Atrium Mortgage Investment Corporation Announces Second Quarter Results

Toronto, Ontario--(Newsfile Corp. - July 29, 2020) - Atrium Mortgage Investment Corporation (TSX: AI) (TSX:AI.DB.B) (TSX: AI.DB.C) (TSX: AI.DB.D) (TSX: AI.DB.E) today released its financial results for the three and six month periods ended June 30, 2020.

Highlights

  • Quarterly revenues of $16.2 million, down 2.0% from the second quarter of the prior year

  • Quarterly net income of $9.8 million, up 1.6% from the second quarter of the prior year

  • $0.23 basic and diluted earnings per share for the quarter

  • $0.47 basic and diluted earnings per share year-to-date

  • Mortgage portfolio of $679.96 million, 6.8% decrease from December 31, 2019

  • High quality mortgage portfolio

    • 85.4% of portfolio in first mortgages

    • 93.9% of portfolio is less than 75% loan to value

    • average loan-to-value is 59.0%

"We are pleased with the second quarter results which exceeded our quarterly dividend, even after taking another $1.0 million loan loss provision. Atrium now has an aggregate loan loss provision exceeding 1.0% of our mortgage portfolio which will help protect our balance sheet from the impact of COVID 19. The increase in our loan loss provision is consistent with the actions of the major Canadian and US banks.

In Q2, we also executed on our strategy to scale back lending in order to increase our liquidity and be in a position to cautiously resume lending as the real estate market emerges from the downturn. As a result, we expect that Q3 will be a more active quarter for new mortgages," said Rob Goodall, CEO of Atrium.

Interested parties are invited to participate in a conference call with management Friday, July 30, 2020 at 4:00 p.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, conference ID 7681038. For a replay of the conference call (available until August 12, 2020) please call 1 (855) 859-2056, conference ID 7681038.

Results of operations

Atrium ended its second quarter of 2020 with assets of $691.7 million, and revenues of $16.2 million, a decrease of 2.0% from the second quarter of the prior year. Net income for the second quarter of 2020 was $9.8 million, an increase of 1.6% from the second quarter of the prior year.

Basic and diluted earnings per common share were $0.23, for the three month period ended June 30, 2020, compared with $0.25 basic and $0.24 diluted earnings per common share for the comparable quarter in the prior year.

Revenue for the six months ended June 30, 2020 was $33.3 million, an increase of 3.0% from the prior year. Net income for the six months ended June 30, 2020 was $19.7 million, an increase of 4.1% from the prior year. Basic and diluted earnings per common share were $0.47 for the six months ended June 30, 2020, compared with $0.49 basic and $0.48 diluted earnings per common share for the six months ended June 30, 2019.

Atrium had $675.3 million of mortgages receivable as at June 30, 2020, a decrease of 7.1% from December 31, 2019. During the six month period ended June 30, 2020, $97.1 million of mortgage principal was advanced, and $140.8 million was repaid.

The weighted average interest rate on the mortgage portfolio at June 30, 2020 was 8.55%, compared to 8.81% at December 31, 2019.

As at July 28, 2020, the company had collected 96% of the mortgage interest due in July, which is in line with historical collection rates.

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


2020

2019

2020

2019
Revenue $16,241
$16,565
$33,298
$32,343
Mortgage servicing and management fees
(1,700)
(1,757)
(3,477)
(3,437)
Other expenses
(335)
(265)
(684)
(534)
Provision for mortgage losses
(1,000)
(400)
(2,000)
(800)
Income before financing costs
13,206

14,143

27,137

27,572
Financing costs
(3,385)
(4,476)
(7,452)
(8,670)
Net income and comprehensive income $9,821
$9,667
$19,685
$18,902


 

 

 

 
Basic earnings per share $0.23
$0.25
$0.47
$0.49
Diluted earnings per share $0.23
$0.24
$0.47
$0.48


 

 

 

 
Dividends declared $9,536
$8,870
$19,040
$17,518


 

 

 

 
Mortgages receivable, end of period $675,339
$733,852
$675,339
$733,852
Total assets, end of period $691,705
$751,060
$691,705
$751,060
Shareholders' equity, end of period $463,068
$425,306
$463,068
$425,306

 

Analysis of mortgage portfolio



June 30, 2020

December 31, 2019





Outstanding

% of




Outstanding

% of
Property Type
Number

amount

Portfolio

Number

amount

Portfolio
(outstanding amounts in 000s)

















Low-rise residential
28
$ 190,639

28.0%

32
$ 216,144

29.6%
High-rise residential
17

170,270

25.0%

15

174,544

23.9%
Mid-rise residential
20

142,668

21.0%

21

160,456

22.0%
House and apartment
74

49,618

7.3%

91

66,083

9.1%
Condominium corporation
14

2,461

0.4%

14

2,659

0.4%
   Residential portfolio
153

555,656

81.7%

173

619,886

85.0%
Commercial
20

124,299

18.3%

19

109,859

15.0%
   Mortgage portfolio
173

679,955

100.0%

192

729,745

100.0%

 



June 30, 2020











Weighted

Weighted


Number of

Outstanding

Percentage

average

average
Location of underlying property
mortgages

amount

outstanding

loan to value

interest rate
Greater Toronto Area
132
$473,288

69.6%

61.6%

8.52%
Non-GTA Ontario
23

23,475

3.4%

64.4%

8.30%
Alberta
3

15,437

2.3%

76.6%

8.81%
British Columbia
15

167,755

24.7%

49.2%

8.59%


173
$679,955

100.0%

59.0%

8.55%

 




December 31, 2019












Weighted

Weighted



Number of

Outstanding

Percentage

average

average
Location of underlying property

mortgages

amount

outstanding

loan to value

interest rate
Greater Toronto Area

153
$509,299

69.8%

64.1%

8.85%
Non-GTA Ontario

20

20,625

2.8%

57.6%

8.33%
Alberta

4

15,141

2.1%

64.0%

8.80%
British Columbia

15

184,680

25.3%

46.9%

8.77%



192
$729,745

100.0%

59.5%

8.81%

 

For further information on the financial results, and further analysis of the company's mortgage portfolio, please refer to Atrium's interim consolidated financial statements and its management's discussion and analysis for the three and six months ended June 30, 2020, 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 Friday, July 30, 2020 at 4:00 p.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, conference ID 7681038. For a replay of the conference call (available until August 12, 2020) please call 1 (855) 859-2056, conference ID 7681038.

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 Office
(416) 867-1053
info@atriummic.com
www.atriummic.com

Jennifer Scoffield
Chief Financial Officer

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/60764

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