TORONTO, March 29, 2018 /CNW/ - Trez Capital Senior Mortgage Investment Corporation (TSX: TZS) (the "Company") today released its financial results for the year and quarter ended December 31, 2017. The financial statements and MD&A can be found at www.sedar.com or www.trezcapitalseniormic.com.
Financial Highlights & Business Update
On June 16, 2016 the shareholders of the Company approved the orderly wind-up of the Company ("Orderly Wind-Up"). As such, the financial results reflect the ongoing reduction in the size of the portfolio as capital is returned to shareholders.
Towards the objective of an Orderly Wind-Up, principal repayments or sold mortgages were $2.2 million for the quarter and $22.0 million for the year to December 31, 2017 ($22.0 million and $52.6 million for the comparable periods in 2016). All mortgages that have been sold have been done at par value. During the year, the Company paid return of capital distributions at the rate of $0.0485 per share monthly until November 2017. The total of all such distributions including special distributions is $28.7 million for the year to December 31, 2017 ($19.4 million paid for the comparable period in 2016). In addition $0.7 million shares were repurchased in 2017 ($0.6 million in 2016).
For the three months ended December 31, 2017 losses from operations totaled $0.3 million compared to income from operations of $0.4 million in the same period in 2016. Net income and loss in the period were equal to income and loss from operations. Basic and diluted loss per share was $0.04 compared to income of $0.03 in the same period in 2016. Revenue declined by $0.3 million compared to the same period in 2016. The decrease was attributable to reduced mortgage interest of $0.3 million. This reduction resulted from a gradual decrease in the mortgage portfolio as a result of total cessation in mortgage funding activity as part of the Orderly Wind-Up of the Company.
For the year ended December 31, 2017 income from operations totaled $0.3 million compared to $1.0 million in the same period in 2016. Net income in the period was equal to income from operations. Basic and diluted income per share were $0.03 compared to $0.13 in the same period in 2016. Revenue declined by $2.0 million compared to the same period in 2016. The decrease was attributable to reduced mortgage interest of $2.0 million. This reduction resulted from a gradual decrease in the mortgage portfolio as a result of total cessation in mortgage funding activity as part of the Orderly Wind-Up of the Company.
At December 31, 2017, the Company had four mortgages remaining to be liquidated, down from 12 as at December 31, 2016. Of the four remaining mortgages expected to mature or be sold, two mortgages totaling $7.0 million will do so prior to the end of the year and the remaining two mortgages totaling $14.2 million in subsequent years.
Regular Monthly & Special Distributions
In Quarter 3, the Board made a decision to suspend regular monthly distributions until further notice. This decision was premised on a review of the last remaining mortgages and cash requirements. The Board anticipates making further special distributions as the mortgages in the portfolio mature or are sold, and subject to reasonable expected operating expenditures. As the wind-up of the Company progresses, it is expected that there will be some variance in the timing and quantum of special distributions.
Forward Looking Statements
Certain statements in this news release about Trez Capital Senior Mortgage Investment Corporation, and its business, operations, investments and strategies, and financial performance and condition may constitute forward-looking information, future oriented financial information, or financial outlooks (collectively, "forward looking statements"). The forward-looking statements are stated as of the date of this news release and are based on estimates and assumptions made by Trez Capital Fund Management Limited Partnership ("Trez") in light of its experience and perception of historical trends, current conditions and expected future developments, as well as other factors that Trez believes are appropriate and reasonable in the circumstances. There can be no assurance that such forward-looking statements will prove to be accurate, as actual results, performance and future events could differ materially from those anticipated in such statements. Past performance is not an indication of future returns, and there can be no guarantee that targeted returns or yields can be achieved. Trez refers you to the Company's public disclosure for information regarding these forward-looking statements, including the assumptions made in preparing forward-looking statements and management's expectations, and the risk factors that could cause the Company's actual results, yield, levels of activity, performance or achievements or future events or developments to differ materially from those expressed or implied by the forward-looking statements. Such public disclosure is available on SEDAR and at the request of Trez. This news release does not represent an offer or solicitation to sell securities of the Company.
About the Company
The Company holds a portfolio of mortgages in Canada. Trez Capital Fund Management Limited Partnership is the manager of and portfolio advisor to the Company. On June 16, 2016 the shareholders of the Company approved the Orderly Wind-Up of the Company. Under the Orderly Wind-Up plan the Company will distribute the net proceeds through special distributions, the repurchase of shares pursuant to the normal course issuer bid, or otherwise.
SOURCE Trez Capital Senior Mortgage Investment Corporation
For further information: Alexander Manson, Chief Executive Officer & Chief Financial Officer, Trez Capital, Tel: (604) 630-0775, E-mail: [email protected]