Guardian Capital Group Limited
Annual Meeting of Shareholders
May 10, 2019 George Mavroudis | President and Chief Executive Officer Forward Looking Statements
This presentation may contain “forward-looking statements” with respect to Guardian Capital Group Limited and its products and services, including its business operations and strategy and financial performance and condition. These statements, characterized by such words as “goal”, “outlook”, “intends”, “expects”, “plan”, “prospects”, “are confident”, “believe” and ”anticipate”, are intended to reflect Guardian’s objectives, plans, expectations, estimates, beliefs and intentions.
By their nature, forward-looking statements involve risks and uncertainties. There is a risk that the expectations reflected in such forward-looking statements will not be achieved. Undue reliance should not be placed on these statements, as a number of factors could cause actual results to differ materially from Guardian’s objectives, plans, expectations and estimates reflected in the forward-looking statements. Factors that could cause actual results to differ materially from expectations include, among other things, general economic and market conditions, including interest rates, business competition, changes in government regulations or in tax laws, and other factors.
2 Guardian Overview 4
Financial Highlights 6
Investment Management 14
Financial Advisory 21 Guardian’s Businesses
Corporate Activities and Investments
• Management expertise, financing, coordination of business activities and support • Shareholders’ equity: $656 million¹ (2018 - $599M)
• Securities holdings: Investment Management Financial Advisory $674 million¹ (2018 - $627M) • Market Capitalization: $667 million2 AUM of $29.6 billion¹ AUA of $18.7 billion¹ • TSX Listed: GCG, GCG.A
¹As at March 31, 2019 2As at May 8, 2019
4 Guardian’s Fee Generating Assets
Investment Management Financial Advisory Assets Under Management | As at period end | ($ billions) Assets Under Administration | As at period end | ($ billions)
$29.6 $18.7 $17.8 $17.4 $16.5 $27.3 $27.3 $27.0 $14.9 $13.1
$25.0 $24.3
2014 2015 2016 2017 2018 Q1 2019 2014 2015 2016 2017 2018 Q1 2019
5 2018 Financial Statement Highlights
% Increase / ($ millions, except per share amounts) 2018 2017 Decrease Net revenues $171.5 $151.2 13% Operating earnings $46.4 $48.2 (4%) Net earnings (losses) attributable to shareholders ($17.0) $96.8 (118%)
EBITDA¹ $56.2 $52.8 7%
AUM $26,962 $27,250 (1%) AUA $17,385 $17,795 (2%) Shareholders’ equity, per share¹ $21.57 $21.88 (1%) Securities, per share¹ $22.58 $22.49 0%
1 As defined in Guardian’s MD&A
6 Q1 2019 Financial Statement Highlights
% Increase / ($ millions, except per share amounts) 2019 2018 Decrease Net revenues $ 44.3 $ 41.5 7% Operating earnings $ 11.2 $ 10.5 7% Net earnings (losses) attributable to shareholders $ 67.2 $ (6.2) 1184%
EBITDA¹ $ 14.5 $ 12.5 16%
AUM $ 29,621 $ 29,457 1% AUA $ 18,745 $ 17,601 6% Shareholders’ equity, per share¹ $ 23.66 $ 21.98 8% Securities, per share¹ $ 24.30 $ 22.84 6%
1 As defined in Guardian’s MD&A
7 Financial Highlights
Net Revenue Operating Earnings For the years ended ($ millions) For the years ended ($ millions)
$171.5 $48.2 $44.7 $46.4 $43.0 $151.2 $142.7 $38.1 $132.9 $119.3
$27.7 $32.3 $35.1 $38.6 $41.5 $44.3 $8.6 $10.5 $11.4 $12.5 $10.5 $11.2
2014 2015 2016 2017 2018 Q1 2019 2014 2015 2016 2017 2018 Q1 2019
First Quarter Results
8 Diversified Revenue Sources
For the year ended December 31, 2018 For the year ended December 31, 2010 (in $ millions) (in $ millions)
$14.1 $5.4 $2.3
$25.8
TOTAL TOTAL $15.5 $171.5 $65.0 $23.4 $108.1 $41.8
Asset-Based Revenues (63%) Insurance (15%) Asset-Based Revenues (64%) Insurance (4%) Dividend and Interest (14%) Other (8%) Dividend and Interest (24%) Other (8%)
9 Return to Shareholder: Dividends
Quarterly Dividends Per Share Total Annual Dividends Paid For the periods ended ($ per share) For the periods ended ($millions)
$0.150 $13.3
$0.125 $11.1 $9.7 $0.100 $8.6 $0.085 $0.075 $7.2 $0.065
$3.4 $2.5 $2.8 $1.9 $2.2
$1.7 $1.9 $2.2 $2.5 $2.8 $3.4
2014 2015 2016 2017 2018 2019 2014 2015 2016 2017 2018 Q1 2019
First Quarter Results For 2019, the rate represents the latest quarterly declared dividend. For years 2014-2018, the rates represent the dividend paid in the fourth quarter.
10 Return to Shareholder: Share Buybacks
Shares Average Share Buybacks (in 000’s) Price (in $’s) For the periods ended ($ millions)
Outstanding at Jan. 1, 2012 33,843 $26.0 $23.9 2012 (800) $9.73 2013 (574) $13.73 2014 (324) $17.45 $15.2 2015 (817) $17.62 $14.4 2016 (1,173) $20.35
2017 (632) $24.08 $7.8 $7.9 2018 (1,118) $23.28 $5.7 2019 - - Total Purchases (5,438) $18.54
Outstanding at Mar. 31, 2019* 28,405 2012 2013 2014 2015 2016 2017 2018
Since 2012, approximately $100.8 million has been returned to shareholders in the form of share buybacks. * Excludes the effects of treasury stock
11 Managing Our Investment Portfolio
Securities Guardian Capital Proprietary Strategies (in $ millions) | Total $674 (in $ millions) | Total $253
$61 $20 $20 $18 $359 $21
$154
$233 $40
Bank of Montreal (53%) Real Estate (3%) Global Equity (61%) Fixed Income (7%) Investment Funds (35%) Other Equities (9%) Emerging Markets Equity (16%) Real Estate (8%)
Canadian Equity (8%)
As at March 31, 2019
12 A Focus on Shareholder Value
Equity per share, diluted Securities per share, diluted As at period end (in $) As at period end (in $)
$24.30 $23.66 $22.49 $22.58 $21.88 $21.57 $20.97 $19.62 $17.72 $16.78 $16.55 $15.62
2014 2015 2016 2017 2018 Q1 2019 2014 2015 2016 2017 2018 Q1 2019
13 Investment Management
• $29.6 billion in AUM
• Competitive investment products Institutional Investment Private • Executing on opportunities Management Wealth • Active across multiple $26.5 billion in AUM $3.1 billion in AUM distribution channels
As at March 31, 2019
14 Institutional Investment Solutions
CANADIAN FOREIGN FIXED EQUITIES EQUITIES INCOME
$9.8 billion $9.7 billion $7.0 billion
• Large Cap Core • Systematic Strategies • Core • Growth • Fundamental Global & • Liability Driven • Equity Income Emerging Market Equity • Short Duration • High Conviction All Cap • US Equity Large Cap and • High Yield All Cap Growth • Unconstrained HY
As at March 31, 2019
15 Institutional Investment Solutions
Growth in Global AUM Growth of Global Revenue ($ billions) ($millions)
100% 100% $14.0 $60.0 90% 90% $12.0 80% 80% $50.0 70% $10.0 70% $40.0 60% 60% $8.0 50% 50% $30.0 40% $6.0 40% $20.0 30% 30% $4.0 20% 20% $10.0 10% $2.0 10% 21% 23% 26% 48% 53% 11% 15% 14% 16% 34% 37% 16% $- 0% 0% $- 2014 2015 2016 2017 2018 Q1 2019 2014 2015 2016 2017 2018 Q1 2019
Global AUM % Domestic AUM % Global AUM $ Global Revenue % Domestic Revenue % Global Revenue $
¹Revenue is Q1 2019 annualized
16 High-Conviction Investing - Performance
Guardian High-Conviction Investing Strategies (Since Inception Performance)
14%
12%
10%
8%
6%
4%
2% Fundamental Global Equities Alta Select US Large Cap Canadian Focused Equity Fundamental Emerg Mkts Fundamental EAFE
Strategy Return Benchmark Return Above chart represents the quartile ranking of annualized performance since inception, as a percentage
17 Institutional AUM: By Geography (in Billions)
CANADIAN CLIENTS
2017: $22.8 INTERNATIONAL 2018: $21.0 CLIENTS 2019: $19.2 2017: $0.8 2018: $1.0 US CLIENTS 2019: $1.8 2017: $0.3 2018: $4.6 2019: $5.5
As at March 31 for the noted year
18 Distribution Channels
GUARDIAN CAPITAL GROUP $29.6 billion in AUM
40% 50% 10%
RETAIL PRIVATE INSTITUTIONAL INTERMEDIARY WEALTH $11.7 billion $14.8 billion $3.1 billion
SUB- WRAP ADVISORY $10.9 billion $3.9 billion
As at March 31, 2019
19 Private Wealth
Assets Under Management . Managing over $3 billion on behalf of As at period ends ($ billions) over 1700 households across 3 offices in Canada
. Increased use of Guardian solutions $3.1 $3.0 with approximately $826 million $2.9 $2.9 invested in Guardian Capital Funds as $2.3 at March 31, 2019 ($218 million in $2.1 2012) . Beneficiary of $610 million in referral of client accounts from Worldsource advisors
2014 2015 2016 2017 2018 Q1 2019
20 Financial Advisory
• $18.7 billion in AUA • National distribution platforms Mutual Fund & Securities Life Insurance • Leading platform for Canada’s Dealerships MGA independent financial advisors $13.6 billion in AUA $5.1 billion in AUA
As at March 31, 2019
21 Financial Advisory
Operating Earnings ($ millions)
$14.6 First Quarter Results $12.9
$11.0 $10.1
$6.4
$2.7 $2.6 $4.4 $2.9 $3.3 $0.8
2014 2015 2016 2017 2018 Q1 2019
. Significant growth in operating earnings through acquisitions, organic growth and management of costs . Represents approximately 28% of Guardian’s operating earnings in 2018
22 Mutual Fund and Securities Dealers
Assets Under Administration . 7% increase in AUA in Q1 2019 As at period ends ($ billions) . A source of AUM for Guardian’s Investment Management business $13.6 . Approximately $786 million $12.9 $12.7 invested or referred into Guardian $12.0 $10.8 solutions at March 31, 2019 $10.1
2014 2015 2016 2017 2018 Q1 2019 First Quarter Results
23 Mutual Fund and Securities Dealers
Net Revenue . $24.6 million in net revenues for ($ millions) 2018, a 5% increase from 2017 . Net revenue continues to transition away from transaction $24.6 based towards trailer $23.4 $21.7 commissions and fee based $20.4 revenue $18.3
$4.4 $5.0 $5.2 $5.8 $6.1 $6.2
2014 2015 2016 2017 2018 Q1 2019 First Quarter Results
24 Life Insurance Managing General Agency
Assets Under Administration Premiums: Life Insurance Policies Sold As at period end | ($ billions) For the period end | ($ millions)
$111.0 $4.9 $5.1 $4.6 $4.5 $90.4 $4.0 $77.0
$3.0 $56.0 $45.1
$16.6 $29.4 $16.6 $31.0 $9.9 $12.8
2014 2015 2016 2017 2018 Q1 2019 2014 2015 2016 2017 2018 Q1 2019
First Quarter Results
25 Life Insurance Managing General Agency
. Record high net revenue of Net Revenue $32.4 million in 2018 ($ millions) . $14.5 million of annual service commissions in 2018, compared $32.4 to $11.4 million in 2017 $28.6 . $111 million in new premiums in $25.2 2018 will add an estimated $2.7 $21.5 million in new annual service commissions in future years $17.1
$6.1 $8.0 $7.0 $9.4 $3.6 $5.0
2014 2015 2016 2017 2018 Q1 2019
26 Explore the world of Guardian Capital guardiancapital.com