Subject:
Home Capital reports record growth and earnings through second quarter
Date:
Thu, 22 Jul 1999 08:49:28 -0400
From:
portfolio@newswire.ca
To:
"Portfolio Email User" <portfolio@newswire.ca>
Attention Business/Financial Editors:
Home Capital reports record growth and earnings through second quarter
Net income rises 43%
Assets pass $600 million mark for first time
TORONTO, July 22 /CNW/ - Home Capital Group Inc. (TSE:HCG.B) reports
record growth and increased earnings through the second quarter and six months
ended June 30, 1999. These results were generated by the Company's wholly
owned subsidiary, Home Savings & Loan Corporation.
Three months Six months
ended ended
June 30 June 30
1999 1998 1999 1998
Revenue $12,509,508 $9,957,595 $24,452,824 $19,172,272
Net Income $1,958,393 $1,367,295 $3,844,523 $2,572,863
Net Income/Share
-Basic $0.13 $0.11 $0.26 $0.21
-Fully Diluted $0.13 $0.09 $0.25 $0.17
Total Assets $604,213,038 $498,497,759 $604,213,038 $498,497,759
Shares Outstanding 14,811,195 12,544,495 14,811,195 12,544,495
- The return on equity was 21.8% and the Total Capital ratio was 13.95%.
- Total assets at $604 million and mortgages at $516 million set new
record levels.
- The Company remains on track to meet or exceed its stated goals for the
current year.
Home Capital Group Inc. is a holding company, publicly traded on the
Toronto Stock Exchange (HCG.B), operating through its principal subsidiary,
Home Savings & Loan Corporation. Home Savings & Loan was incorporated in 1977
and is a regulated financial institution that offers deposit and mortgage
lending services. The Company's service area is primarily Ontario and has
recently expanded into Western Canada.
HOME CAPITAL GROUP INC.
TO OUR SHAREHOLDERS
Home Capital Group Inc. is pleased to report that record results were
achieved in the first half of the year. In a very competitive marketplace, we
are well on our way to achieving our 1999 objectives for assets, profits and
returns.
These results, achieved through the Company's wholly owned subsidiary,
Home Savings & Loan Corporation, reflect the formula that has generated 16
consecutive quarters of increasing results and value for shareholders. That
formula consists of the achievement of above average growth and above average
return at the lowest possible risk, producing value for our shareholders.
For the three months ended June 30, 1999 your Company reported net
earnings of $1,958,393, an increase of 43% over the $1,367,295 achieved
through the same period in 1998. Net income per share rose from $0.11 to $0.13
and on a fully diluted basis from $0.09 to $0.13.
Net income for the six months ended June 30, 1999 rose by 49% to
$3,844,523 from the $2,572,863 recorded through the first half of 1998. Net
income per share increased from $0.21 to $0.26 and on a fully diluted basis
from $0.17 to $0.25.
The Company's total assets passed the $600 million mark for the first
time. The mortgage portfolio passed the $500 million mark. Based on the most
recent regulatory definition, the Tier 1 and Total Capital ratios for Home
Savings & Loan Corporation rose to 10.13% and 13.95% respectively versus 8.98%
and 12.58% as of June 30, 1998. Return on shareholders' equity was 21.8%
versus 19.4% at the same time last year. In addition, net non-performing
loans represented just 0.30% of the mortgage portfolio.
As noted in previous reports, the Company has secured regulatory approval
to operate in a number of other provinces. The Calgary and Vancouver area
offices are contributing to earnings and are performing at or above our
expectations. We will be initiating business activity in Halifax, Nova Scotia
during the third quarter of this year.
The positive performance represented by these indicators and previously
reported results is reflected in the Company's recent declaration of a
dividend of 1.5 cents per share payable on August 13, 1999 to shareholders of
record at the close of business on July 15, 1999.
It was previously announced that an agreement had been reached to acquire
up to $34 million in mortgages from the Mutual Life Assurance Company of
Canada (Clarica). These mortgages, consisting of residential and
non-residential accounts in the Greater Toronto Area, presents a low risk
means of growing our business and providing added value to shareholders. The
first stage of this portfolio closed as expected in June with the balance of
the purchase to be completed in the third quarter.
Your Company has completed all renovations and implementation of mission
critical systems pertaining to Year 2000 readiness. Internal testing has
deemed our systems to be Y2K compliant. We continue to monitor the readiness
of third party service providers and expect they will be ready to continue to
provide services to their customers and us. Your financial records will be
fully protected before, on and after January 1, 2000.
As we look out over the last half of 1999, we remain confident that Home
Capital will meet or exceed our goals for 1999 as outlined in our 1998 annual
report. These goals include the achievement of a 20% increase in each of
assets, earnings and fully diluted earnings per share, plus a return on equity
in the 20% range. These results will continue to strengthen the foundation of
your Company for the long term enhancement of shareholder value.
GERALD M. SOLOWAY
President and Chief Executive Officer
July 22, 1999
-0- 07/22/1999
For further information: Gerald M. Soloway, President and Chief Executive Officer, or W. Roy Vincent, Senior Vice President, tel. (416) 360-4663, fax: (416) 363-7611, web: www.homecapital.com |
