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Highlights

  • RCG’s revenue declined 2% to CAD 89.3 million due to lower interest income from declining rates.
  • EBITDA fell 29% to CAD 10.7 million while net loss reached CAD 2.1 million versus prior-year profit.
  • Free cash flow turned negative at (CAD 0.2) million, compared to CAD 1.9 million in Q2 2024.

RF Capital Group Inc. (TSX:RCG) reported a net loss of CAD 2.1 million for the second quarter of fiscal year 2025, compared to net income of CAD 2.7 million in the same period last year. The decline in profitability was primarily attributed to a 29% decrease in EBITDA to CAD 10.7 million, driven by a reduction in gross margin, which fell 8% to CAD 49.3 million. Gross margin pressure was linked to a decrease in total revenue and a higher share of commissionable revenue in the company’s mix.

The company reported total revenue of CAD 89.3 million for Q2 FY2025, down 2% from the prior year. This drop was largely due to a 21% reduction in interest income, impacted by a lower interest rate environment in Canada. Fee revenue, however, rose 6%, supported by higher average Assets Under Administration (AUA). Ending AUA reached CAD 40.4 billion, reflecting an increase of CAD 3.2 billion or 9% YoY, supported by favorable equity markets and advisor recruitment.

Cash from operating activities was CAD 5.5 million, slightly higher than the CAD 5.2 million reported in Q2 2024. However, free cash flow declined to (CAD 0.2) million compared to CAD 1.9 million last year, due to lower free cash flow available for growth and partially offset by a reduction in advisor loans issued. Net working capital stood at CAD 89.9 million, up CAD 3.3 million from Q1 2025.

Subsequent to quarter-end, RF Capital entered into a definitive agreement for acquisition by iA Financial Corporation Inc., with advisors expected to continue operating under the Richardson Wealth brand. The company’s outlook highlights potential continued market volatility due to U.S. trade policy changes and expectations of lower Canadian interest rates for the remainder of the year.

On July 31, the board declared a cash dividend of CAD 0.233313 per Series B Preferred Share, totalling CAD 1,073,000, payable on September 29, 2025, to shareholders of record as of September 15, 2025.