Mcan Mortgage Corporation · TSX:MKP
Mcan Mortgage — Q2 2021 Earnings Presentation
27 slides from Mcan Mortgage's earnings presentation, Aug 12, 2021
Slide 1: Investor Presentation | Q2 2021
INVESTOR PRESENTATION | Q2 2021 August 12, 2021
Slide 2: Our mission every day
Our mission every day is to provide sustainable growth and returns for all our stakeholders • through relationship-driven mortgage lending and investing; • by delivering quality work through an expert, engaged and committed team; and • dedication to excellence in service of our clients, our colleagu
Slide 3: Forward-looking Information
Forward-looking Information This presentation may contain forward-looking information within the meaning of applicable Canadian securities laws, including statements regarding the business and anticipated financial performance of MCAN Mortgage Corporation and its subsidiaries. These statements are b
Slide 4: MCAN at-a-glance
MCAN at-a-glance $3.3B Total Assets Net Income 1,925% Increase YoY Residential Commercial and Return on 19.8% Equity YTD Lending Construction Lending $651M Total Uninsured portfolio $612M Total portfolio Market Capitalization 53% Increase YoY $1.4B Total Insured securitized $246M Q2 originations por
Slide 5: Key Performance Indicators
Key Performance Indicators * Non IFRS measure as defined in MCAN’s Q2 2021 MD&A
Slide 6: Business Overview and Investment Strategy
BUSINESS OVERVIEW AND INVESTMENT STRATEGY
Slide 7: Business Model
Business Model Our focus since founding in 1991 has consistently and successfully been strategic long-term growth and return on investment. LONG-TERM OBJECTIVES • Sustained annual growth of assets 10% • Sustained ROE 13-15% • Sustained and prudent dividend growth SHAREHOLDER VALUE • Improving RE • G
Slide 8: Diversified Quality Real Estate Investments
Diversified Quality Real Estate Investments Real Estate Investment Portfolio $1.8B Total Corporate Assets $3.3B Total Assets • 12.8 months average term to maturity of the corporate mortgage portfolio • Data presented at June 30, 2021
Slide 9: Residential Lending
Residential Lending • Purchases, refinances and renewals • Insurable and uninsured mortgages ⚬ Strategy of securitizing insured mortgages • Focus on first time/ first move-up homebuyers characterized by: ⚬ Lower price points and products ⚬ Lower price volatility ⚬ Steady product absorption based on
Slide 10: Construction and Commercial Lending
Construction and Commercial Lending • Lending on the construction of affordable housing in urban/suburban growth markets • Long-established relationships with originators, partners and borrowers Invest where deep experience and knowledge exist In-house expertise and underwriting • Target experienced
Slide 11: Investments
Investments • Portfolio yield enhanced through select real estate-related investments, including our investment in MCAP Commercial LP • Marketable securities in REIT portfolio • Non-marketable securities in various real estate development funds or mortgage and mortgage product funds
Slide 12: Liability Funding
Liability Funding TERM DEPOSITS • Since 1993 • $1.41 billion at June 30, 2021 • Non-redeemable prior to maturity1 • 19.6 months average term to maturity • Eligible for CDIC insurance coverage OTHER FUNDING SOURCES • Securitization of insured single-family mortgages via CMHC securitization program •
Slide 13: Total Mortgage Portfolio
Total Mortgage Portfolio Mortgages - Corporate and Securitization ($M) ($ millions) Q2 2021 Q1 2021 Change Q4 2020 Change Single Family $ 789 $ 728 8% $ 706 12% Construction & Commercial $ 612 $ 559 9% $ 547 12% Total Corporate Mortgages $ 1,401 $ 1,287 9% $ 1,253 12% Securitization $ 1,435 $ 1,327
Slide 14: 10-Year History
10-YEAR HISTORY
Slide 15: Net Income and Earnings Per Share
Net Income and Earnings Per Share $35.3M Net Income 1.38 $1.38 EPS YTD 2021
Slide 16: Capital History
Capital History $14.13 Q2 2021 book value per share* * Non IFRS measure as defined in MCAN’s Q2 2021 MD&A
Slide 17: Dividend Growth and Yield
Dividend Growth and Yield 8.42% 10-year average yield** ** MKP CN Equity - Dividend Indicated Yield – Gross; monthly data 2012 to 2021
Slide 18: Q2 2021
Q2 2021
Slide 19: Q2 2021 Balance Sheet Highlights
Q2 2021 Balance Sheet Highlights QoQ Q2 2021 Q1 2021 Q4 2020 Q3 2020 USF Balance** $651 million $575 million $532 million $491 million USF Originations** $147 million $105 million $113 million $66 million ISF Originations** $157 million $210 million $218 million $196 million Corporate Assets $1.82 b
Slide 20: Earnings Highlights
Earnings Highlights The board declared a third-quarter cash dividend of $0.34 per share and conforms with OSFI's current restriction on increasing cash dividends in effect since March 2020. Trend QoQ Q2 2021 Q2 2020 Trend YoY YTD Q2 2021 YTD Q2 2020 Mortgage Interest - Corporate Assets $16.5 million
Slide 21: Strong Capital Position
Strong Capital Position * Non IFRS measure as defined in MCAN’s Q2 2021 MD&A *** Effective March 31, 2020, the total capital ratio includes Tier 2 capital comprising Stage 1 and Stage 2 allowances on our mortgage portfolio. Prior period ratios have not been restated. For further information, refer t
Slide 22: Portfolio Credit Quality
Portfolio Credit Quality • At June 30, 2020, we had one construction mortgage where an asset recovery program was initiated, and we received full recovery of past-due interest and principal in Q3 2020. At March 31, 2021, we also had one impaired construction mortgage where an asset recovery program
Slide 23: Environmental, Social, Governance
ENVIRONMENTAL, SOCIAL, GOVERNANCE
Slide 24: ESG Strategic Highlights
ESG Strategic Highlights Our values and culture are rooted in our people, and we are committed to responsible environmental, social and governance practices, with focus on: ENVIRONMENTAL GOVERNANCE • Working with real estate development partners committed to • Sustainable infrastructure ensuring str
Slide 25: Leadership Team
Leadership Team Karen Weaver Floriana Cipollone Carl Brown President and Chief Executive Officer VP and Chief Financial Officer VP Investments Avish Buck Emily Randle Brenna McGibney VP Residential Lending VP and Chief Risk Officer VP Human Resources Mike Jensen Sylvia Pinto Milica Pejic VP and Chie
Slide 26: Our vision
Our vision is to be the preferred mortgage lender and investor within our chosen real estate markets in Canada.
Slide 27: Contact
CONTACT MCAN Mortgage Corporation 200 King Street West, Suite 600 Toronto, ON M5H 3T4 (416) 572-4880 | mcanexecutive@mcanmortgage.com | mcanmortgage.com