Ontario Teachers' announces positive 2024 results

• Achieved a one-year total-fund net return of 9.4%.
• Strong returns across public equity, venture growth, credit and inflation sensitive assets.
• Underperformed the 2024 benchmark return of 12.9% resulting in negative value add of $7.6 billion.
• Delivered a ten-year annualized total-fund net return of 7.4% and return since inception of 9.3%.
• Continued to have a strong preliminary funding surplus of $29.1 billion and is fully funded for the 12^th straight year.
• Achieved our 2025 interim target of reducing our portfolio emissions intensity, compared to a 2019 baseline, one year early.

TORONTO, March 20, 2025 /CNW/ - Ontario Teachers' Pension Plan Board (Ontario Teachers') today announced a one-year total-fund net return of 9.4% for the year ended December 31, 2024¹, compared to 1.9% return in 2023. Net assets grew to $266.3 billion, up from $247.5 billion in 2023. Investment income of $23.7 billion and member and employer contributions of $4.3 billion for the year were partially offset by benefits paid of $8.1 billion and administrative expenses of $1.0 billion.

The plan is fully funded as at January 1, 2025, with a $29.1 billion preliminary funding surplus. This marks the plan's 12^th consecutive year being fully funded (meaning plan assets exceed future pension liabilities), underscoring the plan's long-term financial health and stability.

"Our teams worked methodically in 2024 to create value in the portfolio, delivering a 9.4% return, significantly above the outcome for 2023 and more in line with our long-term returns. We had positive contributions from across the plan, with notable success in venture growth, credit, inflation-sensitive and public equity investments. The resilience of our portfolio, combined with our proactive approach to creating value, has positioned us strongly in an unpredictable economic climate," said Jo Taylor, President & Chief Executive Officer. "Our investment portfolio is well placed to deliver strong risk-adjusted returns for the plan in 2025 and meet our long-term obligations to the members we serve."

Results reflect underperformance relative to the benchmark return of 12.9% by 3.5%, or $7.6 billion in negative value add². The benchmark underperformance was primarily attributed to assets in private equity and real estate trailing their respective benchmarks.  

Impact of currency on returns

In 2024, the fund experienced a foreign currency gain of $6.9 billion as assets denominated in foreign currencies appreciated in value when converted back into Canadian dollars. This gain was primarily driven by the appreciation of the U.S. dollar compared to the Canadian dollar. The fund's net exposure to the U.S. dollar is significantly larger than any other foreign currency.

Investment performance

Given the plan's liabilities stretch decades into the future, results over longer periods are particularly important. Ontario Teachers' has delivered an annualized total-fund net return of 9.3% since inception in 1990, and five- and 10-year annualized total-fund net returns of 6.9% and 7.4%, respectively.

The table below summarizes Ontario Teachers' investment returns and related benchmark returns by investment asset class for the current and previous year.

Portfolio Performance by Asset Class (all figures as at December 31)

The table below summarizes Ontario Teachers' portfolio mix by asset class for the current and previous year.  

Detailed Asset Mix (all figures as at December 31)

Investment highlights

Ontario Teachers' manages approximately 80% of its assets internally, with a focus on deploying capital into a mix of active and passive strategies around the world.

Transaction highlights in 2024 include:

• Through our Boreal IM joint venture, expanded our logistics real estate portfolio across Europe, acquiring eight fully leased logistics assets in France and three warehouses in Germany.
  
  
• Signed an agreement to sell an equity stake in Connexa, New Zealand's largest mobile network.
  
  
• Our portfolio company, Fairstone Bank of Canada, merged with Home Trust Company to create one of Canada's largest alternative lenders.
  
  
• Led a funding $95 million series round for Instagrid, a European provider of high-performance portable battery systems.
  
  
• Reached an agreement to co-acquire Max Matthiessen, a leading financial services advisor for pensions, insurance and wealth management companies in the Nordics.
  
  
• Signed an agreement to invest in Omega Healthcare, a leading technology-enabled healthcare management solutions provider.
  
  
• Successfully closed the sale of Shearer's Foods, a leading contract manufacturer and private label supplier serving the snack industry in North America.
  
  
• Co-led a $140 million fundraising round of SmartHR, a leading cloud-native human resources management platform in Japan.

Corporate news

• In 2024, we announced the following executive appointments:
  • Mabel Wong was appointed Chief Financial Officer;
  • Stephen McLennan and Gillian Brown appointed into Chief Investment Officer roles;
  • Jonathan Hausman appointed Chief Strategy Officer; and
  • Nick Jansa joined the executive team in his role as Executive Managing Director, Europe, Middle East and Africa
    
    
• Expanded the investment senior leadership team, including appointing Bernard Grzinic as Executive Managing Director, Capital Markets; Steve Saldanha as Executive Managing Director, Total Fund Management; and Robert Sturgeon as Senior Managing Director, Global Investment Strategy.
  
  
• Kevin Kerr was appointed Executive Managing Director, Portfolio Solutions, a new function aimed at driving enhanced value creation efforts within our portfolio.
  
  
• Congratulated Chief Operating Officer Tracy Abel on her retirement at the end of 2024, after 37 years with the organization.
  
  
• Following year-end, we made the decision to optimize our Asia-Pacific office footprint with a focus on our Singapore and Mumbai locations.  As a result, we have made the decision to close our Hong Kong office. We established this office in 2013 as our first in the region and have since opened additional regional offices in Singapore and Mumbai, where we have teams working across asset classes and markets. We believe activities currently undertaken in Hong Kong can be effectively and efficiently served out of Singapore going forward.

Climate ambition

• At the end of 2024, Ontario Teachers' met its 2025 interim target of decreasing its portfolio emissions intensity by 45% compared to a 2019 baseline, achieving a 49% reduction over that timeframe. This goal was met one year early.

Note to Editors: To read our annual report, please click here. 

About Ontario Teachers'

Ontario Teachers' Pension Plan Board (Ontario Teachers') is a global investor with net assets of $266.3 billion as at December 31, 2024. Ontario Teachers' is a fully funded defined benefit pension plan, and it invests in a broad array of asset classes to deliver retirement security for 343,000 working members and pensioners. For more information, visit otpp.com and follow us on LinkedIn. 

Contact
Dan Madge
Ontario Teachers' Pension Plan
Phone: +1 416-419-1437
Email: media@otpp.com

Forward-looking statements
This annual report contains forward-looking information and statements that are intended to enhance the reader's ability to assess the future financial and business performance of Ontario Teachers'.

Because the forward-looking information and statements include all information and statements regarding Ontario Teachers' current beliefs, targets, intentions, plans, and expectations concerning its objectives, future performance, strategies, and financial results, as well as any other information or statements that relate to future events or circumstances and which do not directly and exclusively relate to historical facts. Forward-looking information and statements often but not always use words such as "trend," "potential," "opportunity," "believe," "expect," "anticipate," "current," "intention," "estimate," "position," "assume," "outlook," "continue," "remain," "maintain," "sustain," "seek," "achieve," and similar expressions, or future or conditional verbs such as "will," "would," "should," "could," "may" and similar expressions.

Because the forward-looking information and statements are based on estimates and assumptions that are subject to significant business, economic and competitive uncertainties, many of which are beyond Ontario Teachers' control or are subject to change, actual results or events could be materially different. Although Ontario Teachers' believes that the estimates and assumptions inherent in the forward-looking information and statements are reasonable, such information and statements are not guarantees of future performance and, accordingly, readers are cautioned not to place undue reliance on such information or statements due to the inherent uncertainty therein. Ontario Teachers' forward-looking information and statements speak only as of the date of this annual report or as of the date they are made and should be regarded solely as Ontario Teachers' current plans, estimates and beliefs. Ontario Teachers' does not intend or undertake to publicly update such statements to reflect new information, future events, and changes in circumstances or for any other reason.

Cautionary Statement
Addressing climate change and achieving net zero will require a global effort involving governments, business, and civil society. We strive to contribute to this effort through our multi-faceted climate strategy.  In connection with our multi-faceted climate strategy, we have made certain commitments and set certain goals and targets ("Targets"). In establishing our Targets, we relied on various laws, guidelines, taxonomies, methodologies, frameworks, market practices and other standards (collectively, "Standards"). Given the complex and evolving nature of the global response to climate change, these Standards may change over time.   If any Standards change significantly, we may need to update our Targets or our progress toward these Targets, while still contributing to the global effort to address climate change.  We also made good faith assumptions and estimates in establishing our Targets. Although we believe these assumptions and estimates are reasonable, they may prove incorrect or inaccurate for reasons we cannot foresee or predict. These assumptions and estimates relate to, among other things, the growth, outlook, and strategy of our business, the ability of our portfolio companies to make changes, the feasibility of third-party decarbonization and energy transition scenarios, the development and availability of low-carbon technologies, economic and political trends, stakeholder participation, and the evolution of legal regimes and policies to address climate change. If any of these assumptions prove incorrect or inaccurate, we may be unable to achieve our Targets and we may need to revisit them.

To monitor and report on our progress toward our Targets, we rely on data obtained from our portfolio companies and other third-party sources. Although we believe these sources are reliable, we have not independently verified this data, or assessed the assumptions underlying such data, and cannot guarantee its accuracy or completeness. We also attempt to improve accuracy in the data through an independent limited assurance review.  The data may be of varying quality or usefulness and may change over time as Standards evolve. These factors could impact our Targets and our ability to achieve them.

SOURCE Ontario Teachers' Pension Plan