Terra Firma Capital Corporation Reports 2012 Fourth Quarter and Year End Results

Terra Firma Capital Corporation Reports 2012 Fourth Quarter and Year End Results 
Significant Growth in Revenue and Net Income With Increased Loan
Origination and Syndication Activities 
TORONTO, ONTARIO -- (Marketwired) -- 04/30/13 --  
All amounts are stated in Canadian dollars. 
Terra Firma Capital Corporation (TSX VENTURE:TII) ("Terra Firma" or
the "Company"), a real estate finance company, today released its
financial results for the three months and year ended December 31,
2012. 
2012 HIGHLIGHTS: 


 
--  Total revenue is $5.5 million, an increase of $3.9 million or 260%,
    compared to the last year. 
--  Net income and comprehensive income is $1.3 million, an increase of
    $964,658 or 336%, compared to last year. 
--  Total assets increased by 57% to $46.4 million from $29.5 million.

 
"We have made significant strides in 2012 and we will continue to
prudently build on this and expand the Company's presence in the
market," commented Dov Meyer, President and Chief Executive Officer.
"There are still significant investment opportunities in the market,
but we will continue to be prudent in our approach to selection of
new investments." 
Results of operations - year ended December 31, 2012 
Income from continuing operations for the year ended December 31,
2012 increased by 209% to $1.5 million, or $0.05 per basic and
diluted share, from $480,164, or $0.03 per basic and diluted share in
the previous year.  
For the year ended December 31, 2012, interest and fees income grew
281% to $5.2 million compared to $1.4 million in the previous year.  
The significant growth in Terra Firma's revenues and income from
continuing operations for the year ended December 31, 2012 as
compared to the year earlier periods was primarily due to increase in
loan and mortgage investments originations. The Company's loan
portfolio increased to $32.0 million with a weighted average
effective interest rate of 19.9%, at December 31, 2012 compared to
$16.7 million with a weighted average effective interest rate of
19.3% at December 31, 2011.  
Interest expense for the year ended December 31, 2012 was $2.6
million compared to $457,719 for the year ended December 31, 2011,
primarily due to increase in the syndicated portion of the Company's
loan and mortgage investments, which increased from $43.8 million at
December 31, 2011 to $17.0 million at December 31, 2012 and the
issuance of $10.1 million of 3-year, 7% convertible debentures in
September 2011. These funding leveraged the Company's shareholders'
equity and fueled the growth in loan and mortgage investments, while
reducing its overall portfolio risk profile. 
Net Income for the year ended December 31, 2012 was $1.3 million, an
increase of $964,658 or 336% compared to previous year. 
Results of operations - fourth quarter ended December 31, 2012 
Income from continuing operations for the three months ended December
31, 2012 was $728,689, an increase of $422,544 or 138% compared to
the same period in previous year. 
Interest and fees earned for the three months ended December 31, 2012
was $1.9 million compared to $749,883 for the comparable period last
year. The increase in interest and fees earned was primarily due to
the growth in the Company's loan and mortgage investments with higher
weighted average effective interest rate. 
Net income for the three months ended December 31, 2012 was $496,376,
an increase of $188,303 or 61% from net income of $308,073 in the
same period in the previous year. 
Termination of Management Agreement 
Terra Firma was formerly managed by Counsel Asset Management, L.P., a
wholly owned subsidiary of Counsel Corporation (TSX:CXS). Counsel
Corporation owned 6,168,333 or approximately 20.2% of the outstanding
common shares of Terra Firma as at December 31, 2012. On December 31,
2012, Counsel Asset Management L.P. ended its management of Terra
Firma and on January 1, 2013, Counsel distributed its entire holding
of Terra Firma shares as a dividend to its shareholders.  
Following the termination of the management agreement, the Company's
overall strategy remains unchanged and management believes that the
Company will be better positioned to deliver on its strategy and
objectives with a new manager or alternatively, internalizing the
management structure. Management is evaluating both options, among
others. 
The Company's Management's Discussion & Analysis and Financial
Statements as at and for the year ended December 31, 2012 have been
filed and are available on SEDAR (www.sedar.com). 
About Terra Firma 
Terra Firma is a full service, publicly traded real estate finance
company that provides customized equity and debt solutions to the
real estate industry. Our focus is to arrange and provide financing
with flexible terms to property owners looking to improve or add to
their existing real estate assets but who may be limited by
conventional bank financing, as well as to invest in quality
commercial and residential developments by proven real estate
developers. Terra Firma offers a full spectrum of real estate
financing under the guidance of strict corporate governance, clarity
and transparency. For further information please visit Terra Firma's
website at www.terrafirmacapital.ca. 
This Press Release contains forward-looking statements with respect
matters concerning the business, operations, strategy and financial
performance of Terra Firma. These statements generally can be
identified by use of forward looking word such as "may", "will",
"expects", "estimates", "anticipates", "intends", "believe" or
"could" or the negative thereof or similar variations. The future
business, operations and performance of Terra Firma could differ
materially from those expressed or implied by such statements. Such
forward-looking statements are qualified in their entirety by the
inherent risks and uncertainties surrounding future expectations.
Forward-looking statements are based on a number of assumptions which
may prove to be incorrect. Additional, important factors that could
cause actual results to differ materially from expectations include,
among other things, general economic and market factors, local real
estate conditions, competition, changes in government regulation,
dependence on tenants' financial conditions, interest rates, the
availability of equity and debt financing, environmental and tax
related matters, and reliance on key personnel. There can be no
assurances that forward-looking statements will prove to be accurate,
as actual results and future events could differ materially from
those anticipated in such statements. Accordingly, readers should not
place undue reliance on forward-looking statements. The cautionary
statements qualify all forward-looking statements attributable to
Terra Firma and persons acting on its behalf. Unless otherwise
stated, all forward looking statements speak only as of the date of
this Press Release and Terra Firma has no obligation to update such
statements except as required by law. 


 
Terra Firma Capital Corporation                                             
Consolidated Statements of Income and Comprehensive Income                  
For the three months and year ended December 31, 2012                       
(Unaudited)                                                                 
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------
             
                 Three months ended                 Year ended 
                     -------------------------------------------------------
                      December 31,  December 31, December 31,  December 31, 
                              2012          2011         2012          2011 
----------------------------------------------------------------------------
Revenue                                                                     
  Interest and fees                                                         
   earned             $  1,897,945  $    749,883 $  5,156,665  $  1,352,124 
  Rental income            195,113        55,305      343,958       174,195 
----------------------------------------------------------------------------
                         2,093,058       805,188    5,500,623     1,526,319 
Expenses                                                                    
  Property operating                                                        
   costs                    76,623        17,834      129,186        55,901 
  General and                                                               
   administrative                                                           
   expenses                134,629        93,829      538,978       245,327 
  Share based                                                               
   compensation             15,369        32,608      216,840       284,998 
  Interest expense         888,303       294,562    2,569,006       457,719 
----------------------------------------------------------------------------
                         1,114,924       438,833    3,454,010     1,043,945 
                                                                            
Fair value adjustment                                                       
 of investment                                                              
 properties                      -        50,000            -       195,000 
----------------------------------------------------------------------------
Income from                                                                 
 continuing                                                                 
 operations before                                                          
 income taxes              978,134       416,355    2,046,613       677,374 
Income tax provision       249,445       110,210      562,320       197,210 
----------------------------------------------------------------------------
Income from                                                                 
 continuing                                                                 
 operations                728,689       306,145    1,484,293       480,164 
Income (loss) from                                                          
 discontinued                                                               
 operations               (232,313)        1,928     (232,313)     (192,842)
----------------------------------------------------------------------------
Net income and                                                              
 comprehensive income $    496,376  $    308,073 $  1,251,980  $    287,322 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
                                                                            
Basic and diluted                                                           
earnings (loss) per                                                         
share                                                                       
  Continuing                                                                
   operations         $       0.02  $       0.01 $       0.05  $       0.03 
  Discontinued                                                              
   operations                (0.01)            -        (0.01)        (0.01)
----------------------------------------------------------------------------
                      $       0.01  $       0.01 $       0.04  $       0.02 
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
Terra Firma Capital Corporation                                             
Consolidated Statements of Financial Position                               
As at December 31, 2012 and 2011                                            
(Unaudited)                                                                 
                                                                            
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                         2012           2011
----------------------------------------------------------------------------
                                                                            
Assets                                                                      
                                                                            
Cash and cash equivalents                       $   3,223,291  $   8,771,557
Amounts receivable and prepaid expenses             2,396,180        805,412
Loan and mortgage investments                      31,996,731     16,724,774
Investment properties                               7,834,576      3,234,658
Portfolio investment                                  950,000              -
----------------------------------------------------------------------------
Total assets                                    $  46,400,778  $  29,536,401
----------------------------------------------------------------------------
----------------------------------------------------------------------------
                                                                            
Liabilities                                                                 
                                                                            
Accounts payable and accrued liabilities        $   1,192,616  $   1,052,582
Provision for discontinued operations                 445,957        251,864
Unearned income                                        16,965         52,624
Income taxes payable                                  474,297         82,169
Deferred income taxes                                  15,602         10,260
Loans and mortgages payable                        21,406,070      6,777,907
Convertible debentures                             10,093,325     10,061,869
----------------------------------------------------------------------------
Total liabilities                                  33,644,832     18,289,275
----------------------------------------------------------------------------
                                                                            
Shareholders' Equity                                                        
                                                                            
Share capital                                   $  10,757,405  $  10,687,105
Contributed surplus                                   573,139        386,599
Retained earnings                                   1,425,402        173,422
----------------------------------------------------------------------------
Total shareholders' equity                         12,755,946     11,247,126
----------------------------------------------------------------------------
                                                                            
----------------------------------------------------------------------------
Total liabilities and Shareholders' Equity      $  46,400,778  $  29,536,401
----------------------------------------------------------------------------
----------------------------------------------------------------------------

 
The TSXV has neither approved nor disapproved the contents of this
press release. The TSXV does not accept responsibility for the
adequacy or accuracy of this press release. 
Contacts:
Terra Firma Capital Corporation
Dov Meyer
President and Chief Executive Officer
416.866.8986
ydmeyer@tfcc.ca 
Terra Firma Capital Corporation
Mano Thiyagarajah
Chief Financial Officer
416.866.3168
mthiyagarajah@tfcc.ca
www.terrafirmacapital.ca
 
 
Press spacebar to pause and continue. Press esc to stop.