TORONTO, Nov. 10,
2022 /CNW/ - Standard Mercantile Acquisition Corp.
(TSX: SMA) (the "Company") today released its financial results for
the quarter ended September 30, 2022.
The financial statements and MD&A can be found at www.sedar.com
or www.standardmercantileacquisition.com.
Financial Highlights &
Business Update
As at September 30, 2022, the
Company had two mortgages outstanding. Of the two mortgages
remaining, the more significant one is set to mature in
December 2022. During the second
quarter of 2020, the borrower requested a three month deferral of
mortgage payments, due to the inability of tenants to pay rent as a
result of the COVID-19 economic and health crisis. The deferral was
granted. Regular payments resumed during the third quarter of 2020,
and the Company made certain amendments to this mortgage in
December 2020, including extending
the term of this mortgage through December
2022 in consideration of certain lump-sum repayments which
commenced in December 2020. As of
September 30, 2022, the Company did
not make any fair market value adjustments based on the
management's assessment of the fair market value of its investment
in both mortgages.
Income from operations for the three and nine months ended
September 30, 2022 was higher than
the same periods last year by $37
thousand and $30 thousand
respectively due to lower administrative fees in 2022 and lower
share-compensation expenses in 2022 compared to same periods last
year offset by lower interest income.
Basic income per share from the three and nine months ended
September 30, 2022 was $0.01 and $0.03
respectively compared to $0.01 and
0.02 in the same periods in 2021.
Diluted income per share from the three and nine months ended
September 30, 2022 was $0.01 and $0.02
respectively compared to $0.01 and
0.02 in the same periods in 2021.
At September 30, 2022, cash on
hand was $0.7 million, a decrease of
$0.25 million compared to the amounts
held at December 31, 2021. The
decrease is primarily the result of timing in working capital.
The combined effects of current general economic weakness,
increasing inflation resulting directly or indirectly from the
COVID-19 pandemic and the conflict in Ukraine, as well as higher interest rates
implemented in response to inflation, may negatively impact the
fair value of our mortgage investments, which in turn may adversely
affect the Company's revenue and profit. It is not possible to
reliably estimate the length and severity of these developments and
the impact on the financial results and condition of the Company as
it relates to its ability to complete the orderly wind-up plan of
the Company, as amended by amended by shareholders of the Company
at the Company's annual and special meeting of shareholders held on
May 6, 2021 (the "2021 Meeting").
Regular Monthly & Special
Distributions
There were no regular distributions made for the three months
ended September 30, 2022
(September 30, 2021 - nil).
There were no special distributions made for the nine months
ended September 30, 2022
(September 30, 2021 - $3,510,819).
The Board anticipates from time to time making further special
distributions as the two remaining mortgages in the portfolio
mature or are sold, or if the Board otherwise determines that it is
appropriate to do so based on cash balances, subject to reasonable
expected operating expenditures and repayment of the senior loan
participant on one of the remaining mortgages.
Forward Looking
Statements
Statements in this press release contain forward-looking
information. Such forward-looking information may be identified by
words such as "anticipates", "plans", "proposes", "estimates",
"intends", "expects", "believes", "may" and "will". The
forward-looking statements are founded on the basis of expectations
and assumptions made by the Company. Details of the risk factors
relating to the Company and its business are discussed under the
heading "Business Risks and Uncertainties" in the Company's annual
Management's Discussion & Analysis for the year ended
December 31, 2021 and under the
heading "Risk Factors" in the Company's Annual Information Form
dated March 30, 2022, copies of which
are available on the Company's SEDAR profile at www.sedar.com. Most
of these factors are outside the control of the Company. Investors
are cautioned not to put undue reliance on forward-looking
information. These statements speak only as of the date of this
press release. Except as otherwise required by applicable
securities statutes or regulation, the Company expressly disclaims
any intent or obligation to update publicly forward-looking
information, whether as a result of new information, future events
or otherwise.
About the Company
The Company holds a portfolio of mortgages in Canada. At the 2021 Meeting, the Company
sought and received shareholder approval to change its name to
"Standard Mercantile Acquisition Corp.", among other amendments to
the articles of the Company. The Company is focused on monetizing
its remaining mortgage assets and is considering options to enable
its shareholders to participate in the potential future value of
the Company through transactions that could capitalize on the
Company's public listing. The Board has experience in sourcing,
evaluating and executing transactions of this nature.
SOURCE Standard Mercantile Acquisition Corp.