Sceptre Investment Counsel Limited has reported its financial results for the second quarter and six months ended May 31, 2001.

Second-quarter earnings were $1,727,000, or 13 cents per share fully diluted, compared with $3,418,000, or 25 cents per share fully diluted, for the same period last year. Earnings for the six months ended May 31, 2001 were $3,849,000, or 28 cents per share fully diluted, compared with $7,071,000, or 52 cents per share fully diluted, for the 2000 comparable period.

Revenue for the second quarter was $9,452,000, compared with $12,752,000 for the second quarter last year. Revenue for the six months ended May 31, 2001 was $19,823,000, compared with $26,101,000 for the first six months of 2000.

The Company, having considered its financial requirements, has declared a quarterly dividend of 20 cents per share on outstanding Class A Non-Voting Shares and Common Shares, payable on July 13,
2001 to shareholders of record June 29, 2001. The previous quarterly dividend on both classes of shares was 20 cents. Based on its strong financial position and recent strategic initiatives,the Company believes it can carry its target level dividend of 20 cents per share per quarter for the foreseeable future.

The Company says that second-quarter results reflect the lagged effect of client losses experienced in prior quarters as well as some decline in market value of client accounts related to the overall downturn in financial markets. In this quarter, asset outflows for our Canadian clients have continued but at a significantly reduced rate due to stronger investment performance.

Sceptre’s marketing efforts resulted in securing a number of new specialty foreign mandates under its strategic alliance with Putnam Investments. These mandates are expected to be funded in the fourth quarter and the first quarter of next year. Very little of the revenue from new business has been realized to date because of the lag time between winning the mandate and earning the revenue.

Total expenses for the second quarter were down by 3.3% over the same period last year, mainly due to lower remuneration costs. To the extent that a significant portion of remuneration is incentive-driven and based on corporate performance, the company expects that the ratio of remuneration cost to revenue will return to more traditional levels in a relatively short timeframe.

Results for the second quarter also reflect the sub-advisory fees paid to Putnam for the ongoing management of Sceptre’s foreign pooled funds. Without this cost in the quarter, expenses would have been down by approximately 15% year over year.

“Our earnings have continued to decline due to the lagged effect of lost business and the investment management fee paid to Putnam,” says William Malouin, President and Chief Executive Officer of Sceptre Investment Counsel. “By the end of this year, however, our business won through the Putnam Alliance should reverse the earnings trend, and given our strategic position in the Canadian investment management market, we are optimistic about the longer term.”