Wilmington Announces 2021 Second Quarter Results
CALGARY, Alberta, Aug. 04, 2021 (GLOBE NEWSWIRE) -- Wilmington Capital Management Inc. (“Wilmington” or the “Corporation”) reported net income for the three months ended June 30, 2021 of $23,000 or $0.00 per share compared to net income of $206,000 or $0.02 per share for the same period in 2020. For the six months ended June 30, 2021, the Corporation reported a net loss of $4,000 or ($0.00) per share compared to a net loss of $125,000 or ($0.01) per share for the same period in 2020.
OPERATIONS REVIEW – For the Period Ended June 30, 2021
As at June 30, 2021, Wilmington’s assets under management in its operating platforms totaled approximately $269 million ($76 million representing Wilmington’s share). A summary of the Corporation and the operations of its investee entities are set out below.
Marinas
Maple Leaf Partnerships
During the six months ended June 30, 2021, the Maple Leaf Partnerships acquired four marinas in Ontario having approximately 1,300 boat slips (including dry rack slips). The Maple Leaf Partnerships now own and operate 12 marinas in Ontario, having approximately 4,560 slips, which represents an increase of 98% in the number of slips owned a year ago.
The acquisitions were funded in part by way of a $6.5 million equity raise completed in March 2021. (The Corporation’s proportionate share was $1.1 million).
Despite a delayed start to the 2021 boating season due to Covid-19 restrictions put in place by the Government of Ontario, boat slip occupancies reached new heights averaging approximately 93%.
In June 2021, the Maple Leaf Partnerships distributed $1.9 million to unitholders (Wilmington’s share - $0.3 million), representing an annual cash return of 10% on invested capital.
Real Estate
Bow City Partnership
The Bow City Self Storage facility opened in January 2021 and has been well received in the marketplace. Lease up has exceeded expectations and is above proforma.
Sunchaser Partnership
During the six months ended June 30, 2021, the Corporation invested in a newly formed partnership, the Sunchaser Partnership which has a mandate to acquire opportunistic recreation vehicle (“RV”) resorts and campgrounds in Canada. The Sunchaser Partnership raised $8.7 million of which the Corporation’s proportionate share was $1.4 million. The proceeds of the capital raise, together with additional financing, were used to acquire two campgrounds in Alberta, located on approximately 280 acres of land and having approximately 650 sites.
Private Equity
Northbridge, Northbridge Fund 2021 and Northbridge Fund 2016
In April 2021, the Corporation invested $2.5 million in the Northbridge Fund 2021, a special purpose Fund which invested in a specified private oil and gas company. The total amount raised was $13.7 million.
The Northbridge Fund 2016 increased 18% in value during the three months ended June 30, 2021, due to the recovery in energy prices and efforts placed on repositioning investments into high preforming energy companies. As at June 30, 2021, Northbridge is pleased to see a nearly full recovery in the value of the underlying investments held by the Fund, after experiencing the worst oil and gas downturn in recent memory.
Outlook
During the second quarter, the Corporation continued to make progress in advancing its goal of investing in alternative asset classes. The Maple Leaf Partnerships closed its fourth acquisition of 2021 bringing the total number of wet and dry slips to 4,500. Negotiations are also in the early stages on a number of new marina acquisitions. The 84-unit waterfront residential development continues to progress well and strong pre-sales are in hand. The boating season is exceptionally strong and occupancies are at all-time highs which is consistent with increased demand in recreational boating experienced across the industry.
The newly formed Sunchaser Partnership is experiencing strong demand in its newly acquired RV resorts which are seen as enjoyable recreational alternatives. The Sunchaser Partnership now owns and operates two RV resorts in the Edmonton, Alberta area totaling approximately 650 sites.
Lease up of Bow City Storage continues to exceed expectations and is a reflection in part of its unique location and management’s experience in the self-storage business. Bow City Storage expects to add long term parking as an additional service offering in the early fall.
During the second quarter, the Corporation participated in Northbridge’s newly formed energy fund which invested $13.5 million (Corporation’s share - $2.5 million) in a private oil and gas opportunity. Northbridge is actively seeking additional investment opportunities in the industry.
The Corporation is pleased with the progress of its new and existing initiatives and investments and looks forward to adding to each of its operating platforms.
FINANCIAL RESULTS
STATEMENT OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS) (unaudited)
| For the | Three Months ended June 30, | Six months ended June 30, | ||||||
| (CDN $ thousands, except per share amounts) | 2021 | 2020 | 2021 | 2020 | ||||
| Management fee revenue | 105 | 29 | 166 | 69 | ||||
| Interest and other income | 480 | 677 | 731 | 1,028 | ||||
| 585 | 706 | 897 | 1,097 | |||||
| Expenses | ||||||||
| General and administrative | (330 | ) | (292 | ) | (644 | ) | (614 | ) |
| Amortization | (48 | ) | (48 | ) | (96 | ) | (96 | ) |
| Finance costs | (3 | ) | (10 | ) | (6 | ) | (15 | ) |
| Stock-based compensation | (176 | ) | (101 | ) | (253 | ) | (217 | ) |
| (557 | ) | (451 | ) | (999 | ) | (942 | ) | |
| Fair value adjustments and other activities | ||||||||
| Fair value changes in Energy Securities | (53 | ) | 126 | (23 | ) | (88 | ) | |
| Equity accounted income (loss) | 98 | (15 | ) | 76 | (37 | ) | ||
| 45 | 111 | 53 | (125 | ) | ||||
| Income (loss) before income taxes | 73 | 366 | (49 | ) | 30 | |||
| Current income tax recovery (expense) | 8 | (152 | ) | 91 | (30 | ) | ||
| Deferred income tax expense | (58 | ) | (8 | ) | (46 | ) | (125 | ) |
| Provision for income taxes | (50 | ) | (160 | ) | 45 | (155 | ) | |
| Net income (loss) | 23 | 206 | (4 | ) | (125 | ) | ||
| Other comprehensive income (loss) | ||||||||
| Items that will not be reclassified to net loss: | ||||||||
| Fair value changes in Northbridge Fund 2016 | 142 | 21 | 350 | (366 | ) | |||
| Related income taxes | 8 | 9 | (41 | ) | 52 | |||
| Other comprehensive income (loss), net of income taxes | 150 | 30 | 309 | (314 | ) | |||
| Comprehensive income (loss) | 173 | 236 | 305 | (439 | ) | |||
| Net income (loss) per share | ||||||||
| Basic | --- | 0.02 | --- | (0.01 | ) | |||
| Diluted | --- | 0.02 | --- | (0.01 | ) | |||
BALANCE SHEETS
| (unaudited) | June 30, | December 31, | |
| (CDN $ thousands) | 2021 | 2020 | |
| Assets | |||
| NON-CURRENT ASSETS | |||
| Investment in Maple Leaf Partnerships | 13,310 | 12,184 | |
| Investment in Bow City Partnerships | 2,706 | 2,706 | |
| Investment in Sunchaser Partnership | 1,366 | --- | |
| Investment in Northbridge and Energy Securities | 4,468 | 1,565 | |
| Note receivable | --- | 510 | |
| 21,850 | 16,965 | ||
| CURRENT ASSETS | |||
| Cash | 643 | 3,055 | |
| Short term securities | 38,000 | 41,000 | |
| Income taxes receivable | 73 | --- | |
| Amounts receivable and other assets | 2,142 | 1,240 | |
| Total assets | 62,708 | 62,260 | |
| Liabilities | |||
| NON-CURRENT LIABILITIES | |||
| Deferred income tax liabilities | 354 | 268 | |
| 354 | 268 | ||
| CURRENT LIABILITIES | |||
| Lease liabilities | 17 | 138 | |
| Income taxes payable | --- | 78 | |
| Amounts payable and other | 584 | 581 | |
| Total liabilities | 955 | 1,065 | |
| Equity | |||
| Shareholders’ equity | 51,179 | 51,179 | |
| Contributed surplus | 854 | 601 | |
| Retained earnings | 5,043 | 5,047 | |
| Accumulated other comprehensive income | 4,677 | 4,368 | |
| Total equity | 61,753 | 61,195 | |
| Total liabilities and equity | 62,708 | 62,260 |
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 AND OTHER MEASUREMENTS
Certain statements included in this document 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.
Factors and risks that could cause actual results to differ materially from those contemplated or implied by forward-looking statements include but are not limited to: the ability of management of Wilmington and its investee entities to execute its and their business plans; availability of equity and debt financing and refinancing within the equity and capital markets; strategic actions including dispositions; business competition; delays in business operations; the risk of carrying out operations with minimal environmental impact; industry conditions including changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; operational matters related to investee entities business; incorrect assessments of the value of acquisitions; fluctuations in interest rates; stock market volatility; general economic, market and business conditions; risks associated with existing and potential future law suits and regulatory actions against Wilmington and its investee entities; uncertainties associated with regulatory approvals; uncertainty of government policy changes; uncertainties associated with credit facilities; changes in income tax laws, tax laws; changes in accounting policies and methods used to report financial condition (including uncertainties associated with critical accounting assumptions and estimates); the effect of applying future accounting changes; and other risks, factors and uncertainties described elsewhere in this document or in Wilmington's other 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.
