Wilmington Announces 2013 First Quarter Results
May 14 2013 - 8:00PM
Marketwired Canada
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 March 31, 2013 of $57,000 or ($0.01) compared to a net loss
attributable to shareholders of $324,000 or ($0.04) for the same period in 2012.
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.
Operating Highlights
Business Strategy
The Corporation's principal objectives are to make 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.
During the first quarter, the Corporation continued to take steps to solidify
the foundation of its three newly formed operating platforms - self storage
facilities, private equity funds and natural gas assets. As at May 14, 2013,
Wilmington had assets under management in its operating platforms of
approximately $148 million ($68 million representing Wilmington's share).
Investment in Real Storage Private Trust (the "Trust")
The Trust (44.78% owned) owns 17 self-storage facilities comprising 645,978
square feet of rentable area and one development property. The Trust showed
significant improvements in 2013 as the five properties in western Canada, which
were for the most part in the initial lease up stage, approached stabilized
occupancy levels. During the first quarter of 2013, occupancy levels averaged
78%, compared to 75% in 2012. Operating margins in the first quarter of 2013
improved to 51% up from 43% for the comparable quarter in 2012.
Subsequent to March 31, 2013, the Trust acquired two self-storage facilities -
one located in the western region in Red Deer, Alberta (the "Alberta Facility")
and the other located in the eastern region in Barrie, Ontario (the "Ontario
Facility"). The Alberta Facility is comprised of approximately 78,000 square
feet of rentable area, a portable storage business and a file retention
business. The Ontario Facility is comprised of approximately 39,000 square feet
of rentable area with an additional 12,000 square foot expansion currently under
construction. The two acquisitions were funded by two separate five-year,
fixed-rate mortgages, an unsecured credit facility, equity of the Trust and
available cash. Wilmington's cash contribution was $2.5 million bringing its
total investment in the Trust to approximately $10 million.
Investment in Network Capital Management Inc. ("NCI") and Network 2012 Fund
Network Capital Management Inc. (50% owned) has funds under management now
totalling approximately $50 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.
Investment in Shackleton 2011 Limited Partnership (the "Shackleton Partnership"
or the "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
March 31, 2013 was $3.17 per mcf and operating netbacks averaged $1.90 per mcf
(realized price of $2.10/mcf and netbacks of $0.65/mcf for the comparable period
in 2012). Natural gas production volumes for the 100% interest in the Shackleton
field amounted to 4,452 mcf per day (742 boepd). The outlook for natural gas
pricing has improved significantly and a better pricing environment will be
beneficial to the operating performance of the Shackleton assets. Of its 2013
production, approximately 50% has been hedged under fixed price contracts with
an average price of $3.18 per mcf.
Discontinued Operations
During the fourth quarter of 2012, the Corporation took steps to rationalize its
core business and entered into an agreement to sell its interest in commercial
land in San Francisco, California. The sale is scheduled to close during the
second quarter of 2013.
Outlook
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.
FINANCIAL HIGHLIGHTS
CONSOLIDATED STATEMENTS OF INCOME
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Unaudited Three months
ended March 31
(Thousands of Canadian Dollars, except per share
amounts) 2013 2012
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Income
Natural gas sales $ 1,275 $ 1,130
Royalties (177) (191)
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Natural gas revenue 1,098 939
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Investment and other income 38 32
Foreign exchange gain --- 27
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1,136 998
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Expenses
Petroleum operations 334 602
General and administrative 340 301
Depletion, depreciation and amortization 388 439
Stock compensation 46 41
Foreign exchange loss 28 ---
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Operating loss --- (385)
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Finance costs 78 86
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Loss before share of equity accounted investments and
income taxes (78) (471)
Share of net income (loss) from Real Storage Private
Trust 23 (30)
Share of net loss from Network Capital Management Inc. (22) (24)
Share of net loss from Network 2012 Fund (38) ---
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Loss before income taxes from continuing operations (115) (525)
Income tax benefit 16 142
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Net Loss from continuing operations (99) (383)
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Income (loss) from discontinued operations, net of tax 95 (15)
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Net Loss $ (4) $ (398)
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Net Loss attributable to:
Owners of the Corporation $ (57) $ (324)
Non-controlling interest 53 (74)
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$ (4) $ (398)
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Net Loss per share from continuing operations
Basic $ (0.02) $ (0.04)
Diluted $ (0.02) $ (0.04)
Net Loss per share
Basic $ (0.01) $ (0.04)
Diluted $ (0.01) $ (0.04)
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CONSOLIDATED BALANCE SHEET
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(Thousands of Canadian Dollars) March 31, December 31,
2013 2012
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Assets
Non-current assets
Investment in Real Storage Private Trust 7,294 7,271
Investment in Network Capital Management Inc. 1,690 1,712
Investment in Network 2012 Fund 7,777 7,554
Natural gas property, plant and equipment 17,606 17,840
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34,367 34,377
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Current assets
Income taxes receivable 494 435
Receivables and other assets 784 885
Cash and cash equivalents 6,502 6,601
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7,780 7,921
Assets held for sale 19,243 18,541
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27,023 26,462
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Total assets $ 61,390 $ 60,839
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Liabilities
Non-current liabilities
Asset retirement obligations 758 750
Deferred tax liabilities 343 259
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1,101 1,009
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Current liabilities
Accounts payable and accrued liabilities 936 1,024
Revolving loan facility 6,300 6,700
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7,236 7,724
Liabilities held for sale 22,095 21,432
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29,331 29,156
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Total liabilities 30,432 30,165
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Equity
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Shareholders' equity 27,091 26,860
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Non-controlling interest 3,867 3,814
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Total equity 30,958 30,674
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Total liabilities and equity $ 61,390 $ 60,839
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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
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Unaudited Three months ended
March 31
(Thousands of Canadian Dollars) 2013 2012
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Net Loss $ (4) $ (398)
Items that may subsequently be reclassified to
Profit or Loss
Share of other comprehensive loss from Network
2012 Fund 261 ---
Future income taxes on above items (34) ---
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Other comprehensive income from continuing
operations 227 ---
Items that may subsequently be reclassified to
Profit or Loss
Other comprehensive (loss) income from
discontinued operations, net of tax 15 (17)
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Total other comprehensive income (loss) 242 (17)
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Comprehensive income (loss) $ 238 $ (415)
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Comprehensive income (loss) attributable to:
Owners of the Corporation $ 185 $ (341)
Non-controlling interest 53 (74)
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$ 238 $ (415)
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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.
FOR FURTHER INFORMATION PLEASE CONTACT:
Wilmington Capital Management Inc.
Executive Officers
(403) 800-0869
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