TORONTO, Feb. 28, 2012 /CNW/ - Coventree Inc. ("Coventree" or the "Company") today announced its financial results for the three months ended December 31, 2011. Coventree's unaudited consolidated financial statements for the three months ended December 31, 2011 are the Company's first financial statements prepared using International Financial Reporting Standards ("IFRS"). All amounts are reported in Canadian dollars.
Coventree's net loss for the three months ended December 31, 2011 was $2.4 million, compared to a net loss of $2.7 million for the same period in the previous fiscal year. For the three months ended December 31, 2011, there was a $0.6 million unrealized pre-tax gain on its investment in shares of Xceed Mortgage Corporation compared to an unrealized pre-tax loss of $0.6 million for the same period in the previous fiscal year. As a result, Coventree's comprehensive loss for the three months ended December 31, 2011 was $1.8 million compared to a comprehensive loss of $3.3 million for the same period in the previous fiscal year.
Total revenue for the three months ended December 31, 2011 was $0.3 million, which was the same as that for the comparable period in the previous fiscal year. The Company's primary source of revenue was interest income earned on cash and cash equivalents.
Operating expenses for the three months ended December 31, 2011 were $2.6 million compared to $3.0 million for the same period in the previous year. This decrease is mainly the net result of a decrease in consulting and legal fees related to the Ontario Securities Commission ("OSC") proceeding of $0.5 million, as the OSC hearing on the merits concluded during the three months ended December 31, 2010 and the sanctions hearing took place during the three months ended December 31, 2011. Consulting and legal fees related to the OSC proceeding for the three months ended December 31, 2011 were $2.1 million, compared to $2.6 million in the previous year.
As at December 31, 2011, the Company had cash and cash equivalents of $67.0 million, or approximately $4.42 per share. As at that date, the Company's book value per share was approximately $4.56 per share.
The Company's Management Discussion and Analysis and unaudited consolidated financial statements for the three months ended December 31, 2011 will be available on the Liquidator's website at www.duffandphelps.com/restructuringcases, the Company's website at www.coventree.ca and on SEDAR at www.sedar.com.
The Company is in the process of winding up. The winding up commenced and became effective on February 15, 2012. On that date, the board of directors of the Company was deemed to have resigned, and Duff & Phelps Canada Restructuring Inc. was appointed the liquidator of the Company (the "Liquidator") for the purpose of winding up its affairs. In addition, Wes Voorheis and Geoff Cornish became inspectors of the Company's liquidation, although subsequently Mr. Cornish resigned and William Aziz and Joseph Wiley were appointed as inspectors. On February 15, 2012, the Liquidator applied to the Ontario Superior Court of Justice - Commercial List (the "Court") to have the winding up supervised by the Court and to seek the Court's approval to establish a process for the identification, resolution and barring of claims against the Company, its subsidiaries and their respective directors and officers, both past and present. The Court issued both a winding-up order and a claims procedure order. Pursuant to the claims procedure order, the date by which all claims against the Company must be filed is April 13, 2012. Following the completion of the claims process, the Liquidator intends to make an initial interim distribution to shareholders.
Coventree's common shares were delisted from NEX once the winding up commenced. As a result, February 14, 2012 was the final day for trading in Coventree's common shares on NEX. On and after February 15, 2012, all transfers in Coventree's common shares are void unless made with the explicit prior sanction of the Liquidator. The Liquidator will not sanction any share transfers unless, in the opinion of the Liquidator, material extenuating circumstances exist. Notwithstanding the foregoing, the Liquidator maintains and reserves the right not to sanction any share transfer regardless of the circumstances.
This press release includes certain forward-looking statements relating to the Company's expectations to implement a formal winding up of the Company. These statements can be identified by the expressions "will", "expects" and "intends". These forward-looking statements are not historical facts but reflect Coventree's current expectations regarding future events based on information currently available to Coventree.
These forward-looking statements are subject to a number of known and unknown risks, uncertainties and assumptions which may be substantial. Many factors could cause actual results or events to differ materially from current expectations that may be expressed or implied by such forward-looking statements, including, without limitation, the various matters discussed under "Risks and Uncertainties" contained on pages 11 to 12 of the Company's Management Discussion and Analysis for the three months ended December 31, 2011 which is available under the Company's profile on SEDAR at www.sedar.com. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, the amount of funds available to be distributed to shareholders pursuant to such a winding up could be significantly reduced and/or the timing of the distribution of such funds could be significantly delayed. These factors should be considered carefully and prospective investors should not place undue reliance on the forward-looking statements. These forward-looking statements are made as of the date of this press release and Coventree does not intend, and does not assume any obligation, to update or revise these forward-looking statements, except as required by law.
This press release is intended for distribution in Canada only.
For further information:
Duff & Phelps Canada Limited
Tel: (416) 932-6225
Email: [email protected]