Second Highest Quarterly Total Comprehensive Income of $830,000 Achieved, Just Shy of Last Year's Record
Calgary, Alberta--(Newsfile Corp. - August 29, 2024) - Builders Capital Mortgage Corp. (TSXV: BCF) ("Builders Capital" or "the Company") announced today the release of its second quarter financial results for the period ended June 30, 2024.
Highlights include:
We distributed $0.20 per share to our Class A public shareholders in the second quarter of 2024, again meeting our distribution target as we have every quarter since our inception over 10 years ago.
Subsequent to the quarter-end, we distributed $0.40 per share to our Class B shareholders based on Q2 2024 earnings. This provided an annualized 16% return on the original $10.00 share issue price.
Achieved 2nd highest result in our history for total comprehensive income in a quarter with $830,000, second only to the $833,000 achieved in the same quarter in the previous year
Earnings per share remained consistent with Q1 2024 at $0.26.
Operating expenses (excluding interest and funds set aside for potential loan losses) were within expectations at 9.5% of revenues.
We continue to maintain a balanced presence in both Alberta and BC with 54% of the current mortgage pool invested in Alberta. Shifting affordability constraints in BC has motivated management to begin a transition to a greater portion of our loan concentration back to the Alberta market.
We achieved a weighted average loan-to-value ratio on our mortgage portfolio of approximately 77%, slightly missing our 75% target level.
In commenting on these results, Sandy Loutitt, President of Builders Capital, stated:
"We are pleased to present the results for the quarter which produced positive, consistent returns. However, we see potential risks arising from a growing inventory of unsold houses in our B.C. markets. The management team continues to source, underwrite, and administer loans with a judicious eye to risk management without compromising yield."
"We are very excited to bring our participating bond offer to qualified investors, which will help us meet the rising demand for mortgages in our sector. Our current demand for quality mortgages exceeds our capital supply, so we look forward to utilizing this innovative tool to increase the size of our capital stock for our borrowers while providing good returns with short term liquidity to our new participating bond investors."
Financial Overview
Quarter ended June 30, 2024 $
Quarter ended June 30, 2023 $
Quarter ended June 30, 2022 $
Quarter ended June 30, 2021 $
Revenues
1,163,935
1,128,856
914,929
691,848
Total comprehensive earnings
830,165
833,340
694,575
548,076
Net mortgages receivable, end of period
31,332,424
36,089,264
30,803,944
28,669,052
Total assets
32,901,479
36,746,415
32,055,029
26,864,364
Shareholders' equity
29,394,171
29,503,919
27,031,412
26,864,364
Earnings per share
0.26
0.26
0.24
0.19
Cash dividends declared
814,499
812,339
647,134
578,472
Cash dividends declared per Class A share
0.20
0.20
0.1995
0.1995
Cash dividends declared per Class B share
0.40
0.3945
0.2712
0.1972
A more detailed discussion of the Company's financial results can be found in Builders Capital's Second quarter 2024 Financial Statements and Management's Discussion and Analysis, which has been posted on the Company's website (www.builderscapital.ca) and filed on SEDAR (www.sedar.com).
About Builders Capital
Builders Capital is a mortgage lender providing short-term course-of-construction financing to builders of residential, wood-frame properties in Western Canada. The Company commenced active operations on December 12, 2013 on the closing of its initial public offering, whereupon it acquired a portfolio of mortgages from two predecessor companies.
Builders Capital's investment objective is to generate attractive returns, relative to risk, in order to provide stable and consistent distributions to shareholders while remaining focused on capital preservation and satisfying the criteria mandated for mortgage investment corporations ("MIC") as defined in the Income Tax Act.
As an MIC, Builders Capital is not subject to income tax provided that it distributes all of its taxable income as dividends to shareholders within 90 days of its December 31st year-end. Such dividends are generally treated by shareholders as interest income, so that each shareholder is in the same tax position as if their proportionate share of mortgage investments made by the company had been made directly by the shareholder.
Forward-Looking Information
This news release contains forward-looking statements within the meaning of applicable securities legislation, including statements with respect to management's beliefs, estimates and intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "outlook", "objective", "may", "will", "expect", "intent", "estimate", "anticipate", "believe", "should", "plans" or "continue" or similar expressions suggesting future outcomes or events. Such forward-looking statements reflect management's current beliefs and are based on information currently available to management. These statements are not guarantees of future performance and are based on estimates and assumptions that are subject to risks and uncertainties which could cause actual results to differ materially from the forward-looking statements contained in this news release. These include, among other things, risks associated with mortgage lending, competition for mortgage lending, real estate values, interest rate fluctuations, environmental matters and the general economic environment. The company cautions that the foregoing list is not exhaustive, as other factors could adversely affect its results, performance or achievements. Readers are cautioned against undue reliance on any forward-looking statements. Although the forward-looking information contained in this news release is based upon what management believes are reasonable assumptions, there can be no assurance that actual results will be consistent with these forward-looking statements. Except as required by applicable law, Builders Capital undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
