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Mount Logan Capital Inc. Announces March 2020 Interim Results; Declares Shareholder Distribution

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Toronto, Ontario–(Newsfile Corp. – May 11, 2020) – Mount Logan Capital Inc. (NEO: MLC) (“Mount Logan,” “our,” “we,” or the “Company”) announces its financial results for the three months ended March 31, 2020. All amounts are stated in United States dollars, unless otherwise indicated.

First quarter 2020 highlights:

  • Achieved quarterly investment income of $1.1 million for the three months ended March 31, 2020

  • As of March 31, 2020, the fair value of the Company’s portfolio was $54.7 million1, consisting of 80.0% in first lien senior secured loans, 5.6% in promissory notes and 14.4% in the Great Lakes Unitranche Joint Venture

  • Adjusted net investment income of $182,000

  • Primarily driven by unrealized losses, net loss and comprehensive loss for the quarter was $2.3 million, or $(0.22) per basic and diluted share

  • Net assets of $31.8 million as of March 31, 2020 and net asset value per share as of March 31, 2020 of USD$3.00

  • Cash and cash equivalents (including restricted cash) of $8.9 million as of March 31, 2020

  • The board of directors of the Company (the “Board”) declared a cash dividend in the amount of CAD$0.02 per common share to be paid on June 26, 2020 to shareholders of record on May 21, 2020

Ted Goldthorpe, Chief Executive Officer and Chairman of Mount Logan, noted, “We are pleased with our results for the quarter, especially amid the market volatility, and we remain vigilant on the portfolio in this unprecedented environment. We will continue to actively evaluate additional new investments that present an immense opportunity amid the recent market volatility. While we understand and appreciate that the long-term impacts of COVID-19 are uncertain, we believe that Mount Logan’s investment portfolio and balance sheet are positioned defensively and that our management team will continue to take steps to protect stakeholder value and continue to drive value through opportunistically deploying capital in the current environment.”

Results of operations – three months ended March 31, 2020

Total investment income for the three months ended March 31, 2020 was $1.1 million as compared to $0.5 million for the three months ended March 31, 2019. The increase in investment income is attributable to the growth in the Company’s investment portfolio related to the broadening of the Company’s investment strategy following its plan of arrangement completed in October 2018, the greater capital resources available to the Company from equity financings, and from the Company’s revolving senior loan facility which closed in February 2019.

Total expenses for the three months ended March 31, 2020 were $1.2 million, including interest and financing expense under the revolving senior loan facility of $0.6 million, as compared to total expenses of $0.5 million in the same period last year.
___________________

1Excludes the Company’s legacy investment in Cline Mining Corporation (“Cline”), which is subject to the contingent value rights issued by the Company to the holders of the common shares of the Company prior to its plan of arrangement completed in October 2018.

Portfolio and Investment Activity

The fair value of our portfolio was $54.7 million as of March 31, 2020 (excluding Cline). The composition of our investment portfolio at March 31, 2020 and December 31, 2019 at fair value (in each case, excluding Cline) was as follows:

March 31, 2020 December 31, 2019
Fair value % of total Fair value % of total
First Lien Loan $ 43,721 80.0 % $ 48,013 79.2 %
Promissory Notes and Unsecured Debt 3,068 5.6 % 3,068 5.0 %
Great Lakes Unitranche Joint Venture 7,866 14.4 % 9,532 15.7 %
$ 54,655 100.0 %    $ 60,613 99.9 %

 

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For the three months ended March 31, 2020, the Company recognized $2.3 million in unrealized depreciation on its investment portfolio from decreases in the fair value of some of its portfolio company investments primarily due to the potential adverse economic effects and uncertainty presented by COVID-19 the related re-pricing of credit risk in the broadly syndicated credit market.

On January 22, 2020, Marret Asset Management Inc., the former manager, announced that Cline had entered into a binding agreement for the sale by Cline to Allegiance Coal Limited of all the shares in New Elk Coal Company, LLC. The total acquisition consideration is $55.0 million and completion of the sale is anticipated to occur this year. The net proceeds received by the Company will be distributed to holders of the Company’s contingent value rights.

Liquidity and Capital Resources

At March 31, 2020, we had cash and cash equivalents (including restricted cash) of $8.9 million, total assets of $70.7 million and shareholders’ equity of $31.8 million. Our net asset value per common share was USD$3.00. As of March 31, 2020, we had $34.4 million of borrowings outstanding on our revolving senior loan facility. On January 31, 2020, the revolving senior loan facility was amended to, among other things, extend the maturity date from February 21, 2020 to February 19, 2021.

Subject to prevailing market conditions, we intend to grow our portfolio of assets by raising additional capital, including through the prudent use of leverage available to us and potentially raising additional equity from time to time.

Our interim consolidated financial statements for the three months ended March 31, 2020 and related management’s discussion and analysis will be available on the Company’s website at www.mountlogancapital.ca and on SEDAR (www.sedar.com).

Dividend Declaration

The Board has declared a cash dividend in the amount of CAD$0.02 per common share to be paid on June 26, 2020 to shareholders of record on May 21, 2020. This dividend is designated by the Company as an eligible dividend for the purpose of the Income Tax Act (Canada) and any similar provincial or territorial legislation. An enhanced dividend tax credit applies to eligible dividends paid to Canadian residents.

The declaration and payment by the Company of any future cash dividends, including the amount thereof, will be at the discretion of the Board and will depend on, among other things, the financial condition, capital requirements and earnings of the Company.

Conference Call

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We will hold a conference call on Wednesday, May 13, 2020 at 11:00 a.m. Eastern Time to discuss our first quarter 2020 financial results. Shareholders, prospective shareholders, and analysts are welcome to listen to the call. To register for the call and access dial-in information please visit https://bit.ly/2yuPBrp. The recording of the conference call will be available on our Company’s website www.mountlogancapital.ca in the Investor Relations section under Events.

About Mount Logan Capital Inc.

Mount Logan Capital Inc. is a Canada-based asset manager created to source and execute on credit investment opportunities in North America. The Company holds and actively manages and monitors a portfolio of loans and other investments with credit-oriented characteristics. The Company intends to actively source, evaluate, underwrite, monitor, and primarily invest in additional loans, debt securities, and other credit-oriented instruments that present attractive risk-adjusted returns and present low risk of principal impairment through the credit cycle.

Non-IFRS Financial Measures

This news release makes reference to certain non-IFRS financial measures. These measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS and may not be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement IFRS financial measures by providing further understanding of the Company’s results of operations from management’s perspective. The Company’s definitions of non-IFRS measures used in this news release may not be the same as the definitions for such measures used by other companies in their reporting. Non-IFRS measures have limitations as analytical tools and should not be considered in isolation nor as a substitute for analysis of the Company’s financial information reported under IFRS. The Company has included herein certain non-IFRS supplemental measures of key performance, including, but not limited to, adjusted net investment income, net asset value (“NAV”) per share and comprehensive income. We utilize these measures in managing our business, including performance measurement. We believe that providing these performance measures on a supplemental basis is helpful to investors in assessing the overall performance of the Company’s business. However, these measures are not recognized under IFRS. The definitions and calculations of the non-IFRS measures used in this news release are described in greater detail in the Company’s management discussion and analysis for the three months ended March 31, 2020. The Company believes that securities analysts, investors and other interested parties frequently use non-IFRS financial measures in the evaluation of issuers. The Company’s management also uses non- IFRS financial measures in order to facilitate operating performance comparisons from period to period.

Change in Functional Currency
Prior to January 1, 2020, the Company’s functional currency was the Canadian dollar (“CAD”). In accordance with International Auditing Standards 21, The Effects of Changes in Foreign Exchange Rates (“IAS 21”), an entity’s functional currency should reflect the underlying transactions, events and conditions that are relevant to the entity. Management considered primary and secondary indicators in determining functional currency, including the currency that influences sales prices, labor, purchases and other costs. Other indicators included the currency in which funds from financing activities are generated and the currency in which receipts from operations are usually retained. Beginning in 2018, the Company began shifting its investment focus to the U.S. market and the Company’s economic and currency exposure has shifted from Canada to the United States. At December 31, 2019, over 90.0% of the Company’s investments were fully exposed to the United States dollar (“USD”) and the Company earned a significant amount of its revenue in USD.

Based on these factors, management concluded that effective January 1, 2020, the Company’s functional currency should be USD. The Company has accounted for the change in functional currency prospectively, as provided for under IAS 21 with no impact of this change on prior year comparative information other than in conjunction with the change in presentation currency previously made effective January 1, 2019.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains forward-looking statements and information within the meaning of applicable securities legislation. Forward-looking statements can be identified by the expressions “seeks”, “expects”, “believes”, “estimates”, “will”, “target” and similar expressions. The forward-looking statements are not historical facts but reflect the current expectations of the Company regarding future results or events and are based on information currently available to them. Certain material factors and assumptions were applied in providing these forward-looking statements. The forward-looking statements discussed in this release include, but are not limited to, statements relating to the Company’s business strategy, model, approach and future activities, portfolio composition and size, asset management activities and related income, capital raising activities, future credit opportunities of the Company, portfolio realizations, the protection of stakeholder value and the expansion of the Company’s loan portfolio. All forward-looking statements in this press release are qualified by these cautionary statements. The Company believes that the expectations reflected in forward-looking statements are based upon reasonable assumptions; however, the Company can give no assurance that the actual results or developments will be realized by certain specified dates or at all. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations, including the matters discussed under “Risks Factors” in the most recently filed annual information form and management discussion and analysis for the Company. Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, a forward-looking statement speaks only as of the date on which such statement is made. The Company undertakes no obligation to publicly update any such statement or to reflect new information or the occurrence of future events or circumstances except as required by securities laws. These forward-looking statements are made as of the date of this press release.

This press release is not, and under no circumstances is it to be construed as, a prospectus or an advertisement and the communication of this release is not, and under no circumstances is it to be construed as, an offer to sell or an offer to purchase any securities in the Company or in any fund or other investment vehicle.

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For additional information, contact:

Ted Gilpin
Chief Financial Officer
[email protected]

(212) 891-5007

Mount Logan Capital Inc.
365 Bay Street, Suite 800
Toronto, ON M5H 2V1

MOUNT LOGAN CAPITAL INC.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(in thousands of United States dollars, except number of shares and per share amounts)

March 31, 2020 December 31, 2019
       (unaudited)
Assets
Investments, at fair value $ 58,242 $ 64,489
Cash 668 425
Restricted cash 8,261 6,733
Receivable for investments sold 303
Due from affiliates, net 118 411
Accrued interest and dividend receivable 204 358
Deferred tax asset 2,863 2,863
Prepaid expenses 23 33
Total assets $
70,682 $ 75,312
Liabilities
Credit facility (net of deferred financing costs of $441 and $80, respectively) $ 33,959 $ 34,320
Payable for investments purchased 1,880
Interest payable 490 383
Dividends payable to shareholders 151
Contingent value rights 3,589 3,876
Accounts payable and accrued liabilities 728 644
Total liabilities 38,917 41,103
Shareholders’ equity
Share capital 80,988 80,988
Warrants 1,086 1,086
Contributed surplus 7,240 7,240
Deficit (35,691) (33,247)
Cumulative translation adjustment (21,858) (21,858)
Total shareholders’ equity 31,765 34,209
Total liabilities and shareholders’ equity $
70,682
$ 75,312
Common shares issued and outstanding 10,604,998
10,604,998
Net asset value per share $
3.00
$ 3.23

 

MOUNT LOGAN CAPITAL INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(in thousands of United States dollars, except number of shares and per share amounts)

Three Months Ended March 31,
2020 2019
Investment income
Interest income $ 865 $ 483
Dividend income 215
Total investment income 1,080 483
Operating expenses
Administration fees 148
Arrangement costs 138
Interest and other credit facility expenses 648 90
Professional fees 215 122
Compensation 56 81
Marketing 32
Directors’ fees 21 23
Regulatory and shareholder relations 24 26
Other general and administrative 37 19
Total operating expenses 1,181 499
Net investment income (loss) (101) (16)
Realized and unrealized gain (loss)
Net realized gain (loss) on investments 41 25
Net realized loss on foreign currency 1
Net change in unrealized appreciation on investments (2,266) 10
Net change in unrealized (loss) gain on foreign currency 32 (469
Total net realized and unrealized (loss) gain (2,192) (434
Loss and comprehensive loss before income tax (2,293) (450
Deferred tax recovered 698
Income (loss) and comprehensive income (loss) $
(2,293) $
248
Weighted average shares outstanding – basic and diluted
10,604,998 10,233,905
Income (loss) per share – basic and diluted $
(0.22) $
0.02

 


To view the source version of this press release, please visit https://www.newsfilecorp.com/release/55693

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Fintech Pulse: Your Daily Industry Brief (Plaid, Warner Bros., TransUnion, Monevo, FinVolution, CreditTech, Glenbrook Partners)

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Op-Ed: The Dawn of a Fintech Spring

As the financial technology sector continues to navigate the complex post-pandemic landscape, recent developments suggest a revitalized period of growth and innovation. Key players are making bold moves, partnerships are forming, and underserved markets are gaining attention. In this briefing, we explore the latest headlines and what they reveal about the industry’s trajectory.


Plaid Reports Growth in Revenue and Usage Rates

Plaid, the connective tissue of the fintech ecosystem, has shown remarkable resilience and growth. The company’s CEO recently highlighted a surge in both revenue and usage rates, describing the current period as a “fintech spring.” This growth comes as consumer demand for seamless financial solutions remains high, despite macroeconomic challenges.

Plaid’s ability to maintain relevance is tied to its strategic partnerships and continuous innovation. By enabling applications like Venmo and Robinhood to thrive, Plaid underscores the importance of integration in fostering user trust and utility.

Source: Bloomberg


Warner Bros. Discovery Strengthens Board with Fintech Leadership

Warner Bros. Discovery is diversifying its board by bringing in SoFi CEO Anthony Noto and outgoing IAC Chief Executive Joseph Levin. This move signals the increasing influence of fintech expertise beyond traditional financial sectors. With Noto’s leadership in digital banking and Levin’s extensive background in technology-driven enterprises, Warner Bros. Discovery is positioning itself for a future that seamlessly blends media and financial technology.

This cross-industry synergy could lead to innovative offerings, bridging gaps between entertainment platforms and fintech applications, such as micro-investing and personalized financial recommendations for content consumers.

Source: Reuters


TransUnion to Acquire Monevo

Credit reporting agency TransUnion has announced its plans to acquire Monevo, a leading credit prequalification and distribution platform. This acquisition aims to enhance TransUnion’s capabilities in the credit technology space, allowing it to offer more personalized and accessible financial solutions to consumers.

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By integrating Monevo’s platform, TransUnion is expected to provide lenders with advanced tools to better assess creditworthiness while empowering consumers with prequalified loan offers. This development is particularly timely as consumers increasingly seek transparency and efficiency in credit processes.

Source: TransUnion Press Release


FinVolution Highlights CreditTech Opportunities in Southeast Asia

Ming Gu, Senior Vice President of FinVolution, emphasized the transformative potential of CreditTech in Southeast Asia during his address at the Asian Financial Forum. With a significant portion of the region’s population still underserved by traditional financial institutions, CreditTech presents a unique opportunity to bridge the gap.

Gu pointed out that leveraging AI and data analytics can help tailor credit solutions for diverse needs, ultimately fostering financial inclusion and economic growth in these emerging markets. FinVolution’s insights reaffirm the critical role of fintech in empowering underserved communities.

Source: PR Newswire


Glenbrook Partners Launches On-Demand Learning Program

Payments consultancy Glenbrook Partners has introduced an on-demand learning platform designed to educate professionals in the payments industry. This initiative is expected to address the growing need for skilled talent as digital payment ecosystems expand globally.

The program offers modular content covering foundational and advanced topics, catering to professionals at various stages of their careers. By equipping individuals with in-depth knowledge, Glenbrook is contributing to the industry’s sustainability and growth.

Source: PR Newswire


Analysis and Takeaways

These stories collectively highlight a few key trends shaping the fintech landscape:

  1. Resilient Growth: Plaid’s trajectory reaffirms that consumer-centric innovations drive sector resilience even during economic uncertainties.
  2. Cross-Industry Integration: Warner Bros. Discovery’s board appointments underline fintech’s permeation into traditionally non-financial domains.
  3. Strategic Acquisitions: TransUnion’s acquisition of Monevo showcases how established players are leveraging fintech to enhance service offerings.
  4. Global Inclusivity: Efforts by FinVolution and others highlight the role of fintech in addressing global financial disparities.
  5. Education and Skill Development: Initiatives like Glenbrook’s program reflect a proactive approach to fostering a knowledgeable workforce.

 

The post Fintech Pulse: Your Daily Industry Brief (Plaid, Warner Bros., TransUnion, Monevo, FinVolution, CreditTech, Glenbrook Partners) appeared first on News, Events, Advertising Options.

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io.finnet and Cede Labs Partner to Transform Multi-Exchange Portfolio Management for Institutions

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 io.finnet, a leader in digital asset infrastructure, has partnered with  Cede Labs, to introduce a solution for centralized exchange (CEX) connectivity. This collaboration provides institutional clients with a streamlined, secure platform for comprehensive multi-exchange portfolio management.  Through this integration, io.finnet clients can now access leading exchanges such as Binance, Coinbase, Bybit, OKX, Kraken and more with features tailored for institutional-grade governance and operational efficiency.

Institutional digital asset management faces increasing complexity as businesses demand more secure and efficient tools to oversee diverse portfolios.  With 70% of institutional investors expecting a surge in digital asset-focused funds, the need for secure and efficient multi-exchange solutions has never been greater.

“Businesses require solutions that simplify the complexity of managing assets across exchanges while maintaining the highest standards of security.” said Jacob Plaster, CTO of io.finnet. “Through our partnership with Cede Labs, clients can seamlessly connect their exchange accounts and manage their entire portfolio within a unified, secure environment.”

Unlike traditional offerings, io.finnet’s integration with Cede Labs introduces secure account-linking capabilities, allowing clients to effortlessly connect and unlink their exchange accounts while adhering to strict governance protocols. Unified tracking capabilities further enhance this solution, enabling users to monitor their portfolios across all connected exchanges in real-time. This includes the ability to oversee spot and trading wallets, derivatives positions, and sub-accounts under a single pane of glass, a feature few competitors offer at this scale.

Pierre Ni, CEO of Cede Labs, highlighted the impact on institutional workflows: “We are proud to collaborate with io.finnet to redefine digital asset custody and management. By unlocking new use cases for corporates, market makers, liquid funds, foundations, and fintechs through CEX connectivity, we believe io.finnet can grow to become one of the top self-custody players.”

This partnership is particularly timely as market demand for interoperable solutions continues to rise. The integration will eliminate the need to navigate multiple platforms and provide institutions with real-time visibility across their digital asset holdings, enabling seamless exchange connectivity and enhanced risk management.

io.finnet is committed to enhancing its exchange connectivity capabilities with deposits, withdrawals, trades, and sub-account transfers to further streamline asset management workflows. Stay tuned for exciting updates as we expand the possibilities of our Exchange Connectivity feature.

The post io.finnet and Cede Labs Partner to Transform Multi-Exchange Portfolio Management for Institutions appeared first on News, Events, Advertising Options.

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Blocks & Headlines: Today in Blockchain (

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Welcome to Blocks & Headlines, your comprehensive daily briefing on the transformative world of blockchain. Today, we explore groundbreaking partnerships, economic innovations, and blockchain-powered initiatives redefining the future.

Sony Ventures Into Blockchain With New Identity Solutions

Sony has unveiled its latest blockchain-based digital identity solution designed to enhance privacy and security in the online space. This innovative system uses decentralized technology to manage digital credentials, making identity verification seamless and secure.

Sony’s venture reflects a broader trend among tech giants exploring blockchain’s potential to reshape data privacy and authentication systems.

Source: Sony Press Release


TRON’s Daily Revenue Skyrockets 119% in 2024

TRON has reported a staggering 119% increase in daily revenue, a testament to its innovative blockchain economic models. By leveraging smart contracts and a scalable infrastructure, TRON continues to attract developers and businesses seeking cost-efficient blockchain solutions.

This growth positions TRON as a leading player in the competitive blockchain ecosystem, setting benchmarks for others to follow.

Source: Bitcoin.com


MIGMIG Partners With XT.com to Bring Blockchain Rewards

MIGMIG, a blockchain gaming and rewards platform, has partnered with XT.com to expand its reach and user engagement. This collaboration aims to deliver unique blockchain-powered rewards while enhancing the gaming experience for users worldwide.

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The partnership highlights the increasing intersection of blockchain technology and entertainment, opening new avenues for user interaction.

Source: Bitcoinist


Nano Labs Supports the Inaugural Presidential Crypto Ball

Nano Labs has announced a partnership with the Inaugural Presidential Crypto Ball, emphasizing its commitment to fostering blockchain awareness. This high-profile event aims to bridge the gap between blockchain innovators and policymakers, paving the way for broader adoption.

The initiative underscores the importance of collaboration between the blockchain community and governmental bodies to shape the future of digital assets.

Source: PR Newswire


Bybit Card Partners With EnTravel for Luxury Travel Perks

Bybit has teamed up with EnTravel to offer its cardholders exclusive discounts on luxury travel experiences. This partnership integrates blockchain-powered payment solutions with high-end travel services, providing users with unparalleled convenience and value.

The move exemplifies how blockchain technology can enhance traditional industries, offering innovative solutions tailored to modern consumer needs.

Source: PR Newswire


Key Insights and Industry Trends

  1. Decentralized Identity: Sony’s blockchain-based solution addresses growing concerns over online security and privacy.
  2. Economic Innovations: TRON’s revenue surge highlights the profitability of scalable blockchain networks.
  3. Gaming and Blockchain: Partnerships like MIGMIG and XT.com showcase the potential of blockchain in entertainment.
  4. Policy and Collaboration: Nano Labs’ involvement in the Crypto Ball underscores the importance of industry-government dialogue.
  5. Luxury Integration: Bybit and EnTravel demonstrate blockchain’s ability to enhance traditional services.

 

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