All amounts in U.S. dollars unless otherwise stated
TORONTO, Nov. 09, 2018 (GLOBE NEWSWIRE) — Onex Corporation (TSX: ONEX) today announced its consolidated financial results for the third quarter and nine months ended September 30, 2018 and an update on matters following quarter-end.
- We invested and committed to invest $2.3 billion in eight operating companies, of which Onex’ portion is expected to be approximately $860 million.
- We returned and expect to return approximately $1.8 billion to our limited partners, through realizations and distributions, of which Onex’ portion was approximately $675 million, including $25 million of carried interest.
- Operating leverage on Onex’ private equity manager will increase when fees begin to accrue from Onex Partners V later this year, with annualized private equity fees expected to increase by more than $50 million.
- Assets under management in our Credit platform increased by 10% to $10.6 billion, primarily driven by the closing of our 15th U.S. collateralized loan obligation for approximately $615 million.
- In the ten months ended October 31, 2018, 815,658 Subordinate Voting Shares (“SVS”) were repurchased for a total cost of $58 million, or an average cost per share of C$91.19.
“In recent months, we’ve completed several acquisitions along with successful realizations,” said Gerry Schwartz, Chairman and Chief Executive Officer of Onex. “Given this activity, we’re pleased to now be investing from our latest flagship fund, Onex Partners V. In total, we have approximately $8.4 billion, including $2.3 billion from Onex, available for new private equity investments.”
Onex management continues to share in the risks and rewards of our businesses through the team’s significant investment in everything Onex owns. Today the team has approximately $2.0 billion invested in the underlying private equity operating businesses, credit funds and Onex shares, including approximately $120 million invested so far this year.
Creating Value for Shareholders
We create value for shareholders by growing both our capital per share and our fee-generating assets. For the twelve months ended September 30, 2018, Onex’ capital per share increased by 3% to $65.61 and our private equity investments grew by 9%. Over the same period, our fee-generating assets increased by 12% to $21.6 billion largely driven by our success in raising Onex Partners V. Over the last five years, Onex’ capital per share and our fee-generating assets grew by 7% and 18% per year, respectively. Our asset management business is well-positioned to grow in the years to come with fees for Onex Partners V starting to accrue later this year and our credit platform continuing to expand.
Onex paid a third-quarter dividend of C$0.0875 per SVS on October 31, 2018 to shareholders of record on October 10, 2018.
Onex’ quarterly and full-year consolidated financial results do not follow any specific trends due to acquisitions and dispositions of businesses, changes in the value of its publicly traded and privately held operating companies and varying business cycles at its operating companies.
On a consolidated basis for the third quarter, revenues increased by 3% to $6.6 billion compared to the same period of the prior year. The increase was largely due to the inclusion of revenues from the acquisitions of AutoSource, IntraPac, Laces and SMG. Net loss for the third quarter of 2018 was $458 million compared to net earnings of $368 million in the same quarter of 2017. This decrease in earnings was primarily driven by the gain recognized during the third quarter of 2017 by Carestream Health on the sale of its Dental Digital business; a decrease in the fair value of investments in joint ventures and associates; and an increase in non-cash impairment charges recorded by certain operating companies; partially offset by a decrease in the limited partners’ interests charge and favourable foreign exchange fluctuations.
On a consolidated basis for the nine months ended September 30, 2018, revenues increased by 4% to $19.0 billion as compared to the same period of the prior year. Onex reported a consolidated net loss of $884 million during the first nine months of 2018 compared to net earnings of $2.1 billion in the same period of 2017. This decrease in net earnings was primarily driven by $3.3 billion of gains recognized during 2017 from the loss of control over JELD-WEN and the sale of USI; the gain recognized during 2017 by Carestream Health on the sale of its Dental Digital business; and a decrease in the fair value of investments in joint ventures and associates; partially offset by a decrease in the limited partners’ interests charge.
Prior year comparative information has been restated to conform with IFRS 15, Revenue from Contracts with Customers, which was adopted by Onex retrospectively on January 1, 2018 (refer to Note 1 in the interim consolidated financial statements for further details).
Attached are Onex’ unaudited interim Consolidated Balance Sheets at September 30, 2018, December 31, 2017 and January 1, 2017; Statements of Earnings and Information by Industry Segment for the three and nine months ended September 30, 2018 and 2017; and Statements of Cash Flows for the nine months ended September 30, 2018 and 2017 prepared in accordance with International Financial Reporting Standards. The complete financial statements, including Management’s Discussion and Analysis of the results, are posted on Onex’ website, www.onex.com, and are also available on SEDAR at www.sedar.com. A supplemental information package, which includes the How We Are Invested schedule, Schedules of Fees and Expenses and additional information, is available on Onex’ website, www.onex.com.
Onex management will host a webcast to review Onex’ third-quarter 2018 results on Friday, November 9 at 11:00 a.m. ET. The webcast will be available in listen-only mode from the Presentations and Events section of Onex’ shareholder website, https://ir.onex.com/investor-relations. A 90-day on-line replay will be available shortly following the completion of the event.
Onex is one of the oldest and most successful private equity firms. Through its Onex Partners and ONCAP private equity funds, Onex acquires and builds high-quality businesses in partnership with talented management teams. At Onex Credit, Onex manages and invests in leveraged loans, collateralized loan obligations and other credit securities. Onex has more than $33 billion of assets under management, including $6.9 billion of Onex proprietary capital, in private equity and credit securities. With offices in Toronto, New York, New Jersey and London, Onex and the team are collectively the largest investors across Onex’ platforms.
Onex’ businesses have assets of $52 billion, generate annual revenues of $32 billion and employ approximately 218,000 people worldwide. Onex shares trade on the Toronto Stock Exchange under the stock symbol ONEX. For more information on Onex, visit its website at www.onex.com. Onex’ security filings can also be accessed at www.sedar.com.
This news release may contain forward-looking statements that are based on management’s current expectations and are subject to known and unknown uncertainties and risks, which could cause actual results to differ materially from those contemplated or implied by such forward-looking statements. Onex is under no obligation to update any forward-looking statements contained herein should material facts change due to new information, future events or otherwise.
For further information:
Director, Investor Relations