ECN Capital Corp. reported financial results for the three-month and nine-month periods ending September 30, 2016. The Company’s results for the period were reported as distributed operations of Element Fleet Management Corp. (formerly Element Financial Corporation) as a result of the October 3, 2016 separation of ECN Capital Corp. and Element Fleet Management Corp. into two publicly traded companies. The following commentary pertains only to the operations of ECN Capital Corp.
“With the separation transaction completed, as a stand-alone specialty finance company with an investment-grade balance sheet and access to capital to make us actionable on acquisition opportunities, we have right-sized and improved the operating performance of our existing businesses and positioned ECN Capital for the next stage of growth,” said Steven Hudson, ECN Capital’s Chief Executive Officer. “For more than 30 years, the ECN Capital management team has successfully pursued a strategy of opportunistically deploying capital in the specialty finance sector in segments that are resilient through credit cycles and deliver premium yield and growth opportunities for our shareholders and funding partners,” added Mr. Hudson.
For the three-month period ending September 30, 2016, ECN Capital reported After-tax Adjusted Operating Income of $27.4 million or $0.07 per share (basic) in line with the consensus of analyst estimates versus $25.3 million or $0.07 per share (basic) for the previous three-month period ending June 30, 2016 and $26.9 million or $0.08 per share (basic) for the same period last year. Book Value per Share as at September 30, 2016 was $4.42.
Originations for the three-month period ending September 30, 2016 were $407.0 million versus $474.1 million for the previous three-month period ending June 30, 2016 and $767.2 million for the same period last year. Originations in the Company’s core continuing operations increased to $387.7 million versus $385.2 million for the previous three-month period. During the period the Company remained selective in the expansion of its rail car assets to maximize portfolio performance.
Total Earning Assets and Assets under Management as at September 30, 2016 were $7.5 billion versus $7.6 billion as at June 30, 2016 and $6.3 billion as at September 30, 2015. Net Financial Income, net of interest expense and provision for credit losses, for the three-month period ending September 30, 2016 was $48.5 million versus $47.8 million for the previous three-month period ending June 30, 2016 and $53.4 million for the same period last year. Operating Expenses for the three month period ending September 30, 2016 were$17.5 million, a decrease from the $18.4 million reported for the same period last year but higher than the previous quarter which included a one- time reversal of un-earned accrued compensation expenses.