NET ASSET VALUE
The Corporation has an adjusted NAV1 of $11.37/share. This represents 13% discount to the closing price as of November 6, 2023 of $9.89/share.
Investment
Firm Capital Mortgage Investment Corporation Announces Q3/2023 Results
NET INCOME
For the three months ended September 30, 2023 net income increased by 5.1% to $8,594,640 as compared to $8,179,541 for the same period in 2022. Net income for the nine months ended September 30, 2023 increased by 6.4% to $25,828,891, as compared to $24,278,981 reported for the same period in 2022. The increase is primarily a result of a higher interest income.
EARNINGS PER SHARE
Basic weighted average earnings per share for the three months ended September 30, 2023 was $0.249 (September 30, 2022 – $0.237). Basic weighted average earnings per share for the nine months ended September 30, 2023 was $0.749 (September 30, 2022 – $0.708).
PORTFOLIO
The Corporation’s Investment Portfolio decreased by $82 million to $578,929,118 as at September 30, 2023, in comparison to $661,003,596 as at December 31, 2022 (in each case, gross of impairment allowance, fair value adjustment, and unamortized fees). During the nine months ended September 30, 2023, new investment funding was $162.9 million (nine months ended September 30, 2022 – $326.8 million), and repayments were $244.8 million (nine months ended September 30, 2022 – $332.9 million). On September 30, 2023, the Investment Portfolio consisted of 241 investments (December 31, 2022 – 252). The average gross investment size was approximately $2.4 million, with 13 investments individually exceeding $7.5 million.
The Corporation specializes in providing bridge mortgage financing that entails seeing the portfolio revolve and re-deployed into new investments based on current market rates. Of the $578 million Investment portfolio as at September 30, 2023, approximately 88% was either underwritten or newly funded during 2023 and 2022. Only approximately 12% of the Investment Portfolio is associated with investments that were underwritten, or newly funded prior to 2022. The Investment Portfolio’s revolving nature demonstrates the successful implementation of the Corporation’s bridge financing strategy.
PRUDENT IMPAIRMENT ALLOWANCE
Management has always taken a proactive approach to the Corporation’s loan impairment allowance. This is a prudent approach that provides stability of dividends to our shareholders in the event there are any future issues with any of the loans within the Corporation’s Investment Portfolio. The allowance for impairment and fair value adjustment as of September 30, 2023 was $19.16 million (December 31, 2022 – 10.16 million), comprising (i) $6.20 million (December 31, 2022 – $3.70 million) representing the total amount of management’s estimate of the shortfall between the investment balances and the estimated recoverable amount from the security under the specific loans, (ii) $10.46 million (2022 – $4.70 million) representing the total amount of management’s estimate of fair value adjustment on two investments stated at fair value through profit or loss; and (iii) a collective allowance balance of $2.50 million (2022 – $1.76 million).
INVESTMENT PORTFOLIO DETAILS
Details on the Corporation’s investment portfolio as at September 30, 2023, are as follows:
- Total gross investment portfolio of $578,929,118 a 12.4% decrease from the $661,003,596 reported at December 31, 2022.
- Conventional first mortgages, being those first mortgages with loan-to-values less than 75%, comprise 86.0% of the total portfolio (83.5% as at December 2022), and total conventional mortgages with loan-to-values less than 75%, comprise 92.5% of the total portfolio (88.6% as at December 2022).
- Approximately 85% of the portfolio matures by December 31, 2024, of which 29% matures by December 31, 2023.
- The average face interest rate on the portfolio is 11.10% per annum, as compared to 10.99% on December 30, 2022.
- Regionally, the mortgage investment portfolio is primarily diversified as follows: Ontario (87.5%), Quebec (6.1%), and Western Canada (3.1%).
- 95% of the Portfolio have variable interest rates and are priced to be the greater of: (i) Bank Prime plus spread (“Base Rate”), and (ii) a fixed floor rate.
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 DRIP allows participants to have their monthly cash dividends reinvested in additional shares. The price paid per share is 97% (if the share price is higher than $14.85) of the weighted average trading price calculated five trading days immediately preceding each dividend date with no commission cost. Once registered with the Share Purchase Plan, participants have the right to purchase additional shares, totaling no greater than $12,000 per year and no less than $250 per month. Shareholders participating pay no commission.
About the Corporation
Where Mortgage Deals Get Done®
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. Lending activities to date continue to develop a diversified mortgage portfolio, producing a stable return to shareholders. Full reports of the financial results of the Corporation for the year are outlined in the audited consolidated financial statements and the related management discussion and analysis of the Corporation, available on the SEDAR website at www.sedar.com. In addition, supplemental information is available on the Corporation’s website at www.firmcapital.com.
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 investment portfolio and our dividends, 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 our current Annual Information Form under “Risk Factors” (a copy of which can be obtained at www.sedar.com), which could cause our actual results and performance to differ materially from the forward-looking statements contained in this news release.
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.
For further information, please contact:
Firm Capital Mortgage Investment Corporation
Eli Dadouch
President & Chief Executive Officer
(416) 635-0221
Boutique Mortgage Lenders®
1 Includes the face value of the maturing debentures.
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Investment
Tesla shares soar more than 14% as Trump win is seen boosting Elon Musk’s electric vehicle company
NEW YORK (AP) — Shares of Tesla soared Wednesday as investors bet that the electric vehicle maker and its CEO Elon Musk will benefit from Donald Trump’s return to the White House.
Tesla stands to make significant gains under a Trump administration with the threat of diminished subsidies for alternative energy and electric vehicles doing the most harm to smaller competitors. Trump’s plans for extensive tariffs on Chinese imports make it less likely that Chinese EVs will be sold in bulk in the U.S. anytime soon.
“Tesla has the scale and scope that is unmatched,” said Wedbush analyst Dan Ives, in a note to investors. “This dynamic could give Musk and Tesla a clear competitive advantage in a non-EV subsidy environment, coupled by likely higher China tariffs that would continue to push away cheaper Chinese EV players.”
Tesla shares jumped 14.8% Wednesday while shares of rival electric vehicle makers tumbled. Nio, based in Shanghai, fell 5.3%. Shares of electric truck maker Rivian dropped 8.3% and Lucid Group fell 5.3%.
Tesla dominates sales of electric vehicles in the U.S, with 48.9% in market share through the middle of 2024, according to the U.S. Energy Information Administration.
Subsidies for clean energy are part of the Inflation Reduction Act, signed into law by President Joe Biden in 2022. It included tax credits for manufacturing, along with tax credits for consumers of electric vehicles.
Musk was one of Trump’s biggest donors, spending at least $119 million mobilizing Trump’s supporters to back the Republican nominee. He also pledged to give away $1 million a day to voters signing a petition for his political action committee.
In some ways, it has been a rocky year for Tesla, with sales and profit declining through the first half of the year. Profit did rise 17.3% in the third quarter.
The U.S. opened an investigation into the company’s “Full Self-Driving” system after reports of crashes in low-visibility conditions, including one that killed a pedestrian. The investigation covers roughly 2.4 million Teslas from the 2016 through 2024 model years.
And investors sent company shares tumbling last month after Tesla unveiled its long-awaited robotaxi at a Hollywood studio Thursday night, seeing not much progress at Tesla on autonomous vehicles while other companies have been making notable progress.
Tesla began selling the software, which is called “Full Self-Driving,” nine years ago. But there are doubts about its reliability.
The stock is now showing a 16.1% gain for the year after rising the past two days.
The Canadian Press. All rights reserved.
TORONTO – Canada’s main stock index was up more than 100 points in late-morning trading, helped by strength in base metal and utility stocks, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 103.40 points at 24,542.48.
In New York, the Dow Jones industrial average was up 192.31 points at 42,932.73. The S&P 500 index was up 7.14 points at 5,822.40, while the Nasdaq composite was down 9.03 points at 18,306.56.
The Canadian dollar traded for 72.61 cents US compared with 72.44 cents US on Tuesday.
The November crude oil contract was down 71 cents at US$69.87 per barrel and the November natural gas contract was down eight cents at US$2.42 per mmBTU.
The December gold contract was up US$7.20 at US$2,686.10 an ounce and the December copper contract was up a penny at US$4.35 a pound.
This report by The Canadian Press was first published Oct. 16, 2024.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
The Canadian Press. All rights reserved.
TORONTO – Canada’s main stock index was up more than 200 points in late-morning trading, while U.S. stock markets were also headed higher.
The S&P/TSX composite index was up 205.86 points at 24,508.12.
In New York, the Dow Jones industrial average was up 336.62 points at 42,790.74. The S&P 500 index was up 34.19 points at 5,814.24, while the Nasdaq composite was up 60.27 points at 18.342.32.
The Canadian dollar traded for 72.61 cents US compared with 72.71 cents US on Thursday.
The November crude oil contract was down 15 cents at US$75.70 per barrel and the November natural gas contract was down two cents at US$2.65 per mmBTU.
The December gold contract was down US$29.60 at US$2,668.90 an ounce and the December copper contract was up four cents at US$4.47 a pound.
This report by The Canadian Press was first published Oct. 11, 2024.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
The Canadian Press. All rights reserved.
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