Terra Firma Capital Corporation

TSX VENTURE : TII


Terra Firma Capital Corporation

May 21, 2014 17:00 ET

Terra Firma Capital Corporation Reports Results for the First Quarter Ended March 31, 2014

-- 62% Increase in Top Line Revenue Over Last Year

-- 100% Increase in Earnings Per Share Over Last Year

TORONTO, ONTARIO--(Marketwired - May 21, 2014) - All amounts are stated in Canadian dollars -

Terra Firma Capital Corporation (TSX VENTURE:TII) ("Terra Firma" or the "Company"), a real estate finance company, today released its financial results for the three months ended March 31, 2014.

FIRST QUARTER 2014 HIGHLIGHTS:

  • Total revenue in the first quarter is $2.7 million, an increase of $1.0 million or 62%, as compared to the same period in the prior year.

  • Net income and comprehensive income in the first quarter is $618,000, an increase of $353,000 or 133%, compared to the first quarter of 2013.

  • Earnings per share is $0.02 per basic and diluted share, compared to $0.01 per basic and diluted share, an increase of 100% from the same quarter in the prior year.

  • Total assets increased by 28% to $73.0 million from $57.1 million at March 31, 2013.

"I am pleased to report another strong quarter of growth as we begin 2014 on a solid footing," commented Y. Dov Meyer, President and Chief Executive Officer. "Loan originations for Q1 2014 and our current pipeline eclipse our investment activity for the same period last year. As a result we anticipate continued growth in revenue and earnings through the balance of 2014. I am encouraged that subsequent to quarter end, our capital markets initiatives resulted in analyst coverage on the company," concluded Mr. Meyer.

Results of operations - three months ended March 31, 2014

Net income in the first quarter ended March 31, 2014 was $618,000 or $0.02 per basic and diluted share, compared to $265,000, or $0.01 per basic and diluted share, in the first quarter ended March 31, 2013.

Interest and fee income for the first quarter ended March 31, 2014 aggregated $2.6 million, an increase of 65% over the $1.6 million in the same period in the previous year, and slightly down from the $3.0 million in the fourth quarter ended December 31, 2013 due to timing of certain income recorded in 2013. Interest and fees in the fourth quarter ended December 31, 2013 included prepayment penalty, which resulted a $92,000 increase in fee income.

Interest expense for the first quarter ended March 31, 2014 was $1.5 million, compared to $937,000 for the comparative period last year and $1.6 million for the fourth quarter ended December 31, 2013.The Company's loan and mortgage investments increased from $55.3 million at December 31, 2013 to $56.3 million at March 31, 2014, an increase of 2%. The total value of loan and mortgage investments originated in the first quarter ended March 31, 2014 was $9.4 million compared to $13.4 million originated in the first quarter ended March 31, 2013.The average interest rate in the mortgage portfolio at March 31, 2014 was 18.8% compared to 18.6% at December 31, 2013.

The Company's Management's Discussion & Analysis and Financial Statements as at and for the three months ended March 31, 2014 have been filed and are available on SEDAR (www.sedar.com).

About Terra Firma

Terra Firma is a full service, publicly traded real estate finance company that provides customized equity and debt solutions to the real estate industry. Our focus is to arrange and provide financing with flexible terms to property owners looking to improve or add to their existing real estate assets but who may be limited by conventional bank financing, as well as to invest in quality commercial and residential developments by proven real estate developers. Terra Firma offers a full spectrum of real estate financing under the guidance of strict corporate governance, clarity and transparency. For further information please visit Terra Firma's website at www.tfcc.ca.

The TSXV has neither approved nor disapproved the contents of this press release. The TSXV does not accept responsibility for the adequacy or accuracy of this press release.

This Press Release contains forwardlooking statements with respect matters concerning the business, operations, strategy and financial performance of Terra Firma. These statements generally can be identified by use of forward looking word such as "may", "will", "expects", "estimates", "anticipates", "intends", "believe" or "could" or the negative thereof or similar variations. The future business, operations and performance of Terra Firma could differ materially from those expressed or implied by such statements. Such forwardlooking statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Forwardlooking statements are based on a number of assumptions which may prove to be incorrect. Additional, important factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors, local real estate conditions, competition, changes in government regulation, dependence on tenants' financial conditions, interest rates, the availability of equity and debt financing, environmental and tax related matters, and reliance on key personnel. There can be no assurances that forwardlooking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forwardlooking statements. The cautionary statements qualify all forwardlooking statements attributable to Terra Firma and persons acting on its behalf. Unless otherwise stated, all forward looking statements speak only as of the date of this Press Release and Terra Firma has no obligation to update such statements except as required by law.

Terra Firma Capital Corporation
Consolidated Statements of Income and Comprehensive Income
For the three months ended March 31, 2014 and 2013
(Unaudited)
Three months ended
March 31,
2014
March 31,
2013
Revenue
Interest and fees $ 2,620,540 $ 1,586,215
Rental 115,437 107,096
2,735,977 1,693,311
Expenses
Property operating costs 42,076 47,615
General and administrative 354,517 367,163
Share based compensation 12,608 -
Interest 1,478,919 937,412
1,888,120 1,352,190
Income from operations before income taxes 847,857 341,121
Income taxes 229,648 75,776
Net income and comprehensive income $ 618,209 $ 265,345
Earnings per share
Basic $ 0.02 $ 0.01
Diluted $ 0.02 $ 0.01
Terra Firma Capital Corporation
Consolidated Statements of Financial Position
As at March 31, 2014 and December 31, 2013
March 31,
2014
December 31,
2013
Assets
Cash and cash equivalents $ 5,684,469 $ 7,721,115
Funds held in trust 486,336 383,526
Amounts receivable and prepaid expenses 1,844,161 1,661,352
Loan and mortgage investments 56,338,050 55,278,303
Investment properties 7,686,666 7,671,452
Portfolio investment 954,073 954,073
Total assets $ 72,993,755 $ 73,669,821
Liabilities
Accounts payable and accrued liabilities $ 1,678,788 $ 1,366,708
Provision for discontinued operations 290,155 321,490
Unearned income 372,145 472,924
Income taxes payable 182,576 82,375
Deferred income taxes 12,786 6,348
Loans and mortgages payable 44,968,242 46,569,921
Convertible debentures 10,133,265 10,125,074
Total liabilities 57,637,957 58,944,840
Shareholders' Equity
Share capital $ 10,795,790 $ 10,795,790
Contributed surplus 603,962 603,962
Retained earnings 3,756,046 3,125,229
Total shareholders' equity 15,155,798 14,524,981
Non-controlling interest 200,000 200,000
Total liabilities and Shareholders' Equity $ 72,993,755 $ 73,669,821

Contact Information

  • Terra Firma Capital Corporation
    Y. Dov Meyer
    President and Chief Executive Officer
    416.792.4709
    ydmeyer@tfcc.ca

    Spinnaker Capital Markets Inc.
    Ali Mahdavi
    Managing Partner
    416.962.3300
    am@spinnakercmi.com