CALGARY, Alberta, March 09, 2022 (GLOBE NEWSWIRE) -- Wilmington Capital Management Inc. (“Wilmington” or the “Corporation”) (TSX: WCM.A WCM.B) reported net income attributable to shareholders for the three months ended December 31, 2021 of $0.04 million or $0.00 per share compared to net income of $0.7 million or $0.05 per share for the same period in 2020. For the year ended December 31, 2021, the Corporation recognized net loss attributable to shareholders of $0.5 million or ($0.04) per share compared to a net income of $0.7 million or $0.05 per share for the previous year.
OPERATIONS REVIEW – For the Year Ended December 31, 2021
As at December 31, 2021, Wilmington had assets under management in its operating platforms of approximately $308 million ($80 million representing Wilmington’s share). A summary of the Corporation and the operations of its investments is set out below.
Marinas
Maple Leaf Partnerships
In 2021, the Maple Leaf Partnerships successfully completed the acquisition of five marinas and one development property and now owns 14 marinas with over 4,900 boat slips, all within 2 hours driving time of Toronto, Ontario. This represents an approximate 53% increase in the number of slips owned at the beginning of 2021 year-over-year. The total consideration paid for acquisitions closed in 2021 was $19.2 million which was funded by cash on hand, equity contributions from limited partners, mortgage financing and vendor-take-back notes.
Slip occupancies for the 2021 boating season were strong across the portfolio averaging 90% occupancy. High year over year customer retention was also encouraging, however, maintaining adequate staffing levels was challenging due to general labor shortages related to Covid-19. New boat inventory was lower than anticipated due to ongoing supply chain issues related to Covid-19 and shortages are expected to continue in the near term.
To date, the Corporation has invested $9.3 million in the Maple Leaf Partnerships of which $8.7 million was on account of income producing properties and $0.6 million pertained to a waterfront development project, Champlain Shores. The Corporation receives a 10% distribution on its investment attributed to the income producing properties.
The re-development of Champlain Shores (formerly Bay Moorings) to a water-front residential community continues to make good progress with site servicing for the 84 freehold lots and the pre-sales program well underway. Home construction is expected to commence this spring. To facilitate the home construction program, the Corporation entered into a $5 million revolving loan facility bearing interest at 7.5% per annum.
Real Estate
Bow City Partnership
The Bow City Self Storage facility continues to be well received by customers and is leasing ahead of expectations. Outdoor parking is now available to the public and offers an additional service and source of revenue. To date, the Corporation has invested $2.5 million in the Bow City Partnerships.
Sunchaser Partnership
In 2021, the Corporation invested in the newly formed Sunchaser Partnership which has a mandate to acquire opportunistic recreational vehicle (“RV”) resorts and campgrounds in Canada. The Sunchaser Partnership raised $8.7 million of which the Corporation’s proportionate share was $1.4 million. The proceeds of the capital raise, together with proceeds from additional debt financing, were used to acquire two campgrounds in Alberta, located on approximately 280 acres of land and having approximately 650 sites.
Site occupancies for the 2021 camping season were higher than anticipated and lease-up for the 2022 season has been strong.
Private Equity
Northbridge Capital Partners Ltd. (“Northbridge”), Northbridge Fund 2021 Limited Partnership and Northbridge Fund 2016 Limited Partnership
In April 2021, the Corporation invested $2.5 million in the Northbridge Fund 2021, a special purpose Fund which invested in a specified private oil and gas company. The total amount raised was $13.7 million.
The Northbridge Fund 2016 increased 76% in value during 2021, reflecting the continued recovery in energy prices and efforts placed on repositioning investments into “best in class” energy companies.
Outlook
2021 was an exceptionally strong year for each of the operating platforms in terms of growth and operating results. The Corporation invested $6.5 million in additional capital in its operating platforms.
The Maple Leaf Partnerships successfully integrated five marinas during the year resulting in significant growth in total slips (including dry stack slips), waterfront acreage and boat sales. The 2021 boating season was exceptionally strong in all areas of the business despite Covid related issues resulting in shortages of new boat inventory and general labor. Despite this, 2022 is expected to be another strong boating season.
The re-development of Champlain Shores (formerly Bay Moorings Marina) continues to progress through the site preparation and home construction phase with pre-sales exceeding expectations.
Bow City Storage, lease up exceeded expectations in the first year which highlights the strategic location within downtown Calgary, management’s experience in the self-storage business and strong demand in the self-storage sector. Customer response remains positive for the facility and new technology provides access, control and monitoring from a mobile device.
The newly formed Sunchaser Partnership successfully onboarded and operated two RV resorts for most of the 2021 season with higher than expected demand. Both locations have expansion potential and plans are in place for new site additions for the 2023 season. Negotiations for additional RV resorts continues.
Northbridge ended the year strong as the energy sector saw continued upward momentum and the experienced management team is continually seeking further investment to capitalize on opportunities within the sector.
The Corporation is excited by the continued growth and results achieved during the 2021 year and continues to actively seek further investment in the marina, self-storage, campground and energy platforms and expansion in new niche target markets.
FINANCIAL RESULTS
STATEMENT OF INCOME (LOSS) AND COMPREHENSIVE INCOME (unaudited)
| For the | Three Months ended December 31, | Year ended December 31, | |||||||
| (CDN $ thousands, except per share amounts) | 2021 | 2020 | 2021 | 2020 | |||||
| Management fee revenue | 100 | 66 | 386 | 211 | |||||
| Interest and other income | 622 | 621 | 1,559 | 1,956 | |||||
| 722 | 687 | 1,945 | 2,167 | ||||||
| Expenses | |||||||||
| General and administrative | (346 | ) | (444 | ) | (1,399 | ) | (1,337 | ) | |
| Amortization | (12 | ) | (49 | ) | (124 | ) | (193 | ) | |
| Finance costs | (5 | ) | (3 | ) | (11 | ) | (25 | ) | |
| Stock-based compensation | (145 | ) | (52 | ) | (553 | ) | (335 | ) | |
| (508 | ) | (548 | ) | (2,087 | ) | (1,890 | ) | ||
| Fair value adjustments and other activities | |||||||||
| Fair value changes in Bow City Partnerships | --- | 231 | 304 | 231 | |||||
| Fair value changes in Northbridge Fund 2021 | --- | --- | (57 | ) | --- | ||||
| Fair value changes in Energy Securities | --- | 62 | (526 | ) | 89 | ||||
| Equity accounted income (loss) | (10 | ) | (23 | ) | 56 | (82 | ) | ||
| (10 | ) | 270 | (223 | ) | 238 | ||||
| Income (loss) before income taxes | 204 | 409 | (365 | ) | 515 | ||||
| Current income tax recovery | (105 | ) | 15 | (8 | ) | 23 | |||
| Deferred income tax recovery (expense) | (55 | ) | 246 | (88 | ) | 119 | |||
| Provision for income taxes | (160 | ) | 261 | (96 | ) | 142 | |||
| Net income (loss) | 44 | 670 | (461 | ) | 657 | ||||
| Other comprehensive income | |||||||||
| Items that will not be reclassified to net income: | |||||||||
| Fair value changes in Maple Leaf Partnerships | 1,105 | 4,613 | 1,105 | 4,613 | |||||
| Fair value changes in Northbridge Fund 2016 | 46 | 93 | 442 | (228 | ) | ||||
| Related income taxes | (171 | ) | (610 | ) | (218 | ) | (563 | ) | |
| Other comprehensive income, net of income taxes | 980 | 4,096 | 1,329 | 3,822 | |||||
| Comprehensive income | 1,024 | 4,766 | 868 | 4,479 | |||||
| Net income (loss) per share | |||||||||
| Basic | 0.00 | 0.05 | (0.04 | ) | 0.05 | ||||
| Diluted | 0.00 | 0.05 | (0.04 | ) | 0.05 | ||||
BALANCE SHEETS
| (unaudited) | December 31, | December 31, | ||
| (CDN $ thousands) | 2021 | 2020 | ||
| Assets | ||||
| NON-CURRENT ASSETS | ||||
| Investment in Maple Leaf Partnerships | 15,887 | 12,184 | ||
| Investment in Bow City Partnerships | 3,010 | 2,706 | ||
| Investment in Sunchaser Partnership | 1,366 | --- | ||
| Investment in Northbridge and Energy Securities | 3,980 | 1,565 | ||
| Note receivable | 2,058 | --- | ||
| Right-of-use asset | 120 | 510 | ||
| 26,421 | 16,965 | |||
| CURRENT ASSETS | ||||
| Cash | 1,924 | 3,055 | ||
| Short term securities | 35,000 | 41,000 | ||
| Amounts receivable and other assets | 676 | 1,240 | ||
| Total assets | 64,021 | 62,260 | ||
| Liabilities | ||||
| NON-CURRENT LIABILITIES | ||||
| Deferred income tax liabilities | 574 | 268 | ||
| Lease liabilities | 145 | --- | ||
| 719 | 268 | |||
| CURRENT LIABILITIES | ||||
| Lease liabilities | 19 | 138 | ||
| Income taxes payable | 25 | 78 | ||
| Amounts payable and other | 642 | 581 | ||
| Total liabilities | 1,405 | 1,065 | ||
| Equity | ||||
| Shareholders’ equity | 51,179 | 51,179 | ||
| Contributed surplus | 1,154 | 601 | ||
| Retained earnings | 4,586 | 5,047 | ||
| Accumulated other comprehensive income | 5,697 | 4,368 | ||
| Total equity | 62,616 | 61,195 | ||
| Total liabilities and equity | 64,021 | 62,260 | ||
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.
