TORONTO, April 26, 2019 /CNW/ - Fountain Asset
Corp. (TSXV:FA) ("Fountain" or the "Company") is pleased to
announce its financial results for the three months ended
December 31, 2018 ("Q4/18")
and for the year ended December 31,
2018 ("Fiscal 2018").
Highlights from Q4/18:
- Adjusted net asset value ("ANAV") of $36.77 million ($0.63 per share) at December 31, 2018 compared to $35.54 million ($0.60 per share) at September 30, 2018, representing a 5.0% increase
quarter over quarter on a per share basis. ANAV reflects the net
asset value plus the amount of available tax loss pools
available;
- Net comprehensive income of $1.02
million compared to $4.63
million for three months ended December 31, 2017 ("Q4/17");
- Total revenue from investment activity was $2.29 million compared to $3.60 million for Q4/17;
- Net realized gains on the sale of portfolio investments of
$2.17 million compared to net
realized gains of $1.58 million for
Q4/17;
- Net unrealized gains on portfolio investments of $0.05 million compared to net unrealized gains of
$1.84 million for Q4/17;
- Total expenses of $1.26 million,
which include annual incentive plan expense and stock-based
compensation, compared to $0.73
million for Q4/17; and
- Operating expenses of $0.42
million compared to $0.61
million for Q4/17.
Highlights from Fiscal 2018:
- ANAV of $36.77 million
($0.63/share) at December 31, 2018 compared to $25.54 million ($0.47/share) at December
31, 2017, representing a 34% increase year over year on a
per share basis;
- Net comprehensive income of $8.58
million compared to $8.13
million for the year ended December
31, 2017 ("Fiscal 2017");
- Total revenue from investment activity increased to
$13.24 million compared to
$5.04 million for Fiscal 2017;
- Net realized gains on the sale of portfolio investments of
$14.42 million compared to net
realized gains of $2.54 million for
Fiscal 2017;
- Net unrealized losses on portfolio investments of $1.66 million compared to net unrealized gains of
$1.40 million for Fiscal 2017;
- Total expenses of $4.37 million,
which include annual incentive plan expense and stock-based
compensation, compared to $1.85
million for Fiscal 2017; and
- Operating expenses of $1.24
million compared to $1.64
million for Fiscal 2017.
During 2018, the Company saw robust positive performance from
its portfolio of publicly traded companies. This included an
outstanding year for HEXO Corp. which announced a joint venture
with Molson Coors Brewing Company. This was offset by our
investment in Spectra7 Microsystems Inc. Furthermore, several of
Fountain's private investments went public during the year,
including Canopy Rivers Inc. and Green Growth Brands Inc. For
Fiscal 2018, the Company reported total revenue of $13.24 million compared to $5.04 million in the prior year.
The Company reported total expenses of $4.37 million for Fiscal 2018 compared to
$1.85 million in the prior
year. Included in total expenses for the current year was an
annual incentive plan expense of $2.59
million (2017 - $nil) and stock-based compensation of
$0.55 million (2017 – $0.21 million). The annual incentive plan
was initiated during the three months ended September 30, 2018 by the board of directors of
Fountain. Operating expenses decreased by 24% year over year
to $1.24 million for Fiscal 2018
compared to $1.64 million for Fiscal
2017. The decreased was driven by lower salaries, consulting
fees, and general and administrative costs.
The Company generated net comprehensive income of $8.58 million for Fiscal 2018 compared to net
comprehensive income of $8.13 million
for Fiscal 2017. As at December 31,
2018, the Company's adjusted net assets were valued at
$36.77 million or $0.63 per share compared to $25.54 million or $0.47 per share at December 31, 2017.
"The Company posted solid revenue and profit during Fiscal
2018. In addition, Fountain was able to grow its Net Asset
Value by 5% quarter over quarter in Q4/18 while the broader indexes
declined substantially during that period. During 2018, we
continued to prove our ability to support early stage companies and
realize significant returns from these investments for our
shareholders. This is the second year in a row that the
Company has increased its adjusted book value by well over
30%. We continued to make investments that we believe will
help grow Fountain's capital base into 2019 and beyond. We
are extremely excited about our portfolio of investments and our
pipeline going forward." said Andrew
Parks, CEO of Fountain.
A full set of the 2018 audited financial statements and the
management discussion & analysis are available on SEDAR.
About Fountain Asset Corp.
Fountain Asset Corp. is a merchant bank which provides equity
financing, bridge loan services (asset back/collateralized
financing) and strategic financial consulting services to companies
across many industries such as marijuana, oil & gas, mining,
real estate, manufacturing, retail, financial services, blockchain
technology and biotechnology.
Forward-Looking Statements
Certain information contained in this press release constitutes
forward-looking information, which is information relating to
possible events, conditions or results of operations of the
Company, which are based on assumptions and courses of action and
which are inherently uncertain. All information other than
statements of historical fact may be forward-looking information.
Forward-looking information in this press release includes, but is
not limited to, growing Fountain's capital base and a strong
pipeline going forward. These forward-looking statements reflect
the current expectations or beliefs of the Company based on
information currently available to the Company. Forward-looking
statements are subject to a number of risks and uncertainties that
may cause the actual results of the Company to differ materially
from those discussed in the forward-looking statements, and even if
such actual results are realized or substantially realized, there
can be no assurance that they will have the expected consequences
to, or effects on, the Company. Factors that could cause actual
results or events to differ materially from current expectations
include, among other things: the level of bridge loans and equity
investments completed, the nature and credit quality of the
collateral security and the nature and quality of equity
investments, and the other risks disclosed under the heading "Risk
Factors" and elsewhere in the Company's annual information form
dated December 22, 2017 filed on SEDAR
at www.sedar.com. Any forward-looking statement speaks only as
of the date on which it is made and, except as may be required by
applicable securities laws, the Company disclaims any intent or
obligation to update any forward-looking statement, whether as a
result of new information, future events or results or otherwise.
Although the Company believes that the assumptions inherent in the
forward-looking statements are reasonable, forward-looking
statements are not guarantees of future performance and accordingly
undue reliance should not be put on such statements due to the
inherent uncertainty therein.
Neither TSX Venture Exchange Inc. nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
SOURCE Fountain Asset Corp.
