Abode Mortgage Holdings Corp.
TSX VENTURE : ABD

Abode Mortgage Holdings Corp.

April 17, 2008 20:03 ET

Abode Mortgage Holdings Corp. Reports 2nd Quarter 2008 Results

VANCOUVER, BRITISH COLUMBIA--(Marketwire - April 17, 2008) - Abode Mortgage Holdings Corp. (TSX VENTURE:ABD) announces its financial results for the second quarter ending February 29th, 2008. For the quarter, the company recorded a loss of $1,233,298 as compared to a loss of $1,170,857 in the prior year's quarter ended February 28th, 2007.

FINANCIAL HIGHLIGHTS

- Funded loans worth $10.7 million

- Securitized $34.9 million of loans

- Net revenues including gain on sale for the quarter, were $3.44 million

- Net expenses were $4.68 million

Mike Linehan, CEO of Abode Mortgage Holdings Corp., reports the following: "The overall disruption in the Canadian capital markets continued to provide many challenges for the Company. The increased costs of purchasing mortgage insurance on previously uninsured mortgages along with a widening of securitization sales spreads had an impact on earnings. In the latter half of the second quarter 2008 Abode also re-tooled its product line offerings and moved into the "A" residential mortgage distribution space. Operating expenses were maintained in anticipation of the traditional third and fourth quarter seasonal volume increases. Revenues were bolstered with securitization gains of a small portion of previously uninsured mortgages. Infrastructure costs were maintained to the same level as the 1st quarter of 2008. Abode funded $10.7 million in mortgages, and we completed $34.9 million of securitizations, a combination of new insured volume and previously uninsured mortgages during the quarter."

BUSINESS HIGHLIGHTS

- Launched new mortgage programs

- Launched "A" residential mortgage products

OUTLOOK

Mike Linehan, CEO of Abode Mortgage Corporation, continues the discussion with the following comments: "The change in distribution strategy for fiscal 2008 to move to insured mortgages will impact earnings in the short term. However, the benefit of this traditional market approach not only gives the Company access to a broader array of mortgage originations base, ultimately through brokers and their customers, but also access to an increased supply of capital market purchasers. Abode also moved into the "A" residential mortgage product space in the quarter and with this expanded line of business we ultimately provide more mortgage credit to more Canadians. The change in product lines, distribution strategy, and the company's recent Ontario expansion will improve origination volumes during the latter half of 2008 and into 2009."



Financial Information

Abode Mortgage Holdings Corp.
Consolidated Balance Sheets
As at February 29, 2008 and August 31, 2007

February 29, August 31,
2008 2007
(un-audited) (audited)
$ $

Assets

Cash and cash equivalents 1,140,034 1,646,080
Advances for mortgage loans 969,948 1,066,475
Mortgage loans 41,925,452 79,393,174
Accrued interest receivable 175,468 241,305
Prepaid expenses and deposits 740,372 1,274,228
Equipment 105,010 120,378
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45,056,284 83,741,640
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Liabilities

Credit facilities 41,160,837 78,561,414
Accounts payable and accrued liabilities 876,120 1,341,571
Debt 1,451,938 685,169
Interest rate swap 716,772 167,691
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44,205,667 80,755,845
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Shareholders' equity

Capital stock 14,216,040 13,636,439
Equity portion of convertible debt 128,025 65,757
Contributed surplus 407,802 635,426
Deficit (13,901,250) (11,351,827)
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850,617 2,985,795
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45,056,284 83,741,640
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Approved on behalf of the Board of Directors

/s/ "David G. Nelson" Director /s/ "Malcolm Clay" Director
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David G. Nelson Malcolm Clay


Abode Mortgage Holdings Corp.
Consolidated Statements of Operations and Deficit
For the Second Quarter Ended February 29, 2008 and February 28, 2007

Three Months Six Months
Ended February 29 Ended February 29
(unaudited) (unaudited)
2008 2007 2008 2007

Revenue

Fee income 975,757 22,900 2,326,205 22,900
Interest on mortgages held 961,277 - 2,381,238 -
Unrealised gains on
loans held for trading 441,344 - 441,344 -
Gain on sale of mortgages 1,056,555 - 1,194,575 -
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3,434,933 22,900 6,343,362 22,900
Origination and
financing expense (3,141,079) (46,746) (5,891,437) (46,746)
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293,854 (23,846) 451,925 (23,846)
Other income 10,217 23,933 18,149 229,109
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304,071 87 470,074 205,263

Expenses

General and
administrative 1,114,206 1,130,845 2,200,808 2,045,168
Non-recurring
development expense 373,623 - 739,309 -
Interest on debt 49,540 25,378 79,380 56,821
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Loss from continuing
operations (1,233,298) (1,156,136) (2,549,423) (1,896,726)
Other Items
Foreign exchange loss - (14,721) - (35,168)
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Loss for the period (1,233,298) (1,170,857) (2,549,423) (1,931,894)

Deficit - Beginning
of period (12,667,952) (5,648,247) (11,351,827) (4,887,210)
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Deficit - End of period (13,901,250) (6,819,104) (13,901,250) (6,819,104)
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Basic and diluted loss
per share (0.0107) (0.0116) (0.0223) (0.0193)
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Weighted average number
of shares outstanding 114,953,206 100,856,539 114,326,429 100,026,981
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Abode Mortgage Holdings Corp.
Consolidated Statements of Cash Flows
For the Second Quarter Ended February 29, 2008 and February 28, 2007

Three Months Six Months
Ended February 29 Ended February 29
(unaudited) (unaudited)
2008 2007 2008 2007
$ $ $ $

Operating activities:

Loss from continuing
operations (1,233,298) (1,170,857) (2,549,423) (1,931,894)

Items not affecting cash:

Amortization 7,683 7,931 15,368 15,368
Accretion on
convertible debt 10,896 4,666 19,794 15,166
Provision for credit
losses (50,390) - (42,999) -
Stock-based expense (17,819) - 170,073 -
Unrealised loss on
interest rate swap 541,771 - 549,081 -
Unrealised gains on
loans held for trading (441,344) - (441,344) -
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(1,182,501) (1,158,260) (2,279,450) (1,901,360)

Changes in non-cash
working capital items (1,224,790) (552,179) (145,448) (911,270)
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Net cash used in
operating activities (2,407,291) (1,710,439) (2,424,898) (2,812,630)

Financing activities:
Credit facility, net
of repayments (24,439,078) - (37,400,577) -
Advances for
mortgage loans (790,698) - 96,527 -
Proceeds from issue
of unsecured loan notes 875,000 - 875,000 -
Proceeds from share
issuance, net of costs 330,000 540,000 330,000 590,000
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Net cash provided by
financing activities (24,024,776) 540,000 (36,099,050) 590,000

Investing activities:
Net decrease in
mortgage loans 26,058,056 - 38,017,902 -
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Net cash used in
investing activities 26,058,056 - 38,017,902 -
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Decrease in cash and
cash equivalents (374,011) (1,170,439) (506,046) (2,222,630)

Cash and cash
equivalents - beginning
of period 1,514,045 3,898,663 1,646,080 4,950,854
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Cash and cash
equivalents - end of
period 1,140,034 2,728,224 1,140,034 2,728,224
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Supplementary cash
flow information:

Income taxes paid - 19,313 - 162,226
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Interest paid 934,513 20,712 2,219,889 41,655
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About Abode Mortgage Holdings Corp.

Abode Mortgage Holdings Corp. is a publicly traded company on the TSX Venture Exchange under the symbol ABD, and through its wholly owned subsidiary, Abode Mortgage Corporation, provides residential mortgage financing to Canadians in the markets we serve. Headquartered in Vancouver, Abode Mortgage Corporation is delivering a new standard of service excellence to the Canadian residential mortgage industry by providing simplified products, consistent underwriting decisions, competitive pricing and compensation programs. The company launched its lending operations in Western Canada and recently expanded into the Province of Ontario.

Forward-Looking Statements

Forward-looking statements in this document are based on current expectations and are subject to significant risks and uncertainties. Actual results may differ due to factors such as the competitive nature of the industry, the ability of Abode Mortgage to execute its growth strategy, and the reliance of Abode Mortgage on key personnel. Additional information identifying risks and uncertainties is contained the regulatory filings available on its website and at www.sedar.com.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

Contact Information