Another excellent quarterly report:
newswire.ca
Home Capital reports strong second quarter earnings
20th consecutive quarter, or five years, of increasing growth
in earnings, assets
TORONTO, July 20 /CNW/ - Home Capital Group Inc. (TSE:HCG.B) today
reported record second quarter and half-yearly earnings for the period ended
June 30, 2000. These results were achieved through the Company's wholly owned
subsidiary, Home Trust Company.
<<
Three Months Ended % Six Months Ended %
June 30 change June 30 change
2000 1999 2000 1999
Net
Income $2,485,178 $1,958,393 26.9% $4,806,990 $3,844,523 25.0%
Earnings
per
share
(basic) $0.17 $0.13 30.8% $0.33 $0.26 26.9%
Return on
equity 22.9% 21.7% 22.6% 21.8%
Revenue $16,824,847 $12,509,508 34.5% $32,529,047 $24,452,824 33.0%
Assets $791,613,273 $604,213,038 31.0% $791,613,273 $604,213,038 31.0%
Total No.
shares
outstan-
ding 14,749,695 14,811,195 14,749,695 14,811,195
>>
- This represents the 20th consecutive quarter in which earnings
before unusual items exceeded those of the previous quarter.
- The Company recently announced a 33% increase in the dividend,
to $0.08 per share.
- The Hon. William G. Davis, P.C., C.C., Q.C., has been elected
Chairman of the wholly-owned subsidiary, Home Trust Company.
- Home Trust Company has joined the VISA Canada Association,
becoming only the 11th General Member financial institution
authorized to offer VISA cards in Canada.
- Home Trust Company will launch a secured VISA credit card
starting September, 2000 to assist consumers in establishing
or re-establishing their credit worthiness.
- The Company is on track to meet or exceed its stated goals
for the current year.
Home Capital Group Inc.
To Our Shareholders
Home Capital Group Inc. is pleased to announce record 2nd quarter
earnings of $0.17 per share, or $2,485,178, versus earnings of $0.13 per
share, or $1,958,393, for the comparable period in the previous year, an
increase of 26.9%. Total assets grew from $604,213,038 to $791,613,273, or
31.0% and our annualized return on equity was 22.9%, compared to 21.7% on a
year over year basis. Our results reflect the power of our strategy to pursue
market leadership with customers who are underserved by traditional lenders.
This represents the 20th consecutive quarter, a full five years, in which
earnings before unusual items exceeded those of the previous quarter.
For the first six months of the year the Company reported net income of
$4,806,990, an increase of 25.0% over the $3,844,523 recorded through the
first half of 1999. Earnings per share rose from $0.26 to $0.33 and annualized
return on shareholders equity stood at 22.6% compared to 21.8% for the same
period in 1999.
In addition, our credit quality remains excellent. Mortgage charge-offs
continue to decline and our non-performing loans represented 0.36% at June 30,
compared to 0.30% one year ago. In keeping with the safety and soundness with
which the Company has operated, we have moved our general reserve to 0.78% of
assets on a risk-weighted basis as of June 30, 2000, which is slightly higher
than the average of the general reserves for the five leading banks in Canada.
All other performance indicators also reflected positive results during the
period under review. In short, we are on track to report a record year.
These and other achievements are the signs of a stable and profitable
core business and a Company that is "coming of age." Your Board of Directors
further validated this fact by announcing a 33% increase in the dividend paid
on the outstanding convertible Class A shares and Class B subordinated voting
shares. This step, equating to an effective increase from $0.06 to $0.08 per
share on an annualized basis, reflects our strong cash flow from operations,
our financial strength, and the quality of our balance sheet. It also
represents further tangible indication of our commitment to the creation of
value for all our shareholders. The first quarterly dividend at the increased
amount will be payable on August 10, 2000 to shareholders of record at the
close of business on July 13, 2000.
I am pleased to report that the transition of Home Savings & Loan
Corporation into Home Trust Company proceeded smoothly during the second
quarter. Other significant steps will ensure that we are well positioned to
grow and to profit from this change in the years ahead.
The Honourable William Davis, P.C., C.C., Q.C., who is already a Director
of Home Capital Group, has kindly agreed to serve as Chairman of Home Trust
Company. His experience, particularly with broadly based and accomplished
financial institutions, and wise counsel will be of great assistance to your
Company.
During the second quarter we also announced that Home Trust Company had
been approved for membership in the VISA Canada Association. We are only the
eleventh General Member financial institution authorized to offer VISA payment
cards in Canada.
We also announced that Home Trust Company will launch a secured VISA
credit card starting in September of this year. This card is designed to
assist consumers to establish or re-establish their credit worthiness. These
customer segments have been served effectively and profitably in the United
States by several issuers. We believe that we can serve this niche in a manner
that is socially responsible for consumers, and low risk yet profitable for
your Company.
The economic outlook for Canada and your Company remains positive. Our
core business continues to grow in an innovative and dynamic way and we are
confident about the market acceptance of our new secured VISA credit card.
This combination of factors makes your Company very optimistic about its
future prospects.
Gerald M. Soloway
President and Chief Executive Officer
July 20, 2000
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For further information: Gerald M. Soloway, President and Chief
Executive Officer, or W. Roy Vincent, Senior Vice President and Chief
Operating Officer, (416) 360-4663, www.homecapital.com |
