CALGARY, Alberta, Nov. 05, 2024 (GLOBE NEWSWIRE) — Wilmington Capital Management Inc. (TSX: WCM.A, WCM.B) (“Wilmington” or the “Corporation”) reported net income for the three months ended September 30, 2024, of $0.05 million or $0.00 per share and net income for the nine months ended September 30, 2024 of $1.2 million or $0.09 per share, compared to net income of $2.4 million or $0.19 per share and $2.5 million and $0.20 per share for the same periods in 2023.
A summary of the Corporation’s activities is set out below:
Overview
During the past 15 months the Corporation has monetized several of its investments in order to unlock the embedded value, which had been substantially realized, simplify its business, return capital to its shareholders and pursue transactions better suited to creating value and liquidity for shareholders.
On May 7, 2024, the Corporation paid a special dividend and a return of capital distribution totaling $2.75 per Class A and Class B share, or $33.9 million. Class A shareholders received $1.25 per Class A share as a return of capital and $1.50 as an eligible dividend. Class B shareholders received $1.12 per Class B share as a return of capital and $1.63 as an eligible dividend.
On August 7, 2024, the Shareholders of the Corporation approved the disposition of all or substantially all of the assets of the Corporation. The Corporation completed the sale of the assets of Bow City 2 Limited Partnership (“Bow City Seton”), a wholly owned subsidiary of the Corporation on August 30, 2024. The assets were sold on a cost recovery basis. On November 1, 2024, the Corporation completed the sale of its interest in the Sunchaser RV Resorts Limited Partnership (“Sunchaser Partnership”) for proceeds of $ 4.7 million. The Corporation is evaluating options to sell its 18.2% interest in the Bay Moorings Partnership, which is its remaining asset. The Bay Moorings Partnership is reviewing various options to repay advances made by the Corporation. The Corporation estimates that the sale of its interest in the Bay Moorings Partnership together with the repayment of advances will generate proceeds of approximately $5.5 million.
Outlook
The Corporation has taken great strides to reassess its business opportunities in the context of a changing economic environment, simplify its business, and reward shareholders for their support through the payment of dividends and return of capital. As at November 5, 2024, and taking into account the sale of the Corporation’s investment in the Sunchaser Partnership, the Corporation had cash on hand of approximately $32 million. At the completion of monetizing its remaining investments, the Corporation expects to have cash on hand, net of liabilities, of $35 million. The Corporation is actively seeking out opportunities to scale its public platform through transactions which will create value and liquidity for shareholders.
| CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (LOSS) | ||||||||
| (unaudited) | Three months ended September 30 |
Nine months ended September 30, |
||||||
| ($ thousands, except per share amounts) | 2024 | 2023 | 2024 | 2023 | ||||
| Revenues | ||||||||
| Management fee revenue | 240 | 305 | 640 | 640 | ||||
| Interest, distributions and other income | 315 | 1,022 | 1,401 | 2,660 | ||||
| 555 | 1,327 | 2,041 | 3,300 | |||||
| Expenses | ||||||||
| General and administrative | (440 | ) | (423 | ) | (1,887 | ) | (1,331 | ) |
| Amortization | (7 | ) | (7 | ) | (21 | ) | (21 | ) |
| Finance costs | (1 | ) | (2 | ) | (4 | ) | (5 | ) |
| Stock-based compensation | — | (23 | ) | (18 | ) | (94 | ) | |
| (448 | ) | (455 | ) | (1,930 | ) | (1,451 | ) | |
| Fair value adjustments and other activities | ||||||||
| Fair value changes to investments | (30 | ) | 1,700 | 164 | 1,180 | |||
| Gain from dispositions | — | — | 947 | — | ||||
| Equity accounted income (loss) | — | 19 | — | (6 | ) | |||
| (30 | ) | 1,719 | 1,111 | 1,174 | ||||
| Income before income taxes | 77 | 2,591 | 1,222 | 3,023 | ||||
| Current income tax expense | (20 | ) | (347 | ) | (481 | ) | (540 | ) |
| Deferred income tax recovery | — | 140 | 453 | 37 | ||||
| Provision for income taxes | (20 | ) | (207 | ) | (28 | ) | (503 | ) |
| Net income | 57 | 2,384 | 1,194 | 2,520 | ||||
| Other comprehensive income | ||||||||
| Items that will not be reclassified to net income (loss): | ||||||||
| Fair value changes to investments | — | (518 | ) | — | (688 | ) | ||
| Related income taxes | — | (30 | ) | 36 | (17 | ) | ||
| Other comprehensive income (loss), net of income taxes | — | (548 | ) | 36 | (705 | ) | ||
| Comprehensive income | 57 | 1,836 | 1,230 | 1,815 | ||||
| Net income per share | ||||||||
| Basic | — | 0.19 | 0.09 | 0.20 | ||||
| Diluted | — | 0.19 | 0.09 | 0.20 | ||||
| CONSOLIDATED BALANCE SHEETS | ||||
| (unaudited) | September 30, | December 31, | ||
| ($ thousands) | 2024 | 2023 | ||
| Assets | ||||
| NON-CURRENT ASSETS | ||||
| Investment in Maple Leaf Partnerships | 910 | 22,910 | ||
| Investment in Sunchaser Partnership | — | 4,700 | ||
| Investment in Energy Securities | — | 7,584 | ||
| Land held for development | — | 6,632 | ||
| Right-of-use asset | 42 | 64 | ||
| 952 | 41,890 | |||
| CURRENT ASSETS | ||||
| Cash | 27,849 | 10,664 | ||
| Short term securities | — | 17,000 | ||
| Amounts receivable and other | 5,423 | 4,616 | ||
| Asset classified as held for sale | 4,670 | — | ||
| Total assets | 38,894 | 74,170 | ||
| Liabilities | ||||
| NON-CURRENT LIABILITIES | ||||
| Deferred income tax liabilities | 196 | 1,773 | ||
| Lease liabilities | 70 | 85 | ||
| 266 | 1,858 | |||
| CURRENT LIABILITIES | ||||
| Lease liabilities | 38 | 38 | ||
| Income taxes payable | 905 | 171 | ||
| Amounts payable and other | 607 | 800 | ||
| Total liabilities | 1,816 | 2,867 | ||
| Equity | ||||
| Shareholders’ equity | 35,619 | 51,324 | ||
| Contributed surplus | — | 1,132 | ||
| Retained earnings | 1,240 | 10,364 | ||
| Accumulated other comprehensive income | 219 | 8,483 | ||
| Total equity | 37,078 | 71,303 | ||
| Total liabilities and equity | 38,894 | 74,170 | ||
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.
