Wilmington Capital Management Inc. ("Wilmington" or the
"Corporation") (TSX:WCM.A)(TSX:WCM.B) today announced a net loss
attributable to shareholders for the three months ended December
31, 2012 of $938,000 or ($0.11) compared to a net loss attributable
to shareholders of $398,000 or ($0.05) for the same period in 2011.
For the year ended December 31, 2012, net loss attributable to
shareholders amounted to $1.5 million or ($0.18) per share compared
to a net income of $19.7 million or $2.43 per share for the same
period in 2011.
To view a full copy of the Corporation's audited financial
results for the year ended December 31, 2012 including the
Corporation's audited consolidated financial statements,
accompanying MD&A and Annual Information Form, please refer to
the SEDAR website www.sedar.com.
Operations Review
Strategic Plan
The Corporation's principal objectives are to make investments
capable of generating appreciation in value as opposed to current
income and to maximize shareholder returns by investing its own
capital alongside partners and co-investors in hard assets and
private equity funds. These assets are managed through the
Corporation's operating platforms where Wilmington can add scale
and improve valuations.
During 2012, Wilmington continued to take steps to solidify the
foundation of its three operating platforms - self-storage
facilities, private equity funds and natural gas assets. Core
management teams, operational, accounting and reporting systems as
well as a pipeline of new opportunities are in place. As at
December 31, 2012, Wilmington had assets under management in its
operating platforms of approximately $135 million ($64 million
representing Wilmington's share).
Investment in Real Storage Private Trust (the "Trust")
The Trust (44.78% owned) owns 17 self-storage facilities
comprising 645,978 square feet of rentable area and one development
property. The Trust showed significant improvements in 2012 as the
five properties in western Canada, which were for the most part in
the initial lease up stage, approached stabilized occupancy levels.
Across the portfolio of 17 properties, occupancy levels averaged
78%, compared to 73% in 2011. Operating margins improved to 52% up
from 47% achieved in 2011.
Investment in Network Capital Management Inc. ("NCI") and
Network 2012 Fund
NCI (50% owned) successfully closed its $22.3 million fund in
early 2012 bringing total assets under management to $49 million.
The majority of the capital in the 2012 fund was deployed during
the year in a strong mix of junior oil and gas and service
companies. Wilmington invested $8 million in the 2012 fund.
Investment in Shackleton 2011 Limited Partnership (the
"Shackleton Partnership" or the "Partnership")
The natural gas assets owned through the Shackleton Partnership
(59% owned) have proven to be of high quality and present good
opportunities for growth and future development once we reach a
more favorable natural gas pricing environment. The weighted
average price realized during 2012 was $2.33 per mcf and operating
netbacks averaged $0.98 per mcf. Natural gas production volumes for
the 100% interest in the Shackleton field amounted to 5,283 mcf per
day (881 boepd) for the year. Estimated proved plus probable
reserves attributable to the Shackleton assets as evaluated by GLJ
Petroleum Consultants Ltd. with an effective date of December 31,
2012 were 19,702 MMcf. The outlook for natural gas pricing has
improved significantly and a better pricing environment will be
beneficial to the operating performance of the Shackleton assets.
Of its 2013 production, approximately 50% has been hedged under
fixed price contracts with an average price of $3.18 per mcf.
Discontinued Operations
During the fourth quarter, the Corporation took further steps to
rationalize its core business and entered into an agreement to sell
its interest in commercial land in San Francisco, California. The
sale is scheduled to close during the second quarter of 2013.
2013 Outlook
The Corporation is pleased with the progress made in solidifying
and building upon its three operating platforms - the Trust, NCI
and the Shackleton Partnership. In 2013 and in the years ahead, the
Corporation expects to add scale to these operating platforms,
improve valuations and earn attractive cash flow and total returns
for shareholders.
FINANCIAL HIGHLIGHTS
CONSOLIDATED STATEMENTS OF INCOME
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Unaudited Three months ended Years ended
December 31 December 31
(Thousands of Canadian Dollars,
except per share amounts) 2012 2011 2012 2011
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Income
Natural gas sales $ 1,403 $ 1,124 $ 4,498 $ 1,124
Royalties (269) (218) (822) (218)
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Natural gas revenue 1,134 906 3,676 906
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Investment and other income 40 71 233 278
Foreign exchange gain --- 31 33 ---
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1,174 1,008 3,942 1,184
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Expenses
Petroleum operations 469 409 1,808 409
Depletion, depreciation and
amortization 419 303 1,628 303
General and administrative 425 672 1,201 911
Foreign exchange loss 9 --- --- 40
Stock compensation 71 30 210 30
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Operating loss (219) (406) (905) (509)
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Finance costs 95 87 377 87
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Loss before gain on sale, share of
equity accounted investments and
income taxes (314) (493) (1,282) (596)
Gain on sale of investment 12 --- 12 23,581
Share of net income (loss) from Real
Storage Private Trust 25 (8) 163 (223)
Share of net loss from Network
Capital Management Inc. (27) (59) (43) (73)
Share of net loss from Network 2012
Fund (39) --- (147) ---
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(Loss) income before income taxes (343) (560) (1,297) 22,689
Income tax benefit (expense) 50 81 327 (2,985)
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Net Income (loss) from continuing
operations (293) (479) (970) 19,704
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Income from discontinued operations,
net of tax (944) (6) (938) 17
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Net income (loss) $ (1,237) $ (485) $ (1,908) $ 19,721
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Net income (loss) attributable to:
Owners of the Corporation $ (938) $ (398) $ (1,524) $ 19,808
Non-controlling interest (299) (87) (384) (87)
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$ (1,237) $ (485) $ (1,908) $ 19,721
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Net (loss) income per share from
continuing operations
Basic $ --- $ (0.03) $ (0.07) $ 2.43
Diluted $ --- $ (0.03) $ (0.07) $ 2.43
Net (loss) income per share
Basic $ (0.11) $ (0.05) $ (0.18) $ 2.43
Diluted $ (0.11) $ (0.05) $ (0.18) $ 2.43
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CONSOLIDATED BALANCE SHEET
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December 31, December 31,
(Thousands of Canadian Dollars) 2012 2011
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Assets
Non-current assets
Investment property $ --- $ 18,933
Investment in Real Storage Private Trust 7,271 7,096
Investment in Network Capital Management Inc. 1,712 1,755
Investment in Network 2012 Fund 7,554 ---
Natural gas property, plant and equipment 17,840 19,436
Deferred tax asset --- 135
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34,377 47,355
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Current assets
Loan to Network Capital Management Inc. --- 50
Income taxes receivable 435 ---
Receivables and other assets 885 923
Cash and cash equivalents 6,601 18,688
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7,921 19,661
Assets held for sale 18,541 ---
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26,462 19,661
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Total assets $ 60,839 $ 67,016
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Liabilities
Non-current liabilities
Secured debt $ --- $ 19,403
Loan payable --- 1,615
Asset retirement obligations 750 708
Deferred tax liabilities 259 ---
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1,009 21,726
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Current liabilities
Accounts payable and accrued liabilities 1,024 1,481
Revolving loan facility 6,700 7,830
Income taxes payable --- 3,336
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7,724 12,647
Liabilities held for sale 21,432 ---
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29,156 12,647
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Total liabilities 30,165 34,373
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Equity
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Shareholders' equity 26,860 28,445
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Non-controlling interest 3,814 4,198
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Total equity 30,674 32,643
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Total liabilities and equity $ 60,839 $ 67,016
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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
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Unaudited Three months ended Year ended
December 31 December 31
(Thousands of Canadian Dollars) 2012 2011 2012 2011
----------------------------------------------------------------------------
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Net income (loss) $ (1,237) $ (485) $ (1,908) $ 19,721
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Share of other comprehensive loss
from Network 2012 Fund 81 --- (299) ---
Reversal of the fair value
increment of available for sale
securities --- --- --- (23,414)
Future income taxes on above items (9) --- 39 3,287
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Other comprehensive income (loss)
from continuing operations 72 --- (260) (20,127)
Other comprehensive (loss) income
from discontinued operations, net
of tax 18 5 (11) 33
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Comprehensive income (loss) $ (1,147) $ (480) $ (2,179) $ (373)
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Comprehensive income (loss)
attributable to:
Owners of the Corporation $ (848) $ (393) $ (1,795) $ (286)
Non-controlling interest (299) 87 (384) (87)
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$ (1,147) $ (480) $ (2,179) $ (373)
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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.
Contacts: Wilmington Capital Management Inc. Executive Officers
(403) 800-0869
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