TSX Symbol FC
TORONTO, March 21, 2014 /CNW/ - Firm Capital Mortgage Investment
Corporation (the "Corporation") (TSX FC) today released its financial
statements for the three and twelve months ended December 31, 2013.
PROFIT & RETURN ON EQUITY
Profit for the fourth quarter ended December 31, 2013 increased by 8% to
$4,405,596 as compared to $4,071,325 for the same period last year.
For the year ended December 31, 2013, profit increased by 5% to
$17,607,877 as compared to $16,755,292 for the year ended December 31,
2012. Basic weighted average profit per share for the fourth quarter
ended December 31, 2013 was $0.237, which is lower in comparison to the
$0.243 reported for the fourth quarter ended December 31, 2012. Basic
weighted average profit per share for the year ended December 31, 2013
of $0.987 was slightly lower in comparison to the $0.999 for the year
ended December 31, 2012. The Corporation distributed 100% of its
profits for 2013.
Profit for the year ended December 31, 2013 represented an annualized
return on shareholders' equity (based on the month end average
shareholders' equity) of 9.63% versus a previously reported return on
shareholders' equity of 9.83% for the year ended December 31, 2012.
This return on shareholders' equity represents 864 basis points per
annum over the average Government of Canada One Year Treasury Bill
yield for the year of 0.99%, and is well in excess of the Corporation's
stated target yield objective of 400 basis points per annum over the
average one year treasury bill yield.
For the fourth quarter ended December 31, 2013, the Corporation declared
dividends totaling $5,111,513 or $0.282 per share versus $5,007,886 or
$0.288 per share for the fourth quarter ended December 31, 2012. The
fourth quarter 2013 dividend comprised of regular dividends of $0.234
per share and the year-end special dividend of $0.048 per share. For
the year ended December 31, 2013, the Corporation declared dividends
totaling $17,607,877 or $0.984 per share versus $16,755,292 or $0.990
per share for the year ended December 31, 2012.
INVESTMENT PORTFOLIO HIGHLIGHTS
Details on the Corporation's investment portfolio as at December 31,
2013 are as follows:
Total gross investment portfolio of $339,626,485, which is a 14%
increase over December 31, 2012.
Conventional first mortgages, being those first mortgages with loan to
values less than 75%, comprise 64% of our total portfolio, and total
conventional mortgages with loan to values under 75% comprise 73% of
our total portfolio.
Related investments total 17% of the portfolio.
Non-conventional mortgages total 9% of the portfolio.
Discounted debt investments total 1% of the portfolio.
Approximately 69% of the portfolio matures by December 31, 2014. This
results in a continuously revolving portfolio, allowing management to
assess market conditions.
The average face interest rate on the portfolio is 8.58% per annum.
Regionally, the portfolio is diversified approximately as follows:
Ontario (72%), Quebec (8%), Alberta (11%), British Columbia (4%) and
Gross investment portfolio breakdown by loan size is as follows:
$0 - $2,500,000
$2,500,001 - $5,000,000
$5,000,001 - $7,500,000
IMPAIRMENT PROVISION UPDATE
Management has always taken a proactive approach to allowance provision
reserves. This is a prudent approach to protecting our Shareholders'
equity. The impairment provision increased by $150,000 to $3,330,000 as
at December 31, 2013 and represents the total amount of management's
estimate of the shortfall between the investment portfolio principal
balances and the estimated net realizable recovery from the collateral
securing the loans. The impairment provision represents 1.0% of the
Investment portfolio balance.
UNRECOGNIZED INCOME COLLECTED
As at December 31, 2013, the Corporation has recorded as unearned income
on its books, banked non-refundable fee income of $653,191, which will
be recognized as income over the term of the corresponding investments.
DIVIDEND AND SHARE PURCHASE PLAN
The Corporation has in place a Dividend Reinvestment Plan (DRIP) and
Share Purchase Plan that is available to its Shareholders. The plans
allows participants to have their monthly cash dividends reinvested in
additional shares at a 2% discount to market and grants participants
the right to purchase, without commission, additional shares, up to a
maximum of $12,000 per annum.
For supplementary information regarding our return on equity, dividend
history and mortgage portfolio, please refer to the following link. http://40rhel5streamview01.newswire.ca/media/2014/03/21/20140321-745037-38241-2d559b13-85ca-4570-8969-f10f21829f2c.pdf
ABOUT THE CORPORATION
The Corporation, through its Mortgage Banker, Firm Capital Corporation,
is a non-bank lender providing residential and commercial short-term
bridge and conventional real estate financing, including construction,
mezzanine and equity investments. The Corporation's investment
objective is the preservation of Shareholders' equity, while providing
Shareholders with a stable stream of monthly dividends from
investments. The Corporation achieves its investment objectives by
pursuing a strategy of growth through investments in selected niche
markets that are under-serviced by large lending institutions. Lending
activities to date continue to develop a diversified mortgage
portfolio, producing a stable return to Shareholders. Full reports of
the financial results of the Corporation for the year are outlined in
the audited financial statements and the related management discussion
and analysis of Firm Capital, available on the SEDAR website at www.sedar.com. In addition, supplemental information is available on Firm Capital's
website at www.firmcapital.com.
This news release contains forward-looking statements within the meaning
of applicable securities laws including, among others, statements
concerning our objectives, our strategies to achieve those objectives,
our performance, our mortgage portfolio and our distributions, as well
as statements with respect to management's beliefs, estimates, and
intentions, and similar statements concerning anticipated future
events, results, circumstances, performance or expectations that are
not historical facts. Forward-looking statements generally can be
identified by the use of forward-looking terminology such as "outlook",
"objective", "may", "will", "expect", "intent", "estimate",
"anticipate", "believe", "should", "plans" or "continue" or similar
expressions suggesting future outcomes or events. Such forward-looking
statements reflect management's current beliefs and are based on
information currently available to management.
These statements are not guarantees of future performance and are based
on our estimates and assumptions that are subject to risks and
uncertainties, including those described in our Annual Information Form
under "Risk Factors" (a copy of which can be obtained at
www.sedar.com), which could cause our actual results and performance to
differ materially from the forward-looking statements contained in this
circular. Those risks and uncertainties include, among others, risks
associated with mortgage lending, dependence on the Corporation's
manager and mortgage banker, competition for mortgage lending, real
estate values, interest rate fluctuations, environmental matters,
shareholder liability and the introduction of new tax rules. Material
factors or assumptions that were applied in drawing a conclusion or
making an estimate set out in the forward-looking information include,
among others, that the Corporation is able to invest in mortgages at
rates consistent with rates historically achieved; adequate mortgage
investment opportunities are presented to the Corporation; and adequate
bank indebtedness and bank loans are available to the Corporation.
Although the forward-looking information continued in this new release
is based upon what management believes are reasonable assumptions,
there can be no assurance that actual results and performance will be
consistent with these forward-looking statements.
All forward-looking statements in this news release are qualified by
these cautionary statements. Except as required by applicable law, the
Corporation undertakes no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise.
PDF available at: http://stream1.newswire.ca/media/2014/03/21/20140321_C6569_DOC_EN_38241.pdf
SOURCE: Firm Capital Corporation
For further information:
Firm Capital Mortgage Investment Corporation
President & Chief Executive Officer