Challenging market conditions have led to another tough quarter for Canaccord Genuity Group Inc.
Following a net loss last quarter, the company had $26.6 million in net income in its second quarter ended Sept. 30, representing a 57.0% drop year over year.
Revenues fell by 19.9% year over year, while expenses fell by 12.0%.
“In light of the very challenging conditions that continue to grip markets around the world, I am pleased with how our business has performed,” said Dan Daviau, president and CEO of Canaccord Genuity Group, in a release. “Steps we have taken to reduce our reliance on underwriting activities and increase contributions from our wealth management and M&A advisory businesses have contributed to our resilience, and we are very well positioned to reclaim leadership in our core underwriting sectors when market conditions improve.”
In a few bright spots, capital markets advisory revenue increased by 22.2% quarter over quarter, reflecting increases in both the U.S. and Canada, the firm said. And revenues rose by 1.8% year over year for Canaccord Genuity’s global wealth management operations, hitting $169.3 million for the quarter. The firm attributed that gain to a small increase in commissions and fees revenue and a 206.8% increase in interest revenue.
Assets under administration (AUA) in Canada were $33.7 billion as of Sept. 30, down by 0.3% from the previous quarter and down by 5.7% year over year. The firm attributed this to “the decline in market values, partially offset by net new inflows and new assets from existing [investment advisors] and new recruits.”
The average AUA per advisor team was $226.4 million as of the same date, down from $259.5 million as of March 31. The firm reported 149 teams in Canada, up from 146 the previous quarter.
In September, Canaccord Genuity Wealth Management rebranded itself as CG Wealth Management.
Total AUM across Canaccord’s global wealth management business decreased by 9.7% year over year to $88.6 billion.