Atrium Mortgage Investment Corporation Achieves Record Revenues and Net Income in Second Quarter of 2019

Toronto, Ontario--(Newsfile Corp. - August 1, 2019) - Atrium Mortgage Investment Corporation (TSX: AI) (TSX: AI.DB) (TSX: AI.DB.B) (TSX: AI.DB.C) (TSX: AI.DB.D) (TSX: AI.DB.E) today released its unaudited financial results for the three and six month periods ended June 30, 2019.

Highlights

  • Record revenues of $16.7 million, up 14.0% from the second quarter of the prior year

  • Record net income of $9.7 million, up 12.3% from the second quarter of the prior year

  • $0.25 basic and $0.24 diluted earnings per share for the quarter

  • Record $0.49 basic and $0.48 diluted earnings per share year-to-date

  • Mortgage portfolio increased to $736.0 million, 7.5% increase from December 31, 2018

  • High quality mortgage portfolio

    • 85.0% of portfolio in first mortgages

    • 89.4% of portfolio is less than 75% loan to value

    • average loan-to-value is 60.3%

"We are very pleased with our results for the first half of 2019. Our portfolio grew to $736.0 million, up from $684.4 million at December 31, 2018, despite slowing real estate market conditions. We are lending defensively to ensure that our loan quality is preserved. For example, the average loan to value in the mortgage portfolio continued to trend downwards and first mortgages now represent 85% of our portfolio. We strengthened our balance sheet during the first half of 2019 with the completion of two successful public offerings; a $34.5 million common share issuance and a $28.8 million convertible debenture issuance, both of which had strong demand," said Rob Goodall, CEO of Atrium.

Interested parties are invited to participate in a conference call with management on Friday, August 2, 2019 at 9:00 a.m. ET to discuss the results. To participate or listen to the conference call live, please call 1 (888) 241-0551 or (647) 427-3415. For a replay of the conference call (available until August 15, 2019) please call 1 (855) 859-2056, Conference ID 5764875.

Results of operations

Atrium ended its second quarter of 2019 with assets of $751.1 million and record quarterly revenue of $16.7 million, an increase of 14.0% from the second quarter of the prior year. Net income for the second quarter of 2019 was $9.7 million, an increase of 12.3% from the second quarter of the prior year. Basic and diluted earnings per common share were $0.25 and $0.24, respectively, for the three months ended June 30, 2019, compared with $0.24 basic and diluted earnings per common share for the comparable quarter in the prior year.

Revenue for the six months ended June 30, 2019 was $32.5 million, an increase of 16.0% from the prior year. Net income for the six months ended June 30, 2019 was $18.9 million, an increase of 14.3% from the prior year. Basic and diluted earnings per common share were $0.49 and $0.48, respectively, for the six months ended June 30, 2019, compared with $0.48 basic and $0.47 diluted earnings per common share from the prior year.

The company had $733.9 million of mortgages receivable as at June 30, 2019, an increase of 7.5% from December 31, 2018. During the six month period ended June 30, 2019, $130.3 million of mortgages were advanced, and $86.5 million of mortgages were repaid.

The weighted average interest rate on the mortgage portfolio at June 30, 2019 was 8.81%, compared to 8.85% at December 31, 2018.

Financial summary

Interim Consolidated Statements of Income and Comprehensive Income              
(Unaudited, 000s, except per share amounts)   Three months ended     Six months ended  
    June 30     June 30  
    2019     2018     2019     2018  
Revenue $  16,667   $  14,616   $  32,463   $  27,990  
Mortgage servicing and management fees   (1,757 )   (1,610 )   (3,437 )   (3,064 )
Other expenses   (265 )   (317 )   (534 )   (569 )
Rental loss   (102 )       (120 )    
Provision for mortgage losses   (400 )   (400 )   (800 )   (700 )
Income before financing costs   14,143     12,289     27,572     23,657  
Financing costs   (4,476 )   (3,684 )   (8,670 )   (7,125 )
Net income and comprehensive income $  9,667   $  8,605   $  18,902   $  16,532  
                         
Basic earnings per share $  0.25   $  0.24   $  0.49   $  0.48  
Diluted earnings per share $  0.24   $  0.24   $  0.48   $  0.47  
                         
Dividends declared $  8,870   $  8,140   $  17,518   $  15,817  
                         
Mortgages receivable, end of period $  733,852   $  701,568   $  733,852   $  701,568  
Total assets, end of period $  751,060   $  702,709   $  751,060   $  702,709  
Shareholders’ equity, end of period $  425,306   $  382,911   $  425,306   $  382,911  


Analysis of mortgage portfolio
(dollars in 000s)

    June 30, 2019     December 31, 2018  
          Outstanding     % of           Outstanding     % of  
Property Type   Number     amount     Portfolio     Number     amount     Portfolio  
(outstanding amounts in 000s)                                    
Low-rise residential   35   $  219,390     29.8%     38   $  232,713     34.0%  
High-rise residential   18     183,883     25.0%     15     146,027     21.3%  
Mid-rise residential   20     140,506     19.1%     20     139,708     20.4%  
House and apartment   91     61,231     8.3%     101     64,230     9.4%  
Condominium corporation   14     2,850     0.4%     14     2,533     0.4%  
   Residential portfolio   178     607,860     82.6%     188     585,211     85.5%  
Commercial   21     128,166     17.4%     20     99,193     14.5%  
   Mortgage portfolio   199     736,026     100.0%     208     684,404     100.0%  

    June 30, 2019
                      Weighted     Weighted  
    Number of     Outstanding     Percentage     average     average  
Location of underlying property   mortgages     amount     outstanding     loan to value     interest rate  
(outstanding amounts in 000s)                              
Greater Toronto Area   155   $  491,990     66.8%     64.9%     8.91%  
Non-GTA Ontario   23     24,749     3.4%     58.5%     8.31%  
Alberta   4     15,047     2.0%     56.3%     8.80%  
British Columbia   17     204,240     27.8%     49.9%     8.65%  
    199   $  736,026     100.0%     60.3%     8.81%  
                               
    December 31, 2018  
                      Weighted     Weighted  
    Number of     Outstanding     Percentage     average     average  
Location of underlying property   mortgages     amount     outstanding     loan to value     interest rate  
(outstanding amounts in 000s)                              
Greater Toronto Area   162   $  431,334     63.0%     65.5%     8.94%  
Non-GTA Ontario   26     29,160     4.3%     57.9%     8.28%  
Alberta   3     15,698     2.3%     52.5%     8.83%  
British Columbia   17     208,212     30.4%     53.1%     8.76%  
    208   $  684,404     100.0%     61.1%     8.85%  

For further information on the financial results, and further analysis of the company's mortgage portfolio, please refer to Atrium's unaudited interim consolidated financial statements and its management's discussion and analysis for the three and six month periods ended June 30, 2019, available on SEDAR at www.sedar.com, and on the company's website at www.atriummic.com.

Conference call

Interested parties are invited to participate in a conference call with management on Friday, August 2, 2019 at 9:00 a.m. ET to discuss the results. To participate or listen to the conference call live, please call 1 (888) 241-0551 or (647) 427-3415. For a replay of the conference call (available until August 15, 2019) please call 1 (855) 859-2056, Conference ID 5764875.

About Atrium

Canada's Premier Non-Bank Lender™

Atrium is a non-bank provider of residential and commercial mortgages that lends in major urban centres in Canada where the stability and liquidity of real estate are high. Atrium's objectives are to provide its shareholders with stable and secure dividends and preserve shareholders' equity by lending within conservative risk parameters. Atrium is a Mortgage Investment Corporation (MIC) as defined in the Canada Income Tax Act, so is not taxed on income provided that its taxable income is paid to its shareholders in the form of dividends within 90 days after December 31 each year. Such dividends are generally treated by shareholders as interest income, so that each shareholder is in the same position as if the mortgage investments made by the company had been made directly by the shareholder. For further information about Atrium, please refer to regulatory filings available at www.sedar.com or investor information on Atrium's website at www.atriummic.com.

For additional information, please contact

Robert G. Goodall
President and Chief Executive Officer

Jennifer Scoffield
Chief Financial Officer

(416) 867-1053

info@atriummic.com
www.atriummic.com

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/46697

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