$134 million in new commitments for the first six months of 2019, an increase of 23%
Highlights for the six-month period ended June 30, 2019
- Share price: $16.02, up $0.68 from December 31, 2018
- Non-annualized return: 4.4%
- Net earnings: $93.5 million
- Non-annualized return of Investments impacting the Québec economy portfolio: 4.1%
- Non-annualized return of Other investments portfolio: 6.6%
- New amounts committed by CRCD and its partner funds: $134 million in 85 SMEs, cooperatives and funds
Montréal, August 15, 2019 - For the first half of the year ended June 30, 2019, Capital régional et coopératif Desjardins (CRCD) announced that its share price increased today to $16.02, a gain of $0.68 compared with December 31, 2018. For the first six months of fiscal 2019, CRCD realized net earnings of $93.5 million for a non-annualized return of 4.4%. As at June 30, 2019, CRCD's net assets stood at $2,212 million.
These results are attributable, in part, to the profitability of the companies in the Investments impacting the Québec economy portfolio, with a non-annualized return of 4.1%, and in part, to the strong performance of the Other Investments portfolio, which ended the first half of the year with a non-annualized return of 6.6%.
The financial asset management strategy applied for a number of years allows CRCD to leverage the benefits of strong complementarity between these two portfolios. Their combined performance generates a reasonable long-term rate of return for shareholders. Accordingly, over seven years, the mandatory minimum holding period for shares of CRCD, the compounded return of the share is 5.1%1 plus the income tax credit claimed on purchase.
New commitments up 23%
During the first six months of fiscal 2019, CRCD and its ecosystem recorded $134 million in new commitments, a 23% increase over the same period last year, in 85 companies, cooperatives and funds. As at June 30, 2019, the ecosystem supported a total of 494 companies, cooperatives and funds through $1,186 million committed across Québec. Delighted with the results, Luc Ménard, Chief Operating Officer of Desjardins Capital, CRCD's manager, noted that they "herald CRCD's growing profile among Québec companies and cooperatives. We have the additional capital and resources to step up the pace and support more of our flagships through their growth plans, at home and abroad."
$200 million benefitting Québec companies and cooperatives
Note that for eligible shareholders, exchanging shares of CRCD they have held for at least seven years consists in deferring for a further seven years the right to redeem those shares as consideration for a 10% Québec tax credit. For the 2018, 2019 and 2020 capitalization periods, CRCD has been authorized by the Québec government to exchange a maximum amount of $100 million per year. Shareholder interest in the 2018 and 2019 exchanges was high, as demand far outstripped supply to total almost double the annual amount allowed in both years. As a result, CRCD was obliged to hold a random selection as for new share subscriptions.
Consequently, up to $200 million will be available for reinvestment over the long term to support the growth of SMEs in all regions of Québec.
$140 million in new shares for sale in the 2019 issue, with a Québec tax credit of 35%
Pre-subscription for the shares will take place from Tuesday, September 3 (9 a.m.) to Monday, September 23 (5 p.m.), 2019, through AccèsD or via the secure online form available during that time at www.desjardins.com/crcd. For 2019, the maximum amount per investor remains $3,000. Investors selected at the end of the pre-subscription period will have until November 8, 2019 to complete their subscription.
About Capital régional et coopératif Desjardins
With more than 105,000 shareholders, Capital régional et coopératif Desjardins (CRCD) is a public company with $2,212 million in net assets. CRCD contributes to Québec economic development through several levers developed with its manager, Desjardins Capital. These levers, with CRCD as the driving force, form an entrepreneurial ecosystem designed to value and nurture the best of Québec entrepreneurship. CRCD supports the growth of nearly 500 businesses, cooperatives and funds in various industries spanning all Québec regions, helping to create and retain more than 60,500 jobs. (www.capitalregional.com)
1 As at June 30, 2019, the share's compound returns were 9.2% over one year, 7.4% over three years, 6.1% over five years, 5.1% over seven years and 5.2% over ten years. The indicated rates of return are the historical annual compounded total returns including changes in share value and reinvestment of all dividends or distributions, as applicable. These rates do not take into account any income taxes payable by any shareholder that would have reduced returns. The CRCD shares are not guaranteed, their value fluctuates and their past performance is not indicative of their future returns. Investment fees may apply. Please read the prospectus online before investing.