Partners Value Fund

TSX VENTURE : PVF


May 23, 2014 16:31 ET

Partners Value Fund Inc. Announces 2014 First Quarter Results

TORONTO, ONTARIO--(Marketwired - May 23, 2014) - Partners Value Fund Inc. ("Partners Value Fund" or the "Company") (TSX VENTURE:PVF) today announced its financial results for the first quarter March 31, 2014.

Partners Value Fund recorded net income of $15 million ($0.20 per common share) for the three months ended March 31, 2014 compared to $9 million ($0.12 per common share) in the prior year period. The increase in net income was primarily the result of increased dividend income associated with the Company's investment in Brookfield Asset Management Inc. and other securities investment portfolios.

Consolidated Statements of Operations
Three months ended March 31
(thousands) 2014 2013
Investment income
Dividends and interest $ 15,416 $ 9,221
Other investment income (loss) 490 2,445
15,906 11,666
Less:
Operating expenses 491 253
Retractable preferred share dividends 6,989 6,494
8,426 4,919
Other items:
Equity accounted income 8,013 5,358
Amortization of deferred financing costs (447 ) (372 )
Income tax expense (1,281 ) (1,138 )
Net income $ 14,711 $ 8,767

Financial Profile and Net Book Value

The Company's principal investment is its interest in 56 million Class A Limited Voting Shares ("Class A Shares") of Brookfield Asset Management Inc. ("Brookfield"), representing 7.6 Brookfield Class A Shares for every 10 common shares of Partners Value Fund.

The net book value of the Company's common shares as at March 31, 2014, was equal to $28.09 per share compared to $21.51 in the prior period. The increase in net book value of $2.73 per share was mainly due to the increase in the market price of Brookfield's Class A Shares held, which was $44.88 per share as of March 31, 2014. The information in the following table shows the changes in net book value for the three months ended March 31:

2014 2013
(Thousands, except per share amounts) Total Per Share Total Per Share
Net book value, beginning of period(1) $ 1,881,555 $ 25.36 $ 1,534,746 $ 20.68
Net income(2) 14,711 0.20 8,767 0.12
Other comprehensive income(2) 188,213 2.53 52,719 0.71
Net book value, end of period(1,3) $ 2,084,479 $ 28.09 $ 1,596,232 $ 21.51

Notes:

  1. Net book value per common share is a non‐IFRS measure.
  2. The weighted average number of common shares outstanding during the three months ended March 31, 2014 was 74,206,510 (March 31, 2013 - 74,206,510).
  3. As of March 31, 201,4 there were 74,206,510 (March 31, 2013 - 74,206,510) voting and non‐voting common shares of the Company issued and outstanding on a fully diluted basis.

The information in the following table has been extracted from the Company's statement of financial position:

Statement of Financial Position
(Thousands, except per share amounts) March 31, 2014 December 31, 2013
Assets
Investment in Brookfield Asset Management Inc.(1) $ 2,523,433 $ 2,310,897
Other securities 365,849 354,180
Cash and cash equivalents 12,902 5,102
Accounts receivable and other 3,062 2,083
$ 2,905,246 $ 2,672,262
Liabilities and Shareholders' Equity
Accounts payable and other $ 5,218 $ 5,196
Retractable preferred shares (2) 537,774 537,531
Deferred taxes (3) 277,775 247,980
820,767 790,707
Shareholders' equity
Common equity 2,084,479 1,881,555
$ 2,905,246 $ 2,672,262
Net book value per common share (4, 5) $ 28.09 $ 25.36

Notes:

  1. The investment in Brookfield Asset Management Inc. consists of 56 million Class A Shares at a bid price of $44.88 as at March 31, 2014 (December 31, 2013 ‐ $41.10).
  2. Represents $542 million retractable preferred shares less $4 million of unamortized issue costs.
  3. The deferred tax liability represents the potential future income tax liability of the Company recorded for accounting purposes based on the difference between the carrying values of the Company's assets and liabilities and their respective tax values, as well as giving effect to estimated capital and non‐capital losses as at the date of this statement.
  4. As at March 31, 2014, there were 74,206,510 (December 31, 2014 - 74,206,510) voting and non‐voting common shares of the Company issued and outstanding on a fully diluted basis.
  5. Net book value per common share is a non‐IFRS measure.

Note: This news release contains "forward‐looking information" within the meaning of Canadian provincial securities laws and "forward‐looking statements" within the meaning of applicable Canadian securities regulations. The words "potential" and "estimated" and other expressions which are predictions of or indicate future events, trends or prospects and which do not relate to historical matters, identify forward‐looking information. Forward‐looking information in this news release includes statements with regard to the Company's potential future income taxes.

Although the Company believes that its anticipated future results, performance or achievements expressed or implied by the forward‐looking statements and information are based upon reasonable assumptions and expectations, the reader should not place undue reliance on forward‐looking statements and information because they involve known and unknown risks, uncertainties and other factors, many of which are beyond its control, which may cause the actual results, performance or achievements of the Company to differ materially from anticipated future results, performance or achievement expressed or implied by such forward‐looking statements and information.

Factors that could cause actual results to differ materially from those contemplated or implied by forward‐looking statements and information include, but are not limited to: the financial performance of Brookfield Asset Management Inc., the impact or unanticipated impact of general economic, political and market factors; the behavior of financial markets, including fluctuations in interest and foreign exchanges rates; global equity and capital markets and the availability of equity and debt financing and refinancing within these markets; strategic actions including dispositions; changes in accounting policies and methods used to report financial condition (including uncertainties associated with critical accounting assumptions and estimates); the effect of applying future accounting changes; business competition; operational and reputational risks; technological change; changes in government regulation and legislation; changes in tax laws, catastrophic events, such as earthquakes and hurricanes; the possible impact of international conflicts and other developments including terrorist acts; and other risks and factors detailed from time to time in the Company's documents filed with the securities regulators in Canada.

The Company cautions that the foregoing list of important factors that may affect future results is not exhaustive. When relying on the Company's forward‐looking statements and information, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward‐looking statements and information, whether written or oral, that may be as a result of new information, future events or otherwise.

Contact Information

  • Partners Value Fund Inc.
    Edward C. Kress
    President
    (416) 956-5140