TORONTO, March 25, 2015 /CNW/ - Firm Capital Mortgage
Investment Corporation (the "Corporation") (TSX FC) today released
its financial statements for the three and twelve months ended
December 31, 2014 and announces that
on March 24th it has
completed a non-brokered private placement of common shares in the
capital of the Corporation ("Common Shares") for gross proceeds of
$980,000.
PROFIT & RETURN ON EQUITY
Profit for the fourth
quarter ended December 31, 2014
increased by 12% to $4,942,120 as
compared to $4,405,596 for the same
period last year. Profit for the year ended December 31, 2014 increased by 11% to
$19,510,113, as compared to
$17,607,877 for the year ended
December 31, 2013. Basic
weighted average profit per Common Share for the fourth quarter
ended December 31, 2014 was
$0.245, which is higher compared to
$0.243 per Common Share reported for
the fourth quarter ended December 31,
2013. Basic weighted average profit per Common Share for the
year ended December 31, 2014 was
$0.976, which is lower than the
$0.987 per Common Share reported for
the year ended December 31, 2013. The
Corporation distributed 100% of it is profits for 2014.
Profit for the year ended December 31,
2014 represented an annualized return on shareholders'
equity (based on the average of the month end shareholders' equity)
of 9.34% versus a previously reported return on shareholders'
equity of 9.63% for the year ended December
31, 2013. This return on shareholders' equity represents 835
basis points per annum over the average Government of Canada One
Year treasury bill yield for the year of 0.99%, and is well in
excess of the Corporation's stated target yield objective of 400
basis points per annum over the average one year treasury bill
yield.
DIVIDEND OVERVIEW
For the fourth quarter ended
December 31, 2014, the Corporation
declared dividends totaling $5,402,269 or $0.268 per Common Share versus $5,111,513 or $0.282 per Common Share for the fourth quarter
ended December 31, 2013. The fourth
quarter 2014 dividend comprised of regular dividends of
$0.234 per Common Share and the
year-end special dividend of $0.034
per Common Share. For the year ended December 31, 2014, the Corporation declared
dividends totaling $19,510,113 or
$0.970 per Common Share versus
$17,607,877 or $0.984 per Common Share for the year ended
December 31, 2013.
INVESTMENT PORTFOLIO HIGHLIGHTS
Details on the
Corporation's investment portfolio as at December 31, 2014 are as follows:
- Total gross investment portfolio of $342,865,051, which is a 1% increase over
December 31, 2013.
- Conventional first mortgages, being those first mortgages with
loan to values less than 75%, comprise 73% of our total portfolio,
and total conventional mortgages with loan to values under 75%
comprise 82% of our total portfolio.
- Related investments total 14% of the portfolio.
- Non-conventional mortgages total 3% of the portfolio.
- Discounted debt investments total 1% of the portfolio.
- Approximately 63% of the portfolio matures by December 31, 2015. This results in a continuously
revolving portfolio, allowing management to assess market
conditions.
- The average face interest rate on the portfolio is 8.29% per
annum.
- Regionally, the portfolio is diversified approximately as
follows: Ontario (71%),
Quebec (13%), Alberta (13%) and Other (3%).
- Gross investment portfolio breakdown by loan size is as
follows:
|
|
|
|
|
Amount
|
Number
of
Investments
|
%
|
Total
Amount
(before
provision)
|
%
|
$0 -
$2,500,000
|
130
|
73.5%
|
$ 123,562,319
|
36.0%
|
$2,500,001 -
$5,000,000
|
29
|
164%
|
$ 89,762,646
|
26.2%
|
$5,000,001 -
$7,500,000
|
13
|
7.3%
|
$ 70,300,000
|
20.5%
|
$7,500,001
+
|
5
|
2.8%
|
$ 59,240,086
|
17.3%
|
|
177
|
100%
|
$ 342,865,051
|
100%
|
IMPAIRMENT PROVISION UPDATE
Management has
always taken a proactive approach to allowance provision reserves.
This is a prudent approach to protecting our Shareholders' equity.
The impairment provision increased by $30,000 to $3,360,000 as at December
31, 2014. The impairment provision represents 1.0% of the
Investment portfolio balance.
UNRECOGNIZED INCOME COLLECTED
As at December 31, 2014, the Corporation has recorded
as unearned income on its books, banked non-refundable fee income
of $700,202, which will be recognized
as income over the term of the corresponding investments.
DIVIDEND AND SHARE PURCHASE PLAN
The Corporation has
in place a Dividend Reinvestment Plan (DRIP) and Share Purchase
Plan that is available to its shareholders. The plans allows
participants to have their monthly cash dividends reinvested in
additional Common Shares and grants participants the right to
purchase, without commission, additional Common Shares, up to a
maximum of $12,000 per annum.
Private Placement of Common Shares
Firm Capital
Mortgage Investment Corporation announces on March 24th it has completed a
non-brokered private placement of 80,000 Common Shares at a
subscription price of $12.25 per
Common Share for gross proceeds of $980,000.
The net proceeds of the private placement will be used for
general corporate purposes.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy Common Shares. The Common
Shares have not been and will not be registered under the United
States Securities Act of 1933 and accordingly will not be offered,
sold or delivered, directly or indirectly within the United States, its possessions and other
areas subject to its jurisdiction or to, or for the account or for
the benefit of a U.S. person, except in limited circumstances.
About The Corporation
The Corporation, through its
mortgage banker, Firm Capital Corporation, is a non-bank lender
providing residential and commercial short-term bridge and
conventional real estate financing, including construction,
mezzanine and equity investments. The Corporation's investment
objective is the preservation of shareholders' equity, while
providing shareholders with a stable stream of monthly dividends
from investments. The Corporation achieves its investment
objectives through investments in selected niche markets that are
under-serviced by large lending institutions. Lending activities to
date continue to develop a diversified mortgage portfolio,
producing a stable return to shareholders. The Corporation is a
Mortgage Investment Corporation (MIC) as defined in the Income Tax
Act (Canada). Accordingly, The
Corporation is not taxed on income provided that its taxable income
is paid to its shareholders in the form of dividends within 90 days
after December 31 each year. Such
dividends are generally treated by shareholders as interest income,
so that each shareholder is in the same position as if the mortgage
investments made by the company had been made directly by the
shareholder. Full reports of the financial results of the
Corporation for the year are outlined in the audited financial
statements and the related management discussion and analysis of
Corporation, available on the SEDAR website at www.sedar.com.
In addition, supplemental information is available on Corporation's
website at www.firmcapital.com.
Forward-Looking Statements
This news release contains
forward-looking statements within the meaning of applicable
securities laws including, among others, statements concerning our
objectives, our strategies to achieve those objectives, our
performance, our mortgage portfolio and our distributions, as well
as statements with respect to management's beliefs, estimates, and
intentions, and similar statements concerning anticipated future
events, results, circumstances, performance or expectations that
are not historical facts. Forward-looking statements
generally can be identified by the use of forward-looking
terminology such as "outlook", "objective", "may", "will",
"expect", "intent", "estimate", "anticipate", "believe", "should",
"plans" or "continue" or similar expressions suggesting future
outcomes or events. Such forward-looking statements reflect
management's current beliefs and are based on information currently
available to management.
These statements are not guarantees of future performance and
are based on our estimates and assumptions that are subject to
risks and uncertainties, including those described in the
Corporation's Annual Information Form under "Risk Factors" (a copy
of which can be obtained at www.sedar.com). Those risks and
uncertainties include, among others, risks associated with mortgage
lending, dependence on the Corporation's manager and mortgage
banker, competition for mortgage lending, real estate values,
interest rate fluctuations, environmental matters, shareholder
liability and the introduction of new tax rules. Material
factors or assumptions that were applied in drawing a conclusion or
making an estimate set out in the forward-looking information
include, among others, that the Corporation is able to invest in
mortgages at rates consistent with rates historically achieved;
adequate mortgage investment opportunities are presented to the
Corporation; and adequate bank indebtedness and bank loans are
available to the Corporation. Although the forward-looking
information continued in this new release is based upon what
management believes are reasonable assumptions, there can be no
assurance that actual results and performance will be consistent
with these forward-looking statements.
All forward-looking statements in this news release are
qualified by these cautionary statements. Except as required
by applicable law, the Corporation undertakes no obligation to
publicly update or revise any forward-looking statement, whether as
a result of new information, future events or otherwise.
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SOURCE Firm Capital Mortgage Investment Corporation