Significant gains in EPS, revenue, gross
yield, ROE, loan book while maintaining credit strength
Note: All amounts in Canadian dollars unless otherwise
indicated.
Third Quarter 2015 Highlights
- Earnings per share (diluted) of $0.40, an increase of 11% from $0.36 last quarter, and 48% from $0.27 in the same quarter last year
- Total revenue of $48 million for
the quarter, up $9 million or 23%
from previous quarter, and $22
million or 85% from the same quarter last year
- Gross yield for the quarter was 19.7%, an increase from 18.8%
in the prior quarter, and a slight decline from 20.0% in the same
quarter last year. As noted previously, this figure is lumpy
quarter to quarter
- ROE was 16.1%, an increase from 15.2% in the prior quarter, and
an increase from 13.6% in the same quarter last year
- Gross loans receivable before derecognition of $1,193 million at September 30, 2015, up $149 million or 14% from the prior quarter, and
up $538 million or 82% from the same
quarter last year
- Average loan portfolio outstanding was $1,102 million, an increase of $174 million or 19% from the prior quarter, and
an increase of $493 million or 81%
from the same quarter last year
- Credit quality continues to be very strong, as evidenced by the
current run-rate for annualized provisioning of 1.5%
year-to-date
- Leverage ratio of 52.8% at the end of the current quarter, an
increase from 49.0% at the end of the prior quarter
- Net income was $19.9 million for
the quarter, up $1.5 million or 8%
from the prior quarter and $6.7
million or 50% from the same quarter last year
- As at September 30, 2015, the
estimated collateral value coverage across aggregate net loans
receivable was approximately 138% with a range between 100% and
384% on an individual loan basis. Furthermore, the aggregate
watchlist loans had an estimated aggregate collateral value
coverage of 107% and non-watchlist loans had an estimated aggregate
collateral value coverage of 147%. It should be noted that there is
no cross collateralization of the asset coverage between
borrowers
TORONTO, Nov. 5, 2015
/CNW/ - Callidus Capital Corporation ("Callidus" or the
"Company") (TSX: CBL), reported strong loan portfolio growth,
strong revenue growth, and further incremental earnings in the
third quarter of 2015. Callidus, which provides flexible and
innovative asset-based loans, primarily to growth and distressed or
troubled companies, today reported its financial results for the
third quarter ended September 30, 2015, and provided an update
on the current state of its business.
Newton Glassman, Executive
Chairman and Chief Executive Officer of Callidus said: "Callidus'
history of consistent improvement in all key metrics continued and
strengthened in the third quarter, demonstrating strong momentum in
loan portfolio growth, revenues, earnings and return on equity,
while maintaining a substantial new loan pipeline. Although
Callidus has surpassed its original target of doubling the loan
book every two to three years by doubling in the first five
quarters after its IPO, Callidus is not only expected to double its
loan book again over the next two to three years, but to also see
continued improvement in key metrics (EPS, revenue, gross yield,
and ROE) over the same period. However, some metrics have
been and will likely in the future continue to be "lumpy" as a
result of the very nature of the business. Callidus currently
finds itself in the envious position of being able to exploit the
intersection of three things, namely: (i) its competitive
advantages in dealing with these loans as well as high barriers to
entry; (ii) a growing market opportunity resulting from the current
state of the Canadian economy; and (iii) changes in the last few
years to lenders' regulatory environment."
"Callidus continues to deliver and expand on its track record of
very strong operating results, quarter over quarter over quarter.
These results, coupled with our continued excellent credit quality,
demonstrate the strength and robustness of our business model.
Through constant refinement and focus of our marketing strategy, we
are expecting higher conversion rates of prospects to funded
clients from our current pipeline. Furthermore, Callidus has, and
will continue to, capitalize on its unique access to Catalyst's
workout expertise and capital for the benefit of Callidus
shareholders, given how strategically critical Callidus is to
Catalyst," added David Reese,
President and Chief Operating Officer of Callidus.
Current state of the business, as at November 4,
2015:
- Gross loans receivable before derecognition stood at
$1.17 billion
- The pipeline of potential new loans stands at approximately
$600 million
- Signed back term sheets of approximately $300 million
- Total debt (net of cash and cash equivalents) of $625 million, or 53% of gross loans
receivable
- The Company substantially realized on two of its watchlist
loans in line with its $11 million
provision. Provisioning was accurate and the Catalyst guarantee was
realized upon immediately
- Approximately 2.2 million shares were acquired into treasury
and cancelled under the normal course issuer bid (approximately 86%
of the 2.6 million shares under the program)
Financial Highlights
|
|
|
|
Three Months
Ended
|
Three Months
Ended
|
($ 000s)
|
Sept 30,
2015
|
Sept 30,
2014
|
Jun 30,
2015
|
Y/Y
Change
|
Q/Q
Change
|
Average loan
portfolio outstanding (1)
|
$1,101,675
|
$608,925
|
$928,172
|
81%
|
19%
|
Total revenue (after
derecognition)
|
48,419
|
26,182
|
39,329
|
85%
|
23%
|
Gross yield
(1)
|
19.7%
|
20.0%
|
18.8%
|
|
|
Net interest
margin(1)
|
13.6%
|
15.3%
|
13.5%
|
|
|
Net income
|
19,925
|
13,246
|
18,390
|
50%
|
8%
|
Earnings per share
(diluted)
|
$0.40
|
$0.27
|
$0.36
|
48%
|
11%
|
ROE
|
16.1%
|
13.6%
|
15.2%
|
|
|
Notes:
|
(1)
|
Refer to "Description
of Non-IFRS Measures" in the MD&A. These financial measures are
not recognized measures under IFRS and do not have a standardized
meaning prescribed by IFRS. Therefore, they may not be comparable
to similar measures used by other issuers.
|
Additional highlights of the third quarter, relative to the
last quarter:
- In September 2015, the Company
increased the amount of its revolving unsecured subordinated bridge
facility from Catalyst by US$50 million to
US$250 million in the aggregate. All other terms remain
substantially unchanged
- During the third quarter, 1.15 million shares were acquired
into treasury and cancelled under the normal course issuer bid
- Net new provision for loan losses for the third quarter was
$7.5 million, of which a $3.3 million recovery was recognized related to
the Catalyst guarantee. Provision on assets held for sale for the
current quarter was $3.0 million of
which a recovery of $3.0 million was
recognized related to the Catalyst guarantee
- In the quarter, three new loans representing $95 million in total credit facilities were
extended and two loans were repaid totalling $10 million. In addition to these new loans,
$92 million in net new funding was
provided to existing borrowers
- Our gross yield was 20.8% on our core product and 14.5% on
Callidus Lite
- Catalyst Fund II, an investment fund and major shareholder of
the Company, was previously scheduled to dispose of its assets no
later than 2016. The term of that Fund has now been extended at
least until November 2017
- In September 2015, the Company
implemented a dividend reinvestment plan ("DRIP"). Catalyst has
elected to participate in the DRIP on 100% of their shareholdings
of the Company and, therefore, received 469,529 shares in
consideration of their dividend subsequent to quarter-end
About Callidus Capital Corporation
Established in
2003, Callidus Capital Corporation is a Canadian company
that specializes in innovative and creative financing solutions for
companies that are unable to obtain adequate financing from
conventional lending institutions. Unlike conventional lending
institutions who demand a long list of covenants and make credit
decisions based on cash flow and projections, Callidus credit
facilities have few, if any, covenants and are based on the value
of the company's assets, its enterprise value and borrowing needs.
Callidus employs a proprietary system of monitoring collateral and
exercising control over the cash inflows and outflows of each
borrower, enabling Callidus to very effectively manage risk of
loss.
Forward-Looking Statements
Certain statements made
herein contain forward-looking information. Although Callidus
believes these statements to be reasonable, the assumptions upon
which they are based may prove to be incorrect. Furthermore, the
forward-looking statements contained in this press release are made
as at the date of this press release and Callidus does not
undertake any obligation to update publicly or to revise any of the
included forward-looking statements, whether as a result of new
information, future events or otherwise, except as may be required
by applicable securities laws.
Conference call
Callidus will host a conference call
to discuss Q3 2015 results on November 6th, 2015
at 10:30 a.m. Eastern Time. The dial in number for the
call is (647) 427-7450 or (888) 231-8191 (reference
number: 61680751). A taped replay of the call will be
available until November 11, 2015 at
(416) 849-0833 or (855) 859-2056 (reference
number: 61680751).
SOURCE Callidus Capital Corporation