Terra Firma Capital Corporation
TSX VENTURE : TII

Terra Firma Capital Corporation

April 14, 2014 16:30 ET

Terra Firma Capital Corporation Reports Stellar Results for the Year Ended December 31, 2013

All amounts are stated in Canadian dollars

TORONTO, ONTARIO--(Marketwired - April 14, 2014) - 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 and year ended December 31, 2013.

YEAR END 2013 HIGHLIGHTS:

  • Total revenue is $8.9 million, an increase of $3.4 million or 62%, compared to the last year.
  • Net income and comprehensive income is $1.7 million, an increase of $448,000 or 36%, compared to last year.
  • Total assets increased by 59% to $73.7 million from $46.4 million at December 31, 2012.

"I am excited to report another great quarter, capping of a truly extraordinary year for our Company. In 2013 we achieved significant expansion of Terra Firma on every front. I believe our ability to effectively originate, design and provide real estate loans increases our stature as a real estate lender in the market, one that has the ability to arrange and participate in financings secured by both high quality investment properties and commercial and residential real estate developments undertaken by proven developers," commented Y. Dov Meyer, President and Chief Executive Officer. "Looking ahead, we are optimistic about 2014 as our solid pipeline of loan originations and our transformative initiatives continue to enhance brand recognition and better positioning us to take full advantage of market opportunities. We are confident in our future and our ability to continue to improve on 2013 income and deliver capital appreciation to our shareholders," he further said.

Results of operations - year ended December 31, 2013

Net income and comprehensive income for the year ended December 31, 2013 was $1.7 million or $0.06 per basic share and $0.05 diluted share, compared to $1.3 million, or $0.04 per basic and diluted share, in the last year. General and administrative expenses for the year ended December 31, 2013 increased to $1.5 million, compared to $539,000 for the last year.

Interest and fee income for the year ended December 31, 2013 aggregated $8.5 million, an increase of 64% over the $5.2 million in previous year.

Interest expense for the year ended December 31, 2013 was $4.7 million, compared to $2.6 million for the year ended December 31, 2012. The increase in interest expense represents the growth of the Company's business and the increase in syndication capital to fund the investment activities.

The Company's loan and mortgage investments increased from $32.0 million at December 31, 2012 to $55.3 million at December 31, 2013, an increase of 73%. The weighted average effective interest rate in the mortgage investment portfolio at December 31, 2013 was 18.6% compared to 19.9% at December 31, 2012.

The Company's Management's Discussion & Analysis and Financial Statements as at and for the three months and year ended December 31, 2013 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 and years ended December 31, 2013 and 2012
(Unaudited)
Three months ended Twelve months ended
December 31,
2013
December 31,
2012
December 31,
2013
December 31,
2012
Revenue
Interest and fees $ 2,964,227 $ 1,897,945 $ 8,454,163 $ 5,156,665
Rental 115,419 195,113 451,335 343,958
3,079,646 2,093,058 8,905,498 5,500,623
Expenses
Property operating costs 35,441 76,623 287,078 129,186
General and administrative 382,940 134,629 1,476,156 538,978
Share based compensation (2,649 ) 15,369 39,208 216,840
Interest 1,585,753 888,303 4,742,023 2,569,006
Fair value adjustment - investment properties 78,287 - 78,287 -
2,079,772 1,114,924 6,622,752 3,454,010
Income from operations before income taxes 999,874 978,134 2,282,746 2,046,613
Income taxes 251,848 249,445 582,919 562,320
Income from continuing operations 748,026 728,689 1,699,827 1,484,293
Loss from discontinued operations - (232,313 ) - (232,313 )
Net income and comprehensive income $ 748,026 $ 496,376 $ 1,699,827 $ 1,251,980
Earnings per share
Basic $ 0.03 $ 0.01 $ 0.06 $ 0.04
Diluted $ 0.02 $ 0.01 $ 0.05 $ 0.04
Terra Firma Capital Corporation
Consolidated Statements of Financial Position
As at December 31, 2013 and 2012
December 31,
2013
December 31,
2012
Assets
Cash and cash equivalents $ 7,721,115 $ 3,223,291
Funds held in trust 383,526 -
Amounts receivable and prepaid expenses 1,661,352 2,396,180
Loan and mortgage investments 55,278,303 31,996,731
Investment properties 7,671,452 7,834,576
Portfolio investment 954,073 950,000
Total assets $ 73,669,821 $ 46,400,778
Liabilities
Accounts payable and accrued liabilities $ 1,366,708 $ 1,192,616
Provision for discontinued operations 321,490 445,957
Unearned income 472,924 16,965
Income taxes payable 82,375 474,297
Deferred income taxes 6,348 15,602
Loans and mortgages payable 46,569,921 21,406,070
Convertible debentures 10,125,074 10,093,325
Total liabilities 58,944,840 33,644,832
Shareholders' Equity
Share capital $ 10,795,790 $ 10,757,405
Contributed surplus 603,962 573,139
Retained earnings 3,125,229 1,425,402
Total shareholders' equity 14,524,981 12,755,946
Non-controlling interest 200,000 -
Total liabilities and Shareholders' Equity $ 73,669,821 $ 46,400,778

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