TORONTO, Nov. 14 /CNW/ - Chesswood Income Fund (the "Fund") (TSX:CHW.UN)
announced today its results for the third quarter of 2007, ended September 30,
2007. As the Fund commenced operations on May 10, 2006, comparative
information is only for a 226-day period and has not been presented.
The Fund's results for the third quarter of 2007 reflect an elevation in
charge-offs in its U.S portfolio. In conjunction with this elevation,
Chesswood recorded a non-cash goodwill impairment in this quarter of
$10.5 million, resulting in a Net Loss Before Non-Controlling Interest for the
third quarter and nine months of $7.9 million and $1.3 million respectively.
Net income before non-controlling interest for the three and nine months ended
September 30, 2007, prior to the impairment charge, was $2.6 million and
$9.2 million, respectively.
"We continue to remain disciplined in the face of loose credit standards
and pricing that does not reflect, in our opinion, the risk profile of the
market," said Barry Shafran, CEO of the Fund. "This discipline means that we
will not likely generate the growth we would like in the near term, while this
cycle runs its course. As we have discussed in prior quarters, chasing volume
in this environment is extremely risky."
"Notwithstanding the market environment, we are always working toward
broadening our broker base and the products we can offer as well as improving
our collections and recovery processes, while we watch for new opportunities
that we believe this business cycle will generate, as a correction unfolds,"
Financial Highlights For The Fund
(in CDN $000's, except Per Unit Amounts)
Three Mths Ended Nine Mths Ended
September 30, September 30,
Revenues $21,840 $65,930
Adjusted EBITDA $2,657 $9,067
Distributable Cash $2,246 $7,025
Distributions(1) $2,220 $6,960
Distributions Per Unit $0.2874 $0.8622
Distributions Per Unit Per Month $0.0958 $0.0958
Net income before goodwill impairment
and non-controlling interest $2,585 $9,194
Net Loss before Non-controlling Interest ($7,927) ($1,318)
(1) - includes dividends on 1,478,537 Class B and C shares of Chesswood
US Acquisition Co Ltd. and distributions on 7,040,558 Fund units.
Non GAAP Measures
References to Adjusted EBITDA and Distributable Cash are not recognized
measures under Canadian GAAP and do not have standard meanings under Canadian
GAAP. Accordingly, these measures may not be comparable to similar measures
presented by other issuers.
Please refer to Chesswood's Management Discussion and Analysis for the
period ended September 30, 2007 for additional information concerning these
measures and a reconciliation of these measures to the Fund's consolidated net
income for the period.
About Chesswood Income Fund
The Fund is a financial services trust with operating businesses in both
Canada and the U.S.
For more information visit www.ChesswoodFund.com.
This press release contains forward-looking statements that involve a
number of risks and uncertainties because they relate to events and depend on
circumstances that will occur in the future. Many factors could cause actual
results and developments to differ materially from those expressed or implied
by these forward-looking statements.
NO STOCK EXCHANGE, SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY
HAS APPROVED OR DISAPPROVED THE INFORMATION CONTAINED HEREIN.
For further information:
For further information: Barry Shafran, Chesswood Income Fund, (416)
386-3099, email@example.com; Catharine Marion (media only),
Environics Communications, Inc., (416) 969-2809, firstname.lastname@example.org