Pinetree Capital Ltd.
TSX : PNP

Pinetree Capital Ltd.

November 07, 2016 17:05 ET

Pinetree Capital Ltd. Announces Unaudited Financial Results for the Three and Nine Months Ended September 30, 2016, and Subsequent Information

TORONTO, ONTARIO--(Marketwired - Nov. 7, 2016) - Pinetree Capital Ltd. (TSX:PNP) ("Pinetree" or the "Company") today announced its financial results for the three and nine months ended September 30, 2016, an investment portfolio update and the appointment of a Chief Operating Officer. All financial information provided in this press release is unaudited and all figures are in $'000 except per share amounts and shares outstanding.

Unaudited financial results for the three and nine months ended September 30, 2016

The following information should be read in conjunction with the Company's Unaudited Condensed Consolidated Interim Financial Statements for the three and nine months ended September 30, 2016 and the accompanying notes, our Management Discussion and Analysis for the three and nine months ended September 30, 2016, and with our annual Consolidated Financial Statements, prepared in accordance with International Financial Reporting Standards ("IFRS") and our annual Management Discussion and Analysis for the year ended December 31, 2015, which can be found on SEDAR at www.sedar.com.

Selected Financial Information

Three months ended Nine months ended
Sept. 30, 2016 Sept. 30, 2015 Sept. 30, 2016 Sept. 30, 2015
Net investment (loss) (856) (12,337) (11,174) (17,994)
Net (loss) for the period (865) (14,419) (14,263) (26,293)
Total expenses 274 3,216 3,520 9,836
(Loss) per share - basic & fully diluted (0.19) (7.14) (4.05) (13.02)
As at Sept. 30, 2016 As at Dec 31, 2015
Total assets 11,870 30,468
Total liabilities 389 10,966
Net asset value 11,481 19,502
Shares outstanding 4,522,599 2,019,292
Net asset value per share - basicc $2.54 $9.66
c Refer to Non-IFRS Measures section of this press release

Third Quarter Financial Results

The net investment loss for the three months ended September 30, 2016 was $856 (three months ended September 30, 2015 - $12,337) as a result of net realized losses of $5,117 plus a net change in unrealized gains of $4,261 on investments.

For the three months ended September 30, 2016, the Company had a net change in unrealized gain on investments of $4,261 as compared to a net change in unrealized loss of $12,217 for the three months ended September 30, 2015.

The net investment loss for the nine months ended September 30, 2016 was $11,174 (nine months ended September 30, 2015 - net investment loss of $17,994) as a result of net realized losses plus a net change in unrealized (losses) gains on investments.

For the nine months ended September 30, 2016, the Company recorded net realized losses on disposal of investments of $14,959, as compared to $40,233 for the nine months ended September 30, 2015.

For the nine months ended September 30, 2016, the Company had a net change in unrealized gain on investments of $3,785 as compared to a net change in unrealized gain of $22,239 for the nine months ended September 30, 2015.

As at September 30, 2016, the Company held investments at fair value totaling $10,635 as compared to $27,864 as at December 31, 2015, a 62% decrease, attributable to two factors: (a) in order to generate cash to fund operations and repay the Debentures, the Company undertook dispositions of investments which generated cash proceeds of $7,855 during the nine months ended September 30, 2016; and (b) management's estimates of the fair values of the remaining investments in private companies based on the facts and circumstances which existed at September 30, 2016.

Subsequent Information

Management continuously reviews and assesses the fair market value of its portfolio investments in the ordinary course of the Company's business. As a result of certain information gathered by management subsequent to September 30, 2016 in respect of a private company in which the Company has a significant investment, management believes that the business prospects of such private company may have materially deteriorated. This company represented 31% of the fair market value of the Company's investment portfolio as at September 30, 2016. Management is continuing to gather information in order to assess this private company's ongoing business prospects and fair market value. Following this assessment by management, the Company may determine that the fair market value of this particular investment has been significantly and permanently impaired and will therefore adjust the recorded fair market value of this particular investment accordingly. Such an asset write-down may have a material adverse effect on the net asset value of the Company's overall investment portfolio.

Mr. Damien Leonard, B.Sc., has been appointed as Chief Operating Officer of Pinetree Capital Inc. Mr. Leonard has been the managing director of a Toronto based family office, since 2011. He has nine years of public markets investing experience in Canada, the United States and Europe. Mr. Leonard specializes in small-cap software company investing and special situation investing. Mr. Leonard holds an honours degree in Physical Science with a major in Physics from the University of Guelph.

Forward Looking Statements

Certain statements herein may be "forward looking" statements that involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Pinetree or the industry to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors could cause actual results to vary significantly from the results discussed in the forward-looking statements. These forward-looking statements reflect current assumptions and expectations regarding future events and operating performance and are made as of the date hereof and Pinetree assumes no obligation, except as required by law, to update any forward-looking statements to reflect new events or circumstances.

Non-IFRS Measures, Non-GAAP Measures

NAV (net asset value per share) is a non-IFRS (international financial reporting standards) measure calculated as the value of total assets less the value of total liabilities divided by the total number of common shares outstanding as at a specific date. The term NAV does not have any standardized meaning according to IFRS and therefore may not be comparable to similar measures presented by other companies. There is no comparable IFRS measure presented in Pinetree's consolidated financial statements and thus no applicable quantitative reconciliation for such non-IFRS financial measure. The Company has calculated NAV consistently for many years and believes that NAV can provide information useful to its shareholders in understanding its performance and may assist in the evaluation of its business relative to that of its peers.

About Pinetree Capital Ltd.

Pinetree is a diversified investment and merchant banking firm focused on the small cap market, with early stage investments in technology, resource and biotechnology companies. Pinetree's common shares are listed on the Toronto Stock Exchange (TSX) under the symbol "PNP".

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