Mass Financial Corp. Reports Results for the First Half 2008



    
    - Return on Shareholders' Equity for Six Months of 25% -

    
    HONG KONG, Sept. 15 /CNW/ -- Mass Financial Corp. ("MFC") (Pink Sheets:  
MFCAF) today reported its financial results for the six months ended June 30,
2008.  All figures are in U.S. dollars.
    For the six months ended June 30, 2008, MFC reported total revenues of
$305.9 million with net income attributable to shareholders of $25.6 million
or $1.12 per diluted share, compared to total revenues of $265.9 million with
net income attributable to shareholders of $34.0 million or $1.46 per diluted
share for the first six months of 2007.
    At June 30, 2008, the Company had $287.8 million in cash and securities,
our working capital ratio was 2.49, and the long-term debt-to-shareholders'
equity ratio was 0.51. Return on shareholders' equity (not annualized) was 25
percent. In comparison, the S&P 500 returned negative 15 percent in this
period. Equity per common share increased to $6.97, a 163 percent increase in
two years.
    President Michael Smith, commented, "With this second half of 2008, we
see a strong year developing. MFC is in its third year since becoming an
independent company. We have kept focus on redefining our corporate objective
of fully capitalizing on our industry knowledge and striving for greater
growth and diversification.
    Our commodities business along with our large number of related contacts
has enabled us to gain greater product, service diversification and find new
markets. This business should not be viewed as a commodities business but as a
risk business with suppliers and purchasers.
    We are pleased to report almost 60 percent of our trading revenues are
derived from term marketing and distribution agreements for non-ferrous metals
and other products. Some of the investments we make in commodity producers are
part of our proprietary investing strategy. Our first shipment from our Indian
iron ore reserves has been completed and we anticipate additional shipments
after the rain season at the end of this year.
    With the downturn in the global economy, opportunities are becoming more
visible. Valuations of several, what started to be, complementary projects
have been coming closer to much more sensible levels and start to be at a real
discount to net tangible asset value. We will, however, maintain our strict
level of discipline in assessing these risks."
    Mr. Smith continued, "It is now time to start creating market awareness
and liquidity for our shareholders. One of the very first steps is to complete
the process of listing our common shares on the Vienna Stock Exchange. This
will only be an initial start to creating liquidity for our common shares
since our spin-out in 2006 as an independent company and marks an important
phase in enhancing shareholder value.
    The effectiveness of our strategy demands constant review and attention
in order for MFC to reflect our commitment to developing wealth for our
shareholders."
    
    About the Company:
    
    Mass Financial Corp's merchant banking business encompasses a broad
spectrum of activities related to the integrated combination of banking,
trading of commodities and natural resources, financing of commercial trade,
and proprietary investing. To obtain further information, please visit our
website at http://www.massfinancialcorp.com

    
     North America Contact:  Rene Randall
                             Tel: 1 (604) 408 8538
                             Fax: 1 (604) 683 3205
                             Email: rrandall@bmgmt.com
    



    
                             MASS FINANCIAL CORP.
                         CONSOLIDATED BALANCE SHEETS
                     June 30, 2008 and December 31, 2007
                                 (unaudited)
                         (U.S. Dollars in Thousands)
    

    
    ASSETS                                             2008            2007
    

    
    Current Assets
    

    
      Cash and cash equivalents                      $262,910        $183,903
      Securities                                       24,856          45,984
      Restricted cash                                   2,161               0
      Loans                                             2,878           1,992
      Trade and other receivables                      43,085          37,053
      Inventories                                      42,654          43,907
      Real estate held for resale                      22,578               0
      Tax receivables                                     246           1,051
      Prepaid and other                                 2,004           1,366
                                                      403,372         315,256
    

    
    Non-current Assets
    

    
      Securities                                        6,041           5,989
      Securities, restricted                            9,357           9,357
      Loans                                             5,645          11,869
      Receivables                                         942             972
      Property, plant and equipment                     3,042             992
      Investment property                              16,998               0
      Goodwill                                          5,158           4,754
      Deferred tax assets                                 589             368
      Equity method investments                         6,018           6,019
                                                       53,790          40,320
    

    
                                                     $457,162        $355,576
    



    
                             MASS FINANCIAL CORP.
                     CONSOLIDATED BALANCE SHEETS (con't)
                     June 30, 2008 and December 31, 2007
                                 (unaudited)
                         (U.S. Dollars in Thousands)
    

    
                                                        2008            2007
    LIABILITIES
    

    
    Current Liabilities
    

    
      Financial liabilities                           $90,960         $85,185
      Trade and other payables and accrued expenses    67,913          56,716
      Provision for warranty                              235               0
      Income tax liabilities                            1,796           1,423
      Long-term debt, current portion                   1,323               0
                                                      162,227         143,324
    

    
    Long-term Liabilities
    

    
      Long-term debt, less current portion             60,902          28,068
      Financial liabilities                             9,357           9,357
      Deferred tax liabilities                            462             154
      Liabilities, preferred shares                    89,207          91,956
      Due to an affiliate                               1,143               0
      Other non-current liabilities                       115               0
                                                      161,186         129,535
    

    
                       Total Liabilities              323,413         272,859
    

    
    EQUITY
    

    
    Shareholders' Equity
    

    
      Common stock                                     14,291           2,591
      Equity component of convertible debt              1,000           1,000
      Other reserves                                     (844)        (11,592)
      Retained earnings                               110,932          89,584
                                                      125,379          81,583
      Less: Treasury stock                             (6,568)              0
      Total shareholders' equity                      118,811          81,583
    

    
    Minority Interests                                 14,938           1,134
      Total Equity                                    133,749          82,717
    

    
                                                     $457,162        $355,576
    



    
                             MASS FINANCIAL CORP.
                      CONSOLIDATED STATEMENTS OF INCOME
               For the Six Months Ended June 30, 2008 and 2007
                                 (unaudited)
              (U.S. Dollars in Thousands, Except per Share Data)
    

    
                                                        2008           2007
    

    
    Revenues from sales, services and other          $303,699        $264,083
    Shares of the results of associates and
     joint ventures                                     2,181           1,780
       Total revenues                                 305,880         265,863
    

    
    Expenses
      Cost of sales                                   250,438         207,666
      General and administrative                       14,230          17,293
      Interest                                          9,075           6,526
      Other                                             3,278             491
                                                      277,021         231,976
    

    
    Operating profit                                   28,859          33,887
    

    
    Other items:
      Currency transaction gain                         1,550           1,004
      Goodwill impairment                              (1,121)              0
    

    
    Profit before income taxes                         29,288          34,891
    Provision for income taxes                         (1,057)           (315)
    Profit after taxes                                $28,231         $34,576
    

    
    Attributable to:
    Shareholders of Mass Financial Corp.               25,644          34,017
    Minority interests                                  2,587             559
    

    
                                                      $28,231         $34,576
    

    
    Earnings per share
      basic                                             $1.50           $2.00
      diluted                                           $1.12           $1.46
    


    
    Weighted average shares outstanding -
     basic                                         17,044,229      17,044,229
    Weighted average shares outstanding -
     diluted                                       23,010,816      23,309,893
    



    
                             MASS FINANCIAL CORP.
                              FINANCIAL SUMMARY
        (U.S. Dollars in Thousands, Except per Share Data and Ratios)
    

    
                                      2008         2007             2006
                                       (1)          (4)              (4)
    


    
    Cash                             262,910      183,903           99,078
    

    
    Securities                        24,856       45,984           36,787
    

    
    Current Assets                   403,372      315,256          195,462
    

    
    Total Assets                     457,162      355,576          230,437
    

    
    Current Liabilities              162,227      143,324           91,280
    

    
    Working Capital                  241,145      171,932          104,182
    

    
    Current Ratio                       2.49         2.20             2.14
    

    
    Long-Term Debt, less current
     portion                          60,902       28,068            4,710
    

    
    Long-Term Debt-to- Shareholders'
     Equity                             0.51         0.34             0.10
    

    
    Debt - Preferred Shares (2)       89,207       91,956           77,976
    

    
    Total Liabilities                323,413      272,859          183,491
    

    
    Shareholders' Equity             118,811       81,583           45,131
    

    
    Return on Shareholders'
     Equity                            25%(3)          77%              40%
    

    
    Equity Per Common Share             6.97         4.79             2.65
    


    
    Notes:
      (1) Unaudited figures for the six months ended June 30, 2008.
      (2) On our opening balance sheet of 2005, preferred shares are
          denominated in Canadian dollars.
      (3) Not annualized.
      (4) As of December 31st

    




For further information:

For further information: Rene Randall, +1-604-408-8538, fax
+1-604-683-3205, rrandall@bmgmt, for Mass Financial Corp. Web Site:
http://www.massfinancialcorp.com

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MASS FINANCIAL CORP.

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