Firm Capital Mortgage Investment Corporation Announces Year
TORONTO, March 10, 2021 (GLOBE NEWSWIRE) – Firm Capital Mortgage Investment Corporation (the “Company”) (TSX FC, FC.DB.E, FC.DB.F, FC.DB.G, FC.DB, H, FC .DB.I and FC.DB.J) have published their financial statements for the three and twelve months ended December 31, 2020.
For the three-month period ended December 31, 2020, revenue increased to $ 7,318,366, compared to $ 6,678,983 for the quarter ended December 31, 2019.
For the year ended December 31, 2020, revenues decreased to $ 26,353,473, compared to $ 28,002,051 for the year ended December 31, 2019. Excluding non-compensation expense. recurring and non-cash share-based share of $ 906,131 recorded in 2020, adjusted earnings for the year ended December 31, 2020 was $ 27,259,604.
EARNINGS PER SHARE
Basic weighted average earnings per share for the quarter ended December 31, 2020 was $ 0.249, compared to $ 0.237 per share reported for the quarter ended December 31, 2019.
Basic weighted average earnings per share for the twelve months ended December 31, 2020 was $ 0.913 (excluding stock compensation expense, it was $ 0.945), compared to $ 1.008 for the year ended December 31, 2019.
The Company’s investment portfolio increased by $ 78.1 million to $ 559.0 million as at December 31, 2020, compared to $ 480.9 million as at December 31, 2019 (in each case, excluding impairment provision). Most of the growth in the portfolio took place at the end of the year. The provision for impairment as at December 31, 2020 was $ 5.61 million ($ 5.48 million as of December 2019). There was a high level of new investment funds in 2020, amounting to $ 399.4 million ($ 260.2 million in 2019), and repayments during the year were $ 321.5 million ($ 300.3 million in 2019), resulting in an increase in the size of the investment portfolio.
RETURN ON EQUITY
The Company continues to exceed its performance target of producing a return on equity greater than 400 basis points over the average yield on one-year Government of Canada T-Bills. For the quarter ended December 31, 2020, the annualized return on equity (based on the average month-end equity for the quarter) of 8.77%, or a return on equity of 857 basis points per year on the average yield on one-year Government of Canada T-bills of 0.20%.
For the year ended December 31, 2020, return on equity (based on average month-end equity) of 8.18%, representing a return on equity of 798 basis points per year. year on the on the average yield on one-year Government of Canada T-bills of 0.20%.
PRUDENT DEPRECIATION ALLOWANCE
Management has always taken a proactive approach to the Company’s loan impairment allowance. This is a prudent approach that ensures stable dividends to our shareholders in the event of future problems with any of the loans in the Company’s investment portfolio. The provision for impairment as at December 31, 2020 was $ 5,609,000, which represents approximately 1% of the Company’s investment portfolio at that date.
INVESTMENT PORTFOLIO DETAILS
The details of the Company’s investment portfolio as at December 31, 2020 are as follows:
- Total gross investment portfolio of $ 559,007,922, which is higher than the $ 480,925,143 reported as of December 31, 2019.
- Conventional first mortgage loans, i.e. first mortgage loans with a loan-to-value of less than 75%, represent 70.9% of the total portfolio, and the total of conventional mortgages including loan-to-value is less than 75%, represents 78.0% of the total portfolio.
- Approximately 73.3% of the portfolio matures on December 31, 2021.
- The portfolio’s average nominal interest rate is 8.20% per year, compared to 8.49% as of December 31, 2019.
- Regionally, the investment portfolio is diversified roughly as follows: Ontario (82.2%), Western Canada (14.1%), Quebec (3.3%) and United States (0, 4%).
The borrower’s repayment performance remained in line with pre-COVID-19 performance and no deferral provision was implemented.
DIVIDEND AND SHARE PURCHASE PLAN
The company has implemented a dividend reinvestment plan (DRIP) and a stock purchase plan made available to its shareholders. The DRIP allows participants to reinvest their monthly cash dividends in additional stocks. The price paid per share is 97% (if the share price is above $ 14.10) of the weighted average trading price calculated five trading days immediately preceding each dividend date without commission charges. Once enrolled in the Share Purchase Plan, participants have the right to purchase additional shares, totaling no more than $ 12,000 per year and no less than $ 250 per month. Participating shareholders pay no commission.
For the quarter and year ended December 31, 2020, the Company declared dividends on common shares totaling $ 7,297,147 and $ 27,430,809, respectively, or $ 0.249 and $ 0.944 per share, compared to $ 8,587,699 and $ 28,002,051, respectively, or $ 0.304 and $ 1.006 per share for the three months and fiscal year ended December 31, 2019. The number of common shares outstanding as of December 31, 2020 was 30,843,166, compared to 28,334,972 as of December 31, 2019.
About the company
Where mortgage transactions are made®
The Company, through its mortgage banker, Firm Capital Corporation, is a non-bank lender that provides short-term residential and commercial bridging financing and conventional real estate financing, including construction, mezzanine and investments in actions. The Company’s investment objective is to preserve shareholders’ equity while providing shareholders with a stable flow of monthly dividends from investments. The Company achieves its investment objectives by investing in selected niche markets which are underserved by large credit institutions. The lending business to date continues to develop a diversified mortgage portfolio, producing a stable return for shareholders. Full reports on the Company’s financial results for the year are set out in the audited consolidated financial statements and in the Company’s Management’s Discussion and Analysis, available on the SEDAR website at www. sedar.com. Additionally, additional information is available on the Company’s website at www.firmcapital.com.
This press release contains forward-looking statements within the meaning of applicable securities laws, including, but not limited to, statements regarding our objectives, our strategies to achieve those objectives, our performance, our investment portfolio and our dividends, as well as statements regarding beliefs, estimates and intentions, and similar statements regarding anticipated future events, results, circumstances, performance or expectations that are not historical facts. Forward-looking statements can generally be identified by the use of forward-looking terms such as “prospect”, “objective”, “may”, “will”, “expect”, “intention”, “estimate”, “anticipate”, “Believe”, “should”, “plan” or “continue”, or similar expressions suggesting future results or events. These forward-looking statements reflect the current beliefs of management 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 subject to risks and uncertainties, including those described in our current annual information form under “Risk Factors” (a copy of which can be obtained at www. sedar .com), which could cause our actual results and performance to differ materially from the forward-looking statements contained in this press release.
These risks and uncertainties include, among others, risks associated with the impact of existing or future waves of the COVID-19 pandemic, mortgages, dependence on the Company’s mortgage manager and banker, competition for mortgages, real estate values, interest rate fluctuations. , environmental issues, shareholder responsibility and the introduction of new tax rules. Significant factors or assumptions that have been applied in drawing a conclusion or making an estimate set out in the forward-looking information include, among other things, that the Company is able to invest in mortgage loans at rates consistent with historically achieved rates; adequate mortgage investment opportunities are presented to the company; adequate bank indebtedness and bank loans are available to the Company; and a non-material impact resulting from the COVID-19 pandemic. Although the forward-looking information contained in this press release is based on what management believes to be reasonable assumptions, there can be no assurance that actual results and performance will be consistent with these forward-looking statements.
All forward-looking statements contained in this press release are qualified by these cautionary statements. Except as required by applicable law, the Company does not undertake to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
For more information, please contact:
Mortgage Investment Company Firm Capital
President and CEO
Mortgage Lenders® Shop