Medwell Capital Announces 2014 Year-End Results and Updates
Marketwired
EDMONTON, ALBERTA--(Marketwired - Apr 1, 2015) - Medwell Capital Corp. (TSX VENTURE:MWC) today announced its financial and operational results for the year ended December 31, 2014, and recent updates.
Updates
Distribution of over $57 million in Spectral stock
In the fourth quarter Medwell approved the distribution on January 2nd 2015 of 16.4 million shares of Spectral Medical Inc. ("Spectral").
"We are obviously pleased by Spectral's recent stock performance," said Kevin Giese, Medwell's President and CEO. "Since 2010, Medwell has distributed over 70 million Spectral shares to the Medwell shareholders, as well as over 15 million share purchase warrants, with a market value as of March 30, 2015 in excess of $57 million."
Sale of Medwell's interest in Mimetogen
On March 31, 2015 Medwell entered into an agreement to sell all of its interest in Mimetogen in consideration of up to $3.2 million in the form of $250,000 upfront, and a contingent payment of up to $2,950,000 from amounts received by the purchaser from Mimetogen prior to the first anniversary of the purchase date. The transaction is set to complete by April 30, 2015.
"The structure of the sale transaction is appealing as Medwell will retain the opportunity to participate in elements of Mimetogen's upside prospects." said Kevin Giese, Medwell's President and CEO.
Arrangement Agreement with GDI worth $11.2 million
On March 31, 2015 Medwell announced that it had entered into an Arrangement Agreement with GDI Integrated Facility Services Inc. ("GDI"), a leader in the North America janitorial services market, with fiscal 2014 revenues in excess of $600 million.
Under the terms of the arrangement Medwell's current shares will be valued in the aggregate at $11.2 million, which equates to approximately $1.54 for each of the 7,282,589 Medwell shares currently issued and outstanding. This represents a premium of approximately121% over the volume weighted average price of the Common Shares on the TSX Venture Exchange (the " Exchange") of $0.697over the last 20 trading days.
"We are very pleased to have created an opportunity for our shareholders to participate in the growth prospects of this dynamic and profitable company," said Kevin Giese, Medwell's President and CEO. "To the current Medwell shareholders who will receive $1.54 per share of value, at a 121% premium to the current market price, this is a transaction with very strong appeal."
Refer to Medwell's other press release of today's date for further details.
Return on Investment
Five years ago Medwell's market capitalization was approximately $33 million. Since that time the Corporation has delivered over $68 million to its shareholders, with over $57 million of Spectral stock distributed to its investors, and $11.2 million of value under the GDI transaction.
"An investor in Medwell five years ago will likely enjoy a significant double digit return on their investment upon the closing of the GDI transaction, delivered in the form of liquid public shares in strong companies with upside growth potential," said Kevin Giese, Medwell's President and CEO.
Financial Results
For the year ended December 31, 2014, the consolidated net loss of the Corporation was $8.0 million ($1.10 loss per share), as compared to a net income of $3.6 million ($0.50 per share) for the same period last year.
The Company had a net loss in 2014 of $1.4 million, as compared to a net loss in 2013 of $3.1 million before accounting for unrealized changes in the value of its investments. In 2014 there was an unrealized investment loss of $6.6 million, and in 2013 there was an unrealized investment gain of $6.7 million.
For the quarter ended December 31, 2014, the consolidated net loss of the Corporation was $3.0 million ($0.41 loss per share), as compared to a net income of $2.5 million ($0.33 per share) for the same period last year.
The Company invested $600,000 in a private placement in Spectral Medical Inc. during 2014, and ended the year with $3.0 million in cash and cash equivalents.
As at December 31, 2014, there were 7,282,589 common shares issued and outstanding.
"We are pleased that in 2014 we were once again able to significantly reduced our corporate costs as compared to the prior year, advance our investments and create value for our shareholders," said Kevin Giese, Medwell's President and CEO. "We are excited about our acquisition of GDI and look forward to completing the arrangement agreement. We expect the transaction to generate significant value for our shareholders."
For complete financial results, please see the company's filings at SEDAR or on the company's website (www.medwellcapital.com).
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. This press release may contain forward-looking statements, which reflect the Company's current expectation regarding future events. These forward-looking statements involve risks and uncertainties that may cause actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward-looking statements. Such factors include, but are not limited to, changing market conditions, the successful and timely completion of clinical studies, the establishment of corporate alliances, the impact of competitive products and pricing, new product development, uncertainties related to the regulatory approval process and other risks detailed from time to time in the Corporation's ongoing quarterly and annual reporting. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
