Fiera Capital: Fiera Capital Corp (FRRPF) Q4 2024 Earnings Call Highlights: Navigating Growth Amid Revenue ...

In This Article: Release Date: February 26, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript . Positive Points Negative Points Q & A Highlights Q : Are you seeing increased interest from clients wanting to invest in private credit and real assets, and how quickly can you deploy capital into these asset classes? A : Jean-Guy Desjardins, Chairman and CEO, noted significant interest, particularly in the agricultural fund, due to new consultant endorsements. Maxime Menard, President and CEO of Fiera Canada and Global Private Wealth, added that the consulting community's support is crucial, and they are seeing positive momentum in agriculture and corporate credit, with a strong pipeline expected to result in positive flows in the coming quarters. Q : What was the cash flow impact of the performance fee decline in Q4 compared to 2023, and does the LTM free cash flow include last year's performance fees? A : Lucas Pontillo, Global CFO, explained that while the performance fee expense ratio is about 50%, the cash flow impact is affected by timing. The LTM free cash flow of $87 million includes last year's performance fees, and they expect Q1 to be in line with Q4, without a decrease like last year. Q : Can you provide more color on the flows in the quarter and whether any mandates were pushed into Q1? A : Maxime Menard mentioned a surprise outflow from PineStone transfer in Q4, with some pipeline activities moving to Q1. Lucas Pontillo added that while they had positive new mandates, negative net contributions from fixed income rebalancing impacted the quarter. Q : What drove the elevated share-based compensation this quarter, and what is a reasonable run rate? A : Lucas Pontillo stated that the increase was due to the acceleration of certain long-term incentive awards and share price evaluation, contributing about $6 million. A reasonable run rate for next year would be around $20 million, with $4 million to $5 million per quarter. Q : Can you provide perspectives on the leverage ratio, which increased this quarter, and your thoughts on leverage for the coming year? A : Lucas Pontillo clarified that the net debt ratio increased due to lower revenue quarters affecting the calculation, but the absolute debt level remained consistent. They expect potential upticks in the next two quarters due to working capital needs but anticipate normalization in the latter half of the year. For the complete transcript of the earnings call, please refer to the full earnings call transcript . This article first appeared on GuruFocus .