WCM.B Wilmington Capital Management

Wilmington Capital Management Inc. (“Wilmington” or the “Corporation”) (TSX: WCM.A WCM.B) reported net income for the three months ended September 30, 2022 of $322,000 or $0.03 per share compared to net loss of $501,000 or $0.04 per share for the same period in 2021. For the nine months ended September 30, 2022, the Corporation reported a net income of $2,330,000 or $0.19 per share compared to a net loss of $505,000 or ($0.04) per share for the same period in 2021.

OPERATIONS REVIEW – For the Period Ended September 30, 2022As at September 30, 2022, Wilmington’s assets under management in its operating platforms totaled approximately $373.3 million ($90.3 million representing Wilmington’s share). A summary of the Corporation and the operations of its investee entities is set out below.

MarinasMaple Leaf PartnershipsDuring the nine months ended September 30, 2022, the Maple Leaf Partnerships acquired two marinas in Ontario having approximately 804 boat slips (including dry rack slips). The Maple Leaf Partnerships now own and operate 16 marinas in Ontario, having approximately 5,737 slips, which represents an increase of 26% in the number of slips owned a year ago.

Slip occupancies for the 2022 boating season was strong averaging 91% and we are anticipating strong customer retention for the 2023 boating season. The Maple Leaf Partnerships have historically distributed 10% on capital contributed to income producing properties.

Real EstateBow City PartnershipThe Bow City Self Storage facility continues to lease up ahead of expectations with strong year to date move-ins and rental rates. Net move-ins have lagged recently in part due to typical seasonality and in part due to a slowing housing market.

Sunchaser PartnershipThe Sunchaser Partnership experienced strong demand during the 2022 camping season. Customer retention remains high for the 2023 camping season and the transition of overnight sites to seasonal continues.

Private EquityNorthbridge, Northbridge Fund 2016, Northbridge Fund 2021 and Northbridge Fund 2022The fair value of Northbridge Fund 2016 decreased 2%, reflecting a distribution of capital during the three months ended September 30, 2022. Northbridge Fund 2021 and Northbridge Fund 2022 had no change in value, however, the outlook remains positive given continued strength in energy prices and a strategy of investing in “best in class” energy companies.

OutlookDuring the third quarter, the Corporation continued to make progress in advancing its goal of investing in alternative asset classes having advanced follow-on opportunities for each business. The Maple Leaf Partnerships’ negotiations are in the formative stages on a number of new marina acquisitions. The 84-unit waterfront residential development continues to progress, strong pre-sales are in hand, however, labor shortages have slowed the anticipated construction pace. Demand for boating remains strong and the marinas are enjoying high occupancies.

Lease up of Bow City Storage continues to exceed expectations and is a reflection in part of its unique location and management’s experience in the self-storage business. Long term parking was recently added as an additional service offering.

The Sunchaser Partnership continues to benefit from pent up demand for camping showing an increase in year over year seasonal rentals and supports upcoming expansion plans. Final approval for the over 100 site expansion is expected to be received in the fall.

Northbridge and the various funds they manage continue to perform well and Northbridge is focused on seeking out new opportunities given the strong outlook for the energy sector.

The Corporation is well positioned to continue to grow organically and seek out new opportunities in each of its operating platforms.

FINANCIAL RESULTS STATEMENT OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS) (unaudited)

For the		Three Months ended September 30,		Nine months ended September 30,
(CDN $ thousands, except per share amounts)		2022	2021	2022	2021
Management fee revenue		133	120	378	286
Interest, distributions and other income		635	206	1,621	937
		768	326	1,999	1,223
Expenses
General and administrative		(411)	(409)	(1,297)	(1,053)
Amortization		(7)	(16)	(21)	(112)
Finance costs		(2)	---	(7)	(6)
Stock-based compensation		(64)	(155)	(272)	(408)
		(484)	(580)	(1,597)	(1,579)
Fair value adjustments and other activities
Fair value changes in Bow City Partnerships		(220)	304	854	304
Fair value changes in Sunchaser Partnership		350	---	350	---
Fair value changes in Northbridge Fund 2021		---	(57)	986	(57)
Fair value changes in Northbridge Fund 2022		---	---	(70)	---
Fair value changes in Energy Securities		---	(503)	235	(526)
Realized loss in Energy Securities		---	---	(146)	---
Equity accounted income (loss)		(7)	(10)	146	66
		123	(266)	2,355	(213)
Income (loss) before income taxes		407	(520)	2,757	(569)
Current income tax recovery (expense)		(70)	6	(87)	97
Deferred income tax recovery (expense)		(15)	13	(340)	(33)
Provision for income taxes		(85)	19	(427)	64
Net income (loss)		322	(501)	2,330	(505)
Other comprehensive income
Items that will not be reclassified to net income (loss):
Fair value changes in Maple Leaf Partnerships		2,200	---	2,750	---
Fair value changes in Northbridge Fund 2016		(255)	46	148	396
Related income taxes		(247)	(6)	(334)	(47)
Other comprehensive income, net of income taxes		1,698	40	2,564	349
Comprehensive income (loss)		2,020	(461)	4,894	(156)
Net income (loss) per share
Basic		0.03	(0.04)	0.19	(0.04)
Diluted		0.03	(0.04)	0.19	(0.04)

BALANCE SHEETS

(unaudited)			September 30,	December 31,
(CDN $ thousands)			2022	2021
Assets
NON-CURRENT ASSETS
Investment in Maple Leaf Partnerships			18,637	15,887
Investment in Bow City Partnerships			3,864	3,010
Investment in Sunchaser Partnership			1,716	1,366
Investment in Northbridge and Energy Securities			6,516	3,980
Note receivable			---	2,058
Right-of-use asset			99	120
			30,832	26,421
CURRENT ASSETS
Cash			1,229	1,924
Short term securities			29,000	35,000
Amounts receivable and other assets			8,888	676
Total assets			69,949	64,021
Liabilities
NON-CURRENT LIABILITIES			1,249	574
Deferred income tax liabilities			133	145
			1,382	719
CURRENT LIABILITIES
Lease liabilities			38	19
Income taxes payable			129	25
Amounts payable and other			618	642
Total liabilities			2,167	1,405
Equity
Shareholders’ equity			51,179	51,179
Contributed surplus			1,426	1,154
Retained earnings			6,916	4,586
Accumulated other comprehensive income			8,261	5,697
Total equity			67,782	62,616
Total liabilities and equity			69,949	64,021

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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.