Flow Capital Corp. (TSXV:FW) (“Flow Capital” and “Company”), a
leading provider of venture debt to high growth companies,
announces its unaudited financial and operating results for the
three-months ended June 30, 2024 (“Q2 2024”). Financial references
are in Canadian dollars unless otherwise specified.
Q2 2024 Performance
Highlights
- $1.9 million in
recurring loan interest income1 up 5.7% from Q1 2024 and up 28.5%
from Q2 2023.
- $1.255 book
value per share up 2.43% over the prior quarter and up 37% over the
past 2 years.
- $283K in
recurring free cash flow2 in Q2 2024; and $1.4 million over the
past 4 quarters.
- $65.8 million in
total assets up 12% over the prior year.
- $29 million in
new capital deployments over the past 12 month, a new 12-month
record for the company.
(1) Recurring Loan Interest
Income is an internally defined, non-IFRS measure calculated as
Loan Interest Income, less Loan Amortization Income and one-time
payments (e.g. prepayment fees). Reconciliations of non-IFRS
measures to the nearest IFRS measure can be found in this press
release under "Reconciliation of Non-IFRS
Measures".(2) Recurring Free Cash Flow is an
internally defined, non-IFRS measure calculated as Recurring Loan
Interest Income, less Salaries, Professional fees, Office and
general administrative and Financing expenses. Reconciliations of
non-IFRS measures to the nearest IFRS measure can be found in this
press release under "Reconciliation of Non-IFRS Measures".
“We are very pleased with our results this quarter. We achieved
several milestones in the quarter including: record recurring
revenue at $1.9M; record book value per share at $1.255/share;
record total assets at $65.8M; and record trailing 12-month new
deployments at over $29 million,” said Alex Baluta, CEO of Flow
Capital. “In addition, our portfolio continues to perform well,”
continued Mr. Baluta.
“As we continue to accelerate the deployment of capital into new
loans, we continue to maintain a strong long-term IRR based on both
the recurring cash contributions from our loans as well as the
contributions of our equity positions. Specifically, as we
disclosed in a press release on June 12, the 6-year portfolio level
IRR generated from our senior secured loan portfolio of growth
venture debt loans, stood at over 26%,” said Mr. Baluta
Flow’s lead generation and business development program
continues to surface excellent investment opportunities. In Q2 we
closed $5.4 into GetTattle Inc. a global Customer Experience
Improvement SaaS platform. We also announced a follow-on investment
into MiniLuxe, an existing portfolio company. After quarter end we
also closed $6.8 million with a tech-enabled marketplace of
co-living spaces and $5.4 million with a media measurement
provider. We continue to see good pipeline activity and expect that
portfolio growth should only be tempered by our access to
capital.
In order to continue to grow our capital base, we continue to
offer our redeemable floating rate debentures to institutional and
accredited investors. The debenture sits senior to almost $40
million of subordinated equity and pays a floating rate of
interest, currently set at 10.0% - 10.5% for Canadian dollar
investors and as high as 11.83% for U.S. dollar investors holding
over US$1 million.
In addition to supporting our growth the debenture also serves
our investors and shareholders well by allowing us to bifurcate
investor returns between capital gains-oriented investors in our
common shares and income oriented investors in our debentures.
Said Mr. Baluta, “Looking forward, we continue to be laser
focused on growing shareholder value and while providing a strong
return to our fixed income stakeholders, all while being a flexible
and supportive partner to our investee companies.”
Detailed Financial Results are available on our
website at www.flowcap.com or on www.sedar.com
RESULTS OF OPERATIONS
|
Three-months ended June 30, 2024 |
Three-months ended June 30, 2023 |
Recurring Loan Interest Income (1) |
$ |
1,858,194 |
$ |
1,446,156 |
Total Loan Interest Income |
|
2,112,885 |
|
1,843,406 |
Total Revenues per IFRS |
|
1,835,420 |
|
2,280,530 |
Net income/(loss) |
|
189,971 |
|
88,110 |
Adjusted Recurring Free Cash Flow (2) |
|
283,036 |
|
127,684 |
Basic Earnings per share |
|
0.0062 |
|
0.0028 |
Diluted Earnings per share |
|
0.0061 |
|
0.0028 |
Book Value per outstanding share(3) |
|
1.2548 |
|
1.1786 |
Weighted basic average number of shares outstanding |
|
30,831,242 |
|
31,055,434 |
Weighted diluted average number of shares outstanding |
|
30,968,301 |
|
31,256,448 |
(1) Recurring Loan Interest Income is an
internally defined, non-IFRS measure calculated as Loan Interest
Income less Loan Amortization Income and one-time payments (e.g.
prepayment fees). See the section “Use of Non-IFRS Financial
Measures”.(2) Recurring Free Cash Flow is an
internally defined, non-IFRS measure calculated as Recurring Loan
Interest Income less Salaries, Professional fees, Office and
general administrative and Financing expenses. See the section “Use
of Non-IFRS Financial Measures”.(3) Calculated by
taking Total Shareholders’ Equity as reported on the Statements of
Financial Position over the number of outstanding shares. See the
section “Use of Non-IFRS Financial Measures”.
Conference Call Details
Flow Capital will host a conference call to
discuss these results at 9:00 a.m. Eastern Time, on Tuesday, August
20, 2024. Participants should call +1 800-717-1738 or +1
289-514-5100 and ask an operator for the Flow Capital Earnings
Call, Conference ID 05811. Please dial in 10 minutes prior to the
call to secure a line. A replay will be available shortly after the
call. To access the replay, please dial +1 888-660-6264 or +1
289-819-1325 and enter passcode 05811#. The replay recording will
be available until 11:59 p.m. Eastern Time, September 03, 2024.
An audio recording of the conference call will
be also available on the investors’ page of Flow Capital’s website
at www.flowcap.com/financials.
About
Flow Capital
Flow Capital Corp. is a publicly listed growth
venture debt lender dedicated to supporting high-growth companies.
Since its inception in 2018, the company has provided financing to
businesses in the US, the UK, and Canada, helping them achieve
accelerated growth without the dilutive impact of equity financing
or the complexities of traditional bank loans. Flow Capital focuses
on revenue-generating, VC-backed, and founder-owned companies
seeking $3 to $7 million in capital to drive their continued
expansion. Learn more at www.flowcap.com
For further information, please contact:
Flow Capital Corp.Alex BalutaChief Executive
Officeralex@flowcap.com
47 Colborne St, Suite 303, Toronto, Ontario M5E 1P8
Non-IFRS Financial Measures
This press release includes references to
certain non-IFRS financial measures such as recurring Loan Interest
income and recurring free cash flow. These financial measures are
employed by the Company to measure its operating and economic
performance and to assist in business decision-making, as well as
providing key performance information to senior management. The
Company believes that, in addition to conventional measures
prepared in accordance with IFRS, certain investors and analysts
use this information to evaluate the Company’s operating and
financial performance. These financial measures are not defined
under IFRS nor do they replace or supersede any standardized
measure under IFRS. Other companies in our industry may calculate
these measures differently than we do, limiting their usefulness as
comparative measures. Reconciliations of non-IFRS measures to the
nearest IFRS measure can be found in this press release under
“Reconciliation of Non-IFRS Measures”.
Reconciliation of Non-IFRS
Measures
The tables below reconcile Loan Interest Income
to Recurring Loan Interest Income and recurring free cash flow for
the periods indicated.
Recurring Loan Interest Income is an internally
defined, non-IFRS measure calculated as Loan Interest Income, less
Loan Amortization Income and one-time payments (e.g. prepayment
fees).
|
Three-months ended June 30, 2024 |
Three-months ended March 31, 2024 |
Three-months ended December 31, 2023 |
Three-months ended September 30, 2023 |
Three-months ended June 30, 2023 |
Loan Interest Income |
$ |
2,112,885 |
$ |
2,005,586 |
$ |
1,882,908 |
$ |
1,697,147 |
$ |
1,843,406 |
Less: Loan Amortization Income |
|
(254,691) |
|
(248,033) |
|
(236,251) |
|
(195,054) |
|
(235,357) |
Less: One-time payments |
|
- |
|
- |
|
- |
|
- |
|
(161,844) |
Total Adjustments |
|
(254,691) |
|
(248,033) |
|
(236,251) |
|
(195,054) |
|
(397,201) |
Recurring Loan Interest Income |
$ |
1,858,194 |
$ |
1,757,553 |
$ |
1,646,657 |
$ |
1,502,093 |
$ |
1,446,205 |
Recurring Free Cash Flow is an internally
defined, non-IFRS measure calculated as Recurring Loan Interest
Income less Salaries, Professional fees, Office and general
administrative and Financing expense.
|
Three-months ended June 30, 2024 |
Three-months ended March 31, 2024 |
Three-months ended December 31, 2023 |
Three-months ended September 30, 2023 |
Three-months ended June 30, 2023 |
Recurring Loan Interest Income |
$ |
1,858,194 |
$ |
1,757,553 |
$ |
1,646,657 |
$ |
1,502,093 |
$ |
1,446,205 |
Less: Salaries |
|
(510,233) |
|
(427,280) |
|
(463,971) |
|
(426,714) |
|
(411,828) |
Less: Professional fees |
|
(188,451) |
|
(99,100) |
|
(18,167) |
|
(132,767) |
|
(276,601) |
Less: One-time non-cash expense |
|
- |
|
- |
|
(538,640) |
|
- |
|
- |
Less: Office and general administrative |
|
(193,431) |
|
(171,202) |
|
(336,873) |
|
(180,284) |
|
(187,408) |
Less: Financing Expense |
|
(683,043) |
|
(644,120) |
|
(624,869) |
|
(525,387) |
|
(443,472) |
Total Adjustments |
|
(1,575,158) |
|
(1,341,702) |
|
(1,308,774) |
|
(1,265,152) |
|
(1,319,309) |
Recurring Free Cash Flow |
$ |
283,036 |
$ |
415,851 |
$ |
337,883 |
$ |
236,941 |
$ |
126,896 |
Forward-Looking Information and
Statements
Certain statements herein may be
“forward-looking” statements that involve known and unknown risks,
uncertainties and other factors that may cause the actual results,
performance or achievements of Flow or the industry to be
materially different from any future results, performance or
achievements expressed or implied by such forward-looking
statements. Forward looking statements involve significant risks
and uncertainties, should not be read as guarantees of future
performance or results, and will not necessarily be accurate
indications of whether or not such results will be achieved. A
number of factors could cause actual results to vary significantly
from the results discussed in the forward-looking statements. These
forward-looking statements reflect current assumptions and
expectations regarding future events and operating performance and
are made as of the date hereof and Flow assumes no obligation,
except as required by law, to update any forward-looking statements
to reflect new events or circumstances.
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