TORONTO, July 31, 2019 /CNW/ - Accord Financial Corp.
(TSX – ACD) today released its financial results for the three and
six months ended June 30, 2019.
The financial figures presented in this release are reported in
Canadian dollars and have been prepared in accordance with
International Financial Reporting Standards.
SUMMARY OF
FINANCIAL RESULTS
|
|
Three Months Ended
June 30
|
Six Months
Ended June 30
|
|
2019
|
2018
|
2019
|
2018
|
|
$
|
$
|
$
|
$
|
Average funds
employed (millions)
|
388
|
255
|
367
|
242
|
Revenue
(000's)
|
13,991
|
10,823
|
26,579
|
20,856
|
Earnings before
income tax (000's)
|
2,912
|
2,592
|
4,848
|
4,000
|
Net earnings
attributable to shareholders (000's)
|
2,222
|
2,363
|
3,865
|
3,580
|
Adjusted net
earnings (000's) (note)
|
2,397
|
2,674
|
4,213
|
4,115
|
Earnings per
common share (basic and diluted)
|
0.26
|
0.28
|
0.46
|
0.43
|
Adjusted earnings
per common share (basic and diluted)
|
0.28
|
0.32
|
0.50
|
0.50
|
Book value per
share (June 30)
|
|
|
$
10.70
|
$
9.68
|
Revenue increased by 29% to a quarterly record $13,991,000 in the second quarter compared to
$10,823,000 last year mainly as a
result of higher funds employed. Average funds employed were 52%
higher at $388 million in the current
quarter compared to $255 million last
year. Funds employed at June 30, 2018
were $382 million.
Net earnings attributable to shareholders ("shareholders' net
earnings") declined by $141,000 to
$2,222,000 in the second quarter of
2019 compared to the $2,363,000
earned last year. Shareholders' net earnings declined mainly as a
result of a higher income tax expense. Earnings per common share
("EPS") were 26 cents compared to
28 cents last year. Adjusted net
earnings declined to $2,397,000 from
the $2,674,000 earned in the second
quarter of 2018. Adjusted EPS decreased to 28 cents compared to 32
cents in last year's second quarter.
Revenue rose 27% to a half year record $26,579,000 in 2018 compared to $20,856,000 last year mainly as a result of
higher funds employed. Average funds employed in the first half of
2019 were 52% higher at $367
million.
Shareholders' net earnings in the first half of 2019 increased
by $285,000 or 8% to $3,865,000 compared to $3,580,000 in 2018. Shareholders' net earnings
rose mainly as a result of higher net revenue (revenue less
interest expense) and a lower provision for losses. EPS
increased by 7% to 46 cents compared
to 43 cents last year. Adjusted net
earnings increased by $98,000 to
$4,213,000 compared to the
$4,115,000 earned in the first half
of 2018. Adjusted EPS were 50 cents
in the first half of 2019, the same as in 2018.
Commenting on 2019's results, the Company's President and CEO,
Mr. Simon Hitzig, stated: "The
second quarter marked the tenth straight quarter of growth in the
Company's loan portfolio. On a year-over-year basis revenue and
earnings before income tax increased in both the quarter and
year-to-date periods. First half earnings per share of 46 cents helped boost book value per share to a
record quarterly high of $10.70."
Mr. Hitzig further added "To fund further growth, the Company is
pleased to report that, after exercising the accordion feature in
its credit facility, its banking syndicate approved a $75 million increase in its bank line. This
amendment is expected to close shortly taking our bank credit limit
to $367 million."
The Company's Board of Directors today declared a regular
quarterly dividend of 9 cents per
common share, payable September 3,
2019 to shareholders of record August
15, 2019.
About Accord Financial Corp.
Accord Financial Corp.,
founded in 1978, is one of North
America's leading independent finance companies. Serving
clients throughout the United
States and Canada, Accord's
flexible finance programs cover the full spectrum of asset-based
lending, from receivables and inventory finance, to equipment and
trade finance, to film and media finance. For 41 years, Accord has
helped businesses manage their cash flows and maximize financial
opportunities – keeping business liquid.
Note: Non-IFRS measures
The Company's financial statements have been prepared in
accordance with IFRS. The Company uses a number of other financial
measures to monitor its performance and believes that these
measures may be useful to investors in evaluating the Company's
operating performance and financial position. These measures may
not have standardized meanings or computations as prescribed by
IFRS that would ensure consistency between companies using these
measures and are, therefore, considered to be non-IFRS measures.
The non-IFRS measures presented in this press release are as
follows:
1) Adjusted net earnings and adjusted EPS. The Company
derives these measures from amounts presented in its IFRS prepared
financial statements. Adjusted net earnings comprise shareholders'
net earnings before stock-based compensation, business acquisition
expenses (transaction costs and amortization of intangible assets)
and restructuring expenses. Adjusted EPS (basic and diluted) is
adjusted net earnings divided by the weighted average number of
common shares outstanding (basic and diluted) in the period.
Management believes adjusted net earnings is a more appropriate
measure of operating performance as it excludes items which do not
relate to ongoing operating activities. The following table
provides a reconciliation of the Company's net earnings to adjusted
net earnings:
|
Three Months
Ended June 30
|
Six
Months Ended June 30
|
|
2019
|
2018
|
2019
|
2018
|
|
$'000
|
$'000
|
$'000
|
$'000
|
Shareholders' net
earnings:
|
2,222
|
2,363
|
3,865
|
3,580
|
Adjustments, net of
tax:
|
|
|
|
|
Stock-based
compensation
|
42
|
113
|
84
|
134
|
Business acquisition
expenses
|
133
|
198
|
264
|
401
|
Adjusted net
earnings
|
2,397
|
2,674
|
4,213
|
4,115
|
2) Book value per share – book value is shareholders' equity and
is the same as the net asset value (calculated as total assets
minus total liabilities) of the Company less non-controlling
interests. Book value per share is the book value divided by the
number of common shares outstanding as of a particular date.
3) Funds employed are the Company's finance receivables and
loans, an IFRS measure. Average funds employed are the average
finance receivables and loans calculated over a particular
period.
SOURCE Accord Financial Corp.