Wilmington Announces 2013 Fourth Quarter Results
TORONTO, ONTARIO--(Marketwired - Mar 18, 2014) - Wilmington
Capital Management Inc. ("Wilmington" or the "Corporation")
(TSX:WCM.A)(TSX:WCM.B) reported net income attributable to
shareholders for the three months ended December 31, 2013 of
$466,000 or $0.05 per share compared to a net loss of $938,000 or
($0.11) per share for the same period in 2012. For the year ended
December 31, 2013, the Corporation generated a net income
attributable to shareholders of $723,000 or $0.08 per share
compared to a net loss of $1.5 million or ($0.18) per share for the
same period in 2012.
To view a full copy of the Corporation's audited financial
results for the year ended December 31, 2013 including the
Corporation's audited consolidated financial statements and
accompanying MD&A, please refer to the SEDAR website
www.sedar.com.
FOURTH QUARTER 2013 HIGHLIGHTS
During the fourth quarter, the Corporation took further steps to
solidify and build upon the foundation of its three operating
platforms - self storage facilities, private equity funds and
natural gas assets. For the three months ended December 31, 2013,
the Corporation:
- Realized a distribution of $76,000 from Real Storage Private
Trust representing the Corporation's share of a 3% per annum
distribution on invested capital which is paid quarterly.
- Realized a distribution of $716,000 from the Network 2012 Fund
representing the Corporation's share of the distribution of
proceeds on the sale of an oil and gas investment which $502,000
represents a return of capital.
- Generated $1.0 million in revenue during the fourth quarter of
2013, compared to $1.2 million during the same period in 2012. This
decrease was primarily due to decrease in natural gas production
which was offset by higher natural gas prices.
- Reported net income from continuing operations of $466,000
compared to a loss of $293,000 during the same period in 2012, of
which $540,000 related to an income tax recovery.
As at December 31, 2013, Wilmington had assets under management
in its operating platforms of approximately $144 million ($56
million representing Wilmington's share).
OPERATIONS REVIEW
Wilmington continues to execute it principal objectives of
making investments capable of generating appreciation in value as
opposed to current income and to maximize shareholder returns by
investing its own capital alongside partners and co-investors in
hard assets and private equity funds. These assets are managed
through the Corporation's operating platforms where Wilmington can
add scale and improve valuations.
Storage Facilities
Real Storage Private Trust ("Trust")
The Trust (42.13% owned) owns 20 self-storage facilities
comprising 787,000 square feet of rentable area and one development
property. The Trust recorded significant improvements in 2013 as
the facilities in Western Canada, which were for the most part in
the initial lease up stage, achieved stabilized occupancy levels.
During 2013, same store occupancy levels averaged 82%, compared to
78% in 2012. Same store operating margins improved to 56% in 2013
from 52% in 2012.
During the third quarter 2013, the Trust commenced quarterly
distributions to its unit holders equivalent to 3% per annum on
invested capital. For the year ended December 31, 2013, quarterly
distributions paid by the Trust were $336,000 (Corporation's share
- $151,000).
Private Equity
Network Capital Management Inc. ("NCI") and Network 2012
Fund
NCI (50% owned) has funds under management now totaling
approximately $39.4 million and the majority of Network's available
capital has been successfully deployed in a strong mix of junior
oil and gas and service companies. Wilmington invested $8.0 million
of capital in the Network 2012 Fund.
During fourth quarter of 2013, the Network 2012 Fund distributed
$2.0 million in proceeds from the disposition of an investment, net
of fees to unit holders (Corporation's share - $716,000).
Approximately $1.4 million represents a return of capital
(Corporation's share - $502,000).
Natural Gas Assets
Shackleton 2011 Limited Partnership (the "Shackleton
Partnership" or the "Partnership")
The Shackleton Partnership (59% owned) owns a 100% interest in
natural gas wells in southwestern Saskatchewan. The weighted
average price realized during 2013 was $3.16 per mcf and operating
netbacks averaged $1.67 per mcf (realized price of $2.33 per mcf
and netbacks of $0.98 per mcf for the comparable period in 2012).
The Partnership's natural gas production volumes amounted to 4,170
mcf per day (695 boe per day) for the year. Of its 2014 production,
approximately 50% has been hedged under fixed price contracts with
an average price of $3.61 per GJ.
Northpoint Resources Ltd. ("Northpoint")
On July 30, 2013, the Corporation added to its natural gas
platform by investing in Northpoint, a privately held oil and gas
producer with assets in the Altares region of northeastern British
Columbia. Northpoint's production during since July 30, 2013 was
6,862 mcfe per day (1,144 boe per day) and as at December 31, 2013
had total proved plus probable reserves totaling approximately
7,650 Mboe (45,900 Mmcfe). The Corporation acquired a 36.5%
ownership interest in Northpoint for total cash consideration of
$2.2 million. In addition and as part of an overall
recapitalization plan, Wilmington acquired $798,000 of a 10%, $5.0
million debenture issue in Northpoint which matures on August 1,
2017. Northpoint is professionally managed by an experienced
executive team. As part of the transaction, the Corporation is
entitled to nominate three of the seven directors to the Northpoint
board.
Discontinued Operations
On July 31, 2013, the Corporation completed the sale of its
interests in commercial land in San Francisco, California. The
Corporation received total proceeds of USD $20.0 million comprised
of cash proceeds of USD $983,000 and the transfer of the secured
debt of USD $19.0 million to the purchaser. Cash proceeds from the
sale were used to settle certain loans payable. The sale was part
of the steps in rationalizing the Corporation's core business.
Outlook
2012 and 2013 have been formative years and the Corporation
believes that the foundation for achieving future growth through
its three operating platforms - self-storage, private equity and
oil and natural gas - is now in place. 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 RESULTS |
| CONSOLIDATED STATEMENTS OF INCOME (LOSS) |
|
|
(unaudited) |
|
(audited) |
|
|
Three months ended December 31, |
|
Years ended December 31, |
|
| (CDN $ Thousands, except per share amounts) |
2013 |
|
2012 |
|
2013 |
|
2012 |
|
|
|
|
|
|
|
|
|
|
| Revenue |
|
|
|
|
|
|
|
|
| Natural gas sales |
1,172 |
|
1,403 |
|
4,812 |
|
4,498 |
|
| Royalties |
(220 |
) |
(269 |
) |
(801 |
) |
(822 |
) |
| Natural gas revenue |
952 |
|
1,134 |
|
4,011 |
|
3,676 |
|
|
|
|
|
|
|
|
|
|
| Investment and other income |
48 |
|
40 |
|
274 |
|
233 |
|
|
1,000 |
|
1,174 |
|
4,285 |
|
3,909 |
|
|
|
|
|
|
|
|
|
|
| Expenses |
|
|
|
|
|
|
|
|
| Petroleum operations |
387 |
|
469 |
|
1,463 |
|
1,808 |
|
| General and administrative |
320 |
|
425 |
|
1,325 |
|
1,201 |
|
| Depletion, depreciation and amortization |
375 |
|
419 |
|
1,498 |
|
1,628 |
|
| Stock-based compensation |
52 |
|
71 |
|
177 |
|
210 |
|
| Foreign exchange loss (gain) |
43 |
|
9 |
|
144 |
|
(33 |
) |
| Finance costs |
67 |
|
95 |
|
317 |
|
377 |
|
|
1,244 |
|
1,488 |
|
4,924 |
|
5,191 |
|
| Loss before share of equity accounted investments and
income taxes |
(244 |
) |
(314 |
) |
(639 |
) |
(1,282 |
) |
|
|
|
|
|
|
|
|
|
| Dilution gain of investment in Real Storage Private
Trust |
2 |
|
12 |
|
2 |
|
12 |
|
| Share of net income from Real Storage Private
Trust |
154 |
|
25 |
|
422 |
|
163 |
|
| Share of net loss from Network Capital Management
Inc. |
(2 |
) |
(27 |
) |
(61 |
) |
(43 |
) |
| Loss on revaluation of investment in Network Capital
Management Inc. |
--- |
|
--- |
|
(1,584 |
) |
--- |
|
| Share of net income (loss) from Network 2012 Fund |
171 |
|
(39 |
) |
59 |
|
(147 |
) |
| Share of net loss from Northpoint Resources Ltd. |
(119 |
) |
--- |
|
(359 |
) |
--- |
|
| Loss before income taxes from continuing
operations |
(38 |
) |
(343 |
) |
(2,160 |
) |
(1,297 |
) |
| Income tax benefit |
504 |
|
50 |
|
595 |
|
327 |
|
| Net loss from continuing operations |
466 |
|
(293 |
) |
(1,565 |
) |
(970 |
) |
|
|
|
|
|
|
|
|
|
| Income (loss) from discontinued operations, net of
tax |
--- |
|
(944 |
) |
2,579 |
|
(938 |
) |
| Net income (loss) |
466 |
|
(1,237 |
) |
1,014 |
|
(1,908 |
) |
|
|
|
|
|
|
|
|
|
| Net income (loss) attributable to: |
|
|
|
|
|
|
|
|
|
Owners of the Corporation |
466 |
|
(938 |
) |
723 |
|
(1,524 |
) |
|
Non-controlling interest |
--- |
|
(299 |
) |
291 |
|
(384 |
) |
|
466 |
|
(1,237 |
) |
1,014 |
|
(1,908 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (CDN $ per share) |
|
|
|
|
|
|
|
|
| Net loss per share from continuing operations |
|
|
|
|
|
|
|
|
|
Basic |
0.05 |
|
--- |
|
(0.22 |
) |
(0.07 |
) |
|
Diluted |
0.05 |
|
--- |
|
(0.22 |
) |
(0.07 |
) |
|
|
|
|
|
|
|
|
|
| Net income (loss) per share |
|
|
|
|
|
|
|
|
|
Basic |
0.05 |
|
(0.11 |
) |
0.08 |
|
(0.18 |
) |
|
Diluted |
0.05 |
|
(0.11 |
) |
0.08 |
|
(0.18 |
) |
|
| CONSOLIDATED BALANCE SHEET |
|
|
(audited) |
|
|
As at December 31, |
|
(CDN $ Thousands) |
2013 |
2012 |
|
|
|
|
Assets |
|
|
|
Non-current assets |
|
|
|
Investment in Real Storage Private Trust |
10,079 |
7,271 |
|
Investment in Network Capital Management Inc. |
67 |
1,712 |
|
Investment in Network 2012 Fund |
8,341 |
7,554 |
|
Investment in Northpoint Resources Ltd. |
1,819 |
--- |
|
Northpoint Debenture |
798 |
--- |
|
Natural gas property, plant and equipment |
16,597 |
17,840 |
|
|
37,701 |
34,377 |
|
Current assets |
|
|
| Loan
to Network Capital Management Inc. |
25 |
--- |
|
Income tax receivable |
299 |
435 |
|
Receivables and other assets |
1,451 |
885 |
|
Cash and cash equivalents |
730 |
6,601 |
|
2,505 |
7,921 |
|
Assets held for sale |
--- |
18,541 |
|
|
2,505 |
26,462 |
|
Total assets |
40,206 |
60,839 |
|
|
|
|
|
|
|
Liabilities |
|
|
|
Non-current liabilities |
|
|
|
Decommissioning liabilities |
792 |
750 |
|
Deferred tax liabilities |
65 |
259 |
|
|
857 |
1,009 |
|
Current liabilities |
|
|
|
Accounts payable and accrued liabilities |
991 |
1,024 |
|
Revolving loan facility |
5,200 |
6,700 |
|
6,191 |
7,724 |
|
Liabilities held for sale |
--- |
21,432 |
|
|
6,191 |
29,156 |
|
Total liabilities |
7,048 |
30,165 |
|
|
|
|
Equity |
|
|
|
Shareholders' equity |
29,053 |
26,860 |
|
Non-controlling interest |
4,105 |
3,814 |
|
Total equity |
33,158 |
30,674 |
|
|
|
|
|
Total liabilities and equity |
40,206 |
60,839 |
|
| CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) |
|
|
(unaudited) |
|
(audited) |
|
|
Three months ended December 31, |
|
Years ended December 31, |
|
| (CDN $ Thousands) |
2013 |
|
2012 |
|
2013 |
|
2012 |
|
|
|
|
|
|
|
|
|
|
| Net income (loss) |
466 |
|
(1,237 |
) |
1,014 |
|
(1,908 |
) |
| Items that may subsequently be reclassified to net
income (loss) |
|
|
|
|
|
|
|
|
|
Share
of other comprehensive income (loss) from Network 2012 Fund |
1,009 |
|
81 |
|
1,444 |
|
(299 |
) |
|
Deferred income (taxes) benefit on above items |
(130 |
) |
(9 |
) |
(190 |
) |
39 |
|
| Other comprehensive income (loss) from continuing
operations |
879 |
|
72 |
|
1,254 |
|
(260 |
) |
|
|
|
|
|
|
|
|
|
| Items reclassified to net income (loss), net of
tax |
50 |
|
18 |
|
50 |
|
--- |
|
| Items that may subsequently be reclassified to net
income (loss) |
|
|
|
|
|
|
|
|
| Other comprehensive income (loss) from discontinued
operations, net of tax |
--- |
|
|
|
(14 |
) |
(11 |
) |
| Total other comprehensive income (loss) |
929 |
|
90 |
|
1,290 |
|
(271 |
) |
| Comprehensive income (loss) |
1,395 |
|
(1,147 |
) |
2,304 |
|
(2,179 |
) |
|
|
|
|
|
|
|
|
|
| Comprehensive income (loss) attributable to: |
|
|
|
|
|
|
|
|
|
Owners of the Corporation |
1,395 |
|
(848 |
) |
2,013 |
|
(1,795 |
) |
|
Non-controlling interest |
--- |
|
(299 |
) |
291 |
|
(384 |
) |
|
1,395 |
|
(1,147 |
) |
2,304 |
|
(2,179 |
) |
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.
Wilmington Capital Management Inc.Executive Officers(403)
800-0869
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