TORONTO, Nov. 2, 2022
/CNW/ - Accord Financial Corp. (TSX: ACD) today released its
financial results for the three and nine months ended September 30, 2022. 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
|
|
2022
|
2021
|
2022
|
2021
|
|
$
|
$
|
$
|
$
|
Average funds
employed (millions)
|
445
|
414
|
452
|
383
|
Revenue
(000's)
|
16,452
|
16,119
|
49,120
|
45,015
|
Pre-provision
operating income (000's)
|
2,925
|
3,468
|
10,122
|
9,743
|
Provision for credit
and loan losses
|
1,069
|
336
|
5,170
|
(340)
|
Earnings before
income tax (000's)
|
1,856
|
3,132
|
4,952
|
10,083
|
Net earnings
attributable to shareholders (000's)
|
1,831
|
2,643
|
5,091
|
8,313
|
Earnings per common
share (basic and diluted)
|
0.21
|
0.31
|
0.59
|
0.97
|
Book value per share
(September 30)
|
|
|
$12.34
|
$11.31
|
While navigating a challenging business environment, the Company's
third quarter performance reflected careful growth of funds
employed, which lifted year-to-date revenue and pre-provision
operating income into record territory.
Average funds employed were $445
million in the third quarter, up 7% over the same quarter
last year, and averaged $452 million
for the first nine months, up 18% over the same period last year.
Funds employed at September 30, 2022
were $457 million. Third quarter
revenue increased to $16,452,000
compared to $16,119,000 in the third
quarter of 2021. Revenue for the first nine months of 2022 rose 9%
to a first nine-month record of $49,120,000 compared to $45,015,000 last year. Pre-provision operating
income remained healthy, with strong cash flow year-to-date
boosting book value per common share to $12.34 at quarter end, up from $11.31 at September 30,
2021 and $11.68 at the start
of the year.
Commenting on the financial results, the Company's President and
CEO, Mr. Simon Hitzig, stated:
"We've maintained steady progress this year, but remain vigilant as
credit conditions evolve." Mr. Hitzig added, "The lack of
visibility into the near-term business climate causes some of the
segments we serve to reduce their use of debt for growth
initiatives and capital investment. And the deteriorating
conditions in some industries make it tougher for prospective
clients to meet our credit standards."
Despite continuing growth, the Company's third quarter net
earnings included a $1.1 million
provision for credit and loan losses, compared to $336,000 during the same quarter last year,
reflecting the economic headwinds and their impact on certain
businesses within the portfolio. Given the uncertain economic
forecast, the Company continues to carry an allowance for expected
losses on the balance sheet: $7.2
million at September 30, 2022
compared to $5.7 million a year
earlier.
Affected by the provision for losses, net earnings attributable
to shareholders were $1,831,000 in
the third quarter of 2022 compared to $2,643,000 in the same quarter last year,
resulting in earnings per common share ("EPS") of 21 cents compared to 31
cents last year. Third quarter earnings rebounded strongly
from $122,000 in the second quarter
owing primarily to a lower provision for losses. Net earnings in
the first nine months of 2022 were $5,091,000 compared to $8,313,000 in 2021, for nine months EPS of
59 cents compared to 97 cents last year.
During the third quarter the Company announced that it expanded
its primary loan facility, provided by a syndicate of six banks, to
a commitment size of $437 million and
extended the term to July 2025. With
$215 million drawn at September 30th, this provides ample
funding for expected growth. Looking ahead, Mr. Hitzig added "The
foundational elements for the next phase of growth, from market
presence to financial strength, are in place. When the economy
finds its footing, we're well-positioned to accelerate growth and
unlock potential for our investors."
Reflecting continued strong cash flow, the Company's Board of
Directors declared a quarterly dividend of 7.5 cents per common share, payable December 1, 2022, to shareholders of record
November 15, 2022.
About Accord Financial Corp.
Accord Financial is North
America's most dynamic commercial finance company providing
fast, versatile financing solutions for companies in transition
including factoring, inventory finance, equipment leasing, trade
finance and film/media finance. By leveraging our unique
combination of financial strength, deep experience and independent
thinking, we craft winning financial solutions for small and
medium-sized businesses, simply delivered, so our clients can
thrive. For 44 years, Accord has helped businesses manage their
cash flows and maximize financial opportunities.
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) Pre-provision operating income: the Company derives this
measure from amounts presented in its IFRS prepared financial
statements. Operating income is earnings before income tax, adding
back the provision for credit and loan losses.
2) Book value per share: book value is shareholders' equity and
is the same as the net asset value (calculated as total assets
minus total liabilities) of the Company less non-controlling
interests. 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.