TORONTO, Feb. 28, 2019 (GLOBE NEWSWIRE) -- (TSX: LCS, LCS.PR.A) Brompton Lifeco Split Corp. (the “Fund”) announces that the distribution rate for the preferred shares (the “Preferred Shares”) for the 5-year term from April 30, 2019 to April 29, 2024 will be $0.625 per preferred share per annum (6.25% on the original issue price of $10) payable quarterly. The Preferred Share distribution rate is based on current market rates for preferred shares with similar terms. The Fund previously announced the extension of the term of the class A shares (the “Class A Shares”) and the Preferred Shares from April 30, 2019 to April 29, 2024. The term extension offers preferred shareholders the opportunity to enjoy preferential cash dividends until April 29, 2024. Since inception in April 2007 to January 31, 2019, the Preferred Share has delivered a 5.6% per annum return. In addition, the Fund intends to maintain the targeted monthly Class A Share distribution rate at $0.075 per Class A Share when the net asset value per unit (consisting of one Class A Share and one Preferred Share) is greater than $15.00, after taking in consideration the payment of the Class A Share distribution.
Over the past 10-year period to January 31, 2019, the Class A share has outperformed the S&P/TSX Composite Index (the “TSX Composite”) by 5.7% per annum (LCS 14.8% per annum, TSX Composite 9.1% per annum). The Preferred share has delivered consistent returns with less volatility and has outperformed the S&P/TSX Preferred Share Index over the past 10-year period by 1.8% per annum.
Since inception on April 18, 2007 to January 31, 2019, Class A shareholders have received cash distributions of $5.73 per share. Class A shareholders have the option to benefit by reinvesting their cash distributions in a distribution reinvestment plan (“DRIP”) which is commission free to participants. Class A shareholders can enroll in the DRIP program by contacting their investment advisor.
The Fund invests in a portfolio of common shares of Canada’s four largest publicly-listed life insurance companies, on an approximately equal weight basis: Great-West Lifeco Inc., Industrial Alliance Insurance and Financial Services Inc., Manulife Financial Corporation and Sun Life Financial Inc.
In connection with the extension, shareholders who do not wish to continue their investment in the Fund, may retract their Preferred Shares or Class A Shares on April 29, 2019 pursuant to a special retraction right and receive a retraction price that is calculated in the same way that such price would be calculated if the Fund were to terminate on April 29, 2019. Pursuant to this option, the retraction price may be less than the market price if the security is trading at a premium to net asset value. Notice must be provided to your investment dealer by March 29, 2019 at 5:00 p.m. (Toronto time) in order to exercise this right; however, investment dealers may have earlier deadlines.
About Brompton Funds
Brompton Funds, a division of Brompton Group which was founded in 2000, is an experienced investment fund manager with over $2 billion in assets under management. Brompton’s investment solutions include TSX traded funds and mutual funds. For further information, please contact your investment advisor, call Brompton’s investor relations line at 416-642-6000 (toll-free at 1-866-642-6001), email info@bromptongroup.com or visit our website at www.bromptongroup.com.
| Annual Compound Returns(1) | 1-Year | 3-Year | 5-Year | 10-Year | Since Inception (April 18, 2007) | |||||
| Brompton Lifeco Split Corp. – Class A | (42.2 | %) | 0.3 | % | (0.8 | %) | 14.8 | % | (4.3 | %) |
| S&P/TSX Capped Financials Index | (2.2 | %) | 11.9 | % | 9.4 | % | 13.9 | % | 6.4 | % |
| S&P/TSX Composite Index | 0.5 | % | 9.8 | % | 5.6 | % | 9.1 | % | 4.1 | % |
| Brompton Lifeco Split Corp. – Preferred | 5.9 | % | 5.9 | % | 5.9 | % | 5.6 | % | 5.6 | % |
| S&P/TSX Preferred Share Index* | (9.8 | %) | 7.5 | % | 0.1 | % | 3.8 | % | 1.3 | % |
⃰ Source: Thomson Reuters as at January 31, 2019.
(1) Returns are for the periods ended January 31, 2019. The following table shows the Fund’s compound returns on a Class A share and, Preferred share for each period indicated, compared with the S&P/TSX Capped Financials Index (“Financials Index”), the S&P/TSX Preferred Share Index (“Preferred Index”) and the S&P/ TSX Composite Index (“Composite Index”). The Financials Index is derived from the Composite Index based on the financials sector of the Global Industry Classification Standard; the Composite Index tracks the performance, on a market-weight basis, of a broad index of large-capitalization issuers listed on the TSX. The Preferred Index is comprised of preferred shares listed and trading on the Toronto Stock Exchange that meet criteria relating to size, liquidity, and issuer rating. The Fund passively invests on an equal-weight basis in a portfolio comprised of four Canadian life insurance companies which are in both the Financials Index and the Composite Index. Since the indices have more diversified portfolios, it is not expected that the Fund’s performance will mirror that of the indices. Further, the indices are calculated without the impact of management fees and fund expenses, whereas the performance of the Fund is calculated after deducting such fees and expenses.
You will usually pay brokerage fees to your dealer if you purchase or sell shares of the investment funds on the Toronto Stock Exchange or other alternative Canadian trading system (an “exchange”). If the shares are purchased or sold on an exchange, investors may pay more than the current net asset value when buying shares of the investment fund and may receive less than the current net asset value when selling them.
There are ongoing fees and expenses associated with owning shares of an investment fund. An investment fund must prepare disclosure documents that contain key information about the fund. You can find more detailed information about the Fund in the public filings available at www.sedar.com. The indicated rates of return are the historical annual compounded total returns including changes in share value and reinvestment of all distributions and do not take into account certain fees such as redemption costs or income taxes payable by any securityholder that would have reduced returns. Investment funds are not guaranteed, their values change frequently, and past performance may not be repeated.
Certain statements contained in this document constitute forward-looking information within the meaning of Canadian securities laws. Forward-looking information may relate to matters disclosed in this document and to other matters identified in public filings relating to the Fund, to the future outlook of the Fund and anticipated events or results and may include statements regarding the future financial performance of the Fund. In some cases, forward-looking information can be identified by terms such as “may”, “will”, “should”, “expect”, “plan”, “anticipate”, “believe”, “intend”, “estimate”, “predict”, “potential”, “continue” or other similar expressions concerning matters that are not historical facts. Actual results may vary from such forward-looking information. Investors should not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date hereof and we assume no obligation to update or revise them to reflect new events or circumstances.