Wilmington Announces 2011 Third Quarter Results
11 November 2011 - 1:00AM
Marketwired Canada
Wilmington Capital Management Inc. (TSX:WCM.A)(TSX:WCM.B) today announced a net
loss for the three months ended September 30, 2011 of $35,000 compared to a net
loss of $41,000 for the same period in 2010. The net loss per Class A and Class
B share for the three months ended September 30, 2011 was $(0.00), compared to
$(0.00) per share for the same period in 2010. For the nine months ended
September 30, 2011, net income amounted to $20.2 million or $2.52 per share
compared to a net loss of $33,000 or $(0.00) cents per share for the same period
in 2010.
The Corporation has recently completed its 2011 strategic plan and has taken
steps to broaden its investment strategy to include selective investments in the
real estate as well as the energy sectors. The Corporation's principal objective
will continue to be aimed at generating appreciation in value from its
investments as opposed to current income. Accordingly, net income, excluding
gains and losses from investment dispositions, is expected to be minimal in any
given year.
On January 7, 2011, all of the issued and outstanding common shares of
Parkbridge Lifestyle Communities Inc. were acquired by the British Columbia
Investment Management Corporation for $7.30 in cash per common share. Pursuant
to this transaction, Wilmington received $40.6 million in proceeds, realized a
pre-tax gain of $23.6 million and repaid its $14.6 million loan payable facility
relating to the Parkbridge shares.
In February, 2011, Wilmington acquired a 46.15% indirect interest in a portfolio
of five self-storage facilities and two development properties in Alberta,
British Columbia and Ontario through the Real Storage Private Trust (the
"Trust"). The five operating properties are in the initial lease up stage and
are expected to reach stabilized occupancy and cash flow in 2012. Wilmington's
share of the cash consideration to complete the acquisition consisted of $2.5
million used to subscribe for additional equity in the Trust and a $1.625
million bridge loan to the Trust repayable upon demand and bearing interest at
7% per annum. The bridge loan and accrued interest have since been fully repaid
with proceeds from the sale of one of the development properties. The Trust now
owns 17 self-storage facilities comprising 645,978 square feet of rentable area
and one development property.
On August 17, 2011, the Corporation acquired 50% of the issued and outstanding
voting shares in NCI Management Ltd. ("NCI") for consideration consisting of
589,673 Class A shares issued by the Corporation. NCI is an investment company
focused on private equity having a mandate to identify and invest in early stage
opportunities in energy, energy services, real estate and special situations.
Pursuant to the transaction the vendor retains control of day to day operations
for a period of two years. During the third quarter of 2011, the Corporation
loaned $25,000 to NCI by way of a non-interest bearing promissory note for
working capital purposes. The loan is due on demand.
Wilmington also owns land leased to commercial property owners which is located
at 370 Third Street in San Francisco, California. During the fourth quarter of
2010, Wilmington reorganized its investment in this property and entered into a
new secured credit facility on which $1.6 million net is drawn, bears interest
at 4% per annum and is repayable on January 1, 2013. At maturity this credit
facility is payable, at the borrower's discretion, in cash or in shares of the
Corporation's wholly owned subsidiary which owns the property.
Subsequent to the third quarter, the Corporation formed a partnership which
acquired 100% working interest in certain petroleum and gas assets in the
Shackleton Field in Saskatchewan. The aggregate cost of the assets including
closing costs amounted to approximately 19.8 million and was funded by a
combination of cash and debt. The Corporation's ownership interest in the
partnership is 59% and its share of cash consideration to complete the
acquisition amounted to $6.215 million which was used to subscribe for
partnership units. In addition, the Corporation advanced approximately $800,000
to the partnership to fund short term capital needs of the partnership. The
assets will be professionally managed by an entity in which the Corporation has
a 51% ownership interest.
Beginning January 1, 2011, the Corporation has prepared its financial statements
in accordance with IFRS. Accordingly, certain adjustments were made to comply
with IFRS for the current and comparable periods.
FINANCIAL HIGHLIGHTS
As reported under International Financial Reporting Standards
CONDENSED INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS
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Three months ended Nine months ended
Unaudited September 30 September 30
(Thousands of Canadian Dollars,
except per share amounts) 2011 2010 2011 2010
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Income
Investment and other income $ 72 $ 210 $ 233 $ 420
Income from investment property 288 310 866 920
Foreign exchange gain --- 39 --- 28
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360 559 1,099 1,368
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Expenses
Interest 293 448 872 1,128
General and administrative 44 63 239 164
Foreign exchange loss --- --- 59 ---
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412 511 1,170 1,292
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Income (loss) before gain on
sale, share of net loss from
equity accounted investment and
income tax expense (benefit) (52) 48 (71) 76
Gain on sale of investment in
Parkbridge Lifestyle Communities
Inc. --- --- 23,581 ---
Share of net loss from equity
accounted investments (25) (225) (229) (225)
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Income (loss) before income taxes (27) 177 23,281 (149)
Income tax expense (benefit) 8 (136) 3,075 (116)
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Net Income (loss) $ (35) $ (41) $ 20,206 $ (33)
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Net income (loss) per share -
basic $ (0.00) $ 0.00 $ 2.52 $ (0.00)
Net income (loss) per share -
diluted $ (0.00) $ 0.00 $ 2.52 $ (0.00)
CONDENSED INTERIM CONSOLIDATED BALANCE SHEET
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Unaudited September 30, December 31, January 1,
(Thousands of Canadian Dollars) 2011 2010 2010
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Assets
Non-current assets
Investment property $ 19,448 $ 18,507 $ 19,489
Investment in associate 7,104 4,819 ---
Investment in Parkbridge Lifestyle
Communities Inc. 1,814 40,466 28,109
Deferred tax asset 51 --- ---
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28,417 63,792 47,598
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Current assets
Loan to associate 25 --- ---
Receivables and other assets 79 67 56
Cash and cash equivalents 25,832 2,085 1,569
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25,936 2,152 1,625
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Total assets $ 54,353 $ 65,944 $ 49,223
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Liabilities
Non-current liabilities
Secured debt $ 19,937 $ 18,949 $ 19,962
Loan payable 1,639 16,103 10,501
Deferred tax liabilities --- 3,431 1,933
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21,576 38,483 32,396
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Current liabilities
Accounts payable and accrued
liabilities 654 588 700
Income taxes payable 3,315 --- ---
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3,969 588 700
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Total liabilities 25,545 39,071 33,096
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Equity
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Shareholders' equity 28,808 26,873 16,127
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Total liabilities and equity $ 54,353 $ 65,944 $ 49,223
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CONDENSED INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
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Three months ended Nine months ended
Unaudited September 30 June 30
(Thousands of Canadian Dollars) 2011 2010 2011 2010
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Net income (loss) $ (35) $ (41) $ 20,206 $ (33)
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Foreign currency translation 66 (49) 30 (32)
Reversal of the fair value increment
of available for sale securities --- 2,338 23,414 2,950
Future income taxes on above items --- (362) 3,285 (481)
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Other comprehensive income (loss) 25 1,927 20,099 2,437
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Comprehensive income $ 56 $ 1,886 $ 107 $ 2,404
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Executive Officers of the Corporation will be available at 403-800-0869 to
answer any questions on the Corporation's financial results.
This news release contains forward-looking statements concerning the
Corporation's business and operations. The Corporation cautions that, by their
nature, forward-looking statements involve risk and uncertainty and the
Corporation's actual results could differ materially from those expressed or
implied in such statements. Reference should be made to the most recent Annual
Information Form for a description of the major risk factors.
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