Subject: ERN
Capital régional et coopératif Desjardins announces its financial results
A year marked by advisory support amid economic uncertainty
Highlights as at December 31, 2023
- Share price: $17.59, up $0.31 since December 31, 2022
- Annual return: 1.8%
- Return of Investments impacting the Quebec economy portfolio: 4.0%
- Return of the Other investments portfolio: 5,1%
- New amounts committed by CRCD and its partner funds: 252 million in 132 SMEs, cooperatives and funds.
MONTREAL, Feb. 15, 2024 /CNW/ - Despite an uncertain economic environment, Capital régional et coopératif Desjardins (CRCD) ended its 2023 financial year with $44.6 million in net earnings and a 1.8% return. Net assets have been maintained over the previous year, having reached $2,567 million as at December 31, 2023. These results bring the share value to $17.59 as at 12 p.m. today. That means the share price has risen by $0.31 since December 31, 2022 (a $0.16 drop compared with the first semester of 2023).
These annual returns are essentially the result of business investment activities and market investments. CRCD is seeking to achieve the right balance between driving Quebec's economic development and providing shareholders with reasonable long-term returns. The financial asset management strategy is designed to have a balanced overall profile and mitigate ups and downs in the event of major market fluctuations or adverse events within partner companies. Over seven years, which is the minimum mandatory holding period for CRCD shares, the compound return on the share was 4.1%,1 plus the tax credit obtained at the time of acquisition.
In 2023, the investment activity impacting the Quebec economy achieved 4.0% returns. Although the impact was less pronounced than in 2022, the portfolio was again affected by the uncertain economic landscape, which, among other things, reduced the profit margins of several companies in the portfolio and reduced investors' appetite for companies in the tech sector. The other investments portfolio posted a 5.1% return. All asset classes contributed positively to this performance, with the exception of real estate funds, which continue to be negatively impacted by rising financing costs. These are putting downward pressure on valuations in general.
In fiscal 2023, share subscriptions amounted to $59,7 million, which represents close to the entirety of the authorized issue limit, with the balance having elapsed in the first few days of 2024. Redemptions totalled $99,8 million.
As at December 31, 2023, 759 businesses, cooperatives and funds were benefitting from $2,279 million in commitments from CRCD and its partner funds, including $252 million committed during the year. Of these SMEs, 74% were located in regions outside of Montreal and Capitale-Nationale.
"Like many sectors, the investment capital industry experienced a slowdown in 2023," stated Nathalie Bernard, Chief Operating Officer of Desjardins Capital, manager of CRCD. "And yet, opportunities continued to emerge during this time, giving way to a record year in terms of reinvesting in the businesses in our portfolio. Our cautious and responsible approach to portfolio management has allowed us to support our partners' growth and projects while maintaining our commitment to regional economic development."
About Capital régional et coopératif Desjardins
Capital régional et coopératif Desjardins (CRCD) is a public company with over 111,400 shareholders and $2,567 million in net assets. CRCD contributes to Quebec's economic development through a number of drivers developed with its manager, Desjardins Capital. These drivers form CRCD's entrepreneurial ecosystem designed to value and nurture the best of Quebec entrepreneurship. As at December 31, 2023, CRCD has committed $2,279 million to support the growth of some 760 businesses, cooperatives and funds in various sectors from across Quebec. (www.capitalregional.com/en)
1 | As at December 31, 2023, the share's compounded returns were 1.8% over one year, 2.7% over three years, 2.8% over five years, 4.1% over seven years and 4.2% 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 of return do not take into account the income tax credits obtained by the shareholder upon acquisition or exchange of shares or any income taxes payable by any shareholder that would have reduced returns. CRCD shares are not guaranteed; their value fluctuates and their past performance is not indicative of future returns. Investment fees may apply. Please read the prospectus before investing. |
SOURCE Desjardins Group
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