TWC TWC Enterprises Limited

Consolidated Financial Highlights (unaudited)

Operating Data

The following is an analysis of net earnings:

The following is a breakdown of net operating income (loss) by segment:

Operating revenue is calculated as follows:

Direct operating expenses are calculated as follows:

(1) Please see Non-IFRS Measures

Second Quarter 2023 Consolidated Operating Highlights

Operating revenue increased 22.6% to $64,653,000 for the three month period ended June 30, 2023 from $52,736,000 in 2022 due to the revenue from the eight Highland Gate home sales in 2023 as compared to two in 2022.

Direct operating expenses increased 36.1% to $53,834,000 for the three month period ended June 30, 2023 from $39,569,000 in 2022 due to the cost of sales from the eight Highland Gate home sales in 2023 as compared to two in 2022.

Net operating income for the Canadian golf club operations segment decreased to $10,289,000 for the three month period ended June 30, 2023 from $12,675,000 in 2022 due to the conclusion of ClubLink’s lease of The Country Club which expired as of December 31, 2023.

Depreciation and amortization decreased 21.7% to $3,492,000 in 2023 from $4,458,000 in 2022 due to the conclusion of The Country Club lease which has also resulted in a decline in depreciation of right-of-use assets.

Interest, net and investment income increased to $2,201,000 for the three month period ended June 30, 2023 from $422,000 in 2022 due to a decrease in borrowings and an increase in distributions from the Company’s investment in Automotive Properties REIT.

Other items consist of the following income (loss) items:

At June 30, 2023, the Company recorded unrealized losses of $474,000 on its investment in marketable securities (June 30, 2022 - $8,366,000). This loss is attributable to the fair market value adjustments of the Company's investment in Automotive Properties REIT.

The exchange rate used for translating US denominated assets has changed from 1.3544 at December 31, 2022 to 1.3240 at June 30, 2023. This has resulted in a foreign exchange gain of $453,000 for the three month period ended June 30, 2023 on the translation of the Company’s US denominated financial instruments. Net earnings increased to $8,114,000 for the three month period ended June 30, 2023 from $3,594,000 in 2022 due to an unrealized loss on the Company’s investment in Automotive Properties REIT in the amount of $8,366,000 recorded in 2022 as compared to $474,000 in 2023. Basic and diluted earnings per share increased to 33 cents per share in 2023, compared to basic and diluted earnings per share of 15 cents in 2022.

Non-IFRS Measures

TWC uses non-IFRS measures as a benchmark measurement of our own operating results and as a benchmark relative to our competitors. We consider these non-IFRS measures to be a meaningful supplement to net earnings. We also believe these non-IFRS measures are commonly used by securities analysts, investors and other interested parties to evaluate our financial performance. These measures, which included direct operating expenses and net operating income do not have standardized meaning under IFRS. While these non-IFRS measures have been disclosed herein to permit a more complete comparative analysis of the Company’s operating performance and debt servicing ability relative to other companies, readers are cautioned that these non-IFRS measures as reported by TWC may not be comparable in all instances to non-IFRS measures as reported by other companies.

The glossary of financial terms is as follows:

Direct operating expenses = expenses that are directly attributable to company’s business units and are used by management in the assessment of their performance. These exclude expenses which are attributable to major corporate decisions such as impairment.

Net operating income = operating revenue – direct operating expenses

Net operating income is an important metric used by management in evaluating the Company’s operating performance as it represents the revenue and expense items that can be directly attributable to the specific business unit’s ongoing operations. It is not a measure of financial performance under IFRS and should not be considered as an alternative to measures of performance under IFRS. The most directly comparable measure specified under IFRS is net earnings.

Eligible Dividend

Today, TWC Enterprises Limited announced an eligible cash dividend of 5 cents per common share to be paid on September 15, 2023 to shareholders of record as at August 31, 2023.

Corporate Profile

TWC is engaged in golf club operations under the trademark, “ClubLink One Membership More Golf.” TWC is Canada’s largest owner, operator and manager of golf clubs with 45 ½ 18-hole equivalent championship and 2.5 18-hole equivalent academy courses (including two managed properties) at 35 locations in Ontario, Quebec and Florida.

For further information please contact:

Andrew Tamlin Chief Financial Officer 15675 Dufferin Street King City, Ontario L7B 1K5 Tel: 905-841-5372 Fax: 905-841-8488 atamlin@clublink.ca

Management’s discussion and analysis, financial statements and other disclosure information relating to the Company is available through SEDAR and at www.sedar.com and on the Company website at www.twcenterprises.ca 

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