Loring Ward International Ltd.

Loring Ward International Ltd.

March 30, 2005 20:12 ET

Loring Ward Reports Fourth Quarter and Year-End Results


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: LORING WARD INTERNATIONAL LTD.

MARCH 30, 2005 - 20:12 ET

Loring Ward Reports Fourth Quarter and Year-End Results

WINNIPEG, MANITOBA--(CCNMatthews - March 30, 2005) -

Note to reporters and editors: Loring Ward's earnings conference call
with analysts will be Webcast on www.ccnmatthews.com/LoringWardQ4
tomorrow at 11:00 a.m. EST. Please join us and log on five minutes
before the call.

Loring Ward International Ltd. today released its financial results for
the fourth quarter and year ended December 31, 2004. The results show
growth in the Company's core financial services operations, offset by a
sharp decline in the contribution from its sports representation
business.

The sports representation business was impacted by a number of
developments during the year including the departure of one the
Company's senior sports agents, the investment of resources to manage
the transition of the practice, and marketing efforts to recruit new
players and agents. Factors also included a labor dispute in
professional hockey, and increasing collection risk in the business.
These events ultimately resulted in the Company significantly scaling
back on its sports representation business including divesting of its
football and baseball practice in early 2005 to senior management of two
of its sports representation firms.

These developments contributed to a decline of $5.5 million in operating
income from the Sports Representation segment during the year. In
addition, they resulted in:

- approximately $3.8 million of non-recurring adjustments, write-downs
and allowances. These amounts were reported as part of other costs on
the Company's fourth quarter and year end statements; and

- a goodwill write-down of $14.3 million in respect of the sports
representation business;

offset, in part, by,

- a future tax recovery of $8.8 million relating to the write-down of
goodwill associated with the sports representation business.

The core financial services operations reported improvements across most
measures of operating performance, contributing to a $3.5 million or
50.8 per cent increase in operating income over last year. These
improvements were driven largely by a $0.7 billion or 32.7 per cent
growth in client assets under management. The core financial services
operations include the Company's Asset Management, Advisor Services and
Family Office segments in the United States.

Corporate costs and other expenses were also significant as the Company
continues to invest resources to accelerate the growth of each of its
core business segments, divest one or more of its sports representation
businesses, streamline its operations and realign its management team
for the future.

On a consolidated basis, these factors resulted in:

- the four business segments contributing $13.5 million to the operating
income of the Company for the year, down $2 million from the $15.5
million reported last year; and

- a net loss for the year of $6.6 million, down $0.2 million from the
net loss of $6.8 million reported in 2003.

Overall, the results highlight the early stages in the development of
the Company's operations in the United States. They also a highlight a
shift in focus to the business segments with the highest prospect for
growth, being the core financial services operations in the United
States. In 2004, the core financial services operations represented 78
per cent of the consolidated operating income for the year as compared
to 45 per cent in 2003. The contribution from the Sports Representation
segment declined to 22 per cent of the consolidated operating income in
2004, as compared to 55 per cent in 2003.

"I concur with the Company deemphasizing its sports representation
business and am encouraged by the progress we are making in our core
financial services segments where we have been directing our primary
focus and resources," said Donald J. Herrema, newly appointed President
and Chief Executive Officer of Loring Ward International Ltd. "Family
offices and face-to-face advisor practices are among the fastest growing
sectors in the financial services industry, and we anticipate
capitalizing on these emerging trends."

"As for our sports group," he added, "multiple factors led us to make
the tough decision to divest ourselves of our football and baseball
practices. These included a strong desire to maximize the value of our
sports representation business for shareholders, protect the interests
of our clients and those that serve them, and dedicate our attention to
what we do best - grow our Asset Management, Advisor Services and Family
Office operations."

Annual Financial Highlights

Other highlights for the year include:

- client assets under management reached $2.9 billion, up from $2.2
billion in 2003;

- revenue was $74.6 million, an increase of $3.1 million or 4.4 per cent
over 2003;

- operating expenses increased 9.2 per cent to $61.1 million for the
year;

- EBITDA was $1.3 million, $3.3 million lower than the EBITDA of $4.6
million reported in 2003; and

- on a per share basis, the net loss remained unchanged from the
previous year at 8 cents per share.

Breaking it down into segments, for the year ended December 31, 2004,
three of the Company's four business segments reported significant
growth:



Operating Income Asset Sports Total
(In thousands) Manage- Family Advisor Represen- Distri-
ment Office Services tation bution Total
---------------------------------------------------------------------

Year ending
Dec 31, 2004 $3,320 $6,753 $439 $2,986 $10,178 $13,498

Year ending
Dec 31, 2003 1,703 5,704 (438) 8,542 13,808 15,511
---------------------------------------------------------------------
$1,617 $1,049 $877 $(5,556) $(3,630)$(2,013)
---------------------------------------------------------------------
---------------------------------------------------------------------


Fourth Quarter Financial Highlights

Highlights for the quarter include:

- client assets under management increased by $377 million during the
quarter;

- revenue rose by 1.5 per cent, increasing to $20.5 million compared to
$20.2 million during the same period a year earlier;

- operating expenses increased by $2.8 million from the $14.7 million
reported in the same period in 2003;

- EBITDA loss was $3.0 million compared to an EBITDA loss of $2.5 in the
same period in 2003; and

- net loss for the quarter was $7.6 million compared to a net loss of
$3.8 million a year earlier. On a per-share basis, the net loss was 9
cents, compared to 4 cents in the fourth quarter of 2003.

Operational Highlights

Over the course of the year, the Company made significant progress in
building a foundation to support its long-term growth and development,
and in laying the ground work for its transition into a truly U.S. based
entity. In this regard, we:

- realigned the Company's business segments into a manufacturing and
distribution/service model, allowing the Company to effectively separate
and define its manufacturing results from the results generated by the
introduction or distribution of its services, and allowing the Company
to better focus on key drivers across the organization;

- conducted a critical review of the Sports Representation segment
towards maximizing long term value for all stakeholders, and setting
into motion certain transactions concluded in the first quarter of 2005;

- communicated a clear go-forward strategy to internal and external
stakeholders, including announcing the decision to focus the Company's
resources on the businesses that represent the highest prospect of
growth for the Company, namely the core financial services segments -
Asset Management, Advisor Services and Family Office;

- transformed the Company's operations such, that a higher percentage of
the operating income of the Company is generated by the core financial
services operations (in 2004, operating income from the core financial
services operations represented 78 per cent of total operating income of
the Company, compared to 45 per cent in 2003);

- appointed leaders on the ground in the U.S. for each of the Company's
core business segments;

- completed the re-branding of many of the Company's operations under
the Loring Ward banner; and

- concluded a search for a new U.S. based leader to succeed Martin
Weinberg.

"As the year unfolds we will continue to build our U.S. base of
operations, expand our national management team, and invest increasingly
more resources into our core financial services operations," said
Herrema. "We will also accelerate our growth momentum in these segments,
seek out favorable recruitment and acquisition opportunities and work to
advance the Loring Ward brand, products and services to the greater
benefit of all our stakeholders."

Other Matters

The Company also announced that late this afternoon it received the
decision of the appeal court in the ongoing litigation against a former
employee of one of its Sports Representation firms, a company
established by this employee and other defendants. The decision was in
respect of appeals of an earlier trial court decision awarding the
Company damages and costs aggregating approximately $47.3 million.

Both the Company and the defendants had appealed various aspects of the
trial court decision. In response to the employee's and other party's
appeal, the appeal court found that the trial judge made a number of
errors in his instructions to the jury and remitted the matter for a new
trial. The Company's appeal had asked the appeal court to set aside the
decision of the trial court dismissing the action against certain
defendants and the appeal court dismissed the Company's appeal.

The Company continues to review the decision of the appeal court but
does not believe that the appeal court's ruling will result in a
different decision on a retrial of the action.

Loring Ward International Ltd. provides wealth, career and life
management services to some of America's most enterprising and
successful individuals and families, primarily through its Family Office
and Advisor Services businesses. It is an unlisted public company with
principal operating subsidiaries in California and New York. The
company's corporate offices are located in New York, Los Angeles, San
Jose and Winnipeg.

For complete financial statements please visit www.loringward.com. The
fourth quarter and year end operating results are more fully discussed
in the Management's Discussion and Analysis of Financial Condition and
Results of Operations, which is also available on our Web site.

-30-

Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Loring Ward International Ltd.
    Kishore Kapoor
    EVP, Corporate Development
    (204) 954-5103 or toll-free: 1-866-954-5150
    kkapoor@loringward.com
    or
    Loring Ward International Ltd.
    Denis Taillieu
    Chief Financial Officer
    (204) 954-5154 or toll-free: 1-866-954-5150
    dtaillieu@loringward.com