Capital régional et coopératif Desjardins announces record net income of $122.6 million and a return of 11.6%
Historic highs for the Company’s 10th year in operation
Montréal, February 16, 2012 – Capital régional et coopératif Desjardins (the “Company”) released its financial results for fiscal 2011, announcing net income of $122.6 million, up from $18.7 million a year earlier, and an annual return of 11.6% compared with 2.0% for the previous fiscal year.
Effective at noon today, these results raise the per share value to $11.02, up $1.11 from $9.91 as at December 31, 2010. For information purposes, taking into account the income tax credit of 50%, at the price of $11.02, shareholders who invested seven years ago obtain an annual after-tax return of between 9.8% and 11.3%.
Delighted with the announcement of this exceptional return, Capital régional et coopératif Desjardins Chairman of the Board André Lachapelle said, “These outstanding results are proof of our active contribution to growing wealth for Québec’s communities by developing a strong economy focused on future generations. After ten years in operation, Capital régional et coopératif Desjardins has the maturity and expertise needed to support the entrepreneurs who then drive the economic vitality of our regions. And these historic results will be very profitable this year for our close to 107,000 shareholders.”
Marie-Claude Boisvert, Chief Operating Officer of Desjardins Venture Capital, the manager of Capital régional et coopératif Desjardins, stated that the return was in part due to the convergence of various factors related to the Company’s investment activities. “This string of successes is the result of the quality of the portfolio management and asset allocation strategies we implemented a few years ago. And, we would be remiss not to mention our transaction with Enobia Pharma, which strongly enhanced this extraordinary performance.”
The Company benefited from a favourable set of factors that allowed the Investments impacting the Québec economy and Other investments activities to drive performance strongly. Assets allocated to Investments impacting the Québec economy focus on the Company’s mission of promoting the economic development of Québec’s regions and cooperatives.
This activity posted a return of 26.0% for the last fiscal year, compared with a return of 6.8% in 2010. This strong increase is due to solid performance in all asset classes, Venture Capital – Health in particular, which was largely boosted by the fair value remeasurement of the Enobia Pharma investment following the offer to purchase received by the Company at the end of fiscal 2011. The transaction was finalized in early February 2012.
Additionally, sales of several investments in the Technological Innovations asset class generated significant gains and the Company Buyout and Major Investments asset class posted solid returns due mainly to a notable improvement in the profitability of a number of companies in the portfolio.
The Other investments portfolio represents the balance of funds not invested in partner companies. The portfolio, consisting primarily of bonds, money market instruments and preferred shares, was established to provide security for the Company’s returns and ensure the necessary liquidity to fund share redemptions and investments. This activity generated a return of 7.4% in 2011 compared with a return of 4.4% in 2010.
The Company makes concrete contributions to Québec’s economic development
As at December 31, 2011, the cost of investments impacting the Québec economy disbursed totalled $499.0 million and funds committed but not disbursed reached $151.8 million. Capital régional’s total commitments amounted to $650.8 million in 215 companies, cooperatives and funds, creating or retaining some 38,000 jobs.
The Company also pursued its economic development mission through the Capital Croissance PME (CCPME) fund, in which it holds a 50% interest. The fund’s main goal is to invest in Québec SMEs, primarily through subordinated debt financing. It is additional leverage that allows the Company to continue to invest across Québec, including the resource regions and cooperatives. CCPME’s commitments as at December 31, 2011, reached $72.8 million in 68 companies.
Shares with high investor profile
Backed by the investments of some 107,000 shareholders, Capital régional et coopératif Desjardins can also take pride in the popularity its shares enjoyed in 2011. So much so, that shares for the 2011 issue sold out in only four months. Subscriptions for the fiscal year reached $154 million and share redemptions totalled $76 million as at December 31, 2011, raising the Company’s share capital to $1,102.3 million.
About Capital régional et coopératif Desjardins
Capital régional et coopératif Desjardins, this year celebrating its 10th anniversary, is a publicly traded company managed by Desjardins Venture Capital. With close to 107,000 shareholders and net assets of $1,220.4 million, the Company contributes to Québec’s economic development while driving the growth of cooperatives and the resource regions. Capital régional et coopératif Desjardins directly and indirectly supports close to 300 companies, cooperatives and funds in various industries spanning all Québec regions. (capitalregional.com)