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Chair Message  

Dear Fellow Shareholders,

This year has been one of noteworthy transformation and solid performance from continuing operations for GMP.

We spent considerable time reviewing and actively discussing strategic priorities, which included overseeing the rightsizing of the firm’s Canadian operations to keep pace with a changing business landscape; reinstating a regular quarterly cash dividend and paying special cash dividends on two separate occasions. Additionally, we sold our U.S. fixed income operations to a third party in early 2019 and we continued collaborating closely with our partners at Richardson GMP.

This year’s financial results from continuing operations evidence a marked improvement in our performance and largely reflect the strides we made in streamlining and refocusing the franchise on our profitable core Canadian operations. GMP delivered adjusted net income from continuing operations of $34.8 million and adjusted diluted earnings per share of $0.40 for the year.


The Board, together with management, continue to work diligently to refocus the firm’s resources and strategic agenda on markets that matters most: our core Canadian capital markets franchise and our ownership interest in Richardson GMP. Make no mistake, the domestic market, particularly the small- to mid-cap segments, is where we are consistently top-tier and profitable despite a multi-year risk-off trade in commodities.

We executed a number of timely tactical and strategic decisions over the past several years, resulting in a more agile, more efficient, more disruptive and, most importantly, a more profitable GMP. And, as always, guiding the firm’s prudent decision making is a steadfast commitment to maintaining a strong risk culture and the firm’s solid capital positioning.


We made the pivotal decision in 2018 to reinstate a regular quarterly cash dividend and pay two separate special dividends on our common shares. In recognition of GMP’s improving financial performance, its strong capital position and the Board and management’s positive outlook for the franchise, we reinstated a quarterly cash dividend of $0.025 per common share and declared special cash dividends of $0.10 per common share in March and an additional $0.075 per common share in November. Our philosophy in this area is unchanged: the Board plans to continue returning excess capital to shareholders.


Diversification and resiliency were also key themes in 2018. GMP successfully translated an early leadership position in the emerging cannabis and blockchain businesses into meaningful business silos and significant contributors to the firm’s profitability. The cannabis sector represented our largest business in 2018.

On a less positive note, 2018 saw a continuation of the bear market in Canadian commodities. Despite the ongoing negative investor sentiment and political and regulatory uncertainties, aptly outlined by Harris in his letter to shareholders, we remain long-term bullish on the world’s number one source of energy: oil. When activity and international investor interest in the Canadian energy sector inevitably returns, GMP FirstEnergy is well positioned as the only viable Canadian independent energy franchise.


Diversity plays a vital role in any firm’s success. Diversity in thinking, business acumen, cultural background, gender and areas of expertise helped fuel GMP’s transformation. Collectively, this leads to in-depth, and candid conversations across the firm helping ensure we execute against what, we believe, is the right path forward. With the benefit of hindsight, we may have approached some decisions differently; however, our decisions were made with the best available information at the time and are always made with the best interest of shareholders in mind.

Additionally, one of the Board’s most fundamental responsibilities is to regularly evaluate its composition with a view to ensure the Board benefits from a broad range of perspectives and relevant experience. In 2018, GMP continued to support diversity and meritocracy, including at the Board level, seeing the value it brings across the entire franchise.

One of the Board’s top priorities in 2018 was evolving its own composition including an increase in the representation of women. While all Board appointments are made on merit, we continue to believe in the importance of a diverse Board.

In June 2018, the Board welcomed Kishore Kapoor as an independent director. Mr. Kapoor is one of two James Richardson & Sons, Limited director nominees on the Board, replacing Donald Solman, who resigned from the Board on the same date. The Board and senior management would like to thank Mr. Solman for his service and contributions to GMP. Kish brings a wide range of leadership experience and business acumen in wealth management, asset management and capital markets.

Following a comprehensive search for appropriate candidates, the Board welcomed Julie Lassonde (September 2018) as an independent director. Julie brings over 20 years’ experience in a variety of senior executive and director roles in the mining industry. Julie is a respected industry leader and her in-depth experience in capital markets and the natural resources sector are a valuable addition to our Board. The addition of both Kish and Julie complements our Board’s existing skills, backgrounds and expertise, and we look forward to their valuable perspectives and contributions. With these additions to the Board, five new directors have joined our Board in the past five years.


The firm’s key focus is now squarely on its consistently profitable Canadian capital markets operations and its ownership interest in Richardson GMP. GMP continues to demonstrate its resilience given its improved financial performance from continuing operations in 2018 and its ability to win greater market share in the non-commodities portion of its business. We believe GMP remains on the right track as it enters the next phase of its evolution. We are encouraged by both the solid revenue and earnings growth we reported in 2018.

I would like to thank our shareholders for their ongoing support and my fellow Board members for their insight and sound judgement.

Chairman of the Board of Directors

Chair of the Board of Directors