Atrium Mortgage Investment Corporation Achieves Strong Results in Second Quarter of 2018

Toronto, Ontario--(Newsfile Corp. - July 26, 2018) - Atrium Mortgage Investment Corporation (TSX: AI) today released its unaudited financial results for the three- and six-month periods ended June 30, 2018.

Highlights for the quarter

• Record net income of $8.6 million for the quarter, up 26.5% from prior year

• Record revenues of $14.6 million, up 21.1% from prior year

• $0.24 basic and diluted earnings per share for the quarter

• Portfolio of $710 million, up 12.2% from December 31, 2017

• High quality mortgage portfolio

  • 80.6% of portfolio in first mortgages

  • 86.9% of portfolio is less than 75% loan to value

  • average loan-to-value is 61.0%

"We had a solid second quarter of 2018. Our mortgage portfolio grew to over $709 million, but more importantly we continued to lend conservatively, with a high percentage of first mortgages and an average loan to value of 61.0 %. Our weighted average interest rate increased for the third consecutive quarter, climbing to 8.54%, up from 8.50% at March 31, 2018, and 8.44% at December 31, 2017. On July 18, 2018, subsequent to quarter end, we successfully completed a $30 million public offering of 5.50% convertible unsecured subordinated debentures, which was upsized from the initial offer of $25 million due to strong shareholder demand," said Rob Goodall, CEO of Atrium.

Interested parties are invited to participate in a conference call with management on Friday, July 27, 2018, at 9:00 a.m. ET to discuss the results. To participate or listen to the conference call live, please call 1-(888)-241-0551 or [phone]. For a replay of the conference call (available until August 9, 2018) please call 1-(855)-859-2056, Conference ID 5083029.

Results of operations

Atrium achieved record results, as its assets grew to $702.7 million, and revenues grew for the quarter to a record $14.6 million, an increase of 21.1% from the prior year.

Net income for the three months ended June 30, 2018, were a record $8.6 million, an increase of 26.5% from the prior year. Basic and diluted earnings per common share were $0.24, for the three months ended June 30, 2018, compared with $0.23 basic and diluted earnings per common share, respectively, for the comparable quarter in the prior year. Net earnings for the six months ended June 30, 2018, were $28.0 million, an increase of 16.5% from the prior year. Basic and diluted earnings per common share were $0.48 and $0.47, respectively, for the six months ended June 30, 2018, compared with $0.47 basic and diluted earnings per common share for the comparable period in the previous year.

The company had $701.6 million of mortgages receivable as at June 30, 2018, an increase of 11.9% from the December 31, 2017. During the quarter, $70.3 million of mortgages were advanced, and $21.2 million of mortgages were repaid.

The weighted average interest rate on the mortgage portfolio increased to 8.54% at June 30, 2018, compared with 8.44% at December 31, 2017 and 8.42% at June 30, 2017.

Interim Consolidated Statements of Income and Comprehensive Income
(Unaudited, 000s, except per share amounts)

Financial summary					Three months ended June 30						Six months ended June 30
					2018			2017			2018			2017
Revenue				$	14,616		$	12,069		$	27,990		$	24,035
Mortgage servicing and management fees					(1,610	)		(1,292	)		(3,064	)		(2,584	)
Other expenses					(317	)		(303	)		(569	)		(588	)
Provision for mortgage losses					(400	)		(745	)		(700	)		(1,048	)
Income before financing costs					12,289			9,729			23,657			19,815
Financing costs					(3,684	)		(2,927	)		(7,125	)		(5,855	)
Net income and comprehensive income				$	8,605		$	6,802		$	16,532			13,960
Basic earnings per share				$	0.24		$	0.23		$	0.48		$	0.47
Diluted earnings per share				$	0.24		$	0.23		$	0.47		$	0.47
Dividends declared				$	8,140		$	6,635		$	15,817		$	13,039
Mortgages receivable, end of period				$	701,568		$	567,895		$	701,568		$	567,895
Total assets, end of period				$	702,709		$	568,663		$	702,709		$	568,663
Shareholders' equity, end of period				$	382,911		$	314,683		$	382,911		$	314,683

Analysis of mortgage portfolio
(dollars in 000s)
		June 30, 2018									December 31, 2017
		Number			Outstanding amount			% of Portfolio			Number			Outstanding amount			% of Portfolio
Mortgage category
Low-rise residential		32		$	209,334			29.5%			36		$	234,343			37.1%
House and apartment		104			104,614			14.7%			120			86,287			13.6%
Mid-rise residential		12			99,840			14.1%			4			31,471			5.0%
Construction		9			80,410			11.3%			8			64,828			10.3%
High-rise residential		6			28,047			4.0%			7			44,949			7.1%
Condominium corporation		14			2,713			0.4%			14			2,887			0.4%
Residential portfolio		177			524,958			74.0%			189			464,765			73.5%
Commercial		24			184,636			26.0%			27			167,622			26.5%
Mortgage portfolio		201			709,594			100.0%			216			632,387			100.0%

		June 30, 2018
		Number of mortgages			Outstanding amount			Percentage outstanding			Weighted average loan to value			Weighted average interest rate
Location of underlying property
(outstanding amounts in 000s)
Greater Toronto Area		151		$	428,613			60.4%			62.3%			8.65%
Non-GTA Ontario		25			17,402			2.5%			67.0%			8.50%
Saskatchewan		2			19,798			2.8%			100.0%			7.90%
Alberta		4			16,931			2.4%			54.1%			8.92%
British Columbia		19			226,850			31.9%			55.3%			8.36%
		201		$	709,594			100.0%			61.0%			8.54%
		December 31, 2017
		Number of mortgages			Outstanding amount			Percentage outstanding			Weighted average loan to value			Weighted average interest rate
Location of underlying property
(outstanding amounts in 000s)
Greater Toronto Area		159		$	397,293			62.8%			62.5%			8.51%
Non-GTA Ontario		35			26,383			4.2%			65.9%			8.54%
Saskatchewan		2			17,107			2.7%			100.0%			8.06%
Alberta		5			22,518			3.6%			59.4%			8.87%
British Columbia		15			169,086			26.7%			54.7%			8.24%
		216		$	632,387			100.0%			61.5%			8.44%

For further information on the financial results, and further analysis of the company's mortgage portfolio, please refer to Atrium's unaudited interim consolidated financial statements and its management's discussion and analysis for the three- and six-month periods ended June 30, 2018, available on SEDAR at www.sedar.com, and on the company's website at www.atriummic.com

Conference call

Interested parties are invited to participate in a conference call with management on Friday, July 27, 2018 at 9:00 a.m. ET to discuss the results. To participate or listen to the conference call live, please call 1-(888)-241-0551 or [phone]. For a replay of the conference call (available until August 9, 2018) please call 1-(855)-859-2056, Conference ID 5083029.

About Atrium

Canada's Premier Non-Bank Lender

Atrium is a non-bank provider of residential and commercial mortgages that lends in major urban centres in Canada, where the stability and liquidity of real estate are high. Atrium's objectives are to provide its shareholders with stable and secure dividends and preserve shareholders' equity by lending within conservative risk parameters. Atrium is a Mortgage Investment Corporation (MIC) as defined in the Canada Income Tax Act, so is not taxed on income provided that its taxable income is paid to its shareholders in the form of dividends within 90 days after December 31 each year. Such dividends are generally treated by shareholders as interest income, so that each shareholder is in the same position as if the mortgage investments made by the company had been made directly by the shareholder. For further information about Atrium, please refer to regulatory filings available at www.sedar.com or investor information on Atrium's website at www.atriummic.com.

For additional information, please contact
Robert G. Goodall
President and Chief Executive Officer

Jennifer Scoffield
Chief Financial Officer

[phone]
[e-mail]
www.atriummic.com