Earnings call transcript: Fiera Capital Q2 2025 sees EPS beat, revenue miss

Fiera Capital reported its Q2 2025 earnings, showcasing a notable earnings per share (EPS) beat but a slight miss on revenue expectations. The company posted an EPS of $0.24, surpassing the forecasted $0.18, marking a 33.33% surprise. However, revenue came in at $163 million, slightly below the anticipated $166.57 million. The stock remained unchanged at $6.62 following the announcement. The company, which offers a substantial 5.64% dividend yield and has delivered a strong 27.56% YTD return, continues to demonstrate resilience in challenging market conditions.

InvestingPro analysis reveals additional insights about Fiera Capital’s performance, with 6 key tips available for subscribers, including detailed dividend sustainability metrics and growth projections.

Key Takeaways

• Fiera Capital’s EPS exceeded expectations by 33.33%.
• Revenue fell short of forecasts by 2.16%.
• The company launched a new Qatar equity strategy with a $200 million investment.
• Operational efficiencies led to a 2% reduction in SG&A expenses.
• Fiera repurchased and canceled 1.1 million shares, amounting to $6.3 million.

Company Performance

Fiera Capital’s performance in Q2 2025 reflected both challenges and opportunities. The company faced a slight decline in total revenues year-over-year, moving from $165 million to $163 million. However, it managed to increase its adjusted EBITDA by 1% to $45.7 million, with the margin improving to 28% from 27.5%. The firm continues to emphasize its strength in private market solutions, a key growth area amid volatile global equity markets.

Financial Highlights

• Revenue: $163 million, down from $165 million year-over-year
• Earnings per share: $0.24, up from $0.03 per diluted share
• Adjusted net earnings: $27 million
• Adjusted EBITDA: $45.7 million, up 1% year-over-year

Earnings vs. Forecast

Fiera Capital’s EPS of $0.24 exceeded the forecast of $0.18, resulting in a 33.33% positive surprise. Despite this, revenue fell short of expectations by 2.16%, coming in at $163 million against a forecast of $166.57 million. This mixed performance highlights the company’s ability to manage costs effectively while facing revenue pressures.

Market Reaction

Despite the notable EPS beat, Fiera Capital’s stock price remained unchanged at $6.62 in pre-market trading. The stock’s performance remains within its 52-week range of $5.50 to $10.92, reflecting broader market volatility and investor caution.

Outlook & Guidance

Looking ahead, Fiera Capital aims to achieve consistent investment performance and prioritize client experience. The company is targeting a 30% EBITDA margin and anticipates continued growth in private markets, particularly in agriculture and real estate sectors. The firm is also focusing on lean operations and investing in its workforce culture.

Executive Commentary

Maxine Menard, Global President and CEO, stated, "Fiera is well positioned for success," emphasizing the company’s strategic focus on private market platforms as a growth catalyst. She also highlighted the importance of fostering a culture of ownership and inclusion.

Risks and Challenges

• Volatility in global equity markets could impact investment performance.
• A weaker U.S. dollar poses currency risk.
• Competition in the private market solutions space is intensifying.
• Operational efficiency improvements may face execution risks.
• Macroeconomic pressures could affect client investment behavior.

Q&A

During the earnings call, analysts inquired about sub-advisory outflows totaling $1.1 billion and explored potential mergers and acquisitions. Discussions also focused on fee rate dynamics and the potential for new mandates with ATB Investment Management and Wellington Altus.

Full transcript - Fiera Capital Corporation (FSZ) Q2 2025:

Conference Operator: Good morning, and welcome to the FIA Capital’s Earnings Call to discuss Financial Results for the 2025. I will now turn the conference over to Natalie Medak, Director, Investor Relations. You may begin your conference.

Natalie Medak, Director, Investor Relations, Sierra Capital: Thank you, and good morning, everyone. Welcome to the Sierra Capital conference call to discuss our financial results for the 2025. A copy of today’s presentation can be found in the Investor Relations section of our website. Comments made on today’s call, including replies to certain questions, may deal with forward looking statements, which are subject to risks and uncertainties that may cause actual results to differ from expectations. Please refer to the forward looking statements on Page two of the presentation.

Our speakers today are Maxine Menard, Global President and CEO and Lucas Pontillo, Executive Director, Global CFO and Head of Corporate Strategy. Also available to answer questions will be John Valentini, President and CEO, Private Markets. With that, I will now turn the call over to Maxine.

Maxine Menard, Global President and CEO, Sierra Capital: Good morning, everyone. Thank you for joining us today as we report our results for second quarter twenty twenty five. The second quarter began with a challenging macro environment and a sharp decline in global equity markets. While markets quickly rebounded ending the quarter higher, a weaker U. S.

Dollar tempered returns for non U. S. Investors. Our assets under management ended the quarter at $160,500,000,000 flat from the end of the prior quarter, excluding the previously announced wind down of our Canadian equity small and micro cap strategies. Robust new mandates of $1,700,000,000 in market gains, which included an unfavorable foreign exchange impact from the weaker U.

S. Dollar, were offset by negative net contribution in the quarter. Assets under management in our public market platforms were $139,600,000,000 down slightly from the prior quarter, reflecting the wind down of the previously mentioned strategies. Strong new mandates activity primarily into our equity strategies and market gains were largely offset by negative net contribution mostly out of the lower fee fixed income strategies. Assets in our private market platform ended the second quarter at 20,900,000,000.0 down slightly from $21,100,000,000 at the end of the prior quarter, reflecting return of capital to investors and income distribution.

I will now turn to highlights of our commercial and investment platform across our asset classes, starting with our public market platform. We were pleased to secure total new mandates of $1,400,000,000 during the quarter, of which close to $1,000,000,000 went into our equity strategies. This marks the highest level of new mandate activity in more than two years and reflects growing momentum in our sales channel. We had several notable wins during the quarter. First, we launched the Qatar equity strategy in partnership with and initially funded by QIA.

The strategy, which has an initial investment of $200,000,000 S, invests in equity listed on the Qatar Stock Exchange and will be available to international and local institution desiring actively managed exposure to Qatar equity market. Fiera was also selected by ATB Investment Management to manage their U. S. Large Cap Equity Fund, which will be available to their advisor base and will be building block for the global equity pool. These are the first new funds ATB has launched in many years.

Lastly, our Canadian large cap equity team was selected by Wellington Altus to manage their Canadian high conviction equity strategy. Both the ATB and Wellington Altus mandates will fund over time and carry significant growth aspiration. Excluding sub advised assets under management, net outflows were $450,000,000 for the quarter, largely out of lower fixed income strategies, lower fee fixed income strategies. We were pleased with the demand for our equity strategies in the quarter, which experienced net inflows of close to 400,000,000 With respect to our sub advised assets under management, total net outflows were $1,100,000,000 of which approximately $700,000,000 were withdrawn by clients with which we continue to have ongoing relationship. Turning to the investment performance in public markets.

The quarter began with a sharp drop in the global markets, triggered by tariff announcements in early April, with the S and P 500 falling over 12% within a few days. Although markets rebounded, the initial shock created a challenging environment for equities outperformance, with much of the rebound driven by speculative interest in tech and AI related stocks. While all of our flagship equity strategies delivered positive absolute returns in the quarter, value add was mixed. Our Canadian equity strategy had top quartile performance year to date, beating its benchmark by two fifty basis points, And our Atlas Global strategy outperformed its benchmark adding close to 180 basis points of value year to date, helped by overweight exposure to the technology sector. Our emerging market strategy, select strategy remains top ranked and outperformed benchmark by three eighty basis points year to date and close to 10% since its inception in 2021.

Our frontier market strategy also had a first quartile ranking year to date, but underperformed its benchmark for the quarter, impacted by selection in Vietnam and overweight to the Saudi Arabia market. Despite some short term softness, the strategy has outperformed by more than 14% over the five year period. Our fixed income strategies continue to outperform for the quarter and year to date, with our active strategic and integrated core strategies all adding value in both the short and long term. Within our foreign fixed income strategies, our global multi sector income strategies added over 80 basis points of alpha for the quarter and outperformed by close to 5% for the five year period. Now turning to our private market platform.

New subscriptions exceeded $200,000,000 for the quarter, primarily into our real estate and private debt strategies, and with return capital of more than $200,000,000 During the quarter, we deployed approximately $600,000,000 of capital and have deployed 1,100,000,000 year to date. Our pipeline remains robust with $1,300,000,000 of committed undeployed capital for future opportunities. With respect to performance, our private market strategies continue to perform well with our key strategy generating positive returns in the second quarter and absolute returns of 5% to 12% over the one year period. Within private credit, our infrastructure debt fund returned more than 2% in the quarter and closed to 12% over the one year period. The strategy remains well positioned to deploy capital through the second half of the year.

In real estate, our Canadian and UK strategies produce steady returns supported by high occupancy and durable income streams. Our portfolios remain concentrated in logistic and housing, which are well positioned to benefit from improving liquidity and central bank easing. And our global private equity strategy returned 2.4 in the second quarter with a gross IRR of close to 15% since inception. The strategy continues to prioritize businesses with resilient cash flow, scalable models, and defensive market position. Turning now to private wealth.

Private wealth assets under management of $13,700,000,000 were down 3% during the second quarter. While we captured close to $100,000,000 in new mandates, the quarter was impacted by negative net contribution mainly out of sub advised assets and fixed income mandates. We view the private wealth business as highly complementary to our public and private market platforms and continue to work to strengthen clients relationship and drive sales growth through that channel. To that end, we appointed Paul Delaroche to Head of Private Wealth Canada earlier this year. Paul brings twenty years of industry experience to the role and has been instrumental in delivering discretionary investment management services to affluent Canadians and their families.

With that, I will turn it over to Lucas to review our financial performance.

Lucas Pontillo, Executive Director, Global CFO and Head of Corporate Strategy, Sierra Capital: Thank you, Maxim, and good morning, everyone. I will now review the financial results for the 2025. Beginning with total revenues. Across our investment platforms, we generated total revenues of $163,000,000 in the second quarter, down slightly from $165,000,000 same quarter last year. Total base management fees were $148,000,000 in the quarter, down 1,000,000 or 1% year over year.

On a year to date basis, however, total base management fees of $3.00 $2,000,000 were up approximately 1% from the same period last year, as we were able to more than offset a decline in fees in public markets with higher base management fees in private markets. We are pleased to note that year to date, our overall fee rate has remained stable compared with the same period last year, as relative AUM growth from private markets and steady private market fee rates have offset modest fee reductions in public markets. Turning to public markets revenues. Base management fees of $98,000,000 in the second quarter declined by $5,000,000 or 5% from the same quarter last year, reflecting outflows from sub advised mandates, partly offset by higher fees from institutional clients in Canada and Asia. On a year to date basis, base management fees of $2.00 $4,000,000 declined 3% from the same period last year.

Performance fees were nil during the quarter, down from fees of less than $1,000,000 in the same quarter last year. Other revenues of $1,600,000 in the quarter were down from $3,800,000 in the same quarter last year, largely as a result of revenues related to a prior year insurance claim. Turning to private markets revenues. Base management fees increased by $4,000,000 or 8% year over year to $49,000,000 for the quarter. The increase was primarily driven by higher AUM within real estate and agriculture from the acquisition of a controlling interest in a UK real estate platform in the prior quarter, along with higher deployed AUM.

On a year to date basis, base management fees of $99,000,000 were also up 8% from the same period last year. Commitment and transaction fees of $5,000,000 were $1,000,000 higher year over year, reflecting higher transaction fees earned from clients in the EMEA region. And performance fees of $2,500,000 in the quarter were close to $1,000,000 higher year over year, reflecting higher fees from our Canadian real estate debt fund in the current quarter. Share of earnings in joint ventures related to our UK real estate business were $2,000,000 in the quarter, down slightly from 2,700,000.0 in the same quarter last year, as a result of timing of completion of joint venture projects. On a year to date basis, earnings from joint ventures of close to $5,000,000 were down from 9,000,000 the same period last year, again as a result of timing of completion of projects.

For the quarter, private markets generated 38% of total revenues, while comprising only 13% of our total assets under management. Private markets continues to drive AUM and revenue growth and provide attractive diversification to our overall business. Turning to SG and A. Last quarter, we announced we had taken actions to streamline the organization and improve operating efficiency. Compared to the prior quarter, our SG and A expenses, excluding share based compensation, were down $2,000,000 or 2%, aided by a 3% decline in our fixed compensation expenses quarter over quarter.

Compared to the same quarter last year, SG and A expenses, excluding share based compensation, declined $2,000,000 or 2%, driven by lower sub advisory fees, primarily offset by the acquisition of a non controlling interest in The UK real estate platform in the prior quarter. On a year to date basis, SG and A expenses, excluding share based compensation, were down 5,500,000.0 or 2% from the same period last year. We continue to closely monitor the macroeconomic environment and prudently manage expenses in response to challenges in market volatility. Turning to adjusted EBITDA and adjusted EBITDA margin. Adjusted EBITDA for the quarter was $45,700,000 up 1% from the same quarter last year, reflecting higher base management fees in private markets and lower SG and A excluding share based compensation, partly offset by lower base management fees in public markets.

Our adjusted EBITDA margin was 28% for the quarter, up from 27.5% for the same quarter last year and up from 26.6% in the prior quarter. Looking at earnings. Net earnings attributable to company shareholders were $4,000,000 or $03 per diluted share for the quarter compared with $5,000,000 or $04 per diluted share for the same quarter last year. Earnings in the second quarter were impacted by a 6,900,000.0 charge of previously announced restructuring costs related to severance. On an adjusted basis, net earnings were $27,000,000 or $0.24 per diluted share for the quarter compared with $25,000,000 or $0.23 per per diluted share in the same quarter last year.

Last twelve months free cash flow was $75,000,000 compared with $87,000,000 for the prior quarter. The decrease primarily reflects higher restructuring charges in the current quarter and the timing and collection of accounts receivables during the quarter. Turning to our financial leverage. During the quarter, we issued $80,000,000 of 7.75% hybrid debentures, which we expect to use to fund the redemption of our 8.25% hybrid debentures on the first call date at the end of this year. In the interim, net proceeds from the offering are being used to reduce the balance on our credit facility.

Net debt at the end of the quarter was $712,000,000 up $9,000,000 from the end of the prior quarter. The increase reflects two dividend payments totaling $34,000,000 and the repurchase and cancellation of shares totaling $6,000,000 which were partly offset by higher free cash flow generated during the second quarter. Going forward, net debt is expected to decrease as we redirect a portion of our savings from the lower dividend to debt repayment and generate higher free cash flow in the second half of the year. Our net debt ratio is consistent with the prior quarter at just over 3.6 times. Our funded debt ratio, as defined by a credit facility agreement, decreased to just under three times from 3.3 times in the prior quarter.

The decrease reflects a decline on the credit facility from the debenture offering proceeds. Finally, delivering value to our shareholders continues to be a fundamental pillar of our strategy. During the quarter, we repurchased and canceled 1,100,000.0 shares for a total consideration of $6,300,000 Lastly, the Board has approved a quarterly dividend of $0.01 $08 per share payable on 09/18/2025, to shareholders of record on 08/20/2025. Now I’ll turn the call back to Maxim for his closing remarks.

Maxine Menard, Global President and CEO, Sierra Capital: Thank you, Lucas. Last month, I was privileged to step into the position of Global President and Chief Executive Officer. I am honored to succeed to Jean Guy Desjardins, whose founding vision and entrepreneurial drive built the firm into the global organization that it is today. And I am grateful for his continued presence and support as we enter this next chapter. Tiara is well positioned for success.

We have established public markets platform with scale and investment capability breadth and depth. Our private market platform remains a catalyst for growth, generating an increased share of our AUM and revenue. And our complementary private wealth business offers institutional grade investment advice and capabilities to the rapidly growing high net worth segment. This diversified model both provides us with the resiliency to weather difficult markets and positions us strongly for future growth. Moving forward, several priorities will remain central to my mandate.

First, delivering consistent investment performance remains key to our success. We must ensure every strategy meets the highest standard through full market cycles. Second, we will continue to offer our clients a consistent and connected experience. Next, we will run lean and efficient operations. We will simplify how we work, modernize our infrastructure, and reinvest in the tools and people that help us grow and focus discipline.

Lastly, our success depends on our people. Fiera has always had an entrepreneurial spirit, and we will continue to encourage initiatives and foster culture of ownership and inclusion. Myself and the senior management team are deeply invested in the company and its success, and I am excited to continue executing on our strategy and building momentum in our business. I will now turn the call back to the operator for questions.

Conference Operator: Thank you, sir. And your first question will be from Etienne Ricard at BMO Capital Markets. Please go ahead, Etienne.

Lucas Pontillo, Executive Director, Global CFO and Head of Corporate Strategy, Sierra Capital: Thank you, and good morning, Maxime and Lucas. So to start on private markets, I’m wondering what appetite are you seeing from investors given the strong market appreciation that we’ve seen in recent months. Would you say there’s greater interest in institutional or the retail channel?

Maxine Menard, Global President and CEO, Sierra Capital: So certainly, like we’ve seen, it’s a constant level of appetite for private market solutions and the institutional business. I would say there’s slightly more interest in this cycle, particularly as institutional managers are considering increasing their proportion to private markets. And if we slice it a little bit more, obviously, with the performance of our real estate core funds, we are seeing lots of RFPs in demand in that cycle of the market. So we’ve seen our real estate fairly successful and also credit. As we mentioned before, the agriculture fund within our COMOX has also had lots of demand.

I would say from a secular standpoint, the private wealth business is certainly moving towards the trend of increasing the level of open ended private market solutions. We were first to come out in the market with these solutions, and a lot of competitors are sort of catching up onto this, but it’s generating a lot of appetite in the private wealth segment. And again, we continue to have a lot of interest in our private market solution within the institutional. And I would say, we look forward, we anticipate this trend to continue.

Lucas Pontillo, Executive Director, Global CFO and Head of Corporate Strategy, Sierra Capital: Maxime, raised real estate, credit, agriculture. I know they’re all growing, but which one of these would you expect to outperform?

Maxine Menard, Global President and CEO, Sierra Capital: From an investment standpoint or from a AUM growth standpoint?

Lucas Pontillo, Executive Director, Global CFO and Head of Corporate Strategy, Sierra Capital: AUM growth.

Maxine Menard, Global President and CEO, Sierra Capital: Yeah. So the agriculture has shown a lot of interest. I would say historically it used to be a subclass of the infrastructure asset class on a global basis. Additional, there’s an increasing number of consulting that are covering the agriculture segment. We’ve seen a lot of appetite.

The performance is obviously well. And so, I would say this is one that we see a lot of global demand from that standpoint, and global being such a larger market, by definition, should see a lot of pickup on that. Our Canadian real estate has performed very well. So here in Canada, it’s a limited market, but we see lots of growth there. We’re currently exploring and concluding a number of agreement on the international side of things to export our real estate capabilities from an investment standpoint.

So, it’s in Germany or even in The UK, we’ve built a vehicle to make this possible through U SITs, and we’ve concluded some agreements to increase distribution. So, I would say these two would certainly be top of mind in terms of our ability to continue to accelerate growth.

Lucas Pontillo, Executive Director, Global CFO and Head of Corporate Strategy, Sierra Capital: Okay, interesting. So switching topics, there was good margin expansion in the quarter. Lucas, I think you previously talked about a 30% EBITDA margin target. What are some levers that you can pull to get there and over what timeframe? I think there’s two.

So, starting on the top line, as Maximus has pointed out a couple of times during the call, the continued growth in private markets just continues to enhance our product mix and our asset mix and our revenue profile as a result. And in addition to sort of the base management fees that come with that revenue, when we talk about strategies like agriculture, it’s the performance fee aspect of that and sort of how that can help enhance the top line. So we do see the opportunity for revenue expansion going forward from a pure BEEPS perspective and asset mix. And then following on that, the continued ability to just standardize, globalize our expense structure. I think we’ve made great strides in the last quarter in terms of the restructuring we put through.

And we’ll continue to hone and work on that going forward to really continue to drive operating leverage there. I know you present margins on a consolidated basis across private and public markets, but we tend to see better margins for alternative asset managers as opposed to traditional asset managers. So I’m curious the mix shift towards private AUM should be helpful in this regard. Is that a fair assessment? It is a fair assessment.

As I say, I think coming back to the point that the revenue profile of those assets as well are also attractive from that perspective. Okay. Thank you very much.

Conference Operator: Thank you. Next question will be from Gary Ho at Desjardins Capital Markets. Please go ahead, Gary.

Gary Ho, Analyst, Desjardins Capital Markets: Thanks. Good morning. Thanks for taking my questions. Maybe to start off with the sub advisory outflows here. So there’s $1,100,000,000 as you highlighted in the quarter.

What’s driving that in the quarter? Is it rebalances? Or has there been kind of softer performance recently? I’m just trying to reconcile that with something in slide 14 to seeing softer near term performance in the equity strategy. Wondering if that’s related to pine stones.

And if not, wondering if you can comment on what’s driving that.

Lucas Pontillo, Executive Director, Global CFO and Head of Corporate Strategy, Sierra Capital: Yeah, I’ll start and then maybe hand it over to Max on the performance piece. So just to clarify the $1,100,000,000 it’s indeed so $400,000,000 of that is lost mandates, and $700,000,000 of that is clients we continue to have, and just it’s a rebalancing effectively of their portfolios or a paring down of the investment strategies. To be clear, this is not any transfers to Pinestone, so the $1,100,000,000 is effectively net loss in both cases. So this is $400,000,000 of clients which are redeemed out of the strategy altogether, and $700,000,000 of clients who continue to invest in the Pinestone sub advised strategies but have just reduced their exposure.

Gary Ho, Analyst, Desjardins Capital Markets: Yeah, and the performance?

Maxine Menard, Global President and CEO, Sierra Capital: So, yeah, so I would say the one year performance has been, with the current macro environment, been a challenging environment, particularly with the concentration of where the performance is coming from. As you know, we keep a close eye on how these different mandates perform, particularly when it comes to our largest asset base, including Pine Stone. There’s no notable change or shift in terms of style or whatnot. So what we do in those instances, obviously, a client support standpoint, we make sure we stay really close, increase the client activity and engagement. But when we relate back to, is this something that is of a level of concern from a style process standpoint, absolutely not.

When it comes to how attribution is being allocated, it’s a number of small stock here and there, or a bigger proportion of the index that makes it hard. But again, we will keep monitoring and keeping a close eye on this.

Gary Ho, Analyst, Desjardins Capital Markets: Okay. And then maybe just a numbers question on the back of that for you, Lucas. Just the Pine Sol’s $36,000,000,000 of assets. Should we think about those assets generating roughly the 30 to 40 basis points kind of similar to kind of your overall fees that’s the management fees that you generate off of your consolidated AUM?

Lucas Pontillo, Executive Director, Global CFO and Head of Corporate Strategy, Sierra Capital: I mean, you need to think of it in a line, Gary, in terms of the three types of strategy there, so global equity, international equity and U. S. Equity, and each one of those has their own sort of fee profiles in terms of the market, so I would say certainly on the global side, they tend to range at the higher end, and US equities have become a bit more commoditized in The US market.

Gary Ho, Analyst, Desjardins Capital Markets: Okay, appreciate that. And then my last question, maybe a broader question. There’s some M and A activity in the space in Canada recently, Burgundy, and also closing of CI. Maximin, maybe perhaps John, are you guys at all looking at tuck ins opportunities, or just comment on the M and A landscape in general? And would there be anything that you’re looking to sell at all on the other side?

Maxine Menard, Global President and CEO, Sierra Capital: So, I’ll just, I mean, obviously I keep an eye on all of this with keen interest from a valuation standpoint to our own company. I think these are being traded at very healthy multiples. Are we looking for opportunistic tuck in? I would say we’re always interested in what’s out there. Currently, the investment platforms, I think, is in a good position.

There’s no immediate need for us to add anything, but we’re being watchful in case there is something. In terms of divestiture, not really. I think when you think about how Fiera has built the investment platforms, we are where we want to be. Now, next part of the chapter is really to focus on making sure that we grow through our regionalization distribution. So if there are any opportunity on the go forward basis through either a team or a small tuck in, we’ll look at it.

But right now, there’s no immediate consideration for that.

Lucas Pontillo, Executive Director, Global CFO and Head of Corporate Strategy, Sierra Capital: And I would add, Gary, thank you for the question. I’d actually turn around from the perspective of saying, know, and you’ve heard me on this before in terms of just our overall sum of the parts valuation and how to look at our business. You know, we’ve got a fantastic Canadian private wealth franchise, you know, it’s close to $12,000,000,000 of assets under management. We are one of the few in the markets that can actually have a very nice diversification of private market assets offering to our clients in that space. From a revenue profile, it’s a platform that generates not only advisory fee, but also investment management fees to the underlying investment platforms, particularly in private markets.

So, when you compare it to some of the transactions that have cleared the marketplace, which I’d qualify probably more as a bit more plain vanilla in terms of private wealth offering compared to the sophistication of what we offer here. So it’s room for pause to think about our overall valuation, think.

Gary Ho, Analyst, Desjardins Capital Markets: Now, that’s exactly where I was going with this. Just wondering if there’s continuing disconnect between share valuation and kind of where some of these transactions are changing hands, whether there’s some opportunity to kind of realize shareholder value. That’s kind of where my line of questions going.

Lucas Pontillo, Executive Director, Global CFO and Head of Corporate Strategy, Sierra Capital: Okay, thanks. Thanks for that.

Conference Operator: Mhmm. Thank thank you. Next question will be from Jane Groin at National Bank Financial. Please go ahead, Jane.

Jane Groin, Analyst, National Bank Financial: Yeah. Just one question. Wanted to dig in on the fee rates. By my calculations, it looks like fee rates across the total platform but also for public and for private markets, base management fee rates I’m talking about declined quarter over quarter, declined year over year. I would have expected to see something like the opposite given

Lucas Pontillo, Executive Director, Global CFO and Head of Corporate Strategy, Sierra Capital: you seem to

Jane Groin, Analyst, National Bank Financial: be losing more low fee mandates. Maybe you can sort of talk through that performance and your expectations on a go forward basis.

Lucas Pontillo, Executive Director, Global CFO and Head of Corporate Strategy, Sierra Capital: Yeah, I’d sort of break it down into two. You sort of have to look at it sort of pre and post, I think, the sub advised mandates, right? So let’s not forget there was a large canoe redemption in the first quarter of the year, which we do it well communicated and telegraphed, and so certainly when you have mandates coming out there from an overall perspective, there’s an impact, But if you look at it sort of ex those sub advised mandates, you’re absolutely right, Jim. What we’ve been losing is lower fee fixed income mandates and actually gaining in our other equity strategies and our other private market strategies. So, when you’re taking the aggregate and the full blends, obviously there’s this impact of the CANU mandate loss at the beginning of the year, but if you look at it ex that, we’re actually in accretion mode, and the product mix shift has actually been positive.

Jane Groin, Analyst, National Bank Financial: Okay, maybe we’ll dig in offline or maybe some some more disclosures to help see that that flow through. It’s just hard from the from the higher level of data. I don’t from what I could tell, but happy to chat offline.

Lucas Pontillo, Executive Director, Global CFO and Head of Corporate Strategy, Sierra Capital: Perfect. Thank you.

Conference Operator: Thank you. And your next question will be from Graham Ryding at TD Securities. Please go ahead, Graham.

Graham Ryding, Analyst, TD Securities: Hi. Good morning. Some good traction in the last few months with Qatar and ATV, Boeing and Altus. Can you try to sort of frame what your expectations or your targets are from these relationships? Like what sort of AUM growth or inflows do you think you would like to see or is possible from these mandates?

Maxine Menard, Global President and CEO, Sierra Capital: Well, again, I don’t want to go too aspirational on this, but there’s certainly transformational in the way we operate within that segment of the market. And I do want to reemphasize that we had announced a quarters ago that we were gonna concentrate on that space of the market, which is the segment of the advisory business. I think these two are fast growing platforms, and we made sure that we were part of a lineup where we had a big proportion of the asset within that asset class. So, if I think of any of them, whether it’s ATB or Wellington, I could easily see a double of assets over the near to mid term in terms of the asset flow. And as we progress, again, based on performance, I am hopeful that this will continue at a pretty accelerated pace.

So, whether it’s Canadian equities or even The US large cap mandates, these are almost exclusive in the nature of their own mandates on the platform. So most of the flows that would either go in one or the other would see a lot of flows coming in. So again, on The US large cap, I think the mandate is near $500,000,000 and we are hopeful to see a double on that over the next six to twelve months. And I would see the same thing for Wellington Altus. We’re also in discussions with a few other intermediary solutions and providers, and I think those discussions are coming along really nicely.

Graham Ryding, Analyst, TD Securities: Okay, great. And were there any flows like out of the gate from ATB or Wellington Altus? Like, those in your numbers this quarter, or is this something that we should just be watching for that’s gonna build over time?

Maxine Menard, Global President and CEO, Sierra Capital: So they they gradually came through in q q two, and, there there’s more to come for future flows.

Graham Ryding, Analyst, TD Securities: Understood. Okay. Great. Private wealth, just the outflows in the quarter, I think you made some comments, I apologize if I missed it. Traditionally, this is pretty sticky channel.

I’m just maybe some color on what drove the outflows on the private wealth channel this quarter?

Maxine Menard, Global President and CEO, Sierra Capital: Again, there were no one particular reason of outflows. I think in the private wealth, we’ve seen some of it related to, again, mentioned fixed income and some sub advisory within one of our you know, the pine stone mandates. Again, I don’t think there’s one common themes in private wealth. This is more about regular outflows that are exceeding our gross contribution, but there are no common themes that I could really speak to in terms of why we’ve seen this. Again, think on the backdrop of a very uncertain macro environment, there may be some nervousness into the segment that typically is more sensitive to immediate market reaction, and that could potentially draw some conclusion of why we’ve seen some outflows.

But to your point, this is a market or a segment that typically has a bit more stickier assets. So I would say I would characterize this quarter as maybe more than what we see usually, but if I want to draw some conclusion, maybe the backdrop of the macro environment may have precipitated some decisions on that side.

Graham Ryding, Analyst, TD Securities: Okay. Understood. And then just, Lucas, a fairly large restructuring charge this quarter. Should we expect sort of that line item of one time integration, acquisition, restructuring charges, should we expect that to sort of be lower going forward?

Lucas Pontillo, Executive Director, Global CFO and Head of Corporate Strategy, Sierra Capital: Yes, and so to sort of dissect that a bit, you had close to $7,000,000 of that flow through the expense line, so that’s seven out of the 10, and that’s just from a cash flow impact perspective, we took $5,000,000 of that into the quarter, which was the cash flow impact on free cash flow, and then there’ll be that balance of $2,000,000 will effectively work its way through over the course of the next twelve months. So you have a bit of a divergence between the expense item and the cash aspect of it, but the majority of it was taken into the quarter from a cash perspective.

Graham Ryding, Analyst, TD Securities: Understood. Okay. That’s it for me. Thank you.

Conference Operator: Thank you. We have no further questions registered at this time. I will now turn the call back over to Natalie Medec.

Natalie Medak, Director, Investor Relations, Sierra Capital: We’d like to thank everyone for joining us this morning. Please reach out if you have any other questions. Sylvie, with that, we can end the call.

Conference Operator: Thank you. Ladies and gentlemen, this does indeed conclude your conference call for today. Once again, thank you for attending. At this time, we ask that you please disconnect your lines. Have a good weekend.

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