TORONTO, Oct. 30, 2017 /CNW/ - Accord Financial Corp. (TSX
– ACD) today released its financial results for the three and nine
months ended September 30,
2017. The financial figures presented in this release are
reported in Canadian dollars and have been prepared in accordance
with International Financial Reporting Standards.
SUMMARY OF
FINANCIAL RESULTS
|
|
Three Months
Ended Sept. 30
|
Nine Months Ended
Sept. 30
|
|
2017
|
2016
|
2017
|
2016
|
|
$
|
$
|
$
|
$
|
Average funds
employed (millions)
|
189
|
151
|
166
|
148
|
Revenue
(000's)
|
8,370
|
7,032
|
21,474
|
20,800
|
Net earnings
attributable to shareholders (000's)
|
1,983
|
1,265
|
3,577
|
4,357
|
Adjusted net
earnings (000's) (note)
|
2,166
|
1,923
|
4,102
|
5,313
|
Earnings per
common share (basic and diluted)
|
0.24
|
0.15
|
0.43
|
0.52
|
Adjusted earnings
per common share (basic and diluted)
|
0.26
|
0.23
|
0.49
|
0.64
|
Book value per
share (September 30)
|
|
|
$
8.98
|
$
8.83
|
Net earnings attributable to shareholders ("shareholders' net
earnings") for the third quarter of 2017 rose 57% to $1,983,000 compared to $1,265,000 last year. Shareholders' net earnings
increased mainly as a result of higher revenue. Earnings per
share ("EPS") rose 60% to 24 cents
compared to 15 cents last year.
Adjusted net earnings increased 13% to $2,166,000 in the third quarter of 2017 compared
to $1,923,000 last year. Adjusted EPS
were 26 cents compared to
23 cents last year.
Revenue increased by 19% to $8,370,000 in the current quarter compared to
$7,032,000 last year. Revenue rose
mainly as a result of higher funds employed. Revenue is included
for the first time from BondIt Media Capital ("BondIt") in which
the Company acquired a majority interest effective July 1, 2017 (see below).
Shareholders' net earnings in the first nine months of 2017
decreased to $3,577,000 compared with
$4,357,000 in the first nine months
of 2016 mainly as a result of a higher provision for credit and
loan losses. The provision for losses of $3,088,000 (2016: $1,185,000) was adversely impacted by a
charge-off for one impaired loan totalling $1,576,000. In addition, as the Company increased
its allowance for losses to support the rise in its funds employed,
the non-cash reserves expense rose to $752,000 (2016: $137,000). EPS declined to 43 cents compared to 52
cents last year. Adjusted net earnings decreased to
$4,102,000 in the first nine months
of 2017 compared to $5,313,000 last
year. Adjusted EPS declined to 49
cents compared to 64 cents
last year.
Revenue was $21,474,000 in the
first nine months of 2017 compared to $20,800,000 last year for reasons noted
above.
Commenting on the third quarter and first nine months results,
Mr. Tom Henderson, the Company's
CEO, stated: "Our funds employed rose to a record high $221 million at September
30, 2017, up 36% from the same time last year. I'm really
happy about that since we are still in a tough competitive
environment. We are seeing more usage from existing clients and new
business activity across the board in all units has been very
healthy. The investments we have made in the Accord brand are
paying off."
"I am excited about the strategic investments we made this year.
We started the quarter with the BondIt acquisition and then on
October 27 we teamed up with CapX
Partners to form a new company that will provide equipment leasing
and financing to mid-market businesses. The new company is named
Accord CapX LLC and Accord's majority interest in this new company
will enable CapX to operate confidently with a permanent source of
capital that will fuel increased growth."
The Company's Board of Directors today declared a quarterly
dividend of $0.09 per common share,
payable December 1, 2017 to
shareholders of record November 15,
2017.
About Accord Financial Corp.
Accord Financial Corp.
is a leading North American finance company providing distinctive
working capital solutions to companies from coast to coast.
Accord's flexible finance programs cover the full spectrum
of asset-based lending, from
factoring and inventory finance, to equipment leasing and trade
finance, to film and media finance. For 39 years, Accord has helped
businesses manage their cash flows and maximize financial
opportunities – keeping business liquid.
Note: Non-IFRS measures
The Company's financial statements have been prepared in
accordance with IFRS. The Company uses a number of other financial
measures to monitor its performance and believes that these
measures may be useful to investors in evaluating the Company's
operating performance and financial position. These measures may
not have standardized meanings or computations as prescribed by
IFRS that would ensure consistency between companies using these
measures and are, therefore, considered to be non-IFRS measures.
The non-IFRS measures presented in this press release are as
follows:
1) Adjusted net earnings and adjusted EPS. The Company
derives these measures from amounts presented in its IFRS prepared
financial statements. Adjusted net earnings comprise shareholders'
net earnings before stock-based compensation, business acquisition
expenses (transaction and integration coats and amortization of
intangible assets) and restructuring expenses. Adjusted EPS is
adjusted net earnings divided by the weighted average number of
common shares outstanding in the period. Management believes
adjusted net earnings is a more appropriate measure of operating
performance as it excludes items which do not relate to ongoing
operating activities. The following table provides a reconciliation
of the Company's net earnings to adjusted net earnings:
|
Three Months
Ended Sept. 30
|
Nine
Months Ended Sept. 30
|
|
2017
|
2016
|
2017
|
2016
|
|
$'000
|
$'000
|
$'000
|
$'000
|
Shareholders' net
earnings:
|
1,983
|
1,265
|
3,577
|
4,357
|
Adjustments, net of
tax:
|
|
|
|
|
|
Stock-based
compensation
|
47
|
34
|
143
|
145
|
|
Business acquisition
expenses
|
67
|
94
|
203
|
281
|
|
Restructuring
expenses
|
69
|
530
|
179
|
530
|
Adjusted net
earnings
|
2,166
|
1,923
|
4,102
|
5,313
|
2) Book value per share – book value is total shareholders'
equity and is the same as the net asset value of the Company
(calculated as total assets minus total liabilities) less
non-controlling interest. Book value per share is the book value
divided by the number of common shares outstanding as of a
particular date.
3) Funds employed are the Company's finance receivables and
loans, an IFRS measure. Average funds employed are the average
finance receivables and loans calculated over a particular
period.
SOURCE Accord Financial Corp.