Firm Capital Mortgage Investment Corporation · TSX:FC
Firm Capital Mortgage Investment — Q4 2021 Earnings Presentation
23 slides from Firm Capital Mortgage Investment's earnings presentation, 2021
Slide 1: Firm Capital Mortgage Investment Corporation Investor Presentation Q4 2021
TSX: FC Firm Capital Mortgage Investment Corporation INVESTOR PRESENTATION – Q4 2021
Slide 2: Contents
Contents INTRODUCTION 3 BOARD OF DIRECTORS 21 HISTORY 4 CONTACT INFORMATION 22 FIRM CAPITAL ADVANTAGE 5 DISCLAIMER 23 INVESTMENT HIGHLIGHTS 6 ALIGNED MANAGEMENT INTERESTS 7 LENDING APPROACH 8 CAPITAL STACK 9 OPERATING STANDARDS 10 2021/Q4 FINANCIAL HIGHLIGHTS 11 2021/Q4 RESULTS OF OPERATIONS 12 ANNU
Slide 3: Introduction
Introduction Firm Capital operates as a boutique real estate and financial services equity investment company deploying capital opportunistically between debt and equity in the real estate private and public markets across Canada and parts of the U.S. Operating in the same industry for over 35 years
Slide 4: History
History Since inception in 1988, Firm Capital has established an exceptional track record demonstrated by past performance and prides itself on its risk management abilities to protect and preserve capital, while acting as a disciplined investor. PROFICIENT SERVICES PROVIDED BY FIRM CAPITAL: Mortgag
Slide 5: Firm Capital Advantage
Firm Capital Advantage Investing Integrity EXPERIENCE MATTERS Experienced team managing debt and real estate throughout a real estate cycle 35+ year track record with management industry experience in excess of 100 years 01 DIRECT INVESTMENTS DISCIPLINED INVESTING Strong alignment of interest Discip
Slide 6: Investment Highlights
Investment Highlights Underlying Assets • Portfolio comprised of 224 investments • Management Team & Board Members co-invested $65M alongside investors as at December 31, 2021 Alignment of Interests • 694,728 shares are held by Directors and Officers as at December 31, 2021 • 25% pari-passu investme
Slide 7: Aligned Management Interests
Aligned Management Interests Performance Based Compensation Substantial Personal Investment • FCMIC Manager receives 0.75% per annum on performing • Management, directors and/or their respective associates investments (not cash balances) maintain 25% pari-passu investment in all non-conventional mor
Slide 8: Conservative Lending Approach
Conservative Lending Approach Date: 2021/Q4 • 73.4% conventional first mortgages • Experienced borrowers in proven markets • Conservative lending guidelines restricting investment exposure on loan size and related borrower groups Investment Portfolio Geographic Diversification*** Conventional Non-Fi
Slide 9: Capital Stack (in $MM)
Capital Stack (in $MM) Current Capital Stack Convertible Debentures Q4/2021 Q4/2021 (1) $688.9MM $231.7MM $700 $250 Millions Millions $74.5 Credit Facility and Bank Indebtedness $600 $46.0MM $200 Series L 5.00% Due Mar/2029 Convertible Debentures $500 $231.7 (1) $46.0MM Series K 5.00% Due Sep/2028 $
Slide 10: Rigid Operating Standards
Rigid Operating Standards Investment Restrictions Independent Approval Risk Diversification • Maximum single conventional first • Independent director approval for • Co-investment by management mortgage restricted to 5%-10% of every investment: • Syndicated portfolio to diversify risk capital(1) dep
Slide 11: 2021/Q4 Financial Highlights
2021/Q4 Financial Highlights Quarter Ended Quarter Ended Quarter Ended Quarter Ended Dec. 31, 2021 Sept. 30, 2021 Jun. 30, 2021 Mar. 31, 2021 Mortgage Portfolio $642.5 $575 $530 $547 (millions)(1) Basic Profit Per Share $0.234 $0.241 $0.238 $0.237 Dividends Per Share $0.246 $0.234 $0.234 $0.234 Retu
Slide 12: 2021/Q4 Results of Operations
2021/Q4 Results of Operations Quarter Ended Quarter Ended Quarter Ended Quarter Ended ($ in millions) Dec. 31, 2021 Sept. 30, 2021 Jun. 30, 2021 Mar. 31, 2021 Interest and Fees Earned $13.05 $11.92 $11.46 $11.48 Interest and Operating Expenses $5.31 $4.35 $4.08 $4.17 Profit $7.74 $7.57 $7.38 $7.31 D
Slide 13: Annualized Return on Shareholders’ Equity
Annualized Return on Shareholders’ Equity 12% 10% FC 8.46% 8% Q4/2021 ROE Spread 6% 771 bps 4% Gov’t of Canada 1-yr. T-bill 0.75% 2% % 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021/Q4 Firm Capital Mortgage Investment Corporation Disciplined Investing
Slide 14: Stable Cash Dividends
Stable Cash Dividends • Steady 7.8¢ dividend • In addition, spend “top up” dividend at year end 2016 2017 2018 2019 2020 2021 TOTAL: $0.966 TOTAL: $1.006 TOTAL: $0.986 TOTAL: $1.006 TOTAL: $0.944 TOTAL: $0.948 $0.16 0.148 0.148 0.128 $0.12 0.108 0.09 0.086 $0.08 0.078 0.078 0.078 0.078 0.078 0.078 $
Slide 15: Increasing Mortgage Portfolio
Increasing Mortgage Portfolio (in $MM) 224 Investments in Q4/2021 $643 $562 $559 $516 $521 $481 $449 $432 $399 $403 $375 $375 $345 $340 $343 $322 $311 $300 $307 $297 $291 $287 $285 $274 $262 $260 $256 $254 $236 $235 $226 $213 $204 $210 $205 $170 $180 $173 $169 $167 $150 $147 $146 $140 $136 $133 $96
Slide 16: Deal Flow
Deal Flow Significant Origination Capability • 35-year track record of mortgage origination • With the experience of the Mortgage Banker and strong partners, steady deal flow with excellent risk mitigation occurs • Co-investing with knowledgeable real estate partners Transaction Volume (in $MM): 201
Slide 17: Accessing The Capital Markets
Accessing The Capital Markets Accessed the capital market eighteen times since October 2010 Total: $461M $26.0M Equity Offering $28.76M $12.10/share Equity Offering $14.85/share $25.0M Series J $46.0M $25.0M Convert Series K Series I 5.50% Convert $26.5M Convert 5.00% Series H 5.40% $23.1M Equity Co
Slide 18: Average Share Price & Trading Volume
Thousands - 50 100 150 200 250 300 350 400 450 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Firm Capital Mortgage Investment Corporation Feb-19 Mar-19 Apr-19 May-19 Jun-19 Average Share Price & Trading Volume Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan
Slide 19: An Attractive Investment
An Attractive Investment A $100 FC investment in 1999 would be worth $964 today! $1,200 $964 $1,000 $800 10.72% CAGR $600 $533 $400 $200 Since October 6, 1999 to December 31, 2021 $- 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Fi
Slide 20: 2022 Outlook
2022 Outlook • The Corporation’s investment portfolio (the “Investment Portfolio”) has continued to revolve in 2021 with significant investment repayments and new fundings. Management’s position continues to be that we will turn the Investment Portfolio, if need be, at lower interest rates to ensure
Slide 21: Board of Directors
Board of Directors Stanley Goldfarb • CEO of Goldfarb Management Services Limited Chairman, Independent Director • Chairman & Trustee of Firm Capital Property Trust (TSXV: FCD.UN) Anthony Heller • President of Plazacorp Investments Limited Independent Director Larry Shulman • Retired Senior Partner
Slide 22: Contact Information
Contact Information OUR CORE PRINCIPLES TRUST INNOVATION RELATIONSHIPS Our partners, investors and Firm Capital brings an Firm Capital builds strong, long- clients can trust Firm Capital to innovative approach to term relationships with its execute on our commitment. structuring a transaction. partn
Slide 23: Disclaimer
Disclaimer This presentation is for informational purposes only and not intended to solicit Firm Capital Mortgage Investment Corporation (“FC”, “FCMIC”, “Firm Capital MIC”, “TSX: FC”, or the “Corporation”). This presentation may not provide full disclosure of all material facts relating to the secur
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