Fiera Capital Corporation

Good morning. My name is Sylvie and I will be your conference operator today. At this time, I would like to welcome everyone to Fiat Capital's earnings call to discuss financial results for the first quarter of 2025. Please note that all participant lines have been placed on mute to prevent any background noise. After the speaker's prepared remarks, there will be a question and answer period. As a reminder, this conference call is being recorded. If you would like to ask a question during the Q&A period, simply press star 1 on your telephone keypad. And if you would like to withdraw your question, please press star then 2. Thank you. I would now like to turn the conference over to Ms. Marie-France Gay, Senior Vice President, Treasury and Investor Relations. Ms. Gay, you may go ahead and begin your conference.

Thank you, Sylvie. Good morning, everyone. Bonjour à tous. Bienvenue à l'appel de conférence de Fiera Capital pour discuter des résultats financiers du premier trimestre de 2025. Welcome to the Sierra Capital conference call to discuss our financial results for the first quarter of 2025. Note that today's call will be held in English. Before we begin, I invite you to download a copy of today's presentation, which can be found in the investor relations section of our website at ir.sierracapital.com. Also note that 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. I would ask you to take a moment to read the forward-looking statements on page two of the presentation. On today's call, we will discuss our Q1 2025 results, starting with an update on our AUM flows, followed by highlights of our public and private market platforms, as well as our private wealth business. We will then review our financial performance. Our speakers today are Mr. Jean-Yves Desjardins, Chair of the Board and Global CEO, and Mr. Lucas Pontillo, Executive Director and Global CFO. Also available to answer questions following the prepared remarks will be Maxime Menard, President and CEO of FIERA Canada and Global Private Wealth, and John Galantini, President and CEO of Private Markets. With that, I will now turn over the call to Jean-Pierre.

Thank you, Marie-France. Good morning, everyone, and thank you for joining us today as we report our results for the first quarter of 2025. Global equity markets were mixed in the first quarter of the year. The risk appetite deteriorated significantly in the last month of the quarter as investor fears intensified at a trade war. would reignite inflation and dampen growth. The S&P 500 was hit the hardest, declining nearly 5% for the quarter, while the Canadian Benchmark Index managed to eke out a modest gain thanks to solid returns in resources. Global stocks outperformed their North American peers as Germany's fiscal spending plans boosted the outlook for European economies and corporate earnings. Fixed income markets were positive in the quarter as investors fled to the safety of bonds, with investors bracing for the impacts of lingering trade tensions on growth. Speculation mounted that the Federal Reserve would soon need to pivot from worrying about sticky inflation towards fretting about a stagnating economy. Similarly in Canada, fears about U.S. tariffs, pushed government bond yields broadly lower, even as both growth and inflation surprised to the upside. So against this backdrop, our assets under management ended the quarter at 161.6 billion, representing a decrease of 5.5 billion for the quarter. This decrease was attributable to a previously announced outflow in assets under management, sub-advised by Pinestone. We are particularly pleased that excluding Pinestone, we experience positive net organic growth of about 550 million in the quarter. Assets in our private markets platform grew by 1.4 billion, or 7%, to 21.1 billion during the quarter, driven by the acquisition of a controlling interest in a real estate investment platform in the United Kingdom, which increased our assets under management by more than 900 million. Growth was also helped by positive market impact of approximately 400 million and more than 120 million in net organic growth during the quarter. Driven by new mandates of approximately 500 million, primarily from our agriculture and real estate strategies. Our public markets assets under management, excluding those sub-advised by Pinestone, increased by 1% to more than 104 billion during the quarter. Driven by positive net organic growth of more than 400 million, and market impact of approximately $300 million. So, I will now turn to highlights of our commercial and investment performance across our asset classes. So, starting with our public markets platform. Excluding assets under management, some advice by Pinestone. Public markets saw good flow activity during the quarter, reporting new mandates of $1 billion, and positive net organic growth of more than 400 million. With respect to assets sub-advised by Pinestone, as previously announced, Canoe Financial withdrew 5.7 billion of assets and transferred them directly to Pinestone during the quarter. An additional 1.2 billion of assets sub-advised by Pinestone were withdrawn by clients, with which we have ongoing relationships. As we announced at the end of April, we will be winding down our Canadian equity small and micro cap strategies as part of our strategic decision to focus our business on our more scalable strategies. These strategies represented less than 1% of both our total assets under management and total revenues for 2024. Turning to Investment performance in public markets. The macroeconomic environment has been challenging for financial markets. We have been positioned defensively since the fourth quarter of last year, driven by the reacceleration of inflation in the second half of the year, the resilience of the U.S. economy, which was operating at an above-trend pace and a strong job market with unemployment at historic lows. As a result, most of our flagship strategies performed well and generated positive relative returns in the first quarter of the year. Within Canadian fixed income, our strategic core strategy delivered strong excess returns relative to its benchmark in the quarter, driven by active positioning along the curve. Our active core and integrated core also outperformed benchmarks for the quarter. and all three strategies generated alpha over the one, three, and five-year periods. Relative returns for the quarter were mixed for foreign fixed-income strategies. The global multi-sector income strategy outperformed its benchmark by more than 70 basis points in the quarter, driven by long-term active duration across U.S. and Mexican fixed-income markets, and from strong security selection within emerging markets. The high-grade core intermediate strategy modestly outperformed in the first quarter, while the tax-efficient core plus strategy came in below benchmark. All three strategies continue to outperform benchmarks over the longer term. Our Canadian equity strategy had top quartile performance during the quarter as it outperformed its benchmark by close to 240 basis points. The portfolio's lead over the S&P TSX widened once more, driven mainly by stock selection. An overweight position in the better capitalized domestic banks paid off when credit loss provisions surprised on the downside. Turnover stayed below 15%, and active share above 70%, underscoring a conviction-led long horizon approach. Despite a challenging quarter for the frontier market strategy, the strategy continues to deliver notably strong relative performance across all medium and long-term periods, including since inception, for which it has generated over 16.6% of value added for investors. And lastly, the Emerging Markets Select Strategy outperforms its benchmark and maintains an impressive track record, outperforming its benchmark by over 9% since inception in 2021. Turning to our Private Markets Platform. Private markets delivered positive net organic growth of approximately 120 million during the quarter, after returning capital of close to 140 million. Growth was driven by new mandates of approximately 500 million, primarily from clients into our global agriculture fund and in our real estate strategies. Close to 500 million of capital was deployed in the quarter, and we maintain a robust pipeline of 1.5 billion in committed, undeployed capital for future opportunities, an increase of 600 million compared to the end of the prior quarter. With respect to investment performance, our private market strategies performed well in the quarter, with our key strategies all generating positive returns for the quarter and absolute returns of 5% to 12% over the one-year period. Our infrastructure strategy returned 2.3% for the quarter and nearly 9% over one year, benefiting from the long-term contracted nature of the majority of its revenues, inflationary edging, and limited revenue exposure to trade. Our private credit strategies also generated attractive returns for the quarter and one-year period. Our infrastructure private debt strategy produced a 12% absolute return over the one-year period as positive income from investments was supported by favorable movements in base rates. These underlying investments are generally well insulated from macroeconomic and geopolitical volatility. and the team is expected to deploy significant capital in the remainder of 2025. Within our real estate debt strategies, the void left by traditional lenders continues to create outsized risk-adjusted return opportunities with a lack of correlation to the broader financial markets and economies. Within corporate private debt, Canadian borrowers have been minimally impacted by U.S. tariffs due to conservative loan structures and a focus on the Canadian middle market, which primarily involves domestic customers and suppliers. The deal pipeline remains very strong as reduced lending by Canadian banks has allowed us to access higher quality credit while maintaining a senior secured position with stringent covenants and a focus on capital preservation. Our global agriculture strategy performed well in the quarter and generated a nearly 9% return over the one-year period. The strategy has a strong pipeline of follow-on opportunities and new partnerships across Canada, the United States, Australia, and Western Europe. In real estate, the industry is poised to benefit more consistently from the macroeconomic tailwinds from increasing market liquidity and central bank rate cuts. Canadian and UK real estate equity strategies produced good returns in the first quarter, which reflected this underlying positive momentum. Now turning to private wealth. Private wealth assets under management decreased during the quarter to close at 14.2 billion. Gross new mandates were robust at approximately 400 million, the highest level of new mandates since 2022. We continue to see the benefits from the regionalized distribution model as we build deeper relationships with existing and new clients to drive sales growth. However, the quarter was impacted by negative contributions, primarily from one larger withdrawal from a client out of fixed income mandates. So with that, I will turn it over to Lucas for a review of our financial performance.