Toronto, Ontario--(Newsfile Corp. - July 28, 2021) - Atrium Mortgage Investment Corporation (TSX: AI) (TSX: AI.DB.C) (TSX: AI.DB.D) (TSX: AI.DB.E) today released its financial results for the three and six month periods ended June 30, 2021.
Highlights
Mortgage portfolio of $710.6 million, 4.7% decrease from December 31, 2020
High quality mortgage portfolio
84.0% of portfolio in first mortgages
91.9% of portfolio is less than 75% loan to value
average loan-to-value is 61.2%
Quarterly net income of $10.6 million, up 8.2% from the second quarter of the prior year
Quarterly basic and diluted earnings per share of $0.25
"We are pleased with our Q2 and year to date results, and we are on track for a very successful year. The loan quality of the portfolio was stable with previous quarters, and we have repositioned the portfolio to the point where over 99% of our mortgages are now located in our two preferred markets, Ontario and BC. The mortgage portfolio has a conservative average loan to value of 61.2% and a $10 million loan loss provision which will protect the balance in the event of a downturn. In Q2, we were able to mostly offset a record $148 million of repayments with a high level of originations ($93 million). We continue to have a solid pipeline of new loans, although repayments in Q3 may offset most of our new originations. We are encouraged by the increased vaccination rates and lower level of new COVID 19 cases across Canada, but we will remain very diligent in underwriting new loans given the continuing economic threat of emerging variants. While the housing market and industrial sector has remained strong throughout the pandemic, we are cautiously optimistic that the retail and office sectors will begin to recover as the general economy strengthens," said Rob Goodall, CEO of Atrium.
Conference call
Interested parties are invited to participate in a conference call with management Thursday, July 29, 2021 at 4:00 p.m. ET to discuss the results. To participate or listen to the conference call live, please call 1 (888) 241-0551 or (647) 427-3415, conference ID 7559089. For a replay of the conference call (available until August 10, 2021) please call 1 (855) 859-2056, conference ID 7559089.
Results of operations
For the three months ended June 30, 2021, Atrium reported assets of $719.3 million, down from $755.3 million at the end of 2020. Revenues were $16.1 million, a decrease of 0.6% from the second quarter of the prior year. Net income for the second quarter of 2021 was $10.6 million, an increase of 8.2% from the second quarter of the prior year. Atrium's allowance for mortgage losses at June 30, 2021 totaled $10.0 million, or 1.41% of the mortgage portfolio.
For the six months ended June 30, 2021, revenues were $32.6 million, down from $33.3 million for the first six months of the prior year. Net income for the six months ended June 30, 2021 was $20.5 million, up from net income of $19.7 million from the prior year period.
Basic and diluted earnings per common share were $0.25 for the three months ended June 30, 2021, compared with $0.23 basic and diluted earnings per common share in the comparable period. Basic and diluted earnings per common share were $0.48 for the six months ended June 30, 2021, compared with $0.47 basic and diluted earnings per common share for the six months ended June 30, 2020.
Mortgages receivable as at June 30, 2021 were $703.0 million, a decrease of 4.9% from December 31, 2020. During the six months ended June 30, 2021, $186.3 million of mortgage principal was advanced and $220.4 million was repaid. The weighted average interest rate on the mortgage portfolio at June 30, 2021 was 8.56%, compared to 8.65% at December 31, 2020 and 8.55% at June 30, 2020.
Interest collections for the period remain in line with historical collection rates.
Financial summary
Interim Consolidated Statements of Income and Comprehensive Income
(Unaudited, 000s, except per share amounts)
| Three months ended | Six months ended | |||||||||||
| June 30 | June 30 | |||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||
| Revenue | $ | 16,147 | $ | 16,241 | $ | 32,598 | $ | 33,298 | ||||
| Mortgage servicing and management fees | (1,775 | ) | (1,700 | ) | (3,671 | ) | (3,477 | ) | ||||
| Other expenses | (388 | ) | (335 | ) | (850 | ) | (684 | ) | ||||
| Provision for mortgage losses | - | (1,000 | ) | (869 | ) | (2,000 | ) | |||||
| Income before financing costs | 13,984 | 13,206 | 27,208 | 27,137 | ||||||||
| Financing costs | (3,359 | ) | (3,385 | ) | (6,709 | ) | (7,452 | ) | ||||
| Net income and comprehensive income | $ | 10,625 | $ | 9,821 | $ | 20,499 | $ | 19,685 | ||||
| | ||||||||||||
| Basic earnings per share | $ | 0.25 | $ | 0.23 | $ | 0.48 | $ | 0.47 | ||||
| Diluted earnings per share | $ | 0.25 | $ | 0.23 | $ | 0.48 | $ | 0.47 | ||||
| | ||||||||||||
| Dividends declared | $ | 9,575 | $ | 9,536 | $ | 19,125 | $ | 19,040 | ||||
| | ||||||||||||
| Mortgages receivable, end of period | $ | 702,969 | $ | 675,339 | $ | 702,969 | $ | 675,339 | ||||
| Total assets, end of period | $ | 719,331 | $ | 691,705 | $ | 719,331 | $ | 691,705 | ||||
| Shareholders' equity, end of period | $ | 467,033 | $ | 463,068 | $ | 467,033 | $ | 463,068 | ||||
Analysis of mortgage portfolio
| June 30, 2021 | December 31, 2020 | |||||||||||||||||
| Outstanding | % of | Outstanding | % of | |||||||||||||||
| Property Type | Number | amount | Portfolio | Number | amount | Portfolio | ||||||||||||
| (outstanding amounts in 000s) | ||||||||||||||||||
| Mid-rise residential | 24 | $ | 215,005 | 30.2% | 25 | $ | 199,525 | 26.8% | ||||||||||
| High-rise residential | 15 | 196,024 | 27.6% | 16 | 170,074 | 22.8% | ||||||||||||
| Low-rise residential | 14 | 97,876 | 13.8% | 21 | 174,362 | 23.4% | ||||||||||||
| House and apartment | 79 | 55,401 | 7.8% | 63 | 45,522 | 6.1% | ||||||||||||
| Condominium corporation | 13 | 1,961 | 0.3% | 13 | 2,165 | 0.3% | ||||||||||||
| Residential portfolio | 145 | 566,267 | 79.7% | 138 | 591,648 | 79.4% | ||||||||||||
| Commercial | 20 | 144,292 | 20.3% | 20 | 153,666 | 20.6% | ||||||||||||
| Mortgage portfolio | 165 | $ | 710,559 | 100.0% | 158 | $ | 745,314 | 100.0% | ||||||||||
| June 30, 2021 | |||||||||||||||
| Weighted | Weighted | ||||||||||||||
| Number of | Outstanding | Percentage | average | average | |||||||||||
| Location of underlying property | mortgages | amount | outstanding | loan to value | interest rate | ||||||||||
| (outstanding amounts in 000s) | |||||||||||||||
| Greater Toronto Area | 112 | $ | 483,682 | 68.0% | 63.4% | 8.69% | |||||||||
| Non-GTA Ontario | 33 | 26,215 | 3.7% | 65.1% | 7.83% | ||||||||||
| British Columbia | 18 | 193,824 | 27.3% | 54.1% | 8.33% | ||||||||||
| Alberta | 2 | 6,838 | 1.0% | 94.1% | 8.89% | ||||||||||
| 165 | $ | 710,559 | 100.0% | 61.2% | 8.56% | ||||||||||
| December 31, 2020 | |||||||||||||||
| Weighted | Weighted | ||||||||||||||
| Number of | Outstanding | Percentage | average | average | |||||||||||
| Location of underlying property | mortgages | amount | outstanding | loan to value | interest rate | ||||||||||
| (outstanding amounts in 000s) | |||||||||||||||
| Greater Toronto Area | 119 | $ | 548,447 | 73.6% | 63.2% | 8.68% | |||||||||
| Non-GTA Ontario | 21 | 21,706 | 2.9% | 64.7% | 8.32% | ||||||||||
| British Columbia | 16 | 163,685 | 22.0% | 51.0% | 8.57% | ||||||||||
| Alberta | 2 | 11,476 | 1.5% | 96.5% | 8.94% | ||||||||||
| 158 | $ | 745,314 | 100.0% | 61.0% | 8.65% | ||||||||||
For further information on the financial results, and further analysis of the company's mortgage portfolio, please refer to Atrium's interim consolidated financial statements and its management's discussion and analysis for the quarter ended June 30, 2021, available on SEDAR at , and on the company's website at .
About Atrium
Canada's Premier Non-Bank Lender™
Atrium is a non-bank provider of residential and commercial mortgages that lends in major urban centres in Canada where the stability and liquidity of real estate are high. Atrium's objectives are to provide its shareholders with stable and secure dividends and preserve shareholders' equity by lending within conservative risk parameters. Atrium is a Mortgage Investment Corporation (MIC) as defined in the Canada Income Tax Act, so 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. For further information about Atrium, please refer to regulatory filings available at or investor information on Atrium's website at .
For additional information, please contact
Robert G. Goodall
President and Chief Executive Officer
Jennifer Scoffield
Chief Financial Officer
(416) 867-1053
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