Wilmington Capital Management Inc.
TSX : WCM.A
TSX : WCM.B

Wilmington Capital Management Inc.

August 09, 2012 20:00 ET

Wilmington Announces 2012 Second Quarter Results

TORONTO, ONTARIO--(Marketwire - Aug. 9, 2012) - Wilmington Capital Management Inc. ("Wilmington" or the "Corporation") (TSX:WCM.A)(TSX:WCM.B) today announced a net loss for the three months ended June 30, 2012 of $262,000 or ($0.02) per share compared to a net loss of $87,000 or ($0.01) per share for the same period in 2011. For the six months ended June 30, 2012, the net loss amounted to $660,000 or ($0.05) per share compared to net income of $20.2 million or $2.55 per share for the same period in 2011.

To view a full copy of the Corporation's unaudited condensed financial results for the period ended June 30, 2012 including the Corporation's unaudited condensed interim consolidated financial statements and accompanying MD&A, please refer to the SEDAR website www.sedar.com.

OPERATING HIGHLIGHTS

2012 is a formative year for Wilmington and during the second quarter the Corporation continued to take steps in solidifying the foundation of its three newly formed operating platforms - self storage facilities, private equity funds and natural gas assets.

Real Storage Private Trust (46.15% owned) continued to show operational improvements across its portfolio of 17 self-storage facilities containing 648,978 square feet of rentable area and one development site. The five properties located in western Canada, which were acquired in February, 2011, are performing well and expected to reach stabilized occupancy levels in 2012. The majority of the western facilities are newly constructed and in the initial lease-up stage. Overall occupancy for the three months ended June 30, 2012 averaged 77% across the portfolio as compared to 73% for the same period in 2011. Operating margins for the three months ended June 30, 2012 increased to 55%, up from 47% achieved for the comparable period in 2011.

On the private equity front, Network Capital Management Inc. (50% owned) successfully closed its $22.3 million 2012 fund. Network's funds under management now total $50.3 million and Network continues to see good opportunities to deploy available capital in junior oil and gas companies. Wilmington committed $8 million of capital to the 2012 fund.

The natural gas assets owned through the Shackleton Partnership (59% owned) are proving to be of high quality and present good opportunities for growth and future development once we reach a more favorable natural gas pricing environment. The weighted average price realized during the quarter amounted to $1.92 per mcf and operating netbacks averaged $0.82 per mcf. Natural gas production volumes averaged 5,346 mcf per day (891 boepd) for the second quarter. Estimated proved plus probable reserves attributable to the Shackleton assets as evaluated by GLJ Petroleum Consultants Ltd. with an effective date of December 31, 2011 were 24,392 MMcf. The outlook for natural gas pricing has improved significantly and a better pricing environment will be beneficial to the future operating performance of the Shackleton assets.

OUTLOOK

In 2011, the Corporation took significant steps to put in place the foundation for achieving future growth by investing in three operating platforms - the Real Storage Private Trust, Network Capital Management Inc. and the Shackleton Partnership. In 2012 and in the years ahead, the Corporation expects to add scale to these operating platforms, improve valuations and earn attractive cash flow and total returns for shareholders.

FINANCIAL HIGHLIGHTS
As reported under International Financial Reporting Standards
CONSOLIDATED STATEMENTS OF INCOME
Unaudited Three months ended June 30 Six months ended June 30
(Thousands of Canadian Dollars, except per share amounts) 2012 2011 2012 2011
Income
Natural gas sales $ 934 $ --- $ 2,064 $ ---
Royalties (170 ) --- (362 ) ---
Natural gas revenue 764 --- 1,702 ---
Income from investment property 301 285 593 577
Investment and other income 97 79 136 161
Foreign exchange gain --- 9 1 16
1,162 373 2,432 754
Expenses
Petroleum operations 376 --- 978 ---
Interest 375 285 745 578
General and administrative 298 131 599 196
Depletion, depreciation and amortization 402 --- 841 ---
Stock compensation 41 --- 82 ---
Foreign exchange loss 10 --- --- ---
1,502 416 3,245 774
Income (loss) before gain on sale, share of net loss from equity accounted investment and income tax expense (benefit) (340 ) (43 ) (813 ) (20 )
Gain on sale of investment in Parkbridge Lifestyle Communities Inc. --- --- --- 23,581
Share of net income (loss) from Real Storage Private Trust 77 (64 ) (47 ) (254 )
Share of net loss from Network Capital Management Inc. (20 ) --- (4 ) ---
Share of net loss from Network 2012 Fund (103 ) --- (103 ) ---
Income (loss) before income taxes (346 ) (107 ) (873 ) 23,307
Income tax expense (benefit) (84 ) (20 ) (213 ) 3,066
Net Income (Loss) $ (262 ) $ (87 ) $ (660 ) $ 20,241
Net income (loss) attributable to:
Owners of the Corporation (139 ) $ (87 ) $ (463 ) $ 20,241
Non-controlling interest (123 ) $ --- $ (197 ) ---
(262 ) (87 ) (660 ) $ 20,241
Net income (loss) per share - basic $ (0.02 ) $ (0.01 ) $ (0.05 ) $ 2.55
Net income (loss) per share - diluted $ (0.02 ) $ (0.01 ) $ (0.05 ) $ 2.55
CONSOLIDATED BALANCE SHEET
Unaudited (Thousands of Canadian Dollars) June 30, 2012 December 31, 2011
Assets
Non-current assets
Investment property $ 18,842 $ 18,933
Investment in Real Storage Private Trust 7,143 7,096
Investment in Network Capital Management Inc. 1,752 1,755
Investment in Network 2012 Fund 4,935 ---
Natural gas properties and equipment 18,595 19,436
Deferred tax asset --- 135
51,267 47,355
Current assets
Loan to Network Capital Management Inc. 50 50
Receivables and other assets 1,039 923
Cash and cash equivalents 9,509 18,688
10,598 19,661
Total assets $ 61,865 $ 67,016
Liabilities
Non-current liabilities
Secured debt $ 19,307 $ 19,403
Loan payable 1,648 1,615
Asset retirement obligations 729 708
Deferred tax liabilities 106 ---
21,790 21,726
Current liabilities
Accounts payable and accrued liabilities 1,046 1,481
Revolving loan facility 7,250 7,830
Income taxes payable --- 3,336
8,296 12,647
Total liabilities 30,086 34,373
Equity
Shareholders' equity 27,778 28,445
Non-controlling interest 4,001 4,198
Total liabilities and equity $ 61,865 $ 67,016
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Unaudited Three months
ended June 30
Six months
ended June 30
(Thousands of Canadian Dollars) 2012 2011 2012 2011
Net income (loss) $ (262 ) $ (87 ) $ (660 ) $ 20,241
Foreign currency translation 12 (37 ) (5 ) (36)
Fair value increment of available for sale securities --- --- --- (23,414)
Share of other comprehensive loss from Network 2012 Fund (281 ) --- (281 ) ---
Future income taxes on above items --- --- --- 3,285
Other comprehensive income (loss) (269 ) (37 ) (286 ) (20,165)
Comprehensive income (loss) $ (531 ) $ (124 ) $ (946 ) $ 76
Comprehensive income (loss) attributable to:
Owners of the Corporation $ (408 ) $ (124 ) $ (749 ) $ 76
Non-controlling interest (123 ) --- (197 ) ---
$ (531 ) $ (124 ) $ (946 ) $ 76

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.

Boe Conversion: Certain natural gas volumes have been converted to barrels of oil equivalent ("boe") whereby 6,000 cubic feet (mcf) of natural gas is equal to 1 barrel (bbl) of oil. This conversion ratio (6:1) is based on an energy equivalency conversion applicable at the burner tip and does not represent a value equivalency at the wellhead.

Contact Information

  • Wilmington Capital Management Inc.
    (403) 800-0869