TORONTO, Nov. 10, 2017 /CNW/ - Trez Capital Senior Mortgage Investment Corporation (TSX: TZS) (the "Company") today released its financial results for the quarter ended September 30, 2017. The financial statements and MD&A can be found at www.sedar.com or www.trezcapitalseniormic.com.
Financial Highlights & Business Update
On June 16, 2016 the shareholders of the Company approved the orderly wind-up of the Company ("Orderly Wind-Up"). As such, the financial results will reflect the ongoing reduction in the size of the portfolio as capital is returned to shareholders.
Towards the objective of an Orderly Wind-Up, principal repayments or sold mortgages were $7.3 million for the quarter and $19.8 million for the year to September 30, 2017 ($21.8 million and $47.3 million for the comparable periods in 2016). All mortgages that have been sold have been done so at par value. Consequently, during the quarter the Company paid a special distribution of $9.9 million, and the Company continued to pay return of capital distributions at the rate of $0.0485 per share monthly until November 2017. The total of all such paid distributions is $28 million for the year to September 30, 2017 ($3.3 million paid for the comparable period in 2016).
For the three months ended September 30, 2017 net loss from operations totaled $0.1 million, compared to income from operations of $0.6 million. Net loss totaled $0.1 million, compared to net income of $0.6 million in Q3 of 2016. Basic and diluted loss per share were $0.03 and distributions declared were $1.4855 per share. Revenue declined by $0.5 million compared to the same period in 2016. The decrease was attributable to reduced mortgage interest of $0.5 million. This reduction resulted from a gradual decrease in the mortgage portfolio as a result of total cessation in mortgage funding activity as part of the Orderly Wind-Up of the Company.
At September 30, 2017 the Company had 6 mortgages remaining to be liquidated, down from 12 as at December 31, 2016 and 13 as at September 30, 2016. Of the 6 remaining mortgages expected to mature or be sold, 3 mortgages totaling $8.1 million are expected to do so prior to the end of the year and 2 additional mortgages totaling $3.8 million prior to the end of the second quarter of 2018.
Regular Monthly & Special Distributions
The Board has made a decision to suspend regular monthly distributions until further notice. This decision was premised on a review of the last remaining mortgages and cash requirements. The Board anticipates making further special distributions as the mortgages in the portfolio mature or are sold, and subject to reasonable expected operating expenditures. As the wind-up of the Company progresses, it is expected that there will be some variance in the timing and quantum of special distributions.
Forward Looking Statements
Certain statements in this news release about Trez Capital Senior Mortgage Investment Corporation (the "Company"), and its business, operations, investments and strategies, and financial performance and condition may constitute forward-looking information, future oriented financial information, or financial outlooks (collectively, "forward looking statements"). The forward-looking statements are stated as of the date of this news release and are based on estimates and assumptions made by Trez Capital Fund Management LP ("Trez") in light of its experience and perception of historical trends, current conditions and expected future developments, as well as other factors that Trez believes are appropriate and reasonable in the circumstances. There can be no assurance that such forward-looking statements will prove to be accurate, as actual results, performance and future events could differ materially from those anticipated in such statements. Past performance is not an indication of future returns, and there can be no guarantee that targeted returns or yields can be achieved. Trez refers you to the Company's public disclosure for information regarding these forward-looking statements, including the assumptions made in preparing forward-looking statements and management's expectations, and the risk factors that could cause the Company's actual results, yield, levels of activity, performance or achievements or future events or developments to differ materially from those expressed or implied by the forward-looking statements. Such public disclosure is available on SEDAR and at the request of Trez. This news release does not represent an offer or solicitation to sell securities of the Company.
About the Company
The Company holds a portfolio of mortgages in Canada. Trez Capital Fund Management Limited Partnership is the manager of and portfolio advisor to the Company. On June 16, 2016 the Shareholders of the Company approved the orderly wind-up of the Company. Under the orderly wind-up plan the Company will distribute the net proceeds through special distributions, the repurchase of shares pursuant to the normal course issuer bid, or otherwise.
SOURCE Trez Capital Senior Mortgage Investment Corporation
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