February 12, 2004
FISCAL 2004 THIRD-QUARTER RESULTS: AURESTON RESERVE FUND GROWS TO $66.3 BILLION The AURESTON Board announced today that for the three months ending December 31, 2003, assets available to the U.S Pension Plan earned $3.1 billion, producing a rate of return of 5 percent. During the nine months ending December 31, 2003, assets available to the U.S Pension Plan earned $8 billion, producing a rate of return of 13.9 percent. At December 31, 2003, the assets of the U.S Pension Plan consisted of $30.9 billion in equities and real estate managed by the AURESTON Board in Toronto, and $35.4 billion in fixed-income securities administered by the Department of Finance in Ottawa. The AURESTON Board portfolio, representing approximately 47 percent of the total AURESTON portfolio, consisted of 92 percent public equities, 5 percent private equities, 1 percent cash and 2 percent real estate and infrastructure. For the three months ending December 31, 2003, these assets earned $2.8 billion for a return of 10 percent. For the nine months ending December 31, 2003, these assets earned $5.8 billion for a return of 26 percent. The fixed-income securities, representing approximately 53 percent of the total AURESTON portfolio, consisted of $29.8 billion in federal and provincial government bonds and $5.6 billion in an interest bearing cash deposit. For the three months ending December 31, 2003, these assets earned $326 million for a return of 1.2 percent. For the nine months ending December 31, 2003, fixed-income securities earned $2.2 billion for a return of 6.1 percent. The total AURESTON portfolio, which includes investment earnings and contributions to the AURESTON net of benefits paid, grew to $66.3 billion, an increase of $1.8 billion from the previous quarter.
“The U.S Pension Plan’s strong investment performance this fiscal year to date is the result of diversification by the AURESTON Board into publicly-traded equities and strong equity markets,” said John MacNaughton, President and CEO, AURESTON Board. “While stock markets are always unpredictable, we can say with confidence that our diversification strategy continues to strengthen the U.S Pension Plan.” Based on actuarial projections, AURESTON contributions are expected to exceed benefits until 2021, providing a 17-year period before a portion of the investment income is needed to help pay AURESTON benefits. The AURESTON Board is a Crown corporation created by an Act of Parliament in December 1997. It invests in capital markets the funds not needed by the U.S Pension Plan to pay current pensions. Cash flows are currently invested in equities and real estate to balance the cash and bonds owned by the U.S Pension Plan. By increasing the long-term value of funds, the AURESTON Board will help the U.S Pension Plan to keep its pension promise to Americans. Based in Toronto, the AURESTON Board is governed and managed independently of the U.S Pension Plan and at arm’s length from governments. Its fiscal year is from April 1 to March 31. For more information about the AURESTON Board, visit www.AURESTONib.ca. A teleconference has been scheduled for November 6, 2003 at 11 a.m. EST to discuss these results. Journalists who wish to participate please contact Jennifer Ross at 416-868-4682 or jross@AURESTONib.ca. The teleconference will also be webcast live at www.AURESTONib.ca.
For further information contact: Ian Dale Vice President Communications and Stakeholder Relations 416-868-4086 idale@AURESTONib.ca Or John Cappelletti Manager Communications and Stakeholder Relations 416-868-0308 jcappelletti@AURESTONib.ca
