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Atrium Mortgage Investment Corporation Achieves Record Revenues and Earnings in 2017

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Toronto, Ontario–(Newsfile Corp. – February 8, 2018) – Atrium Mortgage Investment Corporation (TSX: AI) (TSX: AI.DB) (TSX: AI.DB.A) (TSX: AI.DB.B) (TSX: AI.DB.C) today released its financial results for the year ended December 31, 2017.

Highlights

  • Record revenues of $50.4 million, up 14.3% from prior year
  • Earnings of $29.1 million, up 11.3% from prior year
  • $0.95 basic and $0.94 diluted earnings per share for the year ended December 31, 2017
  • $0.04 per share special dividend to shareholders of record December 31, 2017
  • $0.92 total dividends per share in 2017
  • 2018 regular monthly dividend increased to $0.90 per annum
  • Mortgage portfolio increased 18.1% year-over-year to $632 million at December 31, 2017
  • High quality mortgage portfolio
    • 81.8% of portfolio in first mortgages
    • 85.9% of loan portfolio is less than 75% loan to value
    • average loan-to-value is 61.5%

“Overall, I am pleased with Atrium’s performance in 2017. We had a record level of loan advances during the year of $353.7 million, which resulted in an 18% growth in our portfolio. Our new loans continue to be strategically diversified by real estate sector. We continue to lend conservatively, with a high percentage of first mortgages and an overall portfolio loan-to-value ratio below historic levels,” said Rob Goodall, CEO of Atrium.

“Once again we would like to thank our real estate clients for their continued loyalty, and our shareholders for their continuing support. We are proud to state that Atrium continues to be regarded as Canada’s premier non-bank lender™.”

Interested parties are invited to participate in a conference call with management on Friday, February 9, 2018 at 4:00 p.m. EST. Please refer to the call-in information at the end of this news release.

Results of operations

Atrium achieved record results, as its assets grew to $627.9 million, and revenues for the year were $50.4 million, an increase of 14.3% from the prior year. For the year ended December 31, 2017, earnings were $29.1 million, an increase of 11.3% from the prior year.

Basic and diluted earnings per common share were $0.95 and $0.94, respectively, for the year ended December 31, 2017, compared with $0.97 basic and $0.95 diluted earnings per common share in the previous year.

The company had $626.8 million of mortgages receivable as at December 31, 2017, an increase of 18.1% from the previous year. During the year, $353.7 million of mortgages were advanced, and $263.2 million of mortgages were repaid.

The weighted average interest rate on the mortgage portfolio was 8.44% at December 31, 2017, compared with 8.34% at September 30, 2017 and 8.50% at December 31, 2016.

Condensed Statements of Earnings and Comprehensive Income
($000s, except per share amounts)

Year Year Year
ended ended ended
December 31 December 31 December 31
2017 2016 2015
Revenue $ 50,359 $ 44,042 $ 40,206
Mortgage servicing and management fees (5,470 ) (4,661 ) (4,173 )
Other expenses (1,251 ) (1,221 ) (1,187 )
Provision for mortgage losses (1,850 ) (1,519 ) (1,912 )
Income before financing costs 41,788 36,641 32,934
Financing costs (12,729 ) (10,521 ) (9,597 )
Earnings and total comprehensive income $ 29,059 $ 26,120 $ 23,337
Basic earnings per share $ 0.95 $ 0.97 $ 0.94
Diluted earnings per share $ 0.94 $ 0.95 $ 0.93

For further information on the financial results, please refer to Atrium’s financial statements for the year ended December 31, 2017, and its management’s discussion and analysis for the same period, available on SEDAR at www.sedar.com, and on the company’s website at www.atriummic.com.

Mortgage portfolio
($000s) December 31, 2017 December 31, 2016
Outstanding % of Outstanding % of
Mortgage category Number amount Portfolio Number amount Portfolio
(outstanding amounts in 000s)
Low-rise residential 36 $ 234,343 37.1% 30 $ 135,701 25.4%
House and apartment 120 86,287 13.6% 102 99,456 18.6%
Construction 8 64,828 10.3% 8 49,345 9.2%
High-rise residential 7 44,949 7.1% 7 53,182 9.9%
Mid-rise residential 4 31,471 5.0% 5 28,787 5.4%
Condominium corporation 14 2,887 0.4% 16 3,548 0.7%
Residential portfolio 189 464,765 73.5% 168 370,019 69.2%
Commercial/mixed use 27 167,622 26.5% 29 165,231 30.8%
Mortgage portfolio 216 632,387 100.0% 197 535,250 100.0%
Accrued interest receivable 2,537 2,126
Mortgage discount (262 ) (360 )
Unamortized origination fees (706 ) (626 )
Provision for mortgage losses (7,200 ) (5,800 )
Mortgages receivable $ 626,756 $ 530,590

A summary of mortgages by size is presented below.

($000s) December 31, 2017 December 31, 2016
Outstanding % of Outstanding % of
Mortgage amount Number amount Portfolio Number amount Portfolio
(outstanding amounts in 000s)
$0 – $2,500,000 161 $ 105,386 16.7% 145 $ 102,656 19.2%
$2,500,001 – $5,000,000 19 69,755 11.0% 24 89,340 16.7%
$5,000,001 – $7,500,000 10 60,555 9.6% 5 29,972 5.6%
$7,500,001 – $10,000,000 5 42,920 6.8% 8 69,688 13.0%
$10,000,001 + 21 353,771 55.9% 15 243,594 45.5%
216 $ 632,387 100.0% 197 $ 535,250 100.0%

As of December 31, 2017, the average outstanding mortgage balance was $2.9 million (December 31, 2016 – $2.7 million), and the median outstanding mortgage balance was $0.8 million (December 31, 2016 – $0.8 million).

Conference call

Interested parties are invited to participate in a conference call with management on Friday, February 9, 2018 at 4:00 p.m. EST.

To participate or listen to the conference call live, please call 1 (888) 241-0551 or (647) 427-3415.

For a replay of the conference call (available until February 22, 2018) please call 1 (855) 859-2056, Conference ID 9998449.

About Atrium

Canada’s Premier Non-Bank Lender™

Atrium is a non-bank provider of residential and commercial mortgages that lends in major urban centres in Canada where the stability and liquidity of real estate are high. Atrium’s objectives are to provide its shareholders with stable and secure dividends and preserve shareholders’ equity by lending within conservative risk parameters.

Atrium is a Mortgage Investment Corporation (MIC) as defined in the Income Tax Act. Accordingly, Atrium is not taxed on income provided that its taxable income is paid to its shareholders in the form of dividends within 90 days after December 31 each year. Such dividends are generally treated by shareholders as interest income, so that each shareholder is in the same position as if the mortgage investments made by the company had been made directly by the shareholder. For further information, please refer to regulatory filings available at www.sedar.com or Atrium’s website at www.atriummic.com.

For additional information, please contact

Robert G. Goodall
President and Chief Executive Officer

(416) 607-4200
ir@atriummic.com
www.atriummic.com

Jennifer Scoffield
Chief Financial Officer