TSX Symbol FC
TORONTO, March 29, 2016 /CNW/ - Firm Capital Mortgage
Investment Corporation (the "Corporation") (TSX FC) today released
its financial statements for the three and twelve months ended
December 31, 2015.
HIGHLIGHTS
FOURTH QUARTER STRONG INCREASE IN PROFIT
Profit for the quarter ended December 31,
2015 increased by 9% to $5,376,207 as compared to $4,942,120 for the same period in the prior
year. Profit for the year ended December 31, 2015 of $20,081,258 represents a 3% increase over the
comparable year ended 2014 year of $19,510,113. Basic weighted average profit
per share for the quarter ended December 31,
2015 was $0.265, which is 8%
higher than the $0.245 per share
reported for the three months ended December
31, 2014. Basic weighted average profit per share for the
year ended December 31, 2015 was
$0.991, which is slightly higher
compared to the $0.976 per share
reported for the year ended December 31,
2014. The Corporation distributed 100% of its profits for
2015.
INCREASED DIVIDENDS
For the fourth quarter and year ended December 31, 2015, the Corporation declared
dividends totaling $0.289 and
$0.991 per share versus $0.268 and $0.970
per share for the fourth quarter and year ended December 31, 2014. The December, 2015 special
dividend was 5.5 cents per share.
SIGNIFICANT 17% YEAR OVER YEAR PORTFOLIO GROWTH
The Corporation's investment portfolio (the "Investment
Portfolio"), as at December 31,
2015 increased by $59.2 million
to approximately $398.7 million as
compared to $339.5 million as at
December 31, 2014 (net of the
impairment provision of $4.23 and
$3.36 million respectively).
VERY SHORT TERM POTFOLIO WITH HUGE ANNUAL TURNOVER
In 2015, the Investment Portfolio repayments totaled $285 million with new investments during the year
totaling $345 million. This
turn is the key to our investment approach and the measure of its
success.
RETURN ON EQUITY
The Corporation continues to exceed its yield objective of
producing a return on shareholders' equity in excess of 400 basis
points over the average one year Government of Canada Treasury bill
yield. Profit for the quarter ended December
31, 2015 represents an annualized return on shareholders'
equity (based on the month end average shareholders' equity in the
quarter) of 10.18%, representing return on shareholders' equity of
969 basis points per annum over the average one year Government of
Canada Treasury bill yield of 0.49%.
PRUDANT IMPAIRMENT PROVISION
Management has always taken a proactive approach to allowance
provision reserves. This is a prudent approach to protecting the
stability of dividends to shareholders in the event there are any
future issues with any of the investments within the Corporation's
investment portfolio. The impairment provision was increased by
$870,000 during 2015 to $4,230,000 as at December
31, 2015, and represents 1.05% of the investment portfolio
balance.
INVESTMENT PORTFOLIO DETAILS
Details on the Corporation's investment portfolio as at
December 31, 2015 are as follows:
- Total gross investment portfolio of $402,919,638, which is an 18% increase over
December 31, 2014.
- Conventional first mortgages, being those first mortgages with
loan to values less than 75%, comprise 71% of our total portfolio,
and total conventional mortgages with loan to values under 75%
comprise 81% of our total portfolio.
- Approximately 65% of the portfolio matures by December 31, 2016.
- The average face interest rate on the portfolio is 8.19% per
annum.
- Regionally, the portfolio is diversified approximately as
follows: Ontario (72%),
Quebec (11%), Alberta (11%) and Other (6%).
DIVIDEND AND SHARE PURCHASE PLAN
The Corporation has
in place a Dividend Reinvestment Plan (DRIP) and Share Purchase
Plan that is available to its Shareholders. The plan allows
participants to have their monthly cash dividends reinvested in
additional shares at a 2% discount to market price, if higher than
$12.50 of the weighted average
trading price calculated five trading days immediately preceding
each dividend date with no commission cost and grants participants
the right to purchase, without commission, additional shares, up to
a maximum of $12,000 per annum.
About The Corporation
The Corporation, through its
mortgage banker, Firm Capital Corporation, is a non-bank lender
providing residential and commercial short-term bridge and
conventional real estate financing, including construction,
mezzanine and equity investments. The Corporation's investment
objective is the preservation of shareholders' equity, while
providing shareholders with a stable stream of monthly dividends
from investments. The Corporation achieves its investment
objectives through investments in selected niche markets that are
under-serviced by large lending institutions. The Corporation is a
Mortgage Investment Corporation (MIC) as defined in the Income Tax
Act (Canada). Accordingly, the
Corporation 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. Full reports of the financial results of the
Corporation for the year are outlined in the audited financial
statements and the related management discussion and analysis of
Corporation, available on the SEDAR website at www.sedar.com.
In addition, supplemental information is available on Corporation's
website at www.firmcapital.com.
Forward-Looking Statements
This news release contains
forward-looking statements within the meaning of applicable
securities laws including, among others, statements concerning our
objectives, our strategies to achieve those objectives, our
performance, our mortgage portfolio and our distributions, as well
as statements with respect to management's beliefs, estimates, and
intentions, and similar statements concerning anticipated future
events, results, circumstances, performance or expectations that
are not historical facts. Forward-looking statements
generally can be identified by the use of forward-looking
terminology such as "outlook", "objective", "may", "will",
"expect", "intent", "estimate", "anticipate", "believe", "should",
"plans" or "continue" or similar expressions suggesting future
outcomes or events. Such forward-looking statements reflect
management's current beliefs and are based on information currently
available to management.
These statements are not guarantees of future performance and
are based on our estimates and assumptions that are subject to
risks and uncertainties, including those described in the
Corporation's Annual Information Form under "Risk Factors" (a copy
of which can be obtained at www.sedar.com). Those risks and
uncertainties include, among others, risks associated with mortgage
lending, dependence on the Corporation's manager and mortgage
banker, competition for mortgage lending, real estate values,
interest rate fluctuations, environmental matters, shareholder
liability and the introduction of new tax rules. Material
factors or assumptions that were applied in drawing a conclusion or
making an estimate set out in the forward-looking information
include, among others, that the Corporation is able to invest in
mortgages at rates consistent with rates historically achieved;
adequate mortgage investment opportunities are presented to the
Corporation; and adequate bank indebtedness and bank loans are
available to the Corporation. Although the forward-looking
information continued in this new release is based upon what
management believes are reasonable assumptions, there can be no
assurance that actual results and performance will be consistent
with these forward-looking statements.
All forward-looking statements in this news release are
qualified by these cautionary statements. Except as required
by applicable law, the Corporation undertakes no obligation to
publicly update or revise any forward-looking statement, whether as
a result of new information, future events or otherwise.
SOURCE Firm Capital Mortgage Investment Corporation
