Gluskin Sheff + Associates, Inc. :GLUSF-US: Earnings Analysis: 2017 By the Numbers : September 25, 2017

Gluskin Sheff + Associates, Inc. reports financial results for the year ended June 30, 2017.

We analyze the earnings along side the following peers of Gluskin Sheff + Associates, Inc. – Invesco Ltd. and ING Groep NV (IVZ-US and INGVF-US) that have also reported for this period.

Highlights

  • Year-on-year change in operating cash flow of 20.11% is about the same as the change in earnings, likely no significant movement in accruals or reserves.
  • Earnings growth from operating margin improvements as well as one-time items.

The table below shows the preliminary results and recent trends for key metrics such as revenues and net income (See complete table at the end of this report):

2017 2016 2015 2014 2013
Relevant Numbers (Annual)
Revenues 114.62 106.4 139.57 231.25 124.49
Revenue Growth (YOY) N/A N/A N/A N/A N/A
Earnings 32.55 25.87 44.62 99.78 49.21
Earnings Growth (YOY) 25.83 -42.03 -55.28 102.76 183.15
Net Margin 28.4 24.31 31.97 43.15 39.53
EPS 1.04 0.83 1.42 3.36 1.68
Return on Equity 33.17 26.85 47.91 119.57 64.4
Return on Assets 22.89 17.92 26.6 65.04 43.53

Access our Ratings and Scores for Gluskin Sheff + Associates, Inc.

Cash Versus Earnings – Sustainable Performance?

It is important to examine a company�s cash versus earnings numbers to gauge whether its performance is sustainable.

Operating Cash Flow Growth Versus Earnings Growth

Quadrant label definitions. Hover to know more

Cash Flow based Earnings, Likely Non-cash Earnings, Low Cash Flow Base, Likely Undeclared Earnings

GLUSF-US’s change in operating cash flow of 20.11% compared to the same period last year is about the same as its change in earnings this period. Additionally, this change in operating cash flow is about average among its peer group. This suggests that the company did not use accruals or reserves to manage earnings this period, and that, all else being equal, the earnings number is sustainable.

Margins

The company’s earnings growth has also been influenced by the following factors: (1) Improvements in operating (EBIT) margins from 34.54% to 40.47% and (2) one-time items. The company’s pretax margins are now 39.24% compared to 34.88% for the same period last year.

EBIT Margin Versus PreTax Margin

Quadrant label definitions. Hover to know more

Operation driven Earnings, One-time Favorables, Low Earnings Base, One-time Unfavorables
EBIT Margin History
PreTax Margin History

Access our Ratings and Scores for Gluskin Sheff + Associates, Inc.

Company Profile

Gluskin Sheff + Associates, Inc. is a wealth management company, which engages in managing portfolios of private clients, as well as institutional investors, including family offices, foundations, endowments, and public and private pension plans. It offers investment strategies across equity, fixed income, and alternative asset classes. The company was founded by Gerald Sheff and Ira Gluskin on April 17, 1984 and is headquartered in Toronto, Canada.

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