iShares Expanded Tech Sector ETF Price & Performance (IGM)

We grew our client assets including our proportionate share for strategic investments by 24%. Reaching over $480,000,000,000 at the end of the year. Our core businesses, IG Wealth and Mackenzie, of our growth in assets and drove the majority demonstrating the strength of our core. Our strategic investments also delivered strong client asset growth. Including significant new inflows across each of the four businesses. And 2024 results support our belief and have architected IGM to deliver growth. Turning to Slide 10. As we look ahead to 2025, we will continue to invest in our wealth and asset management businesses building on recent success and supporting their long term growth. At IT Wealth Management, we will leverage our leading advisor platform and strong momentum to drive further gains in the mass affluent and high net worth segments. And Mackenzie remains focused on delivering investment excellence leveraging and expanding our distribution advantage and elevating the client and advisor experience We will continue to return capital to shareholders with our strong dividend and share repurchase program. And as we've set for over a year, from an M and A perspective, we expect to be most focused on investing in the strategic investments that we own today.

Shifting to our fourth quarter results on Slide 11. Adjusted EPS of $1.05 was up 22% relative to the prior year, and was the second best fourth quarter on record. Quarter ending assets at each of our wealth and asset management companies reached record period ending highs. During the fourth quarter, we renewed our normal course issuer bid and continued returning capital to shareholders. During the quarter, IGM Financial was once again recognized as a top sustainable company as well as one of Canada's top employers. We are proud of these awards and view them as a reflection of the dedication and commitment that our employees deliver each and every day. Turning to Slide 12, financial markets remained strong throughout 2024. With positive returns in all major equity markets. IG and Mackenzie's average client return which represents our diversified asset mix across global asset classes and currency exposures was an impressive 15.5% for the year. As shown on Slide 13, the industry backdrop clearly improved during 2024 helped by strong financial markets that supported investor confidence as the bite of high inflation and interest rates began to ease. Absent financial market volatility, we would expect 2025 to show continued improvement.

But the prospect of volatility is real and has been experienced this week. With the announcement and then delay of tariffs Across IGM, we are prepared for uncertainty surrounding how The U. S. Chooses to engage with Canada and the rest of the world and the potential financial impact market volatility that may come from it. Our client assets are well diversified and our clients will continue to benefit from our focus on financial planning and advice. IGM also benefits from a range of growth drivers. Both within our core businesses and our strategic investments. Which continue to position us for near and long term success. Keith will speak more to our earnings results later in the call, So on Slide 14, I'll just quickly highlight that IGM's double digit earnings growth for the quarter and the year were both driven by the wealth and asset management segments. And on Slide 15, we see how each of the six wealth and asset management businesses contributed to ByGM's asset growth over the course of 2024, which Damon and Luke will each speak to next. So Damon, over to you. You, James, and good morning, everyone. Turn to Slide 17 and Wealth Management's fourth quarter highlights, including IG Wealth, Rockefeller and Wealth ending AU M and A as well as fourth quarter records for total gross inflows total sales and inflows from existing clients.

The fourth quarter set another all time record for inflows for new clients. IG Wealth ended the quarter with AUA $140,400,000,000 up a solid 16% year over year and 2.9% during the fourth quarter driven by financial markets. Growth inflows from the fourth quarter were $3,900,000,000 with gross sales into IGM products, at $3,800,000,000 Net inflows from the quarter were $553,000,000 and net sales into IGM product were $384,000,000 January was a strong month ending with a record AUM and A record gross inflows and record gross sales we continue momentum we start in the second half of twenty twenty four, total gross inflows from newly acquired clients were $1,300,000,000 with clients with more than 250,000 in financial assets representing 78% of these flows. During the quarter, we elevated our advice experience by giving our advisors and clients access to a leading edge estate planning settlement and executive services platform our strategic partnership with Clear Estate, a leading fintech estate planning [indiscernible] Also during the quarter, we ranked number one in earned media share of voice in the Canadian wealth marketplace And during 2024, IG was the most prominent wealth brand for earned media share of voice among both independent firms and bank based wealth advisors.

This ranking confirms our voices being heard by both our current and prospective clients as we share our views on leading financial planning and investment topics. This further validates that our thought leadership, invest in class advice platform is resonating in the marketplace. Both Rocklatil and WellSimple had strong quarters and I'll speak to both in coming slides. Turn to Slide 18.

You can see IG's Q4 flows. As you can see on the left, in January and the fourth quarter, and in 2024, we delivered strong gross inflows with both fourth quarter and 2024 being records for IG. On the right hand side, is our last twelve months debt flows. As you can see, all lines are moving solidly in the right direction as IGM product net flows return to positive territory and approach total net flows. As it's removed through 2025, our advisors will continue to build on the investments we've made and extend our momentum as we work with our clients to both quantify, preserve distribute wealth. Turn to Slide 19, I'll make two brief comments here. In the top left, you will see strong increase in gross inflows were up 27% during the quarter, once again complemented by year over year decrease in our gross outflows rate. On the bottom right, you can see continued upward trend in our 2024 net flows rate which returned to positive territory during the fourth Turn to Slide 20. In 2024, our gross inflows from newly acquired clients exceeding one exceeded $1,000,000,000 per quarter on average while new clients with more than $250,000 in financial assets have represented over three quarters of those flows over that same period.

These solid gross inflows have helped contribute to our AUA for clients with over $250,000 in financial assets to $250,000 in financial assets, which now stands in excess of $117,000,000,000 with clients with financial assets greater than million dollars represent 44% of our total AUM and A, which is up 38% from a year ago. Turning to Slide 21. And our strong momentum in mortgage and insurance. Two quick points. I'll make on this line. One, our mortgage funding was up 17% during 2024 a strong result given the heightened competition and sluggish growth in this market. And two, along with the strong growth in new annualized premiums of 31%, I'll also highlight that both our average case size and the number of cases were up in 2024. We have more advisors selling insurance and our advisors selling larger policies as we go up market. Turn to Slide 22. And an update on how we intend to capitalize on the industry's key wealth drivers. Our partnership with Clear Estate provides multiple opportunities to further address [indiscernible] And our conviction in these opportunities is supported by a minority investment in this company. Half of Canadians do not have a will and those that do approximately one third to have their estate plans in the world updated.

Clear Estate's intuitive state of the art platform is a key market differentiator that can help us further address financial needs of Masafluit and high net worth Canadians. Access to a leading edge estate planning, settlement and executor services can give our advisors a complete view of our clients' wealth providing opportunities for share of wallet growth insurance protection while helping clients bulletproof and execute their financial plans as they prepare for well transfer to the next generation. This partnership will further extend our best in class advice platform. Turning to Slide 23. Some updates on Rockefeller's progress. Client assets were up 24% during 2024, driven by inorganic onorganic growth as well as capital markets. Organic growth drove $6,600,000,000 in client assets in 2024, Rockford Solar continues to add to their private advisor network with 54 new advisors being added in 2024. Turn to Slide 24. Of AUA growth at Wealthsimple. Wealthsimple AOA increased by $11,900,000,000 during the quarter yet another new quarterly record with assets 106%. With that, I'll turn it over to Luke Guo. Thank you, Damon. Good morning, everyone. On Page 26, you'll see a few highlights for Mackenzie and Asset Management for the quarter. Record quarter and high AUM of $213,000,000,000 is up 9% versus last year and approximately 1% in the quarter driven by client returns.

Investment fund net redemptions of $377,000,000 in the quarter were a significant improvement relative to the $826,000,000 last year and January continued this trend with net redemptions of $65,000,000 improved from $172,000,000 last January. The top right, I'd highlight that we had some meaningful institutional wins of around $4,000,000,000 in aggregate which are expected to fund during February and March.

I'll speak a bit to this in coming slides. And would note here that they primarily relate to our global quantitative equity team they are diversified across mandates client types and geographies. Also highlight that we continue to scale our Mackenzie Northleaf private asset products for retail with over $300,000,000 at year end The products have had very strong performance and we're going to continue our focus in 2025 in bringing these important REIT asset classes to retail investors Also noteworthy you can see that we launched a U. S. Small cap fund managed by our quant team as well as two liquid alt funds our Mackenzie Global Dividend Enhanced Yield and Enhanced Yield Plus funds These funds are managed by our global equities income team and use an option rating strategy to enhance income while reducing volatility. We've also highlighted that we've launched our U. S. Allcap Growth Fund to our Primerica FuturePath fund family. This This fund is a five star mandate that we're excited to bring to Primerica. [indiscernible] you can see China MC has strong growth during 2024 with long term investment fund assets up 42% and market share increases from 5.1% to 6.2% largely as a result of strong net sales of KRW225 billion or CAD45 billion.

And Northleaf continued its consistent trend of new commitments of around $1,000,000,000 per quarter in each quarter since our partnership began four years ago, they had just under $5,000,000,000 in new commitments in 2024, diversified across private equity, private credit and infrastructure offerings Turning to Page 27, you can see the trended history of Mackenzie's net flows. As mentioned, we've continued to see year over year sales improvements and our gross sales were up 26% in Q4 and these improvements have continued in January in the context of a continued improving industry environment Redemption rates are stable and on the right you can see this is On Page 28, at the top, you can see that retail gross sales were up 24% from last year and Morningstar ratings overall were relatively unchanged from September. In the table at the bottom left, you can see improvements across client segments in the quarter. Turning to Page 29. Here you can see our performance and net sales for our retail mutual funds and ETFs by boutique. As we've spoken to over prior quarters, In the current environment, we're seeing short term relative underperformance in our Bluewater Growth In These Teams Continue To Manage In Line With Their Proven Approaches Across All Of Our Other Boutiques, We Continue To See Improvement In Net Sales On A Year Over Year Basis And In Our Point In Global Equity And Income Boutiques, They Continue To Deliver Compelling Performance Within Large Product Categories And We're Seeing Growing Positive Net Sales.

We're Also Seeing Improved Net Sales Within Our Fixed Income ETF Mandates. Have A Very Strong U. S. All cap growth mandate advised by Putnam. That we're going to be continuing to emphasize in 2025. [indiscernible] returning the spotlight on our global equity boutique, which we last profiled at our Investor Day about a year and a half ago. Team was added in 2017 and over the seven years they've built exceptional track records across 25 mandates using their holistic quant approach, promoting all weather risk adjusted outperformance across cycles and environments The team is now managing over $13,000,000,000 diversified across client types And pro form a for recent awards, they're at $17,000,000,000 On the top right, we've highlighted the early and growing momentum we're seeing in retail under the banner of Trailblazing Quanta in [indiscernible] We have launched nine new mutual funds in ETFs for this quant team in the retail in 2024 and we have another four coming in early twenty twenty five And in retail, we've had net sales of just over $500,000,000 in 2024, we see significant upside here. With regards to large categories these mandates compete in. We've also highlighted in the bottom right the $4,000,000,000 in partnership and institutional awards that are funding in early twenty twenty five.

As mentioned, these awards are across five different mandates diversified across client type and geographies And I'd also highlight that our quad approach is really well suited to customization, to [indiscernible] we have here as we enter 2025. Also highlight before Keith takes it, I'd remind that these wins, this $4,000,000,000 these are large blocks of business so when you think about pricing, On Page 40, we've got the trending of our fee rates and you could expect these to be obviously higher than the fee rates at IG and Candelife, but lower. Than the average third party fees that we enjoy. Going to Page 31, few comments on the Chinese investment fund industry. On the left side, the fourth quarter exhibited modest net flows driven almost entirely by money market funds and up 17% year over year by both market and strong net flows during the year. On the right, I'd remind and highlight that Chinese New Zealand's position remains very strong as the second largest fund manager in terms of its long term and investment funds and they did experience market share gains in both long term funds and overall in the past year. On Page 32, can see continued growth in China FC's AUM.

With year over year long term investment fund AUM up 42% more than twice the industry rate due to strong net sales of $225,000,000,000 won or $45,000,000,000 over the last twelve months I'd also highlight the growth of 5% overall relative to Q3 China MC is a leader in ETFs in the Chinese marketplace. And in this space, they enjoy a market share of 17%. We did announce in these materials that during the fourth quarter to ensure ongoing competitiveness, and market share leads, China MC made pricing changes across a series of broad market ETFs and this represented about 40% of their long term mutual [indiscernible] Very supportive of these changes and believe it positions Chinese Sea well to continue its leading position and to capture ongoing growth in the space. The impact of these fee changes was included in the fourth quarter half of which was included in the fourth quarter, Keith is going to provide more detail and an outlook on a later slide. On Page 33, you can see another quarter of strong growth in Northleaf with $900,000,000 in new commitments in the quarter and $4,900,000,000 over 2024. [indiscernible] I highlight is that 2024 was a milestone year for Northleaf.

In expanding their distribution reach globally. This reflected the first year where a majority of their new third party commitments were from clientele outside of Canada and we're really pleased to [indiscernible] in them executing on the strategy. As mentioned earlier, the fundraising during the quarter and year was across infrastructure, private credit and private equity and we're pleased with this continued strong growth. I'll now turn the call over to Keith Potter. Thank you, Luke, and good morning, everyone. On Slide 35, you can highlights for Q3 adjusted EPS was $1.05 up 22% year over year our second highest fourth quarter on record. Is driven by strong results at both IG and Mackenzie IGM. Returned a total of $180,000,000 to shareholders in the quarter In addition to the quarterly dividend, we continue to be active with our NCIB program repurchasing $47,000,000 in shares As noted by James, we have renewed our NCIB during the quarter Our operations and support business development expenses [indiscernible] Over 2023 came in at 3.8% versus our guidance of 4%, we are guiding to 2025 expense growth of 4%. I'll speak to this in a moment. Turning to Slide 36. You can see our AUM and A and flows.

As seen on the left hand side, 2024 was a solid year for asset growth. Ending assets up 12.6% year over year and 2.1% in the fourth quarter and during 2024, average assets were up 10% January saw continued solid growth with ending assets at an all time high $278,100,000,000 Turning to Slide 37. As I mentioned, we have our consolidated earnings of 22% year over year, 2% sequentially driven by our wealth and asset management businesses On Slide 38, we present the key profitability drivers for IG Wealth I'll highlight a few points here. On the left hand side, you can see that average AUM and A was up 4.8% over last quarter driven by investment returns and net inflows, And on the right, the advisory fee rate is in line with our guidance and reflects market as clients moved up wealth bands And looking into 2025, we continue to expect 0.5 basis point downward pressure on the rate per quarter driven by a mix shift toward high net worth and mass affluent And this rate may also be impacted by product mix shifts such as cash and cash like deposits Products and program fees remain stable and we expect this trend to continue moving forward.

And finally, asset based compensation rate was up during the quarter as we move into Q1, we do expect this rate to come down to Q3 levels. Driven by our annual grid reset On Slide 39, Ajijs overall earnings were 135,300,000.0 in Q4, up 33% year over year and 7.8% sequentially On point one, advisor and product and program fees are up year over year relative to last quarter driven by asset growth. $1,200,000 Other financial planning revenues reflects strong performance in our insurance business and mortgage results that were in line with our expectations And looking forward, we continue to expect the mortgage business to contribute $68,000,000 per quarter Now it will be excluding the impact of any fair value adjustments. And the insurance business, we expect continued growth Moving to Slide 40, we we have 3.1% On the right, we continue to see strength our wealth management partnerships contributing to a mix shift in third party rate excluding Canada Life while the overall all rate remained relatively flat versus last quarter. As a reminder, as we look forward to Q1, we have two fewer days upon which we charted revenues However, our asset based compensation paid to distributors and advisors is based upon one quarter of the year and the combination of the two will have a negative impact on our revenue rate in Q1 And just for some context, historically, in Q1, this has had approximately 0.3 basis point impact on that rate Turning to Slide 41.

You can see McKendy's earnings of $51,900,000 up 25% year over year and 4.2% sequentially and Euro year over year and relative to Q3, net asset management fees were up driven by higher assets And I'll point to higher net investment income was primarily driven by seed capital returns. Turning to Slide 42. We are guiding to 4% growth in operations and support and business respect to IG, we've made meaningful investments in the business over the past several years and during 2025, we will leverage the momentum we are seeing Our investments will build out our advisor technology leadership enhance our segment and device model and build out solutions focused on key wealth drivers that Damon spoke to IGU expense growth of approximately 2.5% also recognizes efficiencies that we have gained through real estate optimization and decommissioning old systems and processes that we've replaced with new technologies Mackenzie's expense growth of 6% will drive progress on a number of fronts during 2025, including client and advisor experience, room enhancements to the backhaul office, adviser portal and other technologies investment management, through mid office platform development and investments in distribution and product capabilities Slide 43 has Chinese EMC results. First on the left, A1 increased by 4.5% versus last quarter And on the right, you can see Chinese Sea's earnings of $25,400,000 dollars for the fourth quarter have three main points here relative to Q3.

First, as I spoke to Juan last quarter, there were significant seed capital gains in Q3 and excluding these one time items Q3 earnings would have been more in line with Q2 of $28,000,000 Second, as we look to Q4 results, our earnings were lower as well due to seasonality of higher expenses. And then finally, as Luke mentioned, in the In the quarter, in November, Chinese Sea did announce fee reductions on broad based market ETFs, which impacted earnings These changes were made in better service clients and has the company's number one position in the ETF and capture future growth As we look forward to 2025, our best estimate is that we expect full year earnings to be aligned with 2024 Slide '44 has the earnings contribution [indiscernible] the companies in each segment A couple of comments on strategic investments. First, Rockefeller, had strong performance through its core global family office business during the quarter. It was offset somewhat by earnings lower earnings at the mass Northleaf's earnings of $3,100,000 reflect reflect continued investment in the business to globalize its distribution and reach its clientele. As a reminder, the Q4 twenty twenty three comparative period has a positive one time adjustment for a lower effective tax rate in this quarter it actually had a negative adjustment on the tax rate.

Slide 45 provides a summary view the ownership and value of our strategic investments by segment the first main point is that the carrying value of Northley increased in the quarter reflecting earnings and the change in the fair value estimate the amount related to our 2020 purchase transaction, The estimate net of non controlling interest $32,000,000 you can reference in the notes of the financial statements And just to be clear, the euro is capitalized and adjustments not have an impact on earnings. And finally, at the end of Q4, our strategic investments now represent $6,200,000,000 in value Slide 46 highlights our twelve month trailing dividend share ratio is 64% of adjusted cash earnings at the end of [indiscernible] And we've added a slide in the appendix with details of the calculation. We continue to execute on our share repurchases during the quarter while maintaining maintaining our financial flexibility and IGM's leverage ended 2024 at 1.6x debt to EBITDA an unallocated capital increase of $531,000,000 That concludes my remarks and I'll turn it over for We will now begin the question and answer session. The first question today comes from Nick CIBC. Please go ahead.

Yes, thanks. Just wanted to go back to the remark about pricing changes that were enacted at China AMC in the quarter. Just a couple of questions on that. One, was that driven by competitive considerations as opposed to any further regulatory action And two, are you able to quantify the expected impact on run rate earnings to China AMC? [indiscernible] Say on those two dimensions. One, those are competitive changes. And so again, to retain their leading market share position, [indiscernible] that was the nature of them.

On the magnitude, you can expect for Q1 earnings just down very slightly from Q4.

And so I think Keith gave full year guidance that 2025 should see earnings full year in line with twenty twenty fours and then continue to grow beyond. So you shouldn't expect material changes. [indiscernible] here just adding to that, just on Page 41, you can kind of expect a pattern of what we'd expect similar to Q4 twenty twenty three as we move through the year. Okay. And then I also want to drill into the economics attached to AUA growth at Wealthsimple. Very strong quarter and a very strong year. But can you just expand a bit on how balanced that growth is across product lines? And I guess what I'm really trying to understand is whether the revenue growth has been essentially commensurate with the asset growth? Yes, it's James. Like most growth companies, What I'd observe is is companies often start by focusing on growth and clients and then growth in assets, growth in revenue, growth in EBITDA and ultimately kind of it reveals itself in growth in IFRS earnings. Wealthsimple is demonstrating remarkable growth in clients, in assets, in revenue, and in EBITDA. As I described or said in previous calls, I think they are [indiscernible] fully in control of their financial future, Nick.

So we're seeing growth not just in those items that we disclosed quarterly, but we're seeing it right down through EBITDA.

Okay, very good. And last one for me, just a quick point of clarification. I think there was a comment made on the economic attached to the $4,000,000,000 of mandate wins that will be funded in the future months And I think the comment, if I caught it correctly, was that economics attached to those would be somewhere between the Canada Life fee rates and the overall third party fee rates at Mackenzie. So that would put us somewhere between 16 15 basis points and 50 basis points. Did I catch that correctly? Guys, Luke, yes, you sure did, Nick.

So you can think of Candlelight and IG and the race they enjoy based upon their skill and the skill they're [indiscernible] as being kind of a floor And these are large institutional mandates So in that range of kind of 50 to to 60, you can think of it being closer to 60 than the 50. Line with what these mandates are with these large institutions.

Got it. Okay, that makes sense. All right, that's it for me. I'll pass the line. Thank you. The next question comes from Tom MacKinnon with BMO.

Please go ahead. Yes, thanks. First question is just with respect to the buybacks. 3,000,000 share buyback fully utilized and that was offset any kind of potential dilution from option exercises, so no change in share You've upped it now to $5,000,000 Is the thinking here that you would this would be more than needed to offset any dilution [indiscernible] [indiscernible] fully utilize this and possibly decrease the share count going forward. I have a follow-up. [indiscernible] Yes. Tom, it's James. That's exactly what I'd like to see us As you noticed, we now disclose quarterly and annually The capital that we returned to shareholders, which is some obviously of the dividend and the share buyback. And I would very much like to see that that number increase. And we've also disclosed this quarter a cash earnings and we show the dividend and the payout ratio on a couple of different bases.

And so cash earnings minus the dividend is a growing number. Unallocated capital is a growing number. And so I think we're in a position here where we have optionality, we have some flexibility.

And so as we look at a year ahead that may present some volatility, I would view that volatility as an opportunity and return even more capital to shareholders in 2025 than we did in 2024.

Okay.

And just with respect to the dividend, as we I think you had mentioned before that if that payout ratio went cash got around 60%, you'd have a look at the dividend.

Thoughts there? I mean, we got volatile times. Got flexibility with the buyback. How is your thinking there? Yes. I mean, as we approach that, Mark, and we are we're getting close to be sure as that page discloses, we'll take that question. That discussion to our Board I don't know how much more upside there is in the share price from a higher dividend relative to share buybacks. I think again in a world of volatility opportunistically buying back shares I think is a powerful way of supporting both the share price and ongoing shareholders. So sitting here today, Tom, there's a bit of a bias toward share buybacks.

Okay. Thanks for that.

The next question comes from Graeme Ryding with TD Securities. Please go ahead.

Good morning.

Could I just ask you to maybe just elaborate a little bit? You said you're at Mackenzie, you're looking to invest in your product and distribution capabilities and then you're also looking to invest in your middle office solution for investment management. Can you maybe just give us some examples or further context on what the What that means? Yes, it's Luke. Absolutely. So I'll start with the middle office and we profiled it a bit at an Investor Day. [indiscernible] excited in 2025 and 2026 we're bringing to you a multiyear program have been working with BNY Mellon to really provide a world class environment for our investment teams to do their best work. So that is adding some extra cost in 2025 and in 2026, which is in these numbers.

And of course, those changes are meant to Delta capabilities and really provide our investment professionals with the best data and the best environment to generate alpha.

The other big piece of investor we're making is really around the theme of enhancing client experience.

And making sure we administer a lot of plans for advisors and their clients across Canada. And we want to make sure that every touch point with Mackenzie is an excellent one. And so that's where the investment is happening is primarily in the web access that advises and clients at Jourth Mackenzie and in the broader client experience processes to make sure every experience with us is delightful. Okay, understood. And then there was also a reference at Mackenzie about growth within your wealth management partnerships of having an impact on your net asset management fees? Is this a reference to growth sort of within Wealthsimple and Primerica?

Or is it beyond that?

And is the suggestion that these are slightly lower fee mandates, so [indiscernible] of the strong net flows that we've had at Premier and Wealthsimple. We've been participating in the growth of first, Well Simple and second, the Primerica relationship, which we started two years ago, And because those business lines or those relationships have been growing at a faster rate than retail, that's put that's had a consequence on the effective fee rate. Yes, okay. And do those flows get captured within your retail investment funds or do they get captured within that institutional investment funds line. Those flows, I don't know which slide you're looking at. They are in our So we actually do have two numbers on that on a bunch of the line graphs. One has retail, and one's the overall, they are in our overall investment fund numbers. And on Page 28, there's a line institutional investment funds, they're included in that line.

Yes, that was my question. Okay, perfect.

That's it for me.

The next question comes from Aria Samarthada with Jefferies. Please go ahead.

Thank you. [indiscernible] provide an update on your expectations for Rockefeller?

And North Lease earning contribution in 2025 For Rockefeller, do you still anticipate its contribution to replace the income loss from IPC this year? And for Northleaf, could we just assume the 15% annual growth implied at your Investor Day? [indiscernible] On Rockefeller, we expect early going into Q1 in a similar range where we're at right now and turning earnings positive in 2025. Don't know what's going to fully replace the IPC earnings in 2025, but may progress toward that What was the second question related to Northleaf? Yes. For Northleaf, should we expect like a 15% annual growth for their earnings as it was implied in your Investor Day?

Yes. I think for Northleaf, if you look at this past quarter, maybe going into Q1, somewhere in the range of about $5,000,000 per quarter would be a reasonable estimate. So that's a reasonable estimate for now. And I would just add to those two points. First on Rockefeller, the core Wealth's franchise which is what principally attracted us to the business is performing very, very well. They have a strategic advisory business and M and A business, if you will, that that like every M and A business on the planet these days is a bit slow. And they have an asset management business that has grown a bit slower Then we might have initially expected. But I want to emphasize the core wealth franchise is performing very, very well.

So we're seeing great growth in Rockefeller.

Not just on the basis that we disclose in our DAC, but also in down to EBITDA. And on Northleaf, I want to emphasize that Northleaf has a five year kind of board approved strategic plan that I'm very excited about. The They want to do three things over five years. One is double their assets. Two is position the next generation of leadership within Northfleet, that business is twenty years plus and and there's a next gen that will be assuming important roles in the coming [indiscernible] And the third I would describe is finishing the globalization play. I mean, this something that that Luke spoke to a little bit. We have been very supportive of Northleaf actually increasing their expenses in the past few years.

They've hired up They've opened offices in Japan, in Korea. In Australia, several offices in North America and Europe, And this is increasingly a business that is global in nature. And so that's been a choice.

I think the Board would have had an opportunity to focus more on short term profits But we really want to see Northfleet positioned for play is a priority for Northleaf and it's one that has our whole hearted support And to a certain extent, we should acknowledge that has been reflected in the earnings.

Great. Thank you for taking my question. Next question comes from Phil Hardy with Scotiabank.

Please go ahead. Hey, good morning. Just looking at Slide 20, what do you attribute to some of the accelerated penetration in the high net worth clients that looks like clients with over 1,000,000 contributed more than maybe 30% of growth sales last year. I guess I'm just kind of wondering has that reached its natural share or where do you see that going? Yes, Phil, it's Damon. What do I attribute to? We attribute to the fact that what we're focusing on which is making sure that our clients can navigate the wealth drivers and our advice platform is aligned with helping our advisors navigate those drivers for our clients. We believe our capabilities there's an intersection between what we're providing and and where there's traffic in the marketplace and will there be traffic in the marketplace going forward. So we're quite excited about that. Clearly the business has momentum and we've caught our stride. There's no doubt about that. But when you take a look at where we are relative to where we we will be in the future, Our penetration of the high network space is still very, very small. So we have a very long runway here.

And we're building this business to really execute against that runway. So I believe that over the next five years, you're going to see significant growth. This organization in both the MasaFluid and high net worth space. So maybe if I can turn it over as well. I mean, would the opportunities for Mackenzie to capitalize on that trend, again, either directly with IG well or maybe more broadly into that third party advisor channel? [indiscernible] We're so fortunate to be a provider of choice and a key that the key investor manager fueling the shelf at IG. So we're cheerleading and helping every single day to make sure that they're winning for their clients and they've got the most competitive investment offering. That they can possibly have to serve these client segments.

Excellent. Well, great. I'm answering and I think that's it for me. The next question comes from Jamie Goehring with NBS.

Please go ahead.

Thanks. Good morning. Just wanted to clarify on the China AMC guidance for flat growth in 25% versus 24%. Is that entirely driven by the fee rate changes on ETF or are there some other factors that we should be thinking about? It's Keith here. James. Yes, part of it is changes to the to the fee rates, but there's also China A and C has demonstrated an ability to really grow their assets. They're up 35% this year. We expect strong growth next year. Maybe not in line with 35% growth, but that's also part of the story here. Point 5% this past quarter. With strong institutional flows, money market flows. They're diversified and we continue to expect strong asset growth When you kind of net the strong asset growth, what that does to your revenue plus the fee changes that combination we expect earnings to be in line 2025 or 2024. And you know, James, it's James.

I'd just add, if [indiscernible] If earnings are flat in 2025 to 2024, I'll be very pleased. I will view that as as a strong result. Of course, earnings were up 9% in 'twenty four versus 'twenty three and When you consider what's happened to equity markets in China top to bottom and and they've recovered somewhat clearly. And you also take into account reductions in fees for active active equity as well as more recent a passive products. I think for China AMC to grow earnings in 'twenty four, which they did and have flat earnings in 2025 is overall is a really good result and it it speaks principally to the quality of the franchise and the quality of the managed [indiscernible] in what is currently a challenging market.

And we stand by that. It's a special property. Okay. And a follow-up on the fee rates. I understand competitive versus the Chinese market. Just wanted to get a sense as to the industry as Out of fee rates in China, maybe across ETF and other products, compared to global fee rates? Like if we look at The U. S. For example, So just trying to understand whether there's potential for more pressure in future years on those fee rates? Good question on that. It's Luke. On active equity and balanced debt, pro form a for the changes made about two years ago. They're competitive in retail space with global markets. On passive, the changes they just made really puts them more in line with global, where I'd say prior to these changes, it was a bit a bit expensive. In China relative to what you'd expect and these changes actually put it in line with global levels.

And then separate for capital allocation after dividends and buybacks on reinvestment in the business and strategic investments. Obviously, we should expect some acceleration, I guess, in that CapEx, but in terms of the unallocated capital as well, is there sort of like a base level of excess capital that you're looking to hold And would increasing stakes in some of these investments be an alternative that that is at the top of the list as well?

Yes.

I mean, we would probably look to hold maybe $200,000,000 of unallocated capital I mean, we're well through that north of 5% and we expect it to grow from here. So as I said earlier, I'd say we're sitting on a fair bit of optionality and financial flexibility I would expect that to be expressed through we do have an ongoing program of investment in the business and then this year's levels will be similar to last year's.

Expect us to express that flexibility through a higher level of share buybacks this year.

We said in December of twenty twenty three that we'd be focused internally for a couple of years. Strengthening our core businesses and we be less active in M and A. And as we sit here today, that very much remains our outlook and our expectation. So sitting here today, I'm not expecting this to be year of M and A. I expect it to be a year of ongoing investment in the business, support the current dividend and and grow out do more share buybacks opportunistically.

Okay. Understood. Thank you.

The next question comes from James Shanahan with Edward Jones. Please go ahead.

Good morning, everyone. First, I wanted to say thanks for the continued excellent disclosure and transparency. It really is quite good relative to other North American asset managers, wealth management firms outstanding. So my question was relates to Northleaf, I think that Keith had said $5,000,000 per quarter potentially, but I recall that there was some seasonality with regards to the earnings at North East that Q1 was often higher than other quarters due to attendance compensation. Is that still the case? Yes. That's right. It's Keith here. There is incentive fees that are part of the Q1 earnings.

They are Northleaf are also growing their AUM that will drive future quarters beyond that. But But Q1 can be a little bit higher with the intensities.

It's just still on average, so $5,000,000 per quarter is what you were guiding for? Yes. I'd say that would be a good estimate Thank you very much.

This concludes our question and answer session. I would like to turn the conference back over to the company for any closing remarks.

Thank you, Betsy, and thanks everyone again for joining us on the call this morning. Betsy, with that, we can close out today's call.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.