OREANDA-NEWS. Onex Corporation ("Onex") (TSX: OCX) today announced its consolidated financial results for the three and nine months ended September 30, 2014 and an update on matters following quarter-end.

Highlights

In October, Onex acquired York Risk Services Group ("York") for USD 1.325 billion. The total equity investment of USD 555 million was made by Onex Partners III, Onex and York's management team. Onex' initial share of the investment was USD 217 million.

In October, ONCAP III invested USD 102 million in Mavis Discount Tire, of which Onex' share was USD 30 million.

A record number of successful realizations were completed during the quarter, resulting in USD 5.9 billion in total proceeds year-to-date, of which Onex' share was USD 1.9 billion, including USD 169 million of carried interest.

Onex and CPPIB sold Gates, resulting in a gross multiple of capital invested of 2.2 times and a gross IRR of 27% including prior distributions.

Onex sold The Warranty Group, resulting in a gross multiple of capital invested of 3.1 times and a gross IRR of 19% including prior distributions.

ONCAP II sold Mister Car Wash, resulting in a gross multiple of capital invested of 8.1 times (7.6 times in CAD) and a gross IRR of 36% (35% in CAD) including prior distributions.

Onex sold its remaining shares in Spirit AeroSystems, resulting in a gross multiple of capital invested of 8.5 times and a gross IRR of 201% including prior realizations.

Onex sold its remaining shares in Allison Transmission, resulting in a gross multiple of capital invested of 3.2 times and a gross IRR of 21% including prior realizations and dividends.

As a result of recent activities, Onex' cash and near-cash was USD 2.9 billion at the end of October.

In October, Onex Credit established a London office to expand Onex' platform to Europe. Onex Credit also recently priced its seventh collateralized loan obligation ("CLO"), offering USD 514 million of securities in a private placement transaction.

Including realizations and distributions, the value of Onex Partners' and ONCAP's private companies increased by 14% during the first nine months of 2014. Including our public companies, the value of all operating businesses in the Onex Partners and ONCAP Funds, including realizations and distributions, increased by 12%.

Including Onex' cash and near-cash equivalents, Onex' capital per share grew by 4% and 12% in the nine and twelve months ended September 30, 2014, respectively, to USD 52.77 (CAD 59.10).

Onex' fee-generating assets increased by 9% and 36% in the nine and twelve months ended September 30, 2014, respectively, as a result of the recent success raising Onex Partners IV and several CLO issuances.

Recent Performance

"We're very happy with the volume and success of realizations this year," said Gerry Schwartz, Chairman and Chief Executive Officer of Onex. "Our challenge remains to find great businesses at reasonable prices. With a robust pipeline and the recent volatility in the markets, we are hopeful prices moderate and allow us to find some new investment opportunities."

Onex remains in an excellent position to capitalize on its growing pipeline of investment opportunities. With the York acquisition being the last new investment for Onex Partners III, Onex will begin investing from Onex Partners IV.

Onex management continues to share in the success and failure of our operating companies through the team's significant investment in everything we buy. At September 30, 2014, the Onex, ONCAP and Onex Credit teams had an investment of USD 1.9 billion in underlying private equity operating businesses, credit funds and Onex shares.

Creating Value for Shareholders

Onex has two long-term goals. The first is to grow its capital per share by 15% per year. For the twelve months ended September 30, 2014, Onex' capital per share grew by 12% to USD 52.77 (CAD 59.10). Onex' second long-term goal is to grow its fee-generating assets by 10% per year. For the twelve months ended September 30, 2014, Onex' fee-generating assets grew by 36% to USD 13.0 billion. This was primarily the result of raising Onex Partners IV, from which Onex started drawing management fees in August, and Onex Credit's success with its CLO issuances.

If we are successful in achieving these two goals over the long term, we believe Onex' shares will reflect both the growth in the value of our investments and the growing contribution from managing investments for our limited partners and other investors. At September 30, 2014, Onex' Subordinate Voting Shares ("SVS") closed at CAD 62.36, a 6% decrease in the last quarter, a 9% increase from December 31, 2013, and a 15% increase over the last twelve months. This compares to increases in the S&P 500 of 1%, 7% and 17%, respectively. The S&P/TSX Composite was down 1%, and increased 10% and 17%, respectively.

Onex paid a third-quarter dividend of CAD 0.05 per SVS on October 31, 2014 to shareholders of record on October 10, 2014.

In the first ten months of 2014, Onex repurchased approximately 2.2 million SVS for a total cost of USD 131 million (CAD 142 million), or an average cost per share of CAD 63.29.

Consolidated Results

Onex' quarterly and full-year consolidated financial results do not follow any specific trends due to acquisitions and dispositions of businesses, changes in the value of its publicly traded and privately held operating companies and varying business cycles at its operating companies.

On a consolidated basis for the third quarter, revenues decreased 2% to USD 5.0 billion compared to the same period of the prior year reflecting the sales of businesses noted earlier. Onex reported consolidated net earnings of USD 388 million compared to USD 399 million in the third quarter of 2013. Onex' net earnings for third quarter of 2014 include earnings from discontinued operations of USD 365 million, driven by a gain on the sale of The Warranty Group of USD 368 million. This compares to a loss of USD 14 million from discontinued operations for the third quarter of 2013.

On a consolidated basis for the nine months ended September 30, 2014, revenues decreased 2% to USD 14.6 billion. Net earnings for the period were USD 526 million compared to a net loss of USD 590 million for the nine months ended September 30, 2013.