Sceptre Investment reports lower Q2 profit on merger costs

Date: Friday, June 18, 2010
Author: Investment Executive

Sceptre Investment Counsel Ltd. (TSX:SZ) reported a drop in second-quarter profit compared with a year ago, weighed down by costs related the money manager’s merger with Fiera Capital Inc.

Sceptre said Thursday it earned $351,000 or three cents per share for the quarter ended May 31 compared with a profit of $519,000 or four cents per share a year ago.

Revenue totalled $7.4 million, up from $6.2 million.

Excluding the transaction costs and other one time expenses, Sceptre said it would have earned nine cents per share.

On Wednesday, Sceptre said it signed a definitive agreement to merge with Montreal-based Fiera. The new company will be named Fiera Sceptre.

Under the deal, Sceptre shareholders will exchange 14 million shares for 14 million new class A subordinate voting shares of Fiera Sceptre.

Fiera will receive 21.1 million class B shares of Fiera Sceptre in exchange for its operating assets and related liabilities.

Jean-Guy Desjardins, controlling shareholder of Fiera Capital, will become chairman, chief executive and chief investment officer of Fiera Sceptre, while Fiera president and chief operating officer Sylvain Brosseau will become president and chief operating officer of the combined firm.

David Pennycook, president and interim chief executive of Sceptre, will become vice-chairman and executive vice-president.