Toronto Stock Exchange: MTG
TORONTO, Nov. 14, 2013 /CNW/ - Timbercreek Senior Mortgage Investment
Corporation (TSX: MTG) (the "Company") today announced its financial results for the
third quarter ended September 30, 2013 (the "Period").
Third Quarter Highlights
At a special shareholder meeting held on September 12th, Shareholders voted in favour of the transition (the "Transition") of
the Company from the Canadian securities regulatory regime for
investments funds to the regulatory regime for non-investment fund
reporting issuers. Over 50% of all shareholders participated in the
vote and 99.9% of the votes were voted in favour of the Transition.
The Transition took effect on September 13, 2013, while the final
conversion of the class shares to common shares will be completed on or
before November 30, 2013.
Net interest income up 73.4% to $7.4 million from $4.3 million.
Income from operations, less interest on credit facility, plus
Transition related costs is up 106% to $5.5 million from $2.7 million.
Net mortgage investments were up 43% year over year to $392.8 million
The Company advanced 13 new mortgage investments (Q3 2012 - 10) totaling
$47.4 million (Q3 2012 - $132.9 million), had additional advances on
existing mortgage and loan investments totaling $5.5 million (Q3 2012 -
$3.8 million) and received full repayments on 10 mortgage investments
(Q3 2012 - 4) and partial pay downs totaling $52.8 million (Q3 2012 -
$49.7 million), resulting in net mortgage investments of $392.8 million
(September 30, 2012 - $274.8 million) as at September 30, 2013.
The weighted average interest rate on the mortgage investments at
September 30, 2013 was slightly higher at 6.71% (December 31, 2012 -
The weighted average term to maturity as at September 30, 2013 is 2.4
years (December 31, 2012 - 3.1 years), well situated within the
portfolio's target maturity of 2 - 3 years. At Period end, 79.2% of
mortgage investments mature by December 31, 2015.
The portfolio continues to be well diversified across Canada's largest
provinces as follows: Ontario (59.7%), Quebec (16.8%), Alberta (11.9%)
and B.C. (6.6%)
The loan-to-value on the mortgage portfolio at September 30, 2013 was
45.1% (December 31, 2012 - 53.6%), well below the 70% loan-to-value
limit in the Company's asset allocation model.
During the Period, no mortgage investments were in default and as a
result management has determined that no provision for mortgage losses
is required for the Period.
"We continue to take a very conservative approach when it comes to
managing the Company and are focused primarily on lending against
properties where we are comfortable that there is adequate income to
service the debt - rather than land and construction," states Andrew
Jones, Managing Director, Debt Investments of Timbercreek Asset
Management Inc., the manager of the Company (the "Manager"). "With
100% of our portfolio focused in first mortgages, over 91% of mortgages
in the portfolio secured by income-producing properties and an average
loan-to-value across the portfolio of 45%, we feel the 60 cents per
year we are distributing represents a compelling yield on a
Q3 2013 Results
Net interest income earned by the Company in Q3 2013 was $7.4 million
(Q3 2012 - $4.3 million), an increase of $3.1 million, or 73.4%, from
the same period last year. The increase from the same period last year
is a result of fully deploying the equity raised from multiple equity
offerings throughout 2012 into mortgage investments.
The Company received non‐refundable lender fees of $0.6 million (Q3 2012
- $1.0 million) or 1.2% (Q3 2012 - 0.7%) of new mortgage investments
funded in Q3 2013.
Income from operations of $2.4 million were generated (Q3 2012 - $2.9
million) or per Class A, Class B, Class I and Class J share of $0.06,
$0.07, $0.05 and $0.10 (Q3 2012 - $0.09, nil, $0.11 and $0.10),
respectively. The income from operations in Q3 2013 has decreased from
Q3 2012, as the Company incurred a one-time cost of $3.7 million
relating to the Company's transition from the Canadian securities
regulatory regime for investment funds to the regulatory regime for
non-investment fund reporting issuers (the "Public Company Regime").
The Company paid dividends of $0.15 per Class A share for a total of
$5.5 million (Q3 2012 - $0.15; $4.6 million), $0.16 per Class B share
for a total of $0.04 million (Q3 2012 -nil; nil), $0.16 per Class I
share for a total of $0.08 million (Q3 2012 - $0.16; $0.06 million) and
$0.16 per Class J share for a total of $0.02 million (Q3 2012 - $0.16;
About the Company
The Company provides investors with an opportunity to receive attractive
yields by investing indirectly, through holding shares of the Company,
in mortgage loan investments, comprised of first mortgages, selected
and determined to be high quality by its manager, Timbercreek Asset
Management Inc. (the "Manager"). The investment objective of the
Company is, with a primary focus on capital preservation, to acquire
and maintain a diversified portfolio of mortgage investments that
generates attractive, stable returns in order to permit the Company to
pay monthly distributions to its shareholders.
The Company prepares and releases audited annual financial statements
and unaudited condensed consolidated interim 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 Management's Discussion and Analsysis ("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) or cash flows
from operating activities determined in accordance with IFRS as
indicators of the Company's performance.
SOURCE: Timbercreek Senior Mortgage Investment Corporation
For further information:
Timbercreek Asset Management Inc.