Highlights as at November 30, 2020:
- 12-month return of 6.3%
- 6-month return of 11,0%
- Share value at $49.11 (up $4.87 since June 30, 2020 and $2.91 since December 31, 2019)
- 6-month comprehensive income (profit) of $1.6 billion
- Net assets grow to $15.6 billion
Montréal, December 31, 2020 – For the first six months of its financial 2020-2021 year, the Fonds de solidarité FTQ posted comprehensive income (profit) of $1.6 billion for the benefit of its over 700,000 savers. Share value is now $49.11, representing a shareholder return of 11.0% for the 6-month period ended November 30, 2020 and a 12-month return of 6.3%. Net assets grew to $15.6 billion.
The Fonds’ compound annual shareholder return (excluding tax credits) is 6.3% for 1 year, 7.7% for 3 years, 7.9% for 5 years and 7.0% for 10 years.
“While some sectors of our economy are recovering from the consequences of the pandemic, others are still struggling. The start of the vaccination campaign in December offers hope for a broad-based economic recovery, and especially for the workers affected,” said Gaétan Morin, President and CEO of the Fonds de solidarité FTQ.
“True to its mission, the Fonds de solidarité FTQ has been there from the beginning of the crisis to support its savers and partner companies. Now more than ever, our employees and local representatives are working hard to meet everyone's needs and contribute to the vitality of all the regions of Québec,” continued Mr. Morin.
Investments in the first half of the year
In the first six months of its financial year, the Fonds continued to invest to enable Québec companies to better prepare for the future, particularly in terms of technology and environmental transitions.
As part of a new co-investment partnership with EDC, the Fonds invested in Omnirobotic, a start-up specializing in autonomous robots for the manufacturing sector. The two organizations also invested together in NoviFlow, a world leader in high-performance cybersecurity and programmable network software solutions.
Together with the Fonds régionaux de solidarité FTQ Québec, the Fonds also invested in Québec’s leading manufacturer of engineered wood flooring, Preverco, allowing the family business to improve its automation processes by acquiring sophisticated robots. As a result of this innovation, Preverco continues to set itself apart in the industry and increase sales both in Québec and abroad.
To help fight climate change, the Fonds invested in GHGSat, a Montréal-based company and world leader in greenhouse gas monitoring by high-resolution satellite, and in AddÉnergie, a charging network operator for electric vehicles and a major provider of smart charging software and equipment.
“As this unprecedented year comes to a close, I would like to thank our savers for supporting our mission. Thanks to them, the Fonds continues to actively invest in businesses across Québec, not only to help them get through the crisis but also to help them prepare for the future. I salute the courage and determination of entrepreneurs who continue to move Québec forward,” concluded Mr. Morin.
Consequences of a share buyback on the future eligibility for tax credits
In response to questions from shareholders received in recent months, the Fonds would like to remind shareholders of the tax rules governing eligibility for tax credits following a partial or total share redemption under certain criteria.
To encourage workers to save for retirement and to support jobs and economic development, the governments of Québec and Canada each grant a 15% tax credit to savers who purchase Class A shares of the Fonds. Tax credits are capped at $1,500 per fiscal year, which represents a $5,000 purchase of shares.
As provided in the relevant legislation and set out in the Short Form Prospectus (section 8.1, page 16 and Schedule 1, page 24), shareholders can no longer benefit from the tax credits associated with the acquisition of Fonds shares following a partial or total redemption of shares made under the criteria related to retirement and disability resulting in permanent unfitness for work.
For more information in this regard, see the Short Form Prospectus.
Shareholders are ultimately responsible for determining the tax impact of a redemption and ensuring that their contributions to the Fonds de solidarité FTQ are eligible for tax credits and RRSP deductions based on their taxation status.
For more information on the consequences of a share redemption on future eligibility for tax credits, shareholders may contact Saving Services from Monday to Friday, 8:30 a.m. to 6:00 p.m. at 1 800 567-3663 (toll free).
Share issue for 2020-2021
As has been the case in the past, in order to maintain a balanced business model, the Fonds de solidarité FTQ may have to stop issuing shares during the financial year.
In such a case, the Fonds will issue a press release explaining the conditions of the share issue cap.
About the Fonds de solidarité FTQ
The Fonds de solidarité FTQ invests to build a better society by channelling the savings of its over 700,000 shareholders into development and risk capital investments to help Québec transition to a green economy, to a human-centred world of work, and to a healthier society. The Fonds offers businesses unsecured financing and strategic support. With $15.6 billion in net assets as at November 30, 2020, the Fonds has supported more than 3,300 partner companies and over 220,000 jobs. For more information, visit fondsftq.com.
Please read the prospectus before buying shares of the Fonds de solidarité FTQ. Copies of the prospectus may be obtained on the Website fondsftq.com, from a local representative or at the offices of the Fonds de solidarité FTQ. The indicated rates of return are the historical annual compounded total returns including changes in share value and reinvestment of all dividends and do not take into account income taxes payable by any security holder that would have reduced returns. The shares of the Fonds de solidarité FTQ are not guaranteed, their value changes and past performance may not be repeated.
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