Clairvest Reports Fiscal 2021 First Quarter Results
August 11 2020 - 5:31PM
Clairvest Group Inc. (TSX: CVG) today reported results for the
fiscal 2021 first quarter ended June 30, 2020 and material events
which occurred subsequent to quarter end. (All figures are in
Canadian dollars unless otherwise stated)
Highlights
- June 30, 2020 book value was $893.0
million or $59.27 per share versus $837.4 million or $55.55 per
share as at March 31, 2020
- Net income for the first quarter of
fiscal 2021 was $64.4 million or $4.27 per share
- Clairvest and Clairvest Equity
Partners VI (“CEP VI”) completed a US$29.3 million equity
investment in NovaSource Power Services (“NovaSource”). Subsequent
to quarter end, NovaSource announced agreement to acquire First
Solar Energy Services
- Clairvest and CEP VI completed a
US$10.0 million equity investment in Arrowhead Environmental
Partners (“AEP”)
- Subsequent to quarter end, Digital
Media Solutions (“DMS”), an investee company of Clairvest and
Clairvest Equity Partners V (“CEP V”), completed its transaction
with Leo Holdings Corp., becoming a publicly traded company on the
NYSE (NYSE: DMS)
- Subsequent to quarter end,
Clairvest paid an annual ordinary dividend of $1.5 million, or
$0.10 per share, and a special dividend of $6.9 million, or $0.4555
per share, both declared during the first quarter of fiscal 2021
and paid on July 24, 2020
Clairvest’s book value was $893.0 million or
$59.27 per share as at June 30, 2020, compared with $837.4 million
or $55.55 per share as at March 31, 2020. The increase in book
value per share for the quarter was primarily attributable to net
income for the quarter of $64.4 million, or $4.27 per share net of
$8.4 million or $0.5555 per share of dividends accrued as at June
30, 2020. The net income arose from the increase in a number of the
investee company values, partially offset by declines in
others.
In May 2020, Clairvest and CEP VI made a US$29.3
million investment to acquire a combined 86% ownership in the solar
operations and maintenance business of SunPower Corporation. Upon
closing, the acquired business unit was renamed NovaSource Power
Services. Clairvest’s portion of the investment was US$8.3 million
(C$11.4 million) following a partial sale down to NovaSource
management for an effective 24% ownership in NovaSource. Subsequent
to quarter end, NovaSource announced it had entered into an
agreement with First Solar, Inc. to acquire its operations and
maintenance division, First Solar Energy Services. The transaction
will be funded through a combination of third-party term debt and
equity from Clairvest and CEP VI. The proposed transaction is
subject to customary closing conditions, including obtaining
various contractual consents and regulatory approvals, and is
anticipated to close in late calendar 2020. There can be no
assurance that the transaction will be consummated.
In June 2020, Clairvest and CEP VI made a
US$10.0 million minority equity investment in AEP, a non-hazardous
waste-by-rail operator in Northeastern United States markets.
Clairvest’s portion of the investment was US$2.7 million (C$3.7
million) in the form of Class B preferred units for an effective
11.3% ownership in AEP.
Subsequent to quarter end, in July 2020, DMS, an
investee company of Clairvest and CEP V, completed its transaction
with Leo Holdings Corp., becoming publicly traded on the NYSE under
the symbol DMS. Upon the completion of the transaction, Clairvest
and CEP V received cash proceeds of US$7.9 million and US$18.5
million respectively and 6,058,016 and 14,135,371 Class A common
shares of DMS respectively, which in aggregate represents
approximately 34.7% of total outstanding shares of DMS. Clairvest
and CEP V are subject to a 6-month hold period on their DMS shares
and have customary registration rights and would expect any sale of
such shares to be conducted pursuant to a resale prospectus.
Clairvest and CEP V also received 276,653 and 645,524 publicly
traded warrants (NYSE: DMS WS) respectively, which are convertible
into Class A common shares at an exercise price of USD$11.50 per
warrant.
Also subsequent to quarter end, Clairvest paid
an annual ordinary dividend of $0.10 per share and a special
dividend of $0.4555 per share, such that in aggregate, the
dividends represent 1% of the March 31, 2020 book value. Both
dividends were paid on July 24, 2020 to common shareholders of
record as at July 3, 2020 and are eligible dividends for Canadian
income tax purposes.
|
Summary of
Financial Results – Unaudited |
|
|
|
|
|
Financial Results |
Quarter ended |
|
June 30 |
|
2020 |
|
2019 |
|
($000’s, except per share amounts) |
$ |
|
$ |
|
Net investment gain(1) |
74,690 |
|
19,484 |
|
Net carried interest from Clairvest Equity Partners III and IV |
(7,885 |
) |
2,244 |
|
Distributions, interest income, dividends and fees |
11,142 |
|
6,553 |
|
Total expenses, excluding income taxes |
6,287 |
|
23,188 |
|
Net income and comprehensive income |
64,352 |
|
5,878 |
|
Basic and fully diluted net income per share |
4.27 |
|
0.39 |
|
Financial Position |
June 30, |
|
March 31, |
|
2020 |
|
2020 |
|
($000’s, except share information and per share amounts) |
$ |
|
$ |
|
Total assets |
1,009,153 |
|
944,878 |
|
Total cash, cash equivalents and temporary investments |
358,967 |
|
428,856 |
|
Carried interest from Clairvest Equity Partners III and IV |
35,824 |
|
44,409 |
|
Corporate investments(1) |
493,762 |
|
400,291 |
|
Total liabilities |
116,158 |
|
107,463 |
|
Management participation from Clairvest Equity Partners III and
IV |
27,266 |
|
34,115 |
|
Book value(2) |
892,995 |
|
837,415 |
|
Common shares outstanding |
15,066,301 |
|
15,075,301 |
|
Book value per share(2) |
59.27 |
|
55.55 |
|
(1) Includes carried interest ($37,276) and
management participation ($26,736) from Clairvest Equity Partners V
and VI.(2) Book value is a Non-IFRS measure calculated as the value
of total assets less the value of total liabilities. The term book
value does not have any standardized meaning according to IFRS and
therefore may not be comparable to similar measures presented by
other companies. There is no comparable IFRS measure presented in
Clairvest’s consolidated financial statements and thus no
applicable quantitative reconciliation for such non-IFRS financial
measure. The Company has calculated book value consistently for
many years and believes that book value can provide information
useful to its shareholders in understanding its performance, and
may assist in the evaluation of its business relative to that of
its peers.
Clairvest’s first quarter fiscal 2021 financial
statements and MD&A are available on the SEDAR website at
www.sedar.com and the Clairvest website at www.clairvest.com.
About Clairvest
Clairvest Group Inc. is a private equity
investor which invests its own capital, and that of third parties
through the Clairvest Equity Partners (“CEP”) limited partnerships,
in businesses that have the potential to generate superior returns.
In addition to providing financing, Clairvest contributes strategic
expertise and execution ability to support the growth and
development of its investee partners. Clairvest realizes value
through investment returns and the eventual disposition of its
investments.
Contact Information
Maria ShkolnikDirector, Investor Relations and
MarketingClairvest Group Inc.Tel: (416) 925-9270Fax: (416)
925-5753marias@clairvest.com
Forward-looking Statements
This news release contains forward-looking
statements with respect to Clairvest Group Inc., its subsidiaries,
its CEP limited partnerships and their investments. These
statements are based on current expectations and are subject to
known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of Clairvest,
its subsidiaries, its CEP limited partnerships and their
investments to be materially different from any future results,
performance or achievements expressed or implied by such
forward-looking statements. Such factors include general and
economic business conditions and regulatory risks. Clairvest is
under no obligation to update any forward-looking statements
contained herein should material facts change due to new
information, future events or otherwise.
www.clairvest.com
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