Wilmington Announces 2019 First Quarter Results
TORONTO, May 08, 2019 (GLOBE NEWSWIRE) -- Wilmington Capital Management Inc. (“Wilmington” or the “Corporation”) (TSX: WCM.A WCM.B) reported a net loss attributable to shareholders for the three months ended March 31, 2019 of $0.2 million or ($0.02) per share compared to a net loss of $0.6 million or ($0.06) per share for the same period in 2018.
FIRST QUARTER 2019 HIGHLIGHTS
The financial highlights of the Corporation and those of its associated entities are set out below. Investments in associated entities, where the Corporation is deemed to have significant influence account for the majority of the financial results and are accounted for using the equity method of accounting. Investments in entities where the Corporation does not have significant influence, are recorded at fair market value and the results of the investees are not recorded by the Corporation.
Self-storage facilities (Real Storage Private Trust – 41.3% Ownership)
On April 15, 2019 the Corporation, together with other vendors (collectively, the “Vendors”) completed the closing of the sale of all of the interests in Real Storage Private Trust, Woodfield Limited Partnership, SNS Storage (Ontario) Limited Partnership, Real Storage GP Inc. and 2242907 Ontario In., which includes all of the Corporation’s interests in the self-storage business owned and operated by Real Storage Private Trust to Storage Vault Canada Inc. for a gross purchase price payable to the Vendors of $275 million (the “Purchase Price”). The portion of the net purchase price paid to the Corporation was approximately $53 million.
As at March 31, 2019, Wilmington had assets under management in its operating platforms of approximately $203.4 million ($66 million representing Wilmington’s share).
OPERATIONS REVIEW
Self-Storage Facilities
Real Storage Private Trust
As previously noted, the Corporation completed the sale of its interest in Real Storage Private Trust and related entities.
Private Equity
Northbridge Capital Partners Ltd. (“Northbridge”) and Northbridge Fund 2016 Limited Partnership
The Northbridge Fund 2016 value was unchanged from December 31, 2018 and with improving oil prices the value of the underlying investments in oil and gas entities has stabilized. Northbridge Fund 2016 has approximately $5.2 million of undeployed capital as at March 31, 2019.
The Corporation’s expects its remaining share of invested capital in Network 2012 Fund of $1.0 million to be realized before December 31, 2019.
Special Situations
Maple Leaf Partnerships
The Maple Leaf Partnerships are anticipating a busy 2019 season based on the improved boater occupancy in 2018 and the number of boat slip lease renewals as at March 31, 2019. The Maple Leaf Partnerships are also focused on optimizing its service department financial performance in 2019.
The re-development plan for the Bay Moorings Marina whereby the former 344-boat slip marina is to be re-developed into a water-front residential community, is awaiting approval of the re-zoning application expected to be received in June 2019.
Bow City Partnerships
On April 30, 2019, the Corporation acquired for cash consideration of $2.475 million an 19.7% interest in the Bow City partnerships which acquired two parcels of land. The west parcel, a 40,000 sq ft parcel located in the west end of Calgary, Alberta’s downtown, will be developed into a six-storey self-storage facility containing approximately 95,000 sq ft of net rentable area. The zoning approval process for the site spanned a 2-year period and the option to acquire the site was an asset excluded from the recent sale of the Trust. The project is scheduled for completion in the fall of 2020. The Eastern parcel, a 51,000 sq ft parcel, contains 32,000 sq ft of warehouse space leased to the vendor for a 2-year term.
MANAGEMENT APPOINTMENTS
The sale of Real Storage Private Trust marks another significant milestone in the history of the Corporation and the Corporation looks forward to setting its sights on the opportunities that lie ahead. Its go forward strategy will be set under the leadership of Christopher Killi who will assume the role of Managing Partner and Chief Executive Officer. Patrick Craddock will assume the role of Managing Partner and Vice President Finance. Messrs. Killi and Craddock previously were executive officers of the Trust and the Corporation. Mr. Joseph Killi will become Vice Chairman and will remain a director of the Corporation. Mr. Shane Grypiuk will continue to serve as Managing Partner and President of Northbridge and seek out private equity opportunities.
OUTLOOK
The transaction involving the sale of the Corporation’s interest in the Trust represented a compelling valuation for the Corporation and is in keeping with its strategy of seeking undervalued investment opportunities and optimizing the timing of realization. The Corporation’s success in executing its strategy stems from its ability to identify situations and markets where assets are undervalued, speed of decision making and hands on management. Post-closing, the Corporation will have the financial flexibility to continue to add value to its remaining operating platforms and to actively seek out additional investment opportunities where it can add value.
FINANCIAL RESULTS
CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE INCOME
| (unaudited) | For the three months ended March 31, | |||
| (CDN $ Thousands, except per share amounts) | 2019 | 2018 | ||
| Management fee revenue | 39 | 41 | ||
| Interest and other income | 56 | 13 | ||
| 95 | 54 | |||
| General and administrative | (228 | ) | (225 | ) |
| Finance costs | (6 | ) | --- | |
| Amortization | (48 | ) | --- | |
| Stock-based compensation | (28 | ) | (72 | ) |
| Share of net income (loss) of equity accounted investees: | ||||
| Real Storage Private Trust | 180 | (25 | ) | |
| Northbridge Capital Partners Ltd. | (1 | ) | 1 | |
| Network 2012 Limited Partners | (50 | ) | (394 | ) |
| Marina Asset Manager Inc. | --- | (11 | ) | |
| Loss before income tax | (86 | ) | (672 | ) |
| Deferred income tax recovery (expense) | (68 | ) | 75 | |
| Net loss | (154 | ) | (597 | ) |
| Other comprehensive income | ||||
| Items that will not be reclassified to net income (loss) | ||||
| Equity accounted investees – share of other comprehensive income | --- | 387 | ||
| Change in fair value of Northbridge Fund 2016 | --- | (16 | ) | |
| Related tax | --- | (50 | ) | |
| Other comprehensive income, net of tax | --- | 321 | ||
| Comprehensive loss | (154 | ) | (276 | ) |
| Net loss per share: | ||||
| Basic | (0.02 | ) | (0.06 | ) |
| Diluted | (0.02 | ) | (0.06 | ) |
CONSOLIDATED BALANCE SHEETS
| (unaudited) | (audited) | |
| As at | March 31, | December 31, |
| (CDN $ Thousands) | 2019 | 2018 |
| Assets | ||
| NON-CURRENT ASSETS | ||
| Investment in Real Storage Private Trust | --- | 13,953 |
| Investment in Northbridge Capital Partners Ltd. | 249 | 250 |
| Investment in Northbridge Fund 2016 Limited Partnership | 811 | 811 |
| Investment in Network 2012 Limited Partnership | 971 | 1,021 |
| Investment in Maple Leaf Partnerships | 3,530 | 3,530 |
| Other property | 451 | --- |
| Deferred income tax assets | 2,090 | 2,158 |
| 8,102 | 21,723 | |
| CURRENT ASSETS | ||
| Trade and other receivables | 49 | 164 |
| Cash | 3,041 | 3,077 |
| 3,090 | 3,241 | |
| Assets classified as held for sale | 14,133 | --- |
| Total assets | 25,325 | 24,964 |
| Liabilities | ||
| NON-CURRENT LIABILITIES | ||
| Lease liabilities | 330 | --- |
| 330 | --- | |
| CURRENT LIABILITIES | ||
| Lease liabilities | 143 | --- |
| Accounts payable and other | 638 | 624 |
| Total liabilities | 1,111 | 624 |
| Equity | ||
| Shareholders’ equity | 24,214 | 24,340 |
| Total equity | 24,214 | 24,340 |
| Total liabilities and equity | 25,325 | 24,964 |
Executive Officers of the Corporation will be available at 403-705-8038 to answer any questions on the Corporation’s financial results.
STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
Certain statements included in this news release may constitute forward-looking statements or information under applicable securities legislation. Forward-looking statements that are predictive in nature, depend upon or refer to future events or conditions, include statements regarding the operations, business, financial conditions, expected financial results, performance, opportunities, priorities, ongoing objectives, strategies and outlook of the Corporation and its investee entities and contain words such as "anticipate", "believe", "expect", "plan", "intend", "estimate", "propose", or similar expressions and statements relating to matters that are not historical facts constitute “forward-looking information” within the meaning of applicable Canadian securities legislation.
While the Corporation believes the anticipated future results, performance or achievements reflected or implied in those forward-looking statements are based upon reasonable assumptions and expectations, the reader should not place undue reliance on forward-looking statements and information because they involve known and unknown risks, uncertainties and other factors, many of which are beyond the Corporation’s control, which may cause the actual results, performance and achievements of the Corporation to differ materially from anticipated future results, performance or achievement expressed or implied by such forward-looking statements and information.
These risks and uncertainties include but are not limited to: the ability of management of Wilmington and its investee entities to execute its and their business plans; health, safety and environmental risks; uncertainties as to the availability and cost of financing; general economic and business conditions; the possibility that government policies or laws may change or governmental or regulatory approvals may be delayed or withheld; risks associated with existing and potential future law suits and regulatory actions against Wilmington; and other risks and uncertainties described in Wilmington's filings with Canadian securities regulatory authorities.
The foregoing list of important factors that may affect future results is not exhaustive. When relying on the forward-looking statements, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Except as required by law, the Corporation undertakes no obligation to publicly update or revise any forward-looking statements or information, that may be as a result of new information, future events or otherwise. These forward-looking statements are effective only as of the date of this document.
This news release contains natural gas volumes which have been converted on the basis of six thousand cubic feet of natural gas to one barrel of oil equivalent. Barrels of oil equivalent (“boe”) may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet to one barrel of oil is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
