GMP CAPITAL INC. REPORTS FOURTH QUARTER AND YEAR-END 2017 RESULTS
• Earned net income of $6.4 million and diluted earnings per share of $0.07 in fourth quarter 2017, including meaningful contribution from the blockchain and cryptocurrencies and cannabis franchises
• On an adjusted basis, fourth quarter 2017 net income was $9.7 million and diluted earnings per share1 of $0.11
• Board of directors declared a special cash dividend of $0.10 per common share, payable on April 2, 2018, to common shareholders of record on March 15, 2018.
Toronto, March 2, 2018 - GMP Capital Inc. (GMP) (TSX: GMP) today reported revenue of $59.3 million in fourth quarter 2017 representing a 9% decrease relative to the same period a year ago. GMP recorded net income of $6.4 million and EPS of $0.07 in fourth quarter 2017 compared with net income of $3.2 million and diluted EPS of $0.03 in fourth quarter 2016. Adjusted EPS1 was $0.11 in fourth quarter 2017 compared with $0.07 in the prior year quarter.
“The progress we made toward diversifying our business over the past year is best evidenced by a strong fourth quarter 2017. Impressive growth in our underwriting franchise was driven by robust client activity in the burgeoning blockchain and cannabis sectors," said Harris Fricker, President and Chief Executive Officer, GMP. “Additionally, the declaration of a special dividend by our Board is indicative of the improvement in GMP's operational performance in 2017 and our outlook for the first half of 2018. We also remain encouraged by the ongoing financial strength of our industry-leading Wealth Management business."
Full year revenue was $186.8 million in 2017, down 5% compared with 2016. GMP recorded a net loss of $47.1 million and a diluted loss per share of $0.74 in 2017, primarily due to the $52.0 million non-cash goodwill impairment charge recorded in second quarter 2017. This compared with a net loss of $11.6 million and a diluted loss per share of $0.24 in 2016. On an adjusted basis1 net income was $18.8 million in 2017, generating EPS of $0.18 compared with net income1 of $5.5 million and EPS of $0.01 in 2016.
Commenting further, Mr. Fricker said, “While not without challenges, our improved adjusted net income performance in 2017 demonstrates the powerful operating leverage of an operationally leaner, more focused and better diversified franchise. As promised, we made considerable strides toward diversifying our business, with our non-commodities businesses accounting for half of total investment banking revenue in 2017. GMP established itself as a leader in the emerging blockchain and cannabis growth sectors, as investor interest in these sectors surged in 2017. The real opportunity for our firm is continuing to do what we do best, namely helping small- to mid-cap companies efficiently access the requisite capital needed to grow their business."
For further information about GMP Capital Inc., our results for fourth quarter and year-end 2017 and the meaning of certain references, this earnings release should be read in conjunction with our annual financial statements as at and for the year ended December 31, 2017 (2017 Annual Financial Statements), our management's discussion and analysis for the year ended December 31, 2017 (2017 Annual MD&A) and our annual information form, which can be accessed on our website at gmpcapital.com and on SEDAR at sedar.com. Unless otherwise indicated, all dollar amounts are expressed in Canadian dollars and have been taken from our 2017 Annual Financial Statements prepared in accordance with generally accepted accounting principles (GAAP) under International Financial Reporting Standards (IFRS).