year. The increase in Same Community Revenue was a result of increasing monthly lot rent year over year, growth in Same Community Occupancy, and increased utility reimbursements. Ancillary revenues, which are comprised of amenity fees including cable and internet fees, also contributed. Net income and comprehensive income for the three months ended March 31, 2025 was $0.7 million less than the same period last year, as a result of the fair value adjustments on investment properties and Class B Units of Flagship Operating, LLC ('Class B Units') being $4.4 million less than in the same period in 2024. NOI and NOI Margin for the first quarter of 2025 were $16.4 million and 66.2%, respectively, compared to $13.3 million and 67.0% during the first quarter of 2024. Same Community NOI Margin for the first quarter ended March 31, 2025 was 67.0%, the same as in the period last year. Same Community Occupancy was 84.9% as at March 31, 2025, representing an increase of 1.0% compared to the same period in 2024. FFO for the first quarter of 2025 was $8.4 million, an increase of 91.8% from the first quarter of 2024. FFO per unit for the three months ended March 31, 2025 and 2024 was $0.332 and $0.206 respectively, an increase of 61.2%. FFO adjusted was $8.6 million for the first quarter of 2025, a 24.8% increase compared to the same period last year. FFO adjusted per unit for the first quarter of 2025 was $0.342, a 5.2% increase compared to the same period in 2024. AFFO for the first quarter of 2025 was $7.6 million, an increase of 116.5% from the first quarter of 2024. AFFO per unit for the three months ended March 31, 2025 and 2024 was $0.301 and $0.165, respectively, an increase of 82.4%. AFFO adjusted was $7.8 million for the first quarter of 2025, a 29.6% increase compared to the same period last year. AFFO adjusted per unit for the first quarter of 2025 was $0.310, an 8.8% increase compared to the same period in 2024. The increases in FFO adjusted and AFFO adjusted were driven by increases to NOI through lot rent increases, Occupancy growth, ancillary revenue growth and other factors. Rent Collections for the first quarter of 2025 remained stable at 99.7%, compared to the same period last year. During the first quarter of 2025, Flagship borrowed $27.1 million as a supplemental borrowing on its Fannie Mae credit facility. The interest rate on this note is 6.03% for 10 years with all payments being interest only for the full term. Also during the first quarter, Flagship borrowed $22.7 million with an interest rate of 5.76% for 10 years with all payments being interest only for the full term. The proceeds for these borrowings enabled Flagship to repay the $45 million outstanding on the May 2024 Bridge Note, which had an interest rate of 6.82% at the time of payoff. The REIT now has no substantial debt maturities until 2030. As at March 31, 2025 the REIT's Weighted Average Mortgage and Note Interest Rate (see 'Other Real Estate Industry Metrics' for more information) was 4.26% and the REIT's Weighted Average Mortgage and Note Term (see 'Other Real Estate Industry Metrics' for more information) to maturity was 9.8 years. Flagship's Liquidity (see 'Other Real Estate Industry Metrics' for more information) as at March 31, 2025 was approximately $15.6 million consisting of cash, cash equivalents, and available capacity on lines of credit. Operations Overview The REIT continues to advance the integration process and home expansion strategy for the seven new Manufactured Housing Communities ('MHC') Flagship acquired in Tennessee and West Virginia, as well as its lot expansion strategy across the portfolio. The REIT begun clearing land for a lot expansion in Elsmere, Kentucky, which will include a new amenities package that is expected to benefit all residents and be accretive to the existing lots in the community. Flagship also recently published its fifth ESG Report (the 'Report'). The Report articulates Flagship's sustainability strategy and initiatives to help provide affordable housing and quality residential living experiences for its residents. The Report also describes two new initiatives, the installation of Flock security camera systems and the establishment of storm shelters in partnership with a local municipality, specifically aimed to enhance resident safety. To learn more visit Flagship's website at As at March 31, 2025, the REIT owned a 100% interest in a portfolio of 80 MHCs with 14,668 lots as well as two recreational vehicle ('RV') resort communities with 470 sites. The table below provides a summary of the REIT's portfolio as of March 31, 2025, compared to December 31, 2024: ($000s except per unit and Weighted Average Lot Rent amounts) As at March 31, 2025 As at December 31, 2024 Total communities (#) 82 82 Total lots (#) 15,138 15,137 Weighted Average Lot Rent1 (US$) 484 448 Total portfolio occupancy (%) 84.4 83.5 NAV1 (US$) 689,484 670,784 NAV per Unit1 (US$) 27.44 26.71 Debt to Gross Book Value1 (%) 37.5 38.1 Weighted Average Mortgage and Note Interest Rate1 (%) 4.26 4.41 Weighted Average Mortgage and Note Term1 (Years) 9.8 9 See 'Other Real Estate Industry Metrics' Outlook Flagship maintains a positive outlook for the MHC industry and believes it offers significant upside potential to investors. This is primarily due to the MHC industry's consistent track record of historical outperformance relative to other real estate classes. Rising home ownership costs and limited new supply, have led to greater housing unaffordability for many Americans. Additionally, the lack of supply of new manufactured housing communities given the various layers of regulatory restrictions, competing land uses and scarcity of land zoned has created high barriers to entry for new market entrants. Other macro and MHC industry-specific characteristics and trends that support Flagship's positive outlook include: Increasing household formations; Lower housing and rental affordability; Declining single-family residential homeownership rates Non-IFRS Financial Measures In this news release, the REIT uses certain financial measures that are not defined under IFRS including certain non-IFRS ratios, to measure, compare and explain the operating results, financial performance and cash flows of the REIT. These measures are commonly used by entities in the real estate industry as useful metrics for measuring performance. However, they do not have any standardized meaning prescribed by IFRS and are not necessarily comparable to similar measures presented by other publicly traded entities. These measures should be considered as supplemental in nature and not as a substitute for related financial information prepared in accordance with IFRS. Funds from Operations and Adjusted Funds from Operations Funds from operations ('FFO') and adjusted funds from operations ('AFFO') are calculated in accordance with the definition provided by the Real Property Association of Canada ('REALPAC'). FFO is defined as IFRS consolidated net income (loss) adjusted for items such as distributions on redeemable or exchangeable units (including distributions on the Class B Units), unrealized fair value adjustments to Class B Units, unrealized fair value adjustments to investment properties, unrealized fair value adjustments to unit based compensation, loss on extinguishment of acquired mortgages payable, gain on disposition of investment properties, and depreciation. FFO should not be construed as an alternative to consolidated net income (loss) or consolidated cash flows provided by (used in) operating activities determined in accordance with IFRS. The REIT's method of calculating FFO is substantially in accordance with REALPAC's recommendations but may differ from other issuers' methods and, accordingly, may not be comparable to FFO reported by other issuers. Refer to section 'Reconciliation of FFO, FFO per unit, FFO adjusted, FFO adjusted per unit, AFFO, AFFO per unit, AFFO adjusted and AFFO adjusted per unit' for a reconciliation of FFO and FFO adjusted to net income (loss) and comprehensive income (loss). 'FFO per unit (diluted)' is defined as FFO for the applicable period divided by the diluted weighted average unit count (including Units, Class B Units, vested Restricted Units ('RUs') and vested Deferred Trust Units ('DTUs')) during the period. 'FFO adjusted' is defined as FFO adjusted for non-real estate industry specific operating transactions. FFO adjusted presents FFO in a normalized manner that is substantially in accordance with REALPAC's recommendations. FFO adjusted may, as transactions occur, include adjustments that were not included in the definition of FFO adjusted in a previous period but are included in the current period to present FFO in a normalized manner that is substantially in accordance with REALPAC's recommendations. Adjustments for the three months ended March 31, 2025, included mortgages payable settlement, which is comprised of prepayment penalties, defeasance, amortization of financing costs, and other costs associated with the refinance and payoff of certain mortgages payable prior to maturity. 'FFO adjusted per unit (diluted)' is defined as FFO adjusted for the applicable period divided by the diluted weighted average unit count (including Units, Class B Units, vested RUs and vested DTUs) during the period. AFFO is defined as FFO adjusted for items such as maintenance capital expenditures, and certain non-cash items such as amortization of intangible assets, and premiums and discounts on debt and investments. AFFO should not be construed as an alternative to consolidated net income (loss), or consolidated cash flows provided by (used in) operating activities determined in accordance with IFRS. The REIT's method of calculating AFFO is substantially in accordance with REALPAC's recommendations. The REIT uses a capital expenditure reserve of $75 per lot per year and $1,100 per rental home per year, for the years ending, or ended, December 31, 2025 and 2024, respectively, in the AFFO calculation. This reserve is based on management's best estimate of the cost that the REIT may incur related to maintaining the investment properties. This may differ from other issuers' methods and, accordingly, may not be comparable to AFFO reported by other issuers. Refer to section 'Reconciliation of FFO, FFO per unit, FFO adjusted, FFO adjusted per unit, AFFO, AFFO per unit, AFFO adjusted and AFFO adjusted per unit' for a reconciliation of AFFO and AFFO adjusted to net income (loss) and comprehensive income (loss). 'AFFO Payout Ratio' is defined as total cash distributions of the REIT (including distributions on Class B Units) divided by AFFO. 'AFFO per unit (diluted)' is defined as AFFO for the applicable period divided by the diluted weighted average unit count (including Units, Class B Units, vested RUs and vested DTUs) during the period. 'AFFO adjusted' is defined as AFFO adjusted for transactions that are not considered recurring measures of economic earnings with the goal of presenting AFFO in a normalized manner that is substantially in accordance with REALPAC's recommendations. AFFO adjusted may, as transactions occur, include adjustments that were not included in the definition of AFFO adjusted in a previous period but are included in the current period to present AFFO in a normalized manner that is substantially in accordance with REALPAC's recommendations. Adjustments for the three months ended March 31, 2025 included mortgages payable settlement, which includes any mark-to-market adjustment remaining at the time of refinance and payoff of associated mortgages payable prior to maturity (new to FFO adjusted for the period). Adjustments also included mortgages payable settlement expense, which is comprised of prepayment penalties, defeasance, amortization of financing costs, and other costs associated with the refinance and payoff of certain mortgages payable prior to maturity. 'AFFO adjusted Payout Ratio' is defined as total cash distributions of the REIT (including distributions on Class B Units) divided by AFFO adjusted. 'AFFO adjusted per unit (diluted)' is defined as AFFO adjusted for the applicable period divided by the diluted weighted average unit count (including Units, Class B Units, vested RUs and vested DTUs) during the period. The REIT believes these non-IFRS financial measures and ratios provide useful supplemental information to both management and investors in measuring the operating performance, financial performance and financial condition of the REIT. The REIT also uses AFFO and AFFO adjusted in assessing its distribution paying capacity. Other Real Estate Industry Metrics Additionally, this news release contains several other real estate industry financial metrics: 'Acquisitions' means the REIT's properties, excluding Same Community (as defined below) (i.e., Acquisitions Revenue, as well as Acquisitions net operating income ('NOI'), and Acquisitions NOI Margin (as defined below)), and such measure is used by management to evaluate period-over-period performance of such investment properties throughout both respective periods. These results reflect the impact of acquisitions of investment properties. 'Debt to Gross Book Value' is calculated by dividing indebtedness, which consists of the total principal amounts outstanding under mortgages and note payable, net and credit facilities, by Gross Book Value (as defined below). Refer to section 'Calculation of Other Real Estate Industry Metrics – Debt to Gross Book Value.' 'Gross Book Value' means, at any time, the greater of: (a) the value of the assets of the REIT and its consolidated subsidiaries, as shown on its then most recent consolidated statements of financial position prepared in accordance with IFRS, less the amount of any receivable reflecting interest rate subsidies on any debt assumed by the REIT; and (b) the historical cost of the investment properties, plus (i) the carrying value of cash and cash equivalents, (ii) the carrying value of mortgages receivable; and (iii) the historical cost of other assets and investments used in operations. 'Liquidity' is defined as (a) cash and cash equivalents, plus (b) borrowing capacity available under any existing credit facilities. 'Net Asset Value' or 'NAV' is calculated by taking unitholders' equity plus Class B Units, vested RUs and vested DTUs. NAV provides an indication of the total value of the REIT's investment properties, after accounting for outstanding mortgages and note payable. NAV also provides an indication of the changes in the REIT's overall value resulting from the performance of its assets. The reason for adding back Class B Units, vested RUs and vested DTUs is that they are economically equivalent to Units, receive the same distributions (or distribution equivalents) as Units, and can be exchanged for Units. 'Net Asset Value per Unit' or 'NAV per Unit' is defined as NAV divided by the total number of units (including Units, Class B Units, vested RUs and vested DTUs) outstanding. 'NOI Margin' is defined as NOI divided by total revenue. Refer to section 'Calculation of Other Real Estate Industry Metrics – NOI and NOI Margin'. 'Occupancy' is defined as the number of economically occupied lots in a community, defined as a lot that is generating revenue for the REIT as opposed to a lot that is physically occupied by a vacant structure, divided by the total lots in that community. 'Rent Collections' is defined as the total cash collected in a period divided by total revenue charged in that same period. 'Same Community' means all properties which have been owned and operated continuously since the first day of the preceding calendar year by the REIT and such measures (i.e., Same Community Revenue, as well as Same Community NOI, Same Community NOI Margin, and Same Community Occupancy) are used by management to evaluate period-over-period performance. 'Weighted Average Lot Rent' means the lot rent for each individual community multiplied by the total lots in that community summed for all communities divided by the total number of lots for all communities. 'Weighted Average Mortgage and Note Interest Rate' is calculated by the interest rate of each outstanding mortgage and note by the mortgage and note balance (as applicable) and dividing the sum by the total mortgage and note balance. 'Weighted Average Mortgage and Note Term' is calculated by multiplying the remaining term of each mortgage and note by the mortgage and note balance (as applicable) and dividing the sum by the total mortgage and note balance. Reconciliation of FFO, FFO per unit, FFO adjusted, FFO adjusted per unit, AFFO and AFFO per unit, AFFO adjusted and AFFO adjusted per unit ($000s, except per unit amounts) For the three months ended Mar. 31, 2025 For the three months ended Mar. 31, 2024 Net income (loss) and comprehensive income (loss) 10,459 11,124 Adjustments to arrive at FFO Depreciation 127 111 (Gain) on sale of investment properties (50 ) - Fair value adjustments - Class B units 10,820 7,090 Distributions on Class B units 865 824 Fair value adjustment – investment properties (14,207 ) (14,829 ) Fair value adjustment – unit based compensation 338 34 Funds from Operations ('FFO') 8,352 4,354 FFO per unit (diluted) 0.332 0.206 Adjustments to arrive at FFO adjusted Mortgages payable settlement expenses 228 2,523 FFO adjusted 8,580 6,877 FFO adjusted per unit (diluted) 0.342 0.325 Adjustments to arrive at AFFO Accretion of mark-to-market adjustment on mortgage payable (56 ) (257 ) Capital Expenditure Reserves (724 ) (600 ) Adjusted Funds from Operations ('AFFO') 7,572 3,497 AFFO per unit (diluted) 0.301 0.165 Adjustments to arrive at AFFO adjusted Mortgages payable settlement expenses 228 2,523 AFFO adjusted 7,800 6,020 AFFO adjusted per unit (diluted) 0.310 0.285 Calculation of Other Real Estate Industry Metrics NOI and NOI Margin ($000s) For the three months ended Mar. 31, 2025 For the three months ended Mar. 31, 2024 Rental revenue and related income 24,781 19,920 Property operating expenses 8,378 6,583 NOI 16,403 13,337 NOI Margin 66.2% 67.0% NAV and NAV per Unit ($000s, except per unit amounts) As at Mar. 31, 2025 As at Dec. 31, 2024 Unitholders Equity 593,101 585,651 Class B Units 93,979 83,159 Vested RU 703 626 Vested DTU 1,701 1,348 NAV 689,484 670,784 Total Units1 25,122,488 25,111,891 NAV per Unit 27.44 26.71 1. Total Units includes Units, Class B Units, vested RUs and vested DTUs Debt to Gross Book Value ($000s) As at Mar. 31, 2025 As at Dec. 31, 2024 Total Debt Line of Credit - 3,000 Mortgages and note payable, net (current portion) 300 45,271 Mortgages and note payable, net (non-current portion) 422,980 374,552 423,280 422,823 Gross Book Value Cash and cash equivalents 5,622 7,264 Tenant and other receivables, net 1,396 1,984 Prepaids and other assets 3,725 3,344 Lender escrow deposits 4,197 3,206 Other non-current assets 445 615 Investment properties 1,107,284 1,087,348 Property and equipment, net 3,189 3,274 Note receivable – related party 2,460 2,460 1,128,318 1,109,495 Debt to Gross Book Value 37.5% 38.1% Forward-Looking Statements This news release contains statements that include forward-looking information (within the meaning of applicable Canadian securities laws). Forward-looking statements are identified by words such as 'believe', 'anticipate', 'project', 'expect', 'intend', 'plan', 'will', 'may', 'can', 'could', 'would', 'must', 'estimate', 'target', 'objective', and other similar expressions, or negative versions thereof, and include statements herein concerning: the REIT's investment strategy, objectives and creation of long-term value; the REIT's intention to continue to expand in its existing operational footprint, increasing its presence in core markets to enhance efficiencies and achieve economies of scale, and target growth markets, the REIT's intention to convert rental homes to tenant owned homes as opportunities allow; expected sources of funding for future acquisitions and the expected performance of acquisitions; macro characteristics and trends in the United States real estate and housing industry, as well as the manufactured housing community ('MHC') industry specifically; the REIT's distribution policy and intended sources of cash therefor; and the REIT's target indebtedness as a percentage of Gross Book Value. These statements are based on the REIT's expectations, estimates, forecasts, and projections, as well as assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies that could cause actual results to differ materially from those that are disclosed in such forward-looking statements. While considered reasonable by management of the REIT as at the date of this news release, any of these expectations, estimates, forecasts, projections, or assumptions could prove to be inaccurate, and as a result, the forward-looking statements based on those expectations, estimates, forecasts, projections, or assumptions could be incorrect. Material factors and assumptions used by management of the REIT to develop the forward-looking information in this news release include, but are not limited to, the REIT's current expectations about: vacancy and rental growth rates in MHCs and the continued receipt of rental payments in line with historical collections; demographic trends in areas where the MHCs are located; further MHC acquisitions by the REIT; the applicability of any government regulation concerning MHCs and other residential accommodations; the availability of debt financing and future interest rates, as there is no guarantee that the future Federal Reserve will continue to hold or decrease interest rates; increasing expenditures and fees, in connection with the ownership of MHCs, driven by inflation or tariffs; tax laws; general economic conditions; and the recent increased volatility of equity markets in the United States. When relying on forward-looking statements to make decisions, the REIT cautions readers not to place undue reliance on these statements, as they are not guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including, but not limited to, the factors discussed or referenced under the heading 'Risks and Uncertainties' in the REIT's most recent Management's Discussion & Analysis or otherwise disclosed in the Annual Information Form. There can be no assurance that forward-looking statements will prove to be accurate as actual outcomes and results may differ materially from those expressed in these forward-looking statements. Further, certain forward-looking statements included in this news release may be considered as 'financial outlook' for purposes of applicable Canadian securities laws, and as such, the financial outlook may not be appropriate for purposes other than to understand management's current expectations and plans relating to the future, as disclosed in this news release. Forward-looking statements are made as of the date of this news release and, except as expressly required by applicable law, the REIT assumes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. First Quarter 2025 Results Conference Call and Webcast DATE: Wednesday, May 14, 2025 TIME: 8:30 a.m. ET JOIN BY PHONE: (Click the URL to join the conference call by phone) Please register at least 10 minutes before the start of the call. Upon registration, an email will be sent, including dial-in details and a unique conference call access code required to join the live call. LIVE WEBCAST: About Flagship Communities Real Estate Investment Trust Flagship Communities Real Estate Investment Trust (TSX: MHC.U; is a leading operator of affordable residential Manufactured Housing Communities primarily serving working families seeking affordable home ownership. The REIT owns and operates exceptional residential living experiences and investment opportunities in family-oriented communities in Kentucky, Indiana, Ohio, West Virginia, Tennessee, Arkansas, Missouri, and Illinois. To learn more about Flagship, visit For further information, please contact: Eddie Carlisle, Chief Financial OfficerFlagship Communities Real Estate Investment TrustTel: +1 (859) 568-3390Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Cision Canada
07-05-2025
- Business
- Cision Canada
iA Financial Group Reports First Quarter Results
Continued profitable growth supported by sustained strong sales momentum and robust capital position This news release presents financial information in accordance with IFRS ® Accounting Standards (referred to as "IFRS" in this document) and certain non-IFRS and additional financial measures used by the Company when evaluating its results and measuring its performance. For relevant information about non-IFRS measures used in this document, see the "Non-IFRS and Additional Financial Measures" section in this document and in the Management's Discussion and Analysis for the period ended March 31, 2025, which is hereby incorporated by reference and is available for review at or on iA Financial Group's website at The results presented below are for iA Financial Corporation Inc. ("iA Financial Group" or the "Company"). QUEBEC CITY, QC, May 7, 2025 /CNW/ - FIRST QUARTER HIGHLIGHTS Core EPS †† of $2.91 (+19% YoY), trailing-12-month core ROE †† of 16.1% and annualized core ROE †† of 15.8% EPS of $1.98, trailing-12-month ROE 1 of 13.0% and annualized ROE of 10.8% Strong sales 2 momentum in Canada and the U.S., leading to $5.8 billion in premiums and deposits 2,3 (+19% YoY) Assets of more than $264 billion at March 31, 2025, for a solid 15% increase over the last 12 months (total AUM 2 and AUA 2) Robust solvency ratio 4 of 132% at March 31, 2025 supported by ongoing organic capital generation 2 Flexible balance sheet and capital available for deployment 2 of $1.4 billion at March 31, 2025 Book value per common share 5 reaching $74.62 at March 31, 2025, up 2% over 3 months and up 8% over 12 months For the first quarter ended March 31, 2025, iA Financial Group (TSX: IAG) recorded core diluted earnings per common share (EPS) †† of $2.91, which is 19% higher than the same period in 2024. Core return on common shareholders' equity (ROE) †† for the trailing 12 months was 16.1%. First quarter net income attributed to common shareholders was $186 million, diluted EPS was $1.98 and ROE for the trailing 12 months was 13.0%. The solvency ratio was 132% at March 31, 2025, reflecting a strong capital position. "After a solid performance in 2024, we continued to show strong momentum entering 2025 across all business units. The sales and earnings growth seen in both Canada and the U.S. in the first quarter underscores the strength of our distribution network and diversified business model, positioning us strongly to achieve our new financial targets introduced at our Investor Event in February," 6 commented Denis Ricard, President and CEO of iA Financial Group. "In Canada, we maintained our strong sales position in our foundation businesses, comprising individual insurance, dealer services and segregated funds. In the U.S, Individual Insurance reported solid results, fueled by organic growth and acquisitions, and Dealer Services delivered the gradual improvement in earnings we had anticipated, reflecting our disciplined focus on execution." "Profitability was very good in the first quarter, with a 19% increase in core EPS †† year over year driven by good earnings growth in all three operating segments and ROE for the last 12 months in excess of 16%, progressing steadily toward our new target of 17%+ set for 2027, 6" added Éric Jobin, Executive Vice-President, CFO, and Chief Actuary. "In the context of an evolving economic environment, our strong capital position, flexible balance sheet, resilient business model and disciplined, long-term approach collectively serve as a firm base to pursue our sustainable growth strategy." Other Financial Highlights March 31, 2025 December 31, 2024 March 31, 2024 Return on common shareholders' equity (trailing 12 months) 13.0 % 13.9 % 10.9 % Core return on common shareholders' equity †† (trailing 12 months) 16.1 % 15.9 % 14.6 % Solvency ratio 132 % 139 % 142 % Book value per common share $74.62 $73.44 $68.93 Assets under management and assets under administration (in billions) $264.0 $259.4 $229.3 † This item is a non-IFRS financial measure; see the "Non-IFRS and Additional Financial Measures" section and the "Reconciliation of Select Non-IFRS Financial Measures" section in this document for relevant information about such measures and a reconciliation of non-IFRS financial measures to the most directly comparable IFRS measure. †† This item is a non-IFRS ratio; see the "Non-IFRS and Additional Financial Measures" section in this document and in the Q1/2025 Management's Discussion and Analysis. __________________________________________________ 1 Consolidated net income attributed to common shareholders divided by the average common shareholders' equity for the period. 2 Sales, net premiums, premium equivalents and deposits, assets under management (AUM), assets under administration (AUA), capital available for deployment and organic capital generation represent supplementary financial measures. Refer to the "Non-IFRS and Additional Financial Measures" section in this document and in the Q1/2025 Management's Discussion and Analysis for more information. 3 Net premiums, premium equivalents and deposits. 4 The solvency ratio is calculated in accordance with the Capital Adequacy Requirements Guideline – Life and Health Insurance (CARLI) mandated by the Autorité des marchés financiers du Québec (AMF). This financial measure is exempt from certain requirements of Regulation 52-112 respecting Non-GAAP and Other Financial Measures Disclosure according to AMF Blanket Order No. 2021-PDG-0065. 5 Book value per common share is calculated by dividing the common shareholders' equity, which represents the total equity less other equity instruments, by the number of common shares outstanding at the end of the period. 6 See the "Financial Targets" and "Forward-looking statements" sections of this news release. Unless otherwise indicated, the results presented in this document are in Canadian dollars and are compared with those from the corresponding period last year. ANALYSIS OF EARNINGS BY BUSINESS SEGMENT The following table sets out the core earnings † and net income attributed to common shareholders by business segment. An analysis of the performance by business segment and a reconciliation between the net income attributed to common shareholders and core earnings † is provided in the following pages. Insurance, Canada Net income attributed to common shareholders for the Insurance, Canada segment was $87 million, which is higher than $83 million for the same period in 2024. Net income attributed to common shareholders is composed of core earnings † as well as core earnings adjustments. Core earnings adjustments to net income totalled $13 million. These include acquisition-related items ($5 million), impact of non-core pension expenses ($3 million) and other adjustments consisting primarily of tax-related items and reallocations for reporting consistency, which mostly sum to zero on a consolidated basis ($5 million). Core earnings † for this business segment were $100 million, higher than $92 million for the same period in 2024. This 9% increase in core earnings † over the same period in 2024 is the net result of several favourable items. Expected insurance earnings 7 were 9% higher, reflecting an increase in the combined risk adjustment (RA) release 7 and CSM recognized for services provided 7 and an increase in expected earnings on Premium Allocation Approach (PAA) 7 business from iA Auto and Home. Additionally, the impact of new insurance business 7 from Employee Plans was lower compared to a year ago. The increase in core non-insurance activities 7 was driven by good performances from Dealer Services and distribution activities. Lastly, core insurance experience 7 gains of $4 million were recorded during the quarter, reflecting lower claims at iA Auto and Home and favourable morbidity experience in Employee Plans, which were partially offset by unfavourable mortality experience. 7 This item is a component of the drivers of earnings (DOE). Refer to the "Non-IFRS and Additional Financial Measures" section in this document for more information on presentation according to the DOE. For a reconciliation of core earnings† to net income attributed to common shareholders through the drivers of earnings (DOE), refer to the "Reconciliation of Select Non-IFRS Financial Measures" section of this document. † This item is a non-IFRS financial measure; see the "Non-IFRS and Additional Financial Measures" section and the "Reconciliation of Select Non-IFRS Financial Measures" section in this document for relevant information about such measures and a reconciliation of non-IFRS financial measures to the most directly comparable IFRS measure. †† This item is a non-IFRS ratio; see the "Non-IFRS and Additional Financial Measures" section in this document and in the Q1/2025 Management's Discussion and Analysis. Wealth Management Net income attributed to common shareholders for the Wealth Management segment was $95 million, which is higher than $88 million for the same period in 2024. Net income attributed to common shareholders is composed of core earnings † as well as core earnings adjustments. Core earnings adjustments to net income totalled $11 million, mostly from acquisition-related items ($7 million) and a non-recurring specified item ($3 million). Core earnings † for this business segment were $106 million for the first quarter compared with $95 million a year ago. The 12% increase in core earnings † over the same period in 2024 is mainly the result of an increase in the combined RA release and CSM recognized for service provided due to strong net segregated fund sales and the impact of favourable financial market performance over the last 12 months. Also, core non-insurance activities 8 were higher, reflecting a good performance from Group Savings and Retirement, arising mainly from higher net revenue on assets. US Operations Net income attributed to common shareholders for the US Operations segment was $19 million, which is higher than $12 million for the same period in 2024. Net income attributed to common shareholders is composed of core earnings † as well as core earnings adjustments. Core earnings adjustments to net income totalled $11 million from acquisition-related items ($9 million) and an adjustment consisting of a reallocation for reporting consistency, which sum to zero on a consolidated basis ($2 million). Core earnings † for this business segment were $30 million, compared to $19 million for the same period in 2024. The 58% increase in core earnings † over the same period in 2024 is driven by the following: A strong $19 million 9 increase in the core insurance service result, which includes the contributions of the Prosperity blocks of business and $8 million 9 from the Vericity acquisition; A $1 million 9 increase in core non-insurance activities, which includes a significant year-over-year increase of $5 million 9 from Dealer Services and a $4 million 9 loss from the distribution activities of Vericity; and An increase in core other expenses 8 as expected following the addition of Vericity expenses. The impact of the Vericity and Prosperity acquisitions is neutral on core earnings and in line with expectations at the time of their acquisition. Net income attributed to common shareholders for the Investment segment was $35 million compared to $100 million for the same period in 2024. Net income attributed to common shareholders is composed of core earnings † as well as core earnings adjustments. Core earnings adjustments to net income of $50 million for this business segment include the following three items: the market-related impacts that differ from management's expectations, resulting in a net loss of $63 million. This adjustment is explained by the unfavourable impacts of: 1) equity variations, reflecting losses of $42 million from public equity and $17 million from private equity; 2) investment property value adjustments totalling $16 million; and 3) CIF adjustments of $4 million. These were partly offset by the favourable impact of interest rate and credit spread variations of $16 million; the favourable impact of assumption changes of $5 million resulting from the update of credit assumptions used to develop the interest rate scale (recurring update specific to the Investment segment and expected to be carried out in the first quarter of each year under IFRS 17); and other favourable adjustments consisting of tax-related items and reallocations for reporting consistency, which mostly sum to zero on a consolidated basis. Core earnings † for this business segment were $85 million compared to $86 million a year ago. Prior to taxes, financing charges and expenses, core earnings † were driven by a core net investment result 8 of $124 million. This result compares favourably with $109 million recorded a year ago and $120 million the previous quarter. This strong outcome was bolstered by, among other factors, the favourable impact of interest rate variations in recent quarters. In addition, credit experience 8 was favourable due to higher impacts from upgrades than downgrades in the fixed income portfolio ($1 million) and credit experience that was in line with expectations in the car loans portfolio of iA Auto Finance. 8 This item is a component of the drivers of earnings (DOE). Refer to the "Non-IFRS and Additional Financial Measures" section in this document for more information on presentation according to the DOE. For a reconciliation of core earnings† to net income attributed to common shareholders through the drivers of earnings (DOE), refer to the "Reconciliation of Select Non-IFRS Financial Measures" section of this document. 9 Before taxes. † This item is a non-IFRS financial measure; see the "Non-IFRS and Additional Financial Measures" section and the "Reconciliation of Select Non-IFRS Financial Measures" section in this document for relevant information about such measures and a reconciliation of non-IFRS financial measures to the most directly comparable IFRS measure. †† This item is a non-IFRS ratio; see the "Non-IFRS and Additional Financial Measures" section in this document and in the Q1/2025 Management's Discussion and Analysis. Corporate The net loss attributed to common shareholders for the Corporate segment was $50 million, which is similar to the result for the same period in 2024. The net loss attributed to common shareholders comprises core losses † as well as core loss adjustments; Core loss adjustments to net loss for this business segment totalled $2 million and are related to the acquisition and integration of Vericity; and This segment recorded core losses † from after-tax expenses of $48 million, which compares with $49 million in the first quarter of 2024. This quarter's result is derived from Corporate core other expenses of $65 million before taxes, which is in line with the 2025 quarterly expectation of $68 million plus or minus $5 million. This result reflects, among other things, ongoing strong emphasis on operational efficiency leading to positive operating leverage 10 and temporary savings that may reverse in future quarters. RECONCILIATION OF NET INCOME ATTRIBUTED TO COMMON SHAREHOLDERS AND CORE EARNINGS † The following table presents net income attributed to common shareholders and the adjustments that account for the difference between net income attributed to common shareholders and core earnings. † Core earnings † of $273 million in the first quarter are derived from net income attributed to common shareholders of $186 million and a total adjustment of $87 million (post tax) from: the unfavourable market-related impacts that differ from management's expectations, totalling $63 million. This adjustment is explained by the unfavourable impacts of: 1) equity variations, reflecting losses of $42 million from public equity and $17 million from private equity; 2) investment property value adjustments totalling $16 million; and 3) CIF adjustments of $4 million. These were partly offset by the favourable impact of interest rate and credit spread variations of $16 million; the favourable impact of assumption changes of $5 million resulting from the update of credit assumptions used to develop the interest rate scale (recurring update related to our Investment segment and expected to be carried out in the first quarter of each year under IFRS 17); a total of $2 million mainly related to the acquisition and integration of Vericity; the expenses associated with acquisition-related intangible assets of $21 million; the impact of non-core pension expenses of $4 million; and specified items totalling $2 million consisting mostly of tax-related items. Net Income Attributed to Common Shareholders and Core Earnings † Reconciliation – Consolidated (In millions of dollars, unless otherwise indicated) First quarter 2025 2024 Variation Net income attributed to common shareholders 186 233 (20 %) Core earnings adjustments (post tax) Market-related impacts 63 (9) Interest rates and credit spreads (16) (3) Equity 59 (32) Investment properties 16 23 CIF 11 4 3 Currency — — Assumption changes and management actions (5) (5) Charges or proceeds related to acquisition or disposition of a business, including acquisition, integration and restructuring costs 2 3 Amortization of acquisition-related finite life intangible assets 21 17 Non-core pension expense 4 4 Other specified unusual gains and losses 2 — Total 87 10 Core earnings † 273 243 12 % Contractual Service Margin (CSM) 12 – During the first quarter, the CSM increased organically by $132 million. This increase is due to the positive impact of new insurance business of $191 million, organic financial growth of $92 million and a net insurance experience gain of $44 million, which were moderated by the CSM recognized for service provided in earnings of $195 million, up 19% from a year earlier. Non-organic items led to a decrease of $99 million the first quarter, mostly due to the unfavourable impact of market performance. As a result, the total CSM increased by $33 million during the quarter to stand at $6,932 million at March 31, 2025, an increase of 13% over the last 12 months. † This item is a non-IFRS financial measure; see the "Non-IFRS and Additional Financial Measures" section and the "Reconciliation of Select Non-IFRS Financial Measures" section in this document for relevant information about such measures and a reconciliation of non-IFRS financial measures to the most directly comparable IFRS measure. †† This item is a non-IFRS ratio; see the "Non-IFRS and Additional Financial Measures" section in this document and in the Q1/2025 Management's Discussion and Analysis. Business growth – The strong sales 13 momentum of 2024 continued into the first quarter despite uncertainties related to tariffs. Almost every business unit recorded good sales growth compared to the same period last year. In Insurance, Canada, all business units posted good sales growth, particularly Group Insurance with sales of $178 million. Within this segment, Individual Insurance recorded strong sales of $99 million, and the Company maintained a leading position for the number of policies sold. 14 In the Wealth Management segment, the Company had record quarterly sales and continued to rank first for both gross and net segregated fund 15 sales, with net inflows totalling nearly $1.2 billion. Gross sales of mutual funds posted solid year-over-year growth. Business growth in the US Operations segment was also strong, with solid year-over-year sales growth for both Individual Insurance and Dealer Services. Good sales contributed to the growth in net premiums, premium equivalents and deposits, totalling nearly $5.8 billion, a 19% increase compared to the same period last year. Also, total assets under management 16 and assets under administration 16 exceeded $264 billion, an increase of 15% over the last 12 months. INSURANCE, CANADA In Individual Insurance, first quarter sales totalled $99 million, 11% higher than the same period last year. This very good result reflects the strength of all our distribution networks, the excellent performance of our digital tools, as well as our comprehensive and distinctive range of products. Sales were notably strong for participating insurance and term life insurance. The Company maintained the leading position in the Canadian market for the number of policies issued. 16 In Group Insurance, first quarter sales of $70 million in Employee Plans were significantly higher than the $30 million recorded during the same quarter last year. This result is largely attributed to the addition of products and participants to existing policies. Net premiums, premium equivalents and deposits increased by 6% year over year, benefiting from good sales and premium increases on renewals. Special Markets sales were 2% higher than a year earlier, reaching $108 million, supported by good sales in travel medical insurance products. For Dealer Services, total sales ended the first quarter at $163 million, 10% higher than the same period last year. This growth was supported by sales of Guaranteed Asset Protection (GAP) and ancillary products. At iA Auto and Home, direct written premiums reached $129 million in the first quarter, a strong increase of 13% compared to the same period last year. This good business growth is the result of an increased number of policies and disciplined and agile price adjustments. WEALTH MANAGEMENT In Individual Wealth Management, sales of segregated funds were strong during the first quarter, with gross sales amounting to more than $1.9 billion, a significant increase of 52% year over year, and strong net sales of nearly $1.2 billion. The Company continued to rank first in Canada in gross and net segregated fund sales, as per the most recent industry data. This robust performance was notably driven by the strength of our distribution networks and our competitive and comprehensive product lineup. Additionally, clients continued to favour asset classes with higher return potential over guaranteed investments. Sales of other savings products reached $467 million in the first quarter, compared to a strong quarter of $581 million a year earlier. Gross sales of mutual funds totalled $647 million for the quarter, a 33% increase over the same period in 2024. Net outflows of $62 million were recorded, an improvement compared to outflows of $143 million in the first quarter of 2024. Group Savings and Retirement sales for the first quarter totalled $841 million and were 8% lower than a year earlier as accumulation product sales were at the same level as in 2024 and insured annuities sales were lower than last year. Total assets under management at the end of the quarter were 17% higher than they were a year earlier. 13 Sales is a supplementary financial measure. Refer to the "Non-IFRS and Additional Financial Measures" section of this document for more information on sales. 14 According to the latest Canadian data published by LIMRA 15 According to the latest industry data from Investor Economics. 16 Assets under management and assets under administration are supplementary financial measures. Refer to the "Non-IFRS and Additional Financial Measures" section of this document for more information. † This item is a non-IFRS financial measure; see the "Non-IFRS and Additional Financial Measures" section and the "Reconciliation of Select Non-IFRS Financial Measures" section in this document for relevant information about such measures and a reconciliation of non-IFRS financial measures to the most directly comparable IFRS measure. †† This item is a non-IFRS ratio; see the "Non-IFRS and Additional Financial Measures" section in this document and in the Q1/2025 Management's Discussion and Analysis. US OPERATIONS In Individual Insurance, sales of US$68 million in the first quarter, which were 62% higher than a year earlier, reflect our potential for strong growth in the U.S. life insurance market, both organically and through acquisitions. This solid result is driven by good growth in the final expense, middle/family and government/worksite markets and the addition of sales from the Vericity acquisition. In Dealer Services, first quarter sales were up 23% over the same period last year, reaching US$306 million. This good result reflects the quality of our products and services as well as the effectiveness and diversity of our distribution channels. Also, sales of supplementary (F&I) products sold alongside vehicles have improved during the quarter due to increased consumer affordability resulting from lower interest rates, cash incentives from manufacturers, and greater vehicle inventory. ASSETS UNDER MANAGEMENT AND ASSETS UNDER ADMINISTRATION Assets under management and administration totalled more than $264 billion at the end of the first quarter, up 15% over the last 12 months and up 2% during the quarter. This growth was mainly driven by high net fund inflows, particularly from segregated funds. NET PREMIUMS, PREMIUM EQUIVALENTS AND DEPOSITS Net premiums, premium equivalents and deposits amounted to nearly $5.8 billion in the first quarter, a solid increase of 19% over the same period last year. Almost all business units contributed to this strong performance, particularly Individual Wealth Management and both business units in our U.S. Operations segment. FINANCIAL POSITION The Company's solvency ratio 17 was 132% at March 31, 2025, compared with 139% at the end of the previous quarter and 142% a year earlier. This result is well above the regulatory minimum ratio of 90%. The seven-percentage-point decrease during the first quarter is the result of specific items. These include capital management and deployment activities through the Global Warranty acquisition, share buybacks (NCIB), IT investments and the redemption of subordinated debentures outlined below in this section. Also, macroeconomic variations and other non-organic items had an unfavourable impact on the ratio during the quarter. These items were partly offset by the favourable impact of organic capital generation. 18 The Company's financial leverage ratio †† of 14.8% at March 31, 2025 compares to 17.3% at the end of the previous quarter. Organic capital generation and capital available for deployment – The Company organically generated $125 million in additional capital during the first quarter. This result is in line with projections to exceed the annual target threshold of $650 million in 2025, 19 with organic generation typically strengthening from the second quarter onwards due to seasonality. At March 31, 2025, the capital available for deployment was assessed at $1.4 billion. As detailed below in this section, the AMF's revised Capital Adequacy Requirements Guideline – Life and Health Insurance (CARLI) positively impacted the Company's capital available for deployment. Book value – The book value per common share 20 was $74.62 at March 31, 2025, up 2% during the quarter and 8% during the last 12 months. † This item is a non-IFRS financial measure; see the "Non-IFRS and Additional Financial Measures" section and the "Reconciliation of Select Non-IFRS Financial Measures" section in this document for relevant information about such measures and a reconciliation of non-IFRS financial measures to the most directly comparable IFRS measure. †† This item is a non-IFRS ratio; see the "Non-IFRS and Additional Financial Measures" section in this document and in the Q1/2025 Management's Discussion and Analysis. Normal Course Issuer Bid (NCIB) – During the first quarter of 2025, the Company repurchased and cancelled 218,200 outstanding common shares for a total value of $29 million under the NCIB program and cancelled 52,700 additional shares that had been repurchased but not cancelled as of December 31, 2024. Under the program in force from November 14, 2024 to November 13, 2025, the Company can repurchase up to 4,694,894 common shares, representing approximately 5% of the issued and outstanding common shares as at October 31, 2024. Since November 14, 2024, 822,600 shares, or 0.9% of the outstanding shares, have been repurchased and cancelled. Therefore, the Company may repurchase up to 3,872,294 outstanding common shares between March 31, 2025 and November 13, 2025. Dividend – The Company paid a quarterly dividend of $0.9000 per share to common shareholders in the first quarter of 2025. The Board of Directors approved a quarterly dividend of $0.9000 per share payable during the second quarter of 2025. This dividend is payable on June 16, 2025 to the shareholders of record at May 23, 2025. Dividend Reinvestment and Share Purchase Plan – Registered shareholders wishing to enrol in iA Financial Group's Dividend Reinvestment and Share Purchase Plan (DRIP) so as to be eligible to reinvest the next dividend payable on June 16, 2025 must ensure that the duly completed form is delivered to Computershare no later than 4:00 p.m. on May 15, 2025. Enrolment information is provided on iA Financial Group's website at under About iA, in the Investor Relations/Dividends section. Common shares issued under iA Financial Group's DRIP will be purchased on the secondary market and no discount will be applicable. AMF Capital Adequacy Requirements Guideline – As disclosed in the financial documents for the third and fourth quarters of 2024, a revised Capital Adequacy Requirements for Life and Health Insurance (CARLI) Guideline became effective on January 1, 2025. As anticipated, this revision mainly impacted iA Financial Group by increasing the Company's capital available for deployment, through exempting iA Financial Group from intervention target ratios at the holding company level, while still requiring adherence to minimum ratios. The new CARLI guideline also includes revisions related to the regulatory capital requirements for segregated fund guarantees. As allowed by the AMF for insurers, the Company will continue to apply the previous version of the guideline during the first half of 2025. External auditor appointment – On January 28, 2025, iA Financial Group announced that the Board of Directors, following the recommendation of its Audit Committee, has proposed the appointment of Ernst & Young LLP ("EY") as the Company's external auditor for the 2026 financial year. The decision followed a comprehensive external auditor tender process and is part of the Company's commitment to upholding robust governance practices. Deloitte LLP will continue as external auditor for the 2025 financial year, subject to shareholder approval at the Company's annual meeting of common shareholders to be held on May 8, 2025. For additional information, please refer to the press release, which can be found on our website at Acquisition of Global Warranty – On February 4, 2025, iA Financial Group acquired Global Warranty, a group of companies that are leading independent warranty providers and administrators in the used vehicle market in Canada. Global Warranty does business with a network of over 1,500 automotive dealerships and more than 400 authorized repair centres across the country. The acquisition will increase the Company's dealer services presence in the used vehicle warranty market, and is expected to be slightly accretive from the first year, on both a core and reported basis. For additional information, please refer to the press release, which can be found on our website at Anniversary on TSX – On February 3, 2025, iA Financial Group celebrated its 25th anniversary of being listed on the Toronto Stock Exchange. Mr. Denis Ricard and Mr. Jacques Martin marked the occasion by opening the markets at the Toronto Stock Exchange, joined by board members and members of iA's senior leadership teams. The event was broadcast live by the TSX. Investor Event – iA Financial Group hosted an Investor Event on February 24, 2025. The event, titled "Ready for more, the iA way" provided an update on the Company's growth strategy, with a particular focus on U.S. business operations and key objectives for Canadian units. New financial targets were also shared during the event. Materials from the event, including video webcasts, can be accessed on the Company's website at under About Us/Investor Relations/Events and Presentations/2025 Investor Event. Subordinated debentures redemption – On February 21, 2025, iA Financial Group completed the redemption of its $400 million principal amount of 2.400% subordinated debentures due February 21, 2030. 2024 annual documents publication – On March 28, 2025, iA Financial Group released its Annual Report, Proxy Circular, Annual Information Form and Sustainability Report. The documents are available on our website at Appointment – On January 8, 2025, iA Financial Group announced the appointment of John Laudenslager as President of iA American Warranty Group. For additional information, please refer to the press release, which can be found on our website at Credit ratings – During the first quarter of 2025, the S&P Global and DBRS Morningstar agencies confirmed with a stable outlook all ratings of iA Financial Group and its related entities, including Industrial Alliance Insurance and Financial Services Inc. Philanthropy – On March 8, 2025, iA Financial Group recognized the efforts of four inspiring women at the Company and their collaboration with YWCAs in Quebec City, Toronto, and Vancouver, donating a total of $600,000 to four important YWCA programs that provide support, a safe environment and opportunities for women, girls and gender diverse individuals in need to reach their full potential. Subsequent to the first quarter: Annual Meetings – The Annual Shareholder Meeting of iA Financial Corporation Inc. and the Annual Meeting of the Sole Common Shareholder and of the Participating Policyholders of Industrial Alliance Insurance and Financial Services Inc. will be held in hybrid format on Thursday, May 8, 2025. FINANCIAL TARGETS The Company introduced its financial targets at its 2025 Investor Event on February 24. The table below presents the progress towards achieving these annual and mid-term targets. 21 Within the meaning of applicable securities laws, such financial targets constitute "financial outlook" and "forward-looking information". The purpose of these financial targets is to provide a description of management's expectations regarding iA Financial Group's annual and medium-term financial performance and may not be appropriate for other purposes. Actual results could vary materially as a result of numerous factors, including the risk factors referenced herein. Certain material assumptions relating to financial targets provided herein and other related financial and operating targets are described in this document. They are also described in the Investor Event 2025 presentation material available on iA Financial Group's website at under About iA, in the Investor Relations section and in other documents made available by the Company. See "Forward-Looking Statements". 22 The Company's dividend and distribution policy is subject to change, and dividends and distributions are declared or made at the discretion of the Board of Directors. † This item is a non-IFRS financial measure; see the "Non-IFRS and Additional Financial Measures" section and the "Reconciliation of Select Non-IFRS Financial Measures" section in this document for relevant information about such measures and a reconciliation of non-IFRS financial measures to the most directly comparable IFRS measure. †† This item is a non-IFRS ratio; see the "Non-IFRS and Additional Financial Measures" section in this document and in the Q1/2025 Management's Discussion and Analysis. NON-IFRS AND ADDITIONAL FINANCIAL MEASURES iA Financial Corporation reports its financial results and statements in accordance with IFRS® Accounting Standards. The Company also publishes certain financial measures or ratios that are not presented in accordance with IFRS. The Company uses non-IFRS and other financial measures when evaluating its results and measuring its performance. The Company believes that such measures provide additional information to better understand its financial results and assess its growth and earnings potential, and that they facilitate comparison of the quarterly and full year results of the Company's ongoing operations. Since such non-IFRS and other financial measures do not have standardized definitions and meaning, they may differ from similar measures used by other institutions and should not be viewed as an alternative to measures of financial performance, financial position or cash flow determined in accordance with IFRS. The Company strongly encourages investors to review its financial statements and other publicly filed reports in their entirety and not to rely on any single financial measure. Non-IFRS financial measures include core earnings (losses). Non-IFRS ratios include core earnings per common share (core EPS); core return on common shareholders' equity (core ROE); core effective tax rate; core dividend payout ratio; and financial leverage ratio. Supplementary financial measures include return on common shareholders' equity (ROE); components of the CSM movement analysis (organic CSM movement, impact of new insurance business, organic financial growth, insurance experience gains (losses), impact of changes in assumptions and management actions, impact of markets, currency impact); components of the drivers of earnings (in respect of both net income attributed to common shareholders and core earnings); assets under management; assets under administration; capital available for deployment; dividend payout ratio; total payout ratio (trailing 12 months); organic capital generation; sales; net premiums; and premium equivalents and deposits. For relevant information about non-IFRS measures, see the "Non-IFRS and Additional Financial Measures" section in the Management's Discussion and Analysis (MD&A) for the period ending March 31, 2025, which is hereby incorporated by reference and is available for review on SEDAR+ at or on iA Financial Group's website at A reconciliation of net income attributed to common shareholders to core earnings by business segment is included below. See "Reconciliation of Net Income Attributed to Common Shareholders and Core Earnings" above for the reconciliation on a consolidated basis. Net Income and Core Earnings † Reconciliation – Insurance, Canada (In millions of dollars, unless otherwise indicated) First quarter 2025 2024 Variation Net income attributed to common shareholders 87 83 5 % Core earnings adjustments (post tax) Market-related impacts — — Assumption changes and management actions — — Charges or proceeds related to acquisition or disposition of a business, including acquisition, integration and restructuring costs — 2 Amortization of acquisition-related finite life intangible assets 5 4 Non-core pension expense 3 3 Other specified unusual gains and losses 5 — Total 13 9 Core earnings † 100 92 9 % Net Income and Core Earnings † Reconciliation – Wealth Management (In millions of dollars, unless otherwise indicated) First quarter 2025 2024 Variation Net income attributed to common shareholders 95 88 8 % Core earnings adjustments (post tax) Market-related impacts — — Assumption changes and management actions — — Charges or proceeds related to acquisition or disposition of a business, including acquisition, integration and restructuring costs — — Amortization of acquisition-related finite life intangible assets 7 6 Non-core pension expense 1 1 Other specified unusual gains and losses 3 — Total 11 7 Core earnings † 106 95 12 % Net Income and Core Earnings † Reconciliation – US Operations (In millions of dollars, unless otherwise indicated) First quarter 2025 2024 Variation Net income attributed to common shareholders 19 12 58 % Core earnings adjustments (post tax) Market-related impacts — — Assumption changes and management actions — — Charges or proceeds related to acquisition or disposition of a business, including acquisition, integration and restructuring costs — — Amortization of acquisition-related finite life intangible assets 9 7 Non-core pension expense — — Other specified unusual gains and losses 2 — Total 11 7 Core earnings † 30 19 58 % Net Income and Core Earnings † Reconciliation – Investment (In millions of dollars, unless otherwise indicated) First quarter 2025 2024 Variation Net income attributed to common shareholders 35 100 (65 %) Core earnings adjustments (post tax) Market-related impacts 63 (9) Interest rates and credit spreads (16) (3) Equity 59 (32) Investment properties 16 23 CIF 23 4 3 Currency — — Assumption changes and management actions (5) (5) Charges or proceeds related to acquisition or disposition of a business, including acquisition, integration and restructuring costs — — Amortization of acquisition-related finite life intangible assets — — Non-core pension expense — — Other specified unusual gains and losses (8) — Total 50 (14) Core earnings † 85 86 (1 %) Net Income and Core Earnings † Reconciliation – Corporate (In millions of dollars, unless otherwise indicated) First quarter 2025 2024 Variation Net income to common shareholders (50) (50) — Core earnings (losses) adjustments (post tax) Market-related impacts — — Assumption changes and management actions — — Charges or proceeds related to acquisition or disposition of a business, including acquisition, integration and restructuring costs 2 1 Amortization of acquisition-related finite life intangible assets — — Non-core pension expense — — Other specified unusual gains and losses — — Total 2 1 Core earnings (losses) † (48) (49) (2 %) 23 Impact of the tax-exempt investment income (above or below expected long-term tax impacts) from the Company's multinational insurer status. † This item is a non-IFRS financial measure; see the "Non-IFRS and Additional Financial Measures" section and the "Reconciliation of Select Non-IFRS Financial Measures" section in this document for relevant information about such measures and a reconciliation of non-IFRS financial measures to the most directly comparable IFRS measure. †† This item is a non-IFRS ratio; see the "Non-IFRS and Additional Financial Measures" section in this document and in the Q1/2025 Management's Discussion and Analysis. 24 For a breakdown of core earnings adjustments applied to reconcile to net income attributed to common shareholders, see "Reconciliation of Net Income Attributed to Common Shareholders and Core Earnings"† above. 25 Refer to the "Reconciliation of Select Non-IFRS Financial Measures" section of the Q1/2025 Management's Discussion and Analysis for details about these two reclassifications. These reclassifications reflect items subject to a different classification treatment between the financial statements and the drivers of earnings (DOE). 26 Dividends on preferred shares and distributions on other equity instruments. † This item is a non-IFRS financial measure; see the "Non-IFRS and Additional Financial Measures" section and the "Reconciliation of Select Non-IFRS Financial Measures" section in this document for relevant information about such measures and a reconciliation of non-IFRS financial measures to the most directly comparable IFRS measure. †† This item is a non-IFRS ratio; see the "Non-IFRS and Additional Financial Measures" section in this document and in the Q1/2025 Management's Discussion and Analysis. Forward-Looking Statements This document may contain statements that are predictive or otherwise forward-looking in nature, that depend upon or refer to future events or conditions, or that include words such as "may", "will", "could", "should", "would", "suspect", "expect", "anticipate", "intend", "plan", "believe", "estimate", and "continue" (or the negative thereof), as well as words such as "financial targets", "objective", "goal", "guidance", "outlook" and "forecast", or other similar words or expressions. Such statements constitute forward-looking statements within the meaning of securities laws. In this document, forward-looking statements include, but are not limited to, information concerning possible or future operating results, strategies, and financial and operational outlook. These statements are not historical facts; they represent only expectations, estimates and projections regarding future events and are subject to change. Although iA Financial Group believes that the expectations reflected in such forward-looking statements are reasonable, such statements involve risks and uncertainties, and undue reliance should not be placed on such statements. In addition, certain material factors or assumptions are applied in making forward-looking statements, and actual results may differ materially from those expressed or implied in such statements. Material factors and risks that could cause actual results to differ materially from expectations include, but are not limited to: general business and economic conditions; level of competition and consolidation and ability to adapt products and services to market or customer changes; information technology, data protection, governance and management, including privacy breach, and information security risks, including cyber risks; level of inflation; performance and volatility of equity markets; interest rate fluctuations; hedging strategy risks; accuracy of information received from counterparties and the ability of counterparties to meet their obligations; unexpected changes in pricing or reserving assumptions; iA Financial Group liquidity risk, including the availability of funding to meet financial liabilities at expected maturity dates; mismanagement or dependence on third-party relationships in a supply chain context; ability to attract, develop and retain key employees; risk of inappropriate design, implementation or use of complex models; fraud risk; changes in laws and regulations, including tax laws; contractual and legal disputes; actions by regulatory authorities that may affect the business or operations of iA Financial Group or its business partners; changes made to capital and liquidity guidelines; risks associated with the regional or global political and social environment; geopolitical and trade uncertainty; climate-related risks including extreme weather events or longer-term climate changes and the transition to a low-carbon economy; iA Financial Group's ability to meet stakeholder expectations on environmental, social and governance matters; the occurrence of natural or man-made disasters, international conflicts, pandemic diseases (such as the COVID-19 pandemic) and acts of terrorism; and downgrades in the financial strength or credit ratings of iA Financial Group or its subsidiaries. Material factors and assumptions used in the preparation of financial outlooks include, but are not limited to: accuracy of estimates, assumptions and judgments under applicable accounting policies, and no material change in accounting standards and policies applicable to the Company; no material variation in interest rates; no significant changes to the Company's effective tax rate; no material changes in the level of the Company's regulatory capital requirements; availability of options for deployment of excess capital; credit experience, mortality, morbidity, longevity and policyholder behaviour being in line with actuarial experience studies; investment returns being in line with the Company's expectations and consistent with historical trends; different business growth rates per business unit; no unexpected changes in the economic, competitive, insurance, legal or regulatory environment or actions by regulatory authorities that could have a material impact on the business or operations of iA Financial Group or its business partners; no unexpected change in the number of shares outstanding; and the non‑materialization of risks or other factors mentioned or discussed elsewhere in this document or found in the "Risk Management" section of the Company's Management's Discussion and Analysis for 2024 that could influence the Company's performance or results. Escalating U.S.-Canada trade tensions, including tariffs on automobiles and auto parts, along with U.S.-China trade frictions and retaliatory tariffs, have intensified global trade instability. Global equity markets have experienced volatility due to uncertainty around tariffs, shifting interest rate expectations, and softer-than-expected economic data. In addition, trade barriers, such as potential and actual tariffs by the U.S., may shift global growth and trade patterns and have a ripple effect on supply chains, potentially further disrupting markets. These factors could lead to reduced consumer and investor confidence, increased financial volatility, and constrained growth opportunities. Additional information about the material factors that could cause actual results to differ materially from expectations and about material factors or assumptions applied in making forward-looking statements may be found in the "Risk Management" section of the Management's Discussion and Analysis for 2024, the "Management of Financial Risks Associated with Financial Instruments and Insurance Contracts" note to the audited consolidated financial statements for the year ended December 31, 2024 and elsewhere in iA Financial Group's filings with the Canadian Securities Administrators, which are available for review at The forward-looking statements and outlooks in this document reflect iA Financial Group's expectations as of the date of this document. iA Financial Group does not undertake to update or release any revisions to these forward‑looking statements to reflect events or circumstances after the date of this document or to reflect the occurrence of unanticipated events, except as required by law. Forward-looking statements are presented in this document for the purpose of assisting investors and others in understanding certain key elements of the Company's expected financial results, as well as the Company's objectives, strategic priorities and business outlook, and in obtaining a better understanding of the Company's anticipated operating environment. Readers are cautioned that such information may not be appropriate for other purposes. GENERAL INFORMATION Documents Related to the Financial Results For a detailed discussion of iA Financial Group's first quarter results, investors are invited to consult the Management's Discussion and Analysis for the quarter ended March 31, 2025, the related financial statements and accompanying notes and the Financial Information Package, all of which are available on the iA Financial Group website at under About iA, in the Investor Relations/Financial Reports section and on SEDAR+ at CONFERENCE CALL Management will hold a conference call to present iA Financial Group's first quarter results on Thursday, May 8, 2025 at 12:00 p.m. (ET). To listen to the conference call, choose one of the options below: Live Webcast: Click here ( or visit the iA Financial Group website at and go to About iA/Investor Relations/Events and Presentations. By phone: Click here ( to register and receive a dial-in number to connect instantly to the conference call. You can also dial 1-844-763-8274 (toll-free in North America) or 1-647-484-8814 (International) fifteen minutes before the conference call is scheduled to take place and an operator will connect you. The conference call will be recorded and the replay will be available on the iA Financial Group website at under About iA/Investor Relations/Financial Reports. ANNUAL MEETING iA Financial Corporation is holding its Annual Meeting in hybrid format at 2:00 p.m. (ET) on Thursday, May 8, 2025, in person and at the following web address: A webcast of the meeting as well as a copy of management's presentation will be available on the Company's website at under About iA, in the Investor Relations/Events and Presentations section. ABOUT iA FINANCIAL GROUP iA Financial Group is one of the largest insurance and wealth management groups in Canada, with operations in the United States. Founded in 1892, it is an important Canadian public company and is listed on the Toronto Stock Exchange under the ticker symbol IAG (common shares). iA Financial Group is a business name and trademark of iA Financial Corporation Inc. SOURCE iA Financial Group
