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TORONTO, 23 November 2021 / CNW / – Cliffside Capital Ltd. (“on the cliff side“or the “Society“) (TSXV: CEP) is pleased to report strong financial results for the third quarter ended September 30, 2021.
As the restrictions induced by the pandemic begin to ease, Cliffside has started to grow its assets through the acquisition of new financial receivables and is pleased to announce:
The acquisition of $ 53.8 million gross financial receivables during the quarter;
$ 0.8 million increase in net income to $ 1.5 million for nine months ended September 30, 20201 compared to the same period of the previous year, driven by better performance and consistent with the expected profitability of the portfolio over its lifetime;
Q3 2021 net loss of $ 159,039 was impacted by a pre-tax amount of $ 1,449,937 resulting from the movement of the allowance for credit losses in phase 1 of $ 845,397, resulting from the acquisition of $ 53.8 million in new financing receivable and amortization of $ 605,540 financing costs incurred to obtain new financing facilities for CAR LP I; and
The allowance for credit losses decreased to $ 2.2 million for nine months ended September 30, 2021 compared to $ 4.6 million the previous year, thanks to a combination of slower acquisition of new financial receivables in the first half of the year, government economic support to individuals and tight management of borrower performance.
As previously announced, the Company has successfully raised $ 4.5 million as gross proceeds of a private placement of his ordinary shares, in which he invested $ 3.75 million in a newly formed special purpose private limited partnership, CAR LP I, for a 60% stake and the remainder $ 0.75 million should be used for its general working capital needs. The new private limited partnership was formed to acquire unsecured consumer auto loan receivables.
CAR LP I has entered into a new securitization financing facility with a Schedule 1 bank for a maximum of $ 140 million and a subordinated debt commitment up to $ 35.2 million from a private Canadian asset management company. The new financing structure will result in better financing costs and improved cash flow for the Company. In addition, the company also renewed its securitization financing facilities with its existing third party lenders up to an additional amount. $ 85 million, bringing the total availability of funding to $ 260.2 million in accordance with the applicable terms of the financing facilities.
Cliffside also paid a quarterly cash dividend on the outstanding common shares of $ 0.0025 per common share (or $ 0.01 on an annualized basis) on November 1, 2021, to holders of ordinary shares of record at the close of business on October 1, 2021. The dividend was an “eligible dividend” for Canadian income tax purposes.
“The third quarter was marked by the record quarterly acquisition of receivables from $ 53.8 million, strong portfolio performance, improved financing conditions and the announcement of a quarterly cash dividend. I am very satisfied with our results for the quarter and the momentum gained from all the positive activities. Our goal remains the acquisition of new debt with strong risk-adjusted returns in order to generate long-term value for our shareholders ”, said the CEO Steve malone.
Cliffside seeks to grow its asset base and net interest margin by tightly managing its credit exposure, costs and net interest expense.
Further information on Cliffside’s financial results is available at www.cliffsidecapital.ca.
Cliffside is focused on investing in strategic partnerships with parties who have specialized expertise and a proven track record in granting and managing loans and similar types of financial assets. Cliffside’s strategy is to generate income as an investor, offering its shareholders the opportunity to invest in the growing alternative lending industry with the potential for attractive returns and minimal operational risk while achieving a return. total reliable. For more information, see the documents filed by Cliffside on SEDAR at www.sedar.com.
CAUTION REGARDING FORWARD-LOOKING INFORMATION: This press release includes certain “forward-looking statements” under applicable Canadian securities laws. Forward-looking statements include, without limitation, statements regarding the business and operations of Cliffside. Forward-looking statements are necessarily based on a number of estimates and assumptions which, although believed to be reasonable, are subject to known and unknown risks, uncertainties and other factors that may cause actual results and future events differ materially from those expressed or implied. by such forward-looking statements. These factors include, but are not limited to: general business, economic, competitive, political and social uncertainties; results of operations; the potential for conflicts of interest; the availability of appropriate financial receivables which can be purchased by the limited partnerships of the Company under existing financing facilities; and the volatility of the price and volume of common shares. There can be no assurance that such statements will prove to be accurate or complete, as actual results and future events could differ materially from those anticipated in such statements. Therefore, readers should not place undue reliance on forward-looking statements. Cliffside disclaims any intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law.
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 release.
SOURCE Cliffside Capital Ltd.
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