AGF Management TSE: AGF.B executives highlighted higher assets under management, continued positive retail mutual fund sales, and an increased dividend during the company’s fiscal first-quarter 2026 earnings call, while acknowledging that fair value markdowns in legacy infrastructure-related long-term investments weighed on reported results.
Leadership update: new CIO named for AGF Investments
Chief Executive Officer Judy Goldring opened the call by announcing the appointment of John Porter as Chief Investment Officer for AGF Investments, effective May 1, 2026, following what she described as a “comprehensive global search.” Goldring said Porter will join AGF’s executive management team and report directly to her.
Goldring also thanked David Stonehouse, who has served as Interim Chief Investment Officer, saying he provided “steady leadership” during a “pivotal period” for the firm.
Quarterly highlights: AUM above $60B, seventh straight quarter of positive mutual fund net sales
Goldring said that amid “significant market volatility,” AGF’s AUM and fee-earning assets ended the quarter above CAD 60 billion, up 12% year-over-year. She also pointed to retail mutual fund net sales of CAD 237 million, marking the seventh consecutive quarter of positive retail mutual fund net sales.
Goldring noted that seven AGF investment funds earned FundGrade A+ awards, spanning equity, balanced, and fixed income strategies. She also highlighted free cash flow of CAD 36 million during the quarter, up 14% from the prior quarter, and CAD 122 million over the trailing 12 months.
On capital returns, Goldring said the board declared a quarterly dividend of CAD 0.135 per share for Q1 2026, an 8% increase and the sixth consecutive year of dividend growth. She added that the company was added to the Nasdaq Broad Canadian Dividend Achievers Index after the quarter.
Business trends: mutual funds, ETFs/SMAs, institutional and private wealth
Management provided detail on asset trends across channels and products. Goldring and Chief Financial Officer Ken Tsang said AGF Investments’ Canadian mutual fund AUM was CAD 36 billion, up 15% year-over-year, which Tsang said outpaced the industry’s 14% increase. Meanwhile, ETF and separately managed account (SMA) AUM growth remained strong, up 54% year-over-year, and reached approximately CAD 4.5 billion.
Tsang said segregated accounts and sub-advisory AUM declined 9% year-over-year due to redemptions from two institutional clients disclosed in previous quarters. He added that after quarter-end AGF saw CAD 350 million of inflows from an institutional client and that the firm continues to see interest in its institutional strategies.
Private wealth AUM rose 13% year-over-year to roughly CAD 10 billion, according to Tsang. AGF Capital Partners’ AUM and fee-earning assets were CAD 4.5 billion at quarter-end, and Tsang reminded investors that New Holland Capital’s AUM of about CAD 10 billion is not consolidated into AGF’s total AUM and fee-earning assets.
On sales, Tsang said the Canadian mutual fund industry recorded CAD 19 billion of net positive sales during the quarter. He said AGF’s CAD 237 million of retail mutual fund net sales was “in line with the industry net sales rate of 0.7% of AUM.” He also compared flows since Q1 2024, saying the industry generated roughly 2.5% of AUM in net sales versus AGF’s roughly CAD 1 billion of net sales, or 3.3% of AUM, over the same period.
On investment performance, Tsang said AGF’s gross mutual fund returns before fees ranked in the 35th percentile over one year, 46th percentile over three years, and 39th percentile over five years, adding that nearly two-thirds of funds were outperforming peers on a three- and five-year basis.
Goldring also noted that in January AGF launched ETF series of AGF Global Select and AGF American Growth Fund in Canada, aimed at expanding the firm’s ETF lineup.
Financial results: adjusted EBITDA pressured by long-term investment marks
Tsang said adjusted EBITDA for the quarter was CAD 30 million, down CAD 22 million sequentially and down CAD 18 million year-over-year, “primarily reflecting lower net revenues from AGF Capital Partners’ long-term investments.” SG&A was CAD 65 million, down CAD 3 million from the prior quarter and up CAD 1 million from the prior year. Net income attributable to equity owners was CAD 20 million, and adjusted diluted EPS was CAD 0.30.
Within the firm’s traditional asset and wealth management businesses, net management fees were CAD 93 million, down CAD 2 million from the prior quarter and up CAD 7 million from the prior year, Tsang said.
AGF Capital Partners revenue was CAD 0.8 million, down CAD 22 million from the prior quarter and CAD 23 million from the prior year, which Tsang attributed primarily to long-term investment results. He said the company recorded a CAD 16.8 million fair value adjustment loss on long-term investments, partially offset by CAD 6.6 million of distribution income, for net long-term investment revenue of negative CAD 10.6 million.
Tsang said the impact was “primarily driven by our legacy long-term investments in the infrastructure space,” and noted that while these investments had returned more than CAD 36 million in distributions over the last 36 months, “the sector has not been immune from the economic and trade environment.” He added that AGF is an investor with an economic interest in these legacy funds but does not manage them, and characterized fair value adjustments as “lumpy.” Tsang said that since inception the investments have generated returns of over 11% per annum, exceeding AGF’s target range of 8% to 10%.
In addition, Tsang said AGF recorded CAD 4.6 million in “other fair value and income,” largely related to AGF’s share of 2025 profits at New Holland Capital.
Q&A: infrastructure marks, revised return expectations, Kensington redemption update, and fee rate compression
During the analyst Q&A, Head of AGF Capital Partners Ash Lawrence said the quarter’s net negative CAD 10.6 million from fair value adjustments after distributions was “largely driven by markdowns in our legacy infrastructure fund holdings,” citing discussions with the general partner and the impact of the economic environment and cross-border tariff uncertainty. Lawrence emphasized the adjustment represented a “pretty modest 2.5%” decline in the long-term investment portfolio’s value.
Lawrence also said AGF is reducing its fiscal 2026 return expectations for the long-term investment portfolio to “a more modest 5%-6% for this year” from the firm’s typical longer-term guidance of 8%-10%, and confirmed that outlook includes the 2.5% decline recorded in Q1. He told analysts there was no direct Middle East exposure in the infrastructure holdings, though some assets have energy market exposure.
On retail flows and market conditions, Goldring said the firm was “quite pleased” to match the industry’s net sales rate, but noted some investor “skittishness” amid volatility. She said AGF continues to see strength in SMAs, but “a little bit of softness on the mutual fund side.” Goldring also shared that quarter-to-date net sales were about CAD 40 million, excluding SMA flows.
Lawrence addressed AGF’s option to increase its stake in New Holland Capital, saying AGF is able to exercise the option starting in the first half of the year and that the window remains open through the first half of 2027. He said the company is “actively evaluating” the option and noted New Holland’s AUM growth to about CAD 10 billion from roughly CAD 7 billion at the time of AGF’s initial investment.
Responding to questions about AGF Capital Partners recurring manager earnings, Lawrence said the decline was largely due to fair market value adjustments in Kensington’s Evergreen private equity and venture portfolio, which reduces net asset value on which fees are applied. He described that vehicle as approximately CAD 1.2 billion of NAV.
Lawrence also provided an update on Kensington’s redemption suspension, saying Kensington held a unitholder vote on March 25 to amend fund terms. He said the vote passed, the suspension has been lifted, the redemption queue was eliminated, and a new redemption framework was implemented to better align liquidity management with the fund’s underlying investments while avoiding forced asset sales at discounts. In follow-up questions, Lawrence said the fund will “endeavor to make 5% a quarter available,” though it is “neither a cap nor an obligation,” and clarified that no redemptions were paid as a direct result of the amendment passing.
On New Holland-related income, Tsang said the roughly CAD 4.5 million recorded in the quarter represented AGF’s proportionate share of earnings above the coupon collected and could be volatile depending on New Holland’s profitability. He said the comparable amount recorded in the prior year was about CAD 1 million and noted 2025 performance fees contributed to the result. Lawrence confirmed the earnings reflect AGF’s 25% stake and said performance-fee-related earnings can be lumpy.
Tsang also addressed management fee rate trends, saying AGF continues to expect roughly two basis points of annual compression, driven by growth in fee-based IIROC channels shifting assets from MF series to F series and by growth in the SMA business. He added that while revenue basis points may trend lower, overall revenues are expected to increase over time, and he noted quarterly volatility in AUM can create “noise” in reported fee rate metrics.
Finally, Tsang addressed severance and other adjustments, saying elevated severance reflected “targeted workforce adjustments” made to align initiatives and improve efficiency while investing for growth. He described the item as lumpy, noting it was “virtually zero” in the prior quarter and CAD 3.5 million in the current quarter, and said the company adjusts it out to provide a clearer view of run-rate EBITDA.
About AGF Management TSE: AGF.B
Founded in 1957, AGF Management Limited (AGF) is an independent and globally diverse asset management firm. Our companies deliver excellence in investing in the public and private markets through three business lines: AGF Investments, AGF Capital Partners and AGF Private Wealth. AGF brings a disciplined approach, focused on incorporating sound, responsible and sustainable corporate practices. The firm's collective investment expertise, driven by its fundamental, quantitative and private investing capabilities, extends globally to a wide range of clients, from financial advisors and their clients to high-net worth and institutional investors including pension plans, corporate plans, sovereign wealth funds, endowments and foundations.
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