~Company continues to grow its
assets while disbursing a record $8.2
million in the third quarter 2021~
VANCOUVER, BC, Oct. 18, 2021 /CNW/ - TIMIA Capital
Corporation ("TIMIA" or the "Company") (TSXV: TCA) (OTC:
TIMCF) today announced financial results for the third quarter
ended August 31, 2021.
These results do not include the business of Pivot Financial, which
was acquired subsequent to quarter-end.
Third Quarter 2021 Highlights include:
- Total revenue of $1.4 million
versus $1.9 million in the same
period last year. Total revenue in the current period did not
include any income from settlements (2020 - $521,616);
- Interest income from investments of $1.25 million compared to $1.25 million in the same period last year;
- Net income of $307,161 compared
to $333,243 in the same period last
year;
- Net and comprehensive income was $1.2
million compared to a comprehensive loss of $73,584 for the same period last year due largely
to the unrealized foreign currency translation gain on its
consolidated US denominated Limited Partnership (2020 - loss);
- Loan portfolio increased $9.1
million from $25.5 million to
$34.6 million in the last three
months largely due to the disbursement of $8.3 million in new and follow-on
investments;
- Reported total assets of $46.1
million as at August 31, 2021
compared to $41.9 million as at
November 30, 2020. Cash balance, as
part of assets, was $8.9 million
compared to $12.9 million as at
November 30, 2020; and
- Through the Company's normal course issuer bid, the Company
purchased 662,500 shares during the third quarter.
"TIMIA's origination platform continues to prove its value
through the continued deployment of growth capital to successful
software companies with a record $8.2
million disbursed in the third quarter," said Mike Walkinshaw, CEO of TIMIA Capital
Corporation. "Our Q3 revenue came in as expected, impacted by
investment facility exits experienced in the previous year, and we
aim for an improvement in future interest revenue with the record
amount of new and follow-on investments deployed in the third
quarter. Though not included in our third quarter results, our
recent acquisition of Pivot Financial is a great opportunity to
leverage TIMIA's origination platform to improve investment
performance in other market vertices. We strive to further
our growth in both the SaaS and specialty loan market segments
through the efficiency of our fintech platform and our marketing
systems targeting great organizations requiring growth
capital."
Detailed Financial Review
During the quarter ended
August 31, 2021, the Company
continued to grow its revenue base by distributing growth capital
of $8.3 million in new and follow-on
investments and by not posting any loan settlements.
The Company's revenue is primarily interest income. As the
Company makes new investments, the amount of monthly payments
derived from the portfolio grows. Interest income in the
three months ended August 31, 2021
was $1,246,042 compared to
$1,254,651 in the same period
last year. Combined income from the settlement of loans
and transaction and other fees was $161,637 in the three months ended August 31, 2021 compared to $645,129 in the same period last year. The
decrease in income from settlements reflects income from successful
exits made during the quarter in 2020 versus no exits in
2021. Total revenue for the three months ended August 31, 2021 was $1.4
million compared to $1.9
million for the three months ended August 31, 2020. While previous exits impacted
revenue for the current quarter, the Company believes that the
deployment of $8.2 million of
investment capital will have a positive impact on future
quarters.
TIMIA continues to build the value and size of its portfolio by
making new investments and follow-on investments in existing
portfolio companies, and actively assisting portfolio companies
with their growth plans. At the same time, the Company is
investing to support its future growth and the continued
development of its fintech platform. Total expenses,
including interest expense, for the quarter ended August 31, 2021 were $1.0
million compared with $995,193
for the same period last year. The change reflects a decrease in
accounting and legal, interest expense, and share-based payments,
offset by increases in administrative, expected credit loss
provision, management, and director fees, regulatory, investor
relations and communications costs, office, travel, systems, and
miscellaneous expenses, year over year.
US dollar denominated investments and subsidiaries are required
to be converted to Canadian dollars quarterly at the then
prevailing quarter end exchange rates. At the start of the
Company's fiscal year, December 1,
2020, the US dollar was trading at 1.30 Canadian Dollars, by the end of the third
quarter the US dollar had fallen to 1.26
Canadian dollars. The change in foreign currency impacts
income in several ways including the recognition of unrealised
gains and losses on US denominated assets owned directly by TIMIA,
and also through the reduction in carried interest income earned by
the Company in its capacity as manager of the limited
partnerships.
During the quarter ended August 31,
2021, the Company posted net income of $307,161 compared with net income of $333,243 in the same period last year. The small
year-over-year decrease is primarily due to the lower total revenue
in the current period.
As at August 31, 2021, the
Company's cash balance was $8.9
million and working capital was $13.7 million, compared with $12.9 million and $11.1 million, respectively, as of
November 30, 2020.
Subsequent Event
On September
21, 2021, the Company closed a series of agreements to
acquire the business of Pivot Financial ("Pivot"), a
Canadian-based private lender focused on creative financing
solutions for the small and medium business market. Over the past
six years, Pivot has grown to profitability and the Company
believes Pivot's growth will accelerate through its combination
with TIMIA. Ken Thomson, CEO
of Pivot, was appointed Chief Strategy Officer and has joined the
Board of Directors of TIMIA. Dan
Flaro, President of Pivot, continues in his role with
respect to the Pivot business. The acquisition of Pivot Financial
brings TIMIA Capital to over $100
million in assets.
This news release is qualified in its entirety by the Company's
condensed interim financial statements for the three and nine
months ended August 31, 2021 and
August 31, 2020 and the associated
Management's Discussion & Analysis respecting the same periods,
which can be downloaded from the Company's profile on SEDAR at
http://www.sedar.com.
About TIMIA Capital Corporation
TIMIA Capital
Corporation has developed a proprietary loan origination platform
that services private market, high-yield loan opportunities,
thereby earning recurring fees and a share of the profit.
While focusing on the fast growing, global, business-to-business
Software-as-a-Service (or SaaS) segment, TIMIA's automated loan
origination system is applicable to multiple technology sectors, it
creates scalable and profitable growth for TIMIA's stakeholders.
For more information about TIMIA Capital Corporation, please visit
www.timiacapital.com
Neither the 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 news release.
Forward-Looking Information
Certain information and
statements in this news release contain and constitute
forward-looking information or forward-looking statements as
defined under applicable securities laws (collectively,
"forward-looking statements"). Forward-looking statements normally
contain words like 'believe', 'expect', 'anticipate', 'plan',
'intend', 'continue', 'estimate', 'may', 'will', 'should',
'ongoing' and similar expressions, and within this news release
include any statements (express or implied) respecting the growth
of the Company's interest income and profitability, the Company's
ability to improve investment performance as a consequence of the
acquisition of Pivot, the Company's ability to further its growth
in the SaaS and specialty loan market segments, the impact of the
deployment of further investment capital on the Company's future
quarters, the acceleration of Pivot's growth through the
combination with TIMIA, and other statements about growing
the Company's business. Forward-looking statements are not
guarantees of future performance, actions, or developments and are
based on expectations, assumptions and other factors that
management currently believes are relevant, reasonable and
appropriate in the circumstances, including, without limitation,
the following assumptions: that the Company and its investee
companies are able to meet their respective future objectives and
priorities, assumptions concerning general economic growth, the
Company being able to obtain financing on acceptable terms, the
Company's ability to attract and retain skilled staff, the absence
of unforeseen changes in the legislative and regulatory framework
for the Company, the COVID-19 pandemic not having a material impact
on the Company's operations, the products and technology offered by
the Company's competitors and the Company's ability to protect
intellectual proprietary rights. Although management believes that
the forward-looking statements are reasonable, actual results could
be substantially different due to the risks and uncertainties
associated with and inherent to Timia's business. Material risks
and uncertainties applicable to the forward-looking statements set
out herein include, but are not limited to, worldwide pandemics,
such as the recent outbreak of the novel coronavirus COVID-19, may
adversely impact multiple aspects of the Company's business; the
Company having insufficient financial resources to achieve its
objectives; uncertainty as to the Company's ability to raise
additional funding; availability of further investments that are
appropriate for the Company on terms that it finds acceptable or at
all; successful completion of exits from investments on terms that
constitute a gain when no such exits are currently anticipated;
intense competition in all aspects of business; reliance on limited
management resources; the Company's dependence upon certain key
personnel and their loss could adversely affect the Company's
ability to achieve its business objectives; general economic risks;
new laws and regulations, risk of litigation, the Company may not
achieve its publicly announced business objectives according to
schedule, or at all; the Company's success depending upon its
ability to protect its intellectual property and its proprietary
technology; the price of the Company's shares may be subject to
fluctuation in the future based on market conditions; the Company's
success depends on its ability to effectively manage growth; and
significant disruptions of information technology systems or
security breaches could adversely affect the Company's business.
Although Timia has attempted to identify factors that may cause
actual actions, events or results to differ materially from those
disclosed in the forward-looking statements, there may be other
factors that cause actions, events or results not to be as
anticipated, predicted, estimated or intended. Also, many of the
factors are beyond the control of Timia. Accordingly, readers
should not place undue reliance on forward-looking statements.
Timia undertakes no obligation to reissue or update any
forward-looking statements as a result of new information or events
after the date hereof except as may be required by law. All
forward-looking statements contained in this news release are
qualified by this cautionary statement.
SOURCE TIMIA Capital Corp.