TORONTO, June 8, 2020 /CNW/ – Romspen Mortgage Investment Fund, a leading non-bank mortgage lender specializing in commercial and industrial real estate, today released its financial statements for the year ended December 31, 2019. For 2019, the Fund achieved a 7.5% net yield, reflecting both a strong absolute return and significant comparative outperformance against the major fixed income benchmarks.
2019 Highlights
The net investment portfolio increased by 15% in 2019 to $3.0 billion.
Net earnings for 2019 increased by 1% to $187 million.
Distributions to investors totalled $0.73 per unit to yield a compounded net return of 7.5%.
Net yield of 7.5% for Romspen significantly outperformed T-bills (1.7%) and the FTSE-TMX Short-Term Bond Index (“FTSE/TMX–STBI”) (3.1%). S&P/TSX Composite Total Return Index (“S&P/TSX”) (22.9%).
Romspen’s past three, five, ten and twenty year performance has outperformed T–bills, FTSE/TMX–STBI and S&P/TSX.
US mortgages in the portfolio increased to 45% from 44% in 2018.
The Fund’s unitholder equity for all units outstanding grew to $3.0 billion at the end of 2019 compared to $2.4 billion for 2018.
Romspen has delivered positive net investor returns each and every month for the past 20 consecutive years.
“Completing its 53rd year in 2019, the firm has a strong history of growth, broad diversification across North America and a solid and consistent investment track record”, says Mark Hilson, Managing General Partner of Romspen. “We have a long track record of delivering steady and predictable returns. Romspen has generated positive returns each and every month over the past 20 years and has typically outperformed the major benchmarks across a broad spectrum of economic conditions and cycles”.
2019 Results of Operations
Revenues for the year were $232 million, compared to $229 million for 2018. Current year revenues are higher reflecting the growth in size of the mortgage portfolio offset by modestly lower interest rates on the potfolio. For 2019, Romspen recorded net income of $187 million, or $0.68 per unit, compared to $185 million, or $0.81 per unit, in 2018. Investors held units totalling $3.0 billion, compared to $2.4 billion last year. Net debt (debt less cash) was $106 million, compared to last year’s level of $179 million.
Comparative Performance
During 2019, Romspen’s net compounded yield of 7.5% significantly outperformed T-bills (1.7%) and the FTSE/TMX–STBI (3.1%). S&P/TSX (22.9%). The following table presents a comparative performance history reflecting Romspen’s consistent outperformance against the benchmarks.
Romspen returns are net, comparative returns are gross.
Yield/return, as used herein, is calculated based on net compounded monthly cash distributions to unitholders, based on a $10.00/unit subscription price without any adjustment for unit gains/losses on sale/redemption.
Investment Portfolio
At December 31, 2019, the net investment portfolio was $3.0 billion, compared to $2.6 billion in 2018, representing an increase of 15%. The Fund realized losses of $7.2 million on mortgages that were previously reserved for, ensuring that there was no negative impact on net earnings from these losses. Total provisions for credit losses increased to $74.7 million, maintaining a comfortable margin of safety.
The Fund continues to focus on short-term mortgages, with 82% of mortgages maturing within one year and 93% maturing in less than two years. The portfolio remains well diversified with 21% of mortgages invested in Ontario, 26% in Western Canada, 8% in other provinces, and 45% in the US across 17 states. The weighted average interest rate of the mortgage portfolio was 10.4% compared to 10.6% in 2018.
2019 Distributions
Unitholder distributions for 2019 were $0.73 per unit, consistent with $0.73 per unit in 2018. This equates to a compounded net yield to investors of 7.5% consistent with 7.5% in 2018.
About the Fund
Romspen has a long-term track record of successful mortgage investing. With its origins in the mid-60’s, Romspen is one of the largest non-bank commercial/industrial mortgage lenders in Canada with a portfolio in excess of $3.0 billion. Our investors are high net worth individuals, foundations, endowments and pension plans.
The Fund’s investment mandate is focused on capital preservation, strong absolute returns and performance consistency. Romspen has had 20 consecutive years of positive net investor yields (ranging between 7.4% – 10.6%) with positive returns each and every month.
This press release is for informational purposes only. It is not investment or financial product advice, and is not intended to be used as the basis for making an investment decision. This press release is not, and does not constitute, an offer to sell or the solicitation, invitation or recommendation to purchase any securities in any jurisdiction. An offering memorandum containing important information relating to the Fund has been prepared, and the Fund is available only to investors who are “accredited investors” or otherwise qualify under certain other exemptions from prospectus requirements under applicable securities laws. Copies of the offering memorandum may be obtained from Romspen.
SOURCE Romspen Investment Corporation
For further information: Mark L. Hilson, Managing General Partner, [email protected], 416-966-1100
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.
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.
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.
