Timbercreek Mortgage Investment Corporation reports fourth quarter, year-end 2013 results

Consistently high turnover of a well-diversified portfolio continues to drive positive year-end results. 

Toronto Stock Exchange: TMC

TORONTO, March 6, 2014 /CNW/ - Timbercreek Mortgage Investment Corporation (TSX: TMC) (the "Company") today announced its financial results for the fourth quarter and year ended December 31, 2013.

Year End Highlights

  • The Company successfully completed its transition (the "Transition") from the Canadian securities regulatory regime for investment funds to the regulatory regime for non-investment fund reporting issuers.
  • As a result of the Transition, the Company exchanged all of the 32,829,013 outstanding Class A shares and 3,887,053 outstanding Class B shares on November 29, 2013 (the "Exchange Date") into a newly created class of common shares, continuing to trade on the TSX under the symbol 'TMC'.
  • Net interest income up 2.8% to $39.7 million from $38.7 million in 2012.
  • Income from operations, less interest on credit facility, plus costs related to the corporate transition and provision for mortgage and loan investments loss, is up 0.9% to $29 million.
  • Adjusted earnings per share for the year ended December 31, 2013 was $0.79
  • 69 new mortgage investments advanced (2012 - 51) totaling $198.7 million (2012 - $295.4 million), additional advances on existing mortgage investments of $42.6 million (2012 - $32.4 million), full repayments on 50 mortgage investments (2012 - 40) and partial pay downs totaling $283.1 million (2012 - $262.9 million), or a portfolio turnover of 79.76% (2012 - 80.07%).
  • Net mortgage investments were down 13.9% year over year to $317.2 million, mainly due to the one-time special redemption of Class A shares and the re-class of mortgage investments to foreclosed properties held for sale.
  • The Company foreclosed on two properties totalling $11.4 million.  As part of the foreclosed properties and mortgage investments, the Company recognized a loss provision of $2,150,000 (2012 - nil). This is only the first provision taken by the Company since formation in 2008 following advances totalling over $1.2 billion during this period.

Investment Portfolio Highlights

  • 61.1% (2012 - 48.5%) of portfolio in first mortgages.
  • Average loan-to-value of 61.7% (2012 - 69.5%), well below the 85% loan-to-value limit in the Company's Asset Allocation Model.
  • Weighted average interest rate on net mortgage and loan investments was 9.81% (2012 - 10.14%).
  • Lender fees received as a percentage of new mortgage and loan investments funded over the period was 1.83% (2012 - 1.71%)
  • Weighted average term to maturity of 2.2 years (2012 - 2.9 years), well within range of its 1.5 - 3.0 year target.
  • Well diversified portfolio across Canada's largest provinces: Ontario (51.4%), Quebec (13.7%), Alberta (12.6%) and B.C. (14.5%).

"Timbercreek Mortgage Investment Corporation enjoyed another strong year in 2013, with steady and growing distributable income," states Andrew Jones, CEO, Timbercreek Mortgage Investment Corporation.  "Our success is, and always has been, built on a strategy of providing shorter-duration, customized financing solutions secured by cash-flowing properties in and around urban markets.  Since our inception in 2008 and including this year, we have not incurred any impairments to principal, and we have consistently exceeded our targeted dividends to investors.  Following on these strong results, our Board of Directors approved a 6% increase to our dividend, increasing the monthly dividend to $0.067 for common shares."

Q4 Year End 2013 Results*

 
Results Year End December 31, 2013  Year End December 31, 2012
Distributable income  $30.2 million   $29.5 million 
Targeted dividend yield 6.61% 6.61%
Actual dividend yield 8.33% 7.68%
Payout ratio 96.92% 98.97%
Dividends per share:    
  Class A  $0.630   $0.780 
  Class B  $0.670   $0.828 
  Common shares  $0.134   - 
     
Net mortgage and loan investments  $317.2 million   $368.3 million 
Average mortgage and loan investment  $3.3 million   $4.8 million 
Weighted average interest rate 9.81% 10.14%
Average lender fee 1.83% 1.71%
Turnover ratio 79.76% 80.07%

 

About the Company

The Company provides investors with an opportunity to invest in a diversified portfolio of mortgage and loan investments originated and underwritten by its manager, Timbercreek Asset Management Inc. (the "Manager").  The Company focuses on capital preservation and the generation of attractive, stable returns, allowing for the payment of monthly dividends to shareholders.

*Non-IFRS Measures

The Company prepares and releases audited annual financial statements in accordance with IFRS. As a complement to results provided in accordance with IFRS, the Company discloses certain financial measures not recognized under IFRS and that do not have standard meanings prescribed by IFRS (collectively the "non-IFRS measures"). These non-IFRS measures are further described in the Management's Discussion and Analysis ("MD&A") available on SEDAR. The Company has presented such non-IFRS measures because the Manager believes they are relevant measures of the ability of the Company to earn and distribute cash dividends to investors and to evaluate the Company's performance. These non-IFRS measures should not be construed as alternatives to net income (loss) and comprehensive income (loss) or cash flows from operating activities determined in accordance with IFRS as indicators of the Company's performance.

SOURCE Timbercreek Mortgage Investment Corporation

For further information:

Timbercreek Asset Management Inc.
Carrie Morris
Investor Relations
416-800-1552
cmorris@timbercreek.com