TORONTO, ONTARIO--(Marketwired - Aug 8, 2013) - Wilmington Capital Management Inc. (TSX:WCM.A)(TSX:WCM.B) ("Wilmington" or the "Corporation") today announced a net loss attributable to shareholders for the three months ended June 30, 2013 of $41,000 or ($0.00) per share compared to a net loss of $139,000 or ($0.02) per share for the same period in 2012. For the six months ended June 30, 2013, the net loss attributable to shareholders amounted to $98,000 or $(0.01) per share compared to net loss of $463,000 or $(0.05) per share for the same period last year.
To view a full copy of the Corporation's audited financial results for the year ended December 31, 2012 including the Corporation's audited consolidated financial statements, accompanying MD&A and Annual Information Form, please refer to the SEDAR website www.sedar.com.
SECOND QUARTER 2013 HIGHLIGHTS
During the second quarter, the Corporation took significant steps to solidify and build upon the foundation of its three operating platforms - self storage facilities, private equity funds and natural gas assets, through additional investment in three self-storage facilities and natural gas assets.
In May 2013, the Corporation invested $2.5 million in Real Storage Private Trust to fund the acquisition of three self-storage facilities. The total cost of these acquisitions amounted to $16.0 million and were comprised of a 39,000 square foot self-storage facility with capacity to add a 12,000 square foot expansion in Barrie, Ontario and two self-storage facilities in Red Deer, Alberta, comprising 78,000 square feet of rentable area, a file retention facility and 96 portable storage units (totaling 11,000 square feet).
Subsequent to the second quarter, Wilmington invested $2.2 million to acquire a 36.5% ownership interest in Northpoint Resources Ltd. ("Northpoint"), a privately held natural gas producer with assets in the Altares region of northeastern British Columbia. Northpoint currently produces approximately 7,200 mcf per day (1,200 boepd) and has proven plus probable reserves of 7,605 Mboe (45,630 Mmcfe). In addition, the Corporation completed the sale of its commercial land in San Francisco, California. The sale closed on July 31, 2013.
As at June 30, 2013, Wilmington had assets under management in its operating platforms of approximately $135 million ($66 million representing Wilmington's share).
Wilmington continues to execute it principal objectives of making investments capable of generating appreciation in value as opposed to current income and to maximize shareholder returns by investing its own capital alongside partners and co-investors in hard assets and private equity funds. These assets are managed through the Corporation's operating platforms where Wilmington can add scale and improve valuations.
Real Storage Private Trust ("Trust")
The Trust (44.78% owned) now owns 20 self-storage facilities comprising 787,000 square feet of rentable area and one development property. The Trust recorded significant improvements in 2013 as the facilities in western Canada, which were for the most part in the initial lease up stage, achieved stabilized occupancy levels. During the second quarter of 2013, same store occupancy levels averaged 82%, compared to 77% in 2012 and same store operating margins for Q2 2013 of 58% compared to Q2 2012 of 55%.
Network Capital Management Inc. ("NCI") and Network 2012 Fund
NCI (50% owned) has funds under management now totaling approximately $37 million and the majority of Network's available capital has been successfully deployed in a strong mix of junior oil and gas and service companies. Wilmington committed $8 million of capital to the Network 2012 Fund.
Natural Gas Assets
Shackleton 2011 Limited Partnership (the "Shackleton Partnership")
The natural gas assets owned through the Shackleton Partnership (59% owned) have proven to be of high quality and present good opportunities for growth and future development once we reach a more favorable natural gas pricing environment. The weighted average price realized during the three months ended June 30, 2013 was $3.33 per mcf and operating netbacks averaged $1.77 per mcf (realized price of $1.92/mcf and netbacks of $0.80/mcf for the comparable period in 2012). Natural gas production volumes for the 100% interest in the Shackleton field amounted to 4,231 mcf per day (705 boepd). Of its 2013 production, approximately 50% has been hedged under fixed price contracts with an average price of $3.18 per GJ.
Northpoint Resources Ltd. ("Northpoint")
Subsequent to the second quarter of 2013, the Corporation grew its natural gas platform by investing in Northpoint, a privately held oil and gas producer with assets in the Altares region of northeastern British Columbia. Northpoint's production is approximately 7,200 mcf/d (1,200 boe/d) with total proved plus probable reserves totaling approximately 45,630 Mmcfe (7,605 Mboe). The Corporation acquired a 36.5% ownership interest in Northpoint for total cash consideration of $2.2 million. In addition, and as part of an overall recapitalization plan, Wilmington acquired $0.8 million of a 10%, $5 million debenture issue in Northpoint which matures on July 30, 2017. Northpoint is professionally managed by an experienced executive team. As part of the transaction, the Corporation is entitled to nominate three of the seven directors to the Northpoint board.
During 2012, the Corporation took steps to nationalize its core business and entered into an agreement to sell its interest in commercial land in San Francisco, California. The sale closed on July 31, 2013. As part of the transaction, the secured debt was assumed by the purchaser and certain loans were settled.
The Corporation believes that the foundation for achieving future growth through its three operating platforms - the Real Storage Private Trust, Network Capital Management Inc. and the Shackleton Partnership - are now firmly in place. In the years ahead, the Corporation expects to add scale to these operating platforms, improve valuations and earn attractive cash flow and total returns for shareholders.
|CONSOLIDATED INTERIM STATEMENTS OF INCOME (LOSS)|
|Unaudited||Three months ended June 30||Six months ended June 30|
|(CDN $ Thousands, except per share amounts)||2013||2012||2013||2012|
|Natural gas sales||1,282||934||2,557||2,064|
|Natural gas revenue||1,041||764||2,139||1,702|
|Investment and other income||151||88||189||117|
|Foreign exchange gain||---||---||---||6|
|General and administrative||316||276||655||585|
|Depletion, depreciation and amortization||356||402||745||841|
|Foreign exchange loss||90||21||118||---|
|Operating income (loss)||26||(264||)||26||(640||)|
|Loss before share of equity accounted investments and income taxes||(62||)||(354||)||(140||)||(824||)|
|Share of net income from Real Storage Private Trust||44||77||67||47|
|Share of net (loss) income from Network Capital Management Inc.||(32||)||20||(54||)||(4||)|
|Share of net loss from Network 2012 Fund||(39||)||(103||)||(77||)||(103||)|
|Loss before income taxes from continuing operations||(89||)||(360||)||(204||)||(884||)|
|Income tax (expense) benefit||(35||)||91||(18||)||232|
|Net Loss from continuing operations||(124||)||(269||)||(222||)||(652||)|
|Income (loss) from discontinued operations, net of tax||118||7||212||(8||)|
|Net (Loss) income attributable to:|
|Owners of the Corporation||(41||)||(139||)||(98||)||(463||)|
|Net Loss per share from continuing operations|
|Net Loss per share|
|CONSOLIDATED INTERIM BALANCE SHEET|
|Unaudited||June 30,||December 31,|
|(CDN $ Thousands)||2013||2012|
|Investment in Real Storage Private Trust||9,873||7,271|
|Investment in Network Capital Management Inc.||1,658||1,712|
|Investment in Network 2012 Fund||7,655||7,554|
|Natural gas property, plant and equipment||17,275||17,840|
|Income taxes receivable||480||435|
|Receivables and other assets||837||885|
|Cash and cash equivalents||3,766||6,601|
|Assets held for sale||20,135||18,541|
|Asset retirement obligations||773||750|
|Deferred tax liabilities||360||259|
|Accounts payable and accrued liabilities||954||1,024|
|Revolving loan facility||5,700||6,700|
|Liabilities held for sale||22,945||21,432|
|Total liabilities and equity||61,679||60,839|
|CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE INCOME (LOSS)|
|Unaudited||Three months ended June 30||Six months ended |
|(CDN $ Thousands)||2013||2012||2013||2012|
|Items that may subsequently be reclassified to Profit or Loss|
|Share of other comprehensive (loss) income from Network 2012 Fund||(83||)||(281||)||178||(281||)|
|Future income taxes on above items||11||---||(23||)||---|
|Other comprehensive (loss) income from continuing operations||(72||)||(281||)||155||(281||)|
|Items that may subsequently be reclassified to Profit or Loss|
|Other comprehensive income (loss) from discontinued operations, net of tax||22||12||36||(5||)|
|Total other comprehensive (loss) income||(50||)||(269||)||191||(286||)|
|Comprehensive (loss) income||(56||)||(531||)||181||(946||)|
|Comprehensive (loss) income attributable to:|
|Owners of the Corporation||(91||)||(408||)||93||(749||)|
Executive Officers of the Corporation will be available at 403-800-0869 to answer any questions on the Corporation's financial results.
This news release contains forward-looking statements concerning the Corporation's business and operations. The Corporation cautions that, by their nature, forward-looking statements involve risk and uncertainty and the Corporation's actual results could differ materially from those expressed or implied in such statements. Reference should be made to the most recent Annual Information Form for a description of the major risk factors.