TORONTO, ONTARIO--(Marketwire - Nov. 10, 2011) - Wilmington Capital Management Inc. (TSX:WCM.A)(TSX:WCM.B) today announced a net loss for the three months ended September 30, 2011 of $35,000 compared to a net loss of $41,000 for the same period in 2010. The net loss per Class A and Class B share for the three months ended September 30, 2011 was $(0.00), compared to $(0.00) per share for the same period in 2010. For the nine months ended September 30, 2011, net income amounted to $20.2 million or $2.52 per share compared to a net loss of $33,000 or $(0.00) cents per share for the same period in 2010.
The Corporation has recently completed its 2011 strategic plan and has taken steps to broaden its investment strategy to include selective investments in the real estate as well as the energy sectors. The Corporation's principal objective will continue to be aimed at generating appreciation in value from its investments as opposed to current income. Accordingly, net income, excluding gains and losses from investment dispositions, is expected to be minimal in any given year.
On January 7, 2011, all of the issued and outstanding common shares of Parkbridge Lifestyle Communities Inc. were acquired by the British Columbia Investment Management Corporation for $7.30 in cash per common share. Pursuant to this transaction, Wilmington received $40.6 million in proceeds, realized a pre-tax gain of $23.6 million and repaid its $14.6 million loan payable facility relating to the Parkbridge shares.
In February, 2011, Wilmington acquired a 46.15% indirect interest in a portfolio of five self-storage facilities and two development properties in Alberta, British Columbia and Ontario through the Real Storage Private Trust (the "Trust"). The five operating properties are in the initial lease up stage and are expected to reach stabilized occupancy and cash flow in 2012. Wilmington's share of the cash consideration to complete the acquisition consisted of $2.5 million used to subscribe for additional equity in the Trust and a $1.625 million bridge loan to the Trust repayable upon demand and bearing interest at 7% per annum. The bridge loan and accrued interest have since been fully repaid with proceeds from the sale of one of the development properties. The Trust now owns 17 self-storage facilities comprising 645,978 square feet of rentable area and one development property.
On August 17, 2011, the Corporation acquired 50% of the issued and outstanding voting shares in NCI Management Ltd. ("NCI") for consideration consisting of 589,673 Class A shares issued by the Corporation. NCI is an investment company focused on private equity having a mandate to identify and invest in early stage opportunities in energy, energy services, real estate and special situations. Pursuant to the transaction the vendor retains control of day to day operations for a period of two years. During the third quarter of 2011, the Corporation loaned $25,000 to NCI by way of a non-interest bearing promissory note for working capital purposes. The loan is due on demand.
Wilmington also owns land leased to commercial property owners which is located at 370 Third Street in San Francisco, California. During the fourth quarter of 2010, Wilmington reorganized its investment in this property and entered into a new secured credit facility on which $1.6 million net is drawn, bears interest at 4% per annum and is repayable on January 1, 2013. At maturity this credit facility is payable, at the borrower's discretion, in cash or in shares of the Corporation's wholly owned subsidiary which owns the property.
Subsequent to the third quarter, the Corporation formed a partnership which acquired 100% working interest in certain petroleum and gas assets in the Shackleton Field in Saskatchewan. The aggregate cost of the assets including closing costs amounted to approximately 19.8 million and was funded by a combination of cash and debt. The Corporation's ownership interest in the partnership is 59% and its share of cash consideration to complete the acquisition amounted to $6.215 million which was used to subscribe for partnership units. In addition, the Corporation advanced approximately $800,000 to the partnership to fund short term capital needs of the partnership. The assets will be professionally managed by an entity in which the Corporation has a 51% ownership interest.
Beginning January 1, 2011, the Corporation has prepared its financial statements in accordance with IFRS. Accordingly, certain adjustments were made to comply with IFRS for the current and comparable periods.
| FINANCIAL HIGHLIGHTS | ||||||||||||
| As reported under International Financial Reporting Standards | ||||||||||||
| CONDENSED INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||
| Unaudited | Three months ended September 30 | Nine months ended September 30 | ||||||||||
| (Thousands of Canadian Dollars, except per share amounts) | 2011 | 2010 | 2011 | 2010 | ||||||||
| Income | ||||||||||||
| Investment and other income | $ | 72 | $ | 210 | $ | 233 | $ | 420 | ||||
| Income from investment property | 288 | 310 | 866 | 920 | ||||||||
| Foreign exchange gain | --- | 39 | --- | 28 | ||||||||
| 360 | 559 | 1,099 | 1,368 | |||||||||
| Expenses | ||||||||||||
| Interest | 293 | 448 | 872 | 1,128 | ||||||||
| General and administrative | 44 | 63 | 239 | 164 | ||||||||
| Foreign exchange loss | --- | --- | 59 | --- | ||||||||
| 412 | 511 | 1,170 | 1,292 | |||||||||
| Income (loss) before gain on sale, share of net loss from equity accounted investment and income tax expense (benefit) | (52 | ) | 48 | (71 | ) | 76 | ||||||
| Gain on sale of investment in Parkbridge Lifestyle Communities Inc. | --- | --- | 23,581 | --- | ||||||||
| Share of net loss from equity accounted investments | (25 | ) | (225 | ) | (229 | ) | (225 | ) | ||||
| Income (loss) before income taxes | (27 | ) | 177 | 23,281 | (149 | ) | ||||||
| Income tax expense (benefit) | 8 | (136 | ) | 3,075 | (116 | ) | ||||||
| Net Income (loss) | $ | (35 | ) | $ | (41 | ) | $ | 20,206 | $ | (33 | ) | |
| Net income (loss) per share - basic | $ | (0.00 | ) | $ | 0.00 | $ | 2.52 | $ | (0.00 | ) | ||
| Net income (loss) per share - diluted | $ | (0.00 | ) | $ | 0.00 | $ | 2.52 | $ | (0.00 | ) | ||
| CONDENSED INTERIM CONSOLIDATED BALANCE SHEET | ||||||
| Unaudited (Thousands of Canadian Dollars) |
September 30, 2011 | December 31, 2010 | January 1, 2010 | |||
| Assets | ||||||
| Non-current assets | ||||||
| Investment property | $ | 19,448 | $ | 18,507 | $ | 19,489 |
| Investment in associate | 7,104 | 4,819 | --- | |||
| Investment in Parkbridge Lifestyle Communities Inc. | 1,814 | 40,466 | 28,109 | |||
| Deferred tax asset | 51 | --- | --- | |||
| 28,417 | 63,792 | 47,598 | ||||
| Current assets | ||||||
| Loan to associate | 25 | --- | --- | |||
| Receivables and other assets | 79 | 67 | 56 | |||
| Cash and cash equivalents | 25,832 | 2,085 | 1,569 | |||
| 25,936 | 2,152 | 1,625 | ||||
| Total assets | $ | 54,353 | $ | 65,944 | $ | 49,223 |
| Liabilities | ||||||
| Non-current liabilities | ||||||
| Secured debt | $ | 19,937 | $ | 18,949 | $ | 19,962 |
| Loan payable | 1,639 | 16,103 | 10,501 | |||
| Deferred tax liabilities | --- | 3,431 | 1,933 | |||
| 21,576 | 38,483 | 32,396 | ||||
| Current liabilities | ||||||
| Accounts payable and accrued liabilities | 654 | 588 | 700 | |||
| Income taxes payable | 3,315 | --- | --- | |||
| 3,969 | 588 | 700 | ||||
| Total liabilities | 25,545 | 39,071 | 33,096 | |||
| Equity | ||||||
| Shareholders' equity | 28,808 | 26,873 | 16,127 | |||
| Total liabilities and equity | $ | 54,353 | $ | 65,944 | $ | 49,223 |
| CONDENSED INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) | |||||||||||
| Unaudited | Three months ended September 30 | Nine months ended June 30 | |||||||||
| (Thousands of Canadian Dollars) | 2011 | 2010 | 2011 | 2010 | |||||||
| Net income (loss) | $ | (35 | ) | $ | (41 | ) | $ | 20,206 | $ | (33 | ) |
| Foreign currency translation | 66 | (49 | ) | 30 | (32 | ) | |||||
| Reversal of the fair value increment of available for sale securities | --- | 2,338 | 23,414 | 2,950 | |||||||
| Future income taxes on above items | --- | (362 | ) | 3,285 | (481 | ) | |||||
| Other comprehensive income (loss) | 25 | 1,927 | 20,099 | 2,437 | |||||||
| Comprehensive income | $ | 56 | $ | 1,886 | $ | 107 | $ | 2,404 | |||
Executive Officers of the Corporation will be available at 403-800-0869 to answer any questions on the Corporation's financial results.
This news release contains forward-looking statements concerning the Corporation's business and operations. The Corporation cautions that, by their nature, forward-looking statements involve risk and uncertainty and the Corporation's actual results could differ materially from those expressed or implied in such statements. Reference should be made to the most recent Annual Information Form for a description of the major risk factors.
Contact Information:
Francis Cooke
Treasurer
(403) 800-0869