All amounts in Canadian dollars unless otherwise indicated.
First Quarter 2016 Highlights
- Revenue of $49.5 million
increased 2% ($1.1 million) from
fourth quarter 2015 and 41% ($14.4
million) from first quarter 2015.
- Net income of $17.1 million, up
125% ($9.5 million) from the prior
quarter and 7% ($1.1 million) from
the prior year period.
- Earnings per share (diluted) of $0.34, an increase of 127% ($0.19) from last quarter and 10% ($0.03 per share) from the first quarter of
2015.
- ROE was 13.9%, an increase from 6.2% in the prior quarter and
13.6% in first quarter 2015.
- In spite of making the intentional decision not to grow the
loan book during the quarter, performance metrics were very strong.
The average loan portfolio outstanding was $1,227 million, an increase of $34 million from the prior quarter and
$363 million in first quarter
2015.
TORONTO, May 11, 2016 /CNW/ - Callidus Capital
Corporation (TSX:CBL), ("Callidus" or the "Company"), today
announced its unaudited financial and operating results for the
first quarter ended March 31,
2016.
"Our record of consistently strong performance continued in the
first quarter of 2016 with significant gains in revenue, net income
and ROE over the prior period and year over year. Our pipeline
continued to grow while the loan book was intentionally held
basically constant, as we accumulated cash in order to evaluate the
best use thereof upon completion of the SIB in late May." said
Newton Glassman, Executive Chairman
and Chief Executive Officer of Callidus. "During the first
quarter, we began pursuing yield enhancement measures previously
discussed and reflected in the National Bank Financial Valuation
disclosed with the SIB material. We have agreed to terms
pertaining to "yield enhancement options" related to seven of the
loans in our portfolio, and expect to finalize the agreements on
three additional loans next quarter. They are a technical way
of improving returns when a client needs or desires changes to the
original loan agreement. This quarter we have provided a
description of the yield enhancement mechanisms in our MD&A,
and we will begin reporting them on a prospective basis beginning
in the second quarter. Please note that the first quarter
results do not reflect the impact of the yield enhancement
mechanisms. We expect the value of these interests to
continue to grow as our existing loans mature and new loans are
originated."
David Reese, President and Chief
Operating Officer added, "The first quarter reflects our focus on
maintaining and improving our operating performance over multiple
quarters and our intention is to maintain that focus and further
improve thereon. We anticipate favourable market conditions,
our sound and proven business model, strong credit quality, and
unique competitive advantage, will be reflected positively in our
future results."
Business Update (As at May 11,
2016)
- Gross loans receivable before derecognition stood at
$1,170 million.
- The pipeline of potential new loans stands at approximately
$980 million.
- Signed back term sheets and balance of funding for Project
Resolve Inc. of approximately $210
million.
- Total debt (net of cash and cash equivalents) of $472 million, or 40% of gross loans receivable
before derecognition.
- In the coming months, the Company expects four additional loan
repayments, representing approximately $171
million in current gross loans receivable, as of
May 11, 2016.
- The Company expects approximately 31% ($124 million gross loans receivable) of
watch-list loans to be resolved in the coming months.
- On April 22, 2016, an issuer bid
circular and related documents (the "Issuer Bid Circular") in
connection with the Company's previously announced substantial
issuer bid (the "Offer") was mailed to shareholders. Under the
Offer, the Company is offering to purchase for cancellation up to
3,571,428 common shares at a purchase price of $14 per common share.
- In May 2016, the Company received
commitments from two syndicate lenders in the revolving credit
facility to increase their respective commitments by US$37.5 million, increasing the existing facility
to US$337.5 million in the aggregate.
Other terms of the facility are unchanged.
Financial Highlights
|
|
|
Three Months
Ended
|
($ 000s unless
otherwise indicated)
|
March 31,
2016
|
December 31,
2015
|
March 31,
2015
|
Average loan
portfolio outstanding (1)
|
$ 1,226,881
|
$ 1,192,994
|
$
864,324
|
Total revenue (after
derecognition)
|
49,540
|
48,467
|
35,091
|
Gross yield (%)
(1)
|
19.4%
|
19.1%
|
17.9%
|
Net interest margin
(%) (1)
|
12.5%
|
12.2%
|
12.7%
|
Net income
|
17,072
|
7,648
|
15,989
|
Earnings per share
(diluted)
|
$0.34
|
$0.15
|
$0.31
|
ROE (%)
|
13.9%
|
6.2%
|
13.6%
|
Leverage ratio
(%)(1)
|
38.9%
|
50.9%
|
40.3%
|
(1)
|
Refer to "Description
of Non-IFRS Measures" in the MD&A. These financial measures are
not
recognized measures under IFRS and do not have a standardized
meaning prescribed by IFRS.
Therefore, they may not be comparable to similar measures used by
other issuers.
|
- Our First Quarter 2016 MD&A, Unaudited Financial Statements
and Issuer Bid Circular are available on our website
(www.calliduscapital.ca) or on SEDAR (www.sedar.com).
- Average loan portfolio outstanding was $1,227 million, an increase of $34 million or 3% from the prior quarter, and an
increase of $363 million or 42% from
the same quarter last year.
- Total revenue for the quarter was $49.5
million, an increase from $48.5
million the prior quarter, and an increase from $35.1 million in the same quarter last year.
- Gross yield for the quarter was 19.4%, an increase from 19.1%
in the prior quarter, and an increase from 17.9% in the same
quarter last year. As noted previously, gross yields can be "lumpy"
quarter to quarter.
- Net income was $17.1 million for
the quarter, an increase from $7.6
million in the prior quarter and from $16.0 million in the same quarter last year.
Earnings for the prior quarter were impacted by an unusual pre-tax
provision of $22.7 million related to
the expected loss related to an isolated event experienced by one
borrower, Gray Aqua Group Ltd. The increase from the same quarter
last year was due to higher revenues partially offset by higher
loan loss provisions.
- Earnings per share (diluted) were $0.34 for the quarter, an increase from
$0.15 in the prior quarter and from
$0.31 in the same quarter last
year.
- ROE was 13.9%, an increase from 6.2% in the prior quarter and
from 13.6% in the same quarter last year.
- Leverage ratio of 38.9% at the end of the current quarter, a
decrease from 50.9% at the end of the prior quarter. The Company
primarily used the proceeds from the guarantees of a loan sold to
the Catalyst Funds to repay a portion of the balance outstanding
under the subordinated bridge facility.
- As at March 31, 2016, the
estimated collateral value coverage across aggregate net loans
receivable was approximately 150% with a range between 100% and
444% on an individual loan basis. Furthermore, the aggregate
watch-list loans had an estimated aggregate collateral value
coverage of 108% and non-watchlist loans had an estimated
collateral value coverage of 166%. It should be noted that there is
no cross-collateralization of the asset coverage as between
borrowers.
- Provision for loan losses for the first quarter was
$7.9 million. Of this total
provision, $4.3 million relates to
interest revenue recorded on those loans for the current quarter.
Under IFRS, the Corporation continues to record loan interest and
income on impaired loans at the original effective interest rate
and provides for the loan interest and income in instances where
timely collection of interest and principal is unlikely.
About Callidus Capital Corporation
During the
quarter, Paula Myson joined Callidus
as Vice President Investor Relations and Special Projects. Paula is
a CFA charterholder with extensive experience in capital markets,
finance and operations in domestic and international
companies. Further descriptions of our Management Team can be
found on our website, www.calliduscapital.ca.
Established in 2003, Callidus Capital Corporation is a
Canadian company that specializes in innovative and creative
financing solutions for companies that are unable to obtain
adequate financing from conventional lending institutions. Unlike
conventional lending institutions who demand a long list of
covenants and make credit decisions based on cash flow and
projections, Callidus credit facilities have few, if any, covenants
and are based on the value of the company's assets, its enterprise
value and borrowing needs. Callidus employs a proprietary system of
monitoring collateral and exercising control over the cash inflows
and outflows of each borrower, enabling Callidus to very
effectively manage risk of loss. Further information is available
on our website, www.calliduscapital.ca.
Forward-Looking Statements
Certain statements made
herein contain forward-looking information. Although Callidus
believes these statements to be reasonable, the assumptions upon
which they are based may prove to be incorrect. Furthermore, the
forward-looking statements contained in this press release are made
as at the date of this press release and Callidus does not
undertake any obligation to update publicly or to revise any of the
included forward-looking statements, whether as a result of new
information, future events or otherwise, except as may be required
by applicable securities laws.
Conference call
Callidus will host a conference call
to discuss Q1 2016 results on May 12, 2016 at 9:00 a.m.
Eastern Time. The dial in number for the call is (647)
427-7450 or (888) 231-8191 (reference number: 93999844). A
taped replay of the call will be available until May 19, 2016 at (416) 849-0833 or (855) 859-2056
(reference number: 93999844).
SOURCE Callidus Capital Corporation