Cervus Financial Group Inc. Announces Financial Results For The Nine Months Ended June 30, 2005.TORONTO Toronto (tərŏn`tō), city (1998 est pop. 2,400,000), provincial capital, S Ont., Canada, on Lake Ontario. Toronto is the largest city in Canada and since the 1970s has been one of the fastest-changing cities in North America, experiencing -- "Mortgage Assets increased by 182% and Total Mortgage Commitments increased by 150% over the previous quarter" Cervus Cervus a genus of true deer in the family Cervidae. Includes C. canadensis (wapiti), C. elaphus (red deer) and C. elaphus nannodes (tule elk). Financial Group Inc. ("Cervus"), (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :CFG CFG Configuration (File Name Extension) CFG Control Flow Graph CFG Context-Free Grammar CFG Club for Growth CFG Cienfuegos, Cuba (city/airport code) CFG Critical Friends Groups ), is a financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. company dedicated to providing mortgages to selected mortgage broker firms. The company announced results of operations for the quarter ended June June: see month. 30, 2005 with revenues of $2.5 million and residential mortgage originations of $181.5 million. Total Administered Assets increased 182% over the previous quarter ended March 31, 2005 to $276.8 million. Highlights for the quarter ended June 30, 2005: - Increased total Administered Assets by $178.8 million or 182% in the quarter to $276.8 million compared to $98.0 million as at March 31, 2005. - The Company has future mortgage commitments of $214.1 million, compared to $85.9 million and $11.3 million at March 31, 2005 and September September: see month. 30, 2004, respectively. - Completed whole loan sales, totaling $177.1 million, to Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. financial institutions under existing sales and servicing agreements compared to $65.7 million in the previous quarter. - Commenced trading on the Toronto Stock Exchange Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. on Monday Monday: see week. April 11, 2005 under the trading symbol Trading symbol See: Ticker symbol "CFG". - Launched a multi-tiered mortgage partners program and further penetrated the mortgage broker market.
CERVUS FINANCIAL GROUP INC.
Interim Unaudited Consolidated Balance Sheet
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As at June September
30, 2005 30, 2004
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ASSETS
CURRENT
Cash $ 3,136,719 $ 2,296,206
Restricted cash 1,500,000 2,500,000
Residential mortgages (Note 6) 6,107,732 2,085,752
Accounts receivable 84,708 -
Sales tax receivable 39,429 -
Prepaid expenses 384,849 364,188
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11,253,437 7,246,146
OTHER ASSETS 55,340 22,019
CAPITAL ASSETS (Note 4) 2,768,149 1,037,356
INTANGIBLE ASSETS (Note 5) 3,575,121 3,461,133
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$ 17,652,047 $ 11,766,654
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LIABILITIES
CURRENT
Accounts payable and accrued
expenses $ 5,215,998 $ 1,353,692
Sales tax payable - 134,443
Warehouse credit facility - 2,450,000
Other liabilities 48,647 -
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5,264,645 3,938,135
TRAILER COMMISSIONS 586,895 6,351
LEASE INDUCEMENT 188,190 -
LEASE OBLIGATIONS 8,729 -
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6,048,459 3,944,486
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SHAREHOLDERS' EQUITY
COMMON SHARES (Note 8) 19,525,811 9,993,955
CONTRIBUTED SURPLUS 980,387 301,163
DEFICIT (8,902,610) (2,472,950)
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11,603,588 7,822,168
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$ 17,652,047 $ 11,766,654
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Please see the SEDAR website at www.sedar.com for the accompanying
notes which are integral to these interim unaudited consolidated
financial statements and for Management's Discussion & Analysis.
CERVUS FINANCIAL GROUP INC.
Interim Unaudited Consolidated Statement of Operations and Deficit
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For the For the For the For the
three three nine period from
months months months January 16,
ended ended ended 2004
June 30, June 30, June 30, to June 30,
2005 2004 2005 2004
INTEREST INCOME $ 78,148 $ 9,836 $ 305,270 $ 10,366
INTEREST EXPENSE (42,963) - (204,471) -
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NET INTEREST
INCOME 35,185 9,836 100,799 10,366
PROVISION FOR
CREDIT LOSSES (9,807) - (15,082) -
GAIN ON SALE OF
LOANS 2,397,749 - 3,599,915 -
FEES AND OTHER
INCOME 94,565 - 150,772 -
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2,517,692 9,836 3,836,404 10,366
BROKER
COMMISSIONS (1,826,313) - (2,814,053) -
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691,379 9,836 1,022,351 10,366
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OPERATING
EXPENSES
Human
resources 1,384,159 372,338 3,517,444 640,126
Business
processing 416,743 54,717 958,022 70,274
Selling,
general and
administration 365,927 75,641 1,333,316 141,893
Governance and
public markets 320,968 163,613 984,990 402,137
Premises 135,446 30,695 242,976 62,039
Amortization 225,492 14,493 549,957 14,493
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2,848,735 711,497 7,586,705 1,330,962
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NET LOSS BEFORE
INCOME TAXES 2,157,356 701,661 6,564,354 1,320,596
Future income
tax benefit - - (134,694) -
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NET LOSS FOR
THE PERIOD $ 2,157,356 $ 701,661 $ 6,429,660 $ 1,320,596
DEFICIT -
BEGINNING OF
PERIOD 6,745,254 618,935 2,472,950 -
NET LIABILITIES
ACQUIRED - 236,840 - 236,840
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DEFICIT - END
OF PERIOD $ 8,902,610 $ 1,557,436 $ 8,902,610 $ 1,557,436
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NET LOSS PER
COMMON SHARE
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Basic and
diluted
(Note 8(e)) $ 0.05 $ 0.04 $ 0.16 $ 0.08
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Please see the SEDAR website at www.sedar.com for the accompanying
notes which are integral to these interim unaudited consolidated
financial statements and for Management's Discussion & Analysis.
CERVUS FINANCIAL GROUP INC.
Interim Unaudited Consolidated Statement of Cash Flows
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For the For the For the For the
three three nine period from
months months months January 16,
ended ended ended 2004
June 30, June 30, June 30, to June 30,
2005 2004 2005 2004
NET INFLOW (OUTFLOW)
OF CASH RELATED TO
THE FOLLOWING
ACTIVITIES
OPERATING
Net loss for
the period $ (2,157,356) $ (701,661) $ (6,429,660) $ (1,320,596)
Items not
affecting
cash
Amortization
of capital
assets 128,814 14,493 268,669 14,493
Amortization
of intangibles 96,403 - 281,012 -
Provision for
credit losses 9,807 - 15,082 -
Future income
tax benefit - - (134,694) -
Stock option
expense 128,284 - 158,032 -
Lease
inducement (10,206) - (14,289) -
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(1,804,254) (687,168) (5,855,848) (1,306,103)
Net changes in
non-cash
working capital
balance
Prepaid
expenses (15,751) (772) (20,661) (10,327)
Interest
receivable (1,087) - (1,082) -
Residential
mortgages (4,201,712) - (4,035,980) -
Accounts
receivable 178,233 - (84,708) -
Other assets (34,532) 229,139 (33,321) (20,861)
Accounts
payable and
accrued
expenses 3,011,320 203,517 4,120,306 519,279
Sales tax
payable (6,068) 130,312 (173,872) 130,312
Proceeds from
credit
facility
borrowings - - (2,450,000) -
Trailer
commissions 307,979 - 580,544 -
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(2,565,872) (124,972) (7,954,622) (687,700)
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INVESTING
Lease
inducement - - 245,160 -
Cash collateral
- restricted
cash - - 1,000,000 -
Acquisition of
capital assets (322,756) (225,133) (1,982,950) (302,909)
Acquisition of
intangible
assets - (327,105) (22,092) (327,105)
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(322,756) (552,238) (759,882) (630,014)
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FINANCING
Proceeds from
issuance of
common shares - - 10,000,000 1,574,000
Proceeds from
issuance of
subscription
receipts - 7,384,425 - 7,384,425
Proceeds from
exercise of
common share
warrants - - 330,000 -
Common share
issue costs - (17,176) (773,166) (17,176)
Subscription
receipts issue
costs (592,849) (592,849)
Repayment of
obligations
under capital
leases (1,198) - (1,817) -
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(1,198) 6,774,400 9,555,017 8,348,400
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NET INCREASE
(DECREASE) IN
CASH FOR THE
PERIOD (2,889,826) 6,097,190 840,513 7,030,686
CASH, BEGINNING
OF PERIOD 6,026,545 933,496 2,296,206 -
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CASH, END OF
PERIOD $ 3,136,719 $ 7,030,686 $ 3,136,719 $ 7,030,686
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CASH IS
REPRESENTED BY:
Cash in bank $ 3,136,719 $ 206,161 $ 3,136,719 $ 206,161
Cash held in
trust - 6,824,525 - 6,824,525
$ 3,136,719 $ 7,030,686 $ 3,136,719 $ 7,030,686
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Please see the SEDAR website at www.sedar.com for the accompanying
notes which are integral to these interim unaudited consolidated
financial statements and for Management's Discussion & Analysis.
About "Customer for Life" The Cervus "Customer for Life" model enables the mortgage professional to retain the relationship with the borrower BORROWER, contracts. He to whom a thing is lent at his request. 2. The contract of loan confers rights, and imposes duties on the borrower' 1. In general, he has the right to use the thing borrowed, during the time and for the purpose intended between the as a customer throughout the life of the mortgage. The compensation model also creates a continued revenue stream in the form of trailer fees Trailer Fee A fee that a mutual fund manager pays to a salesperson who sells the fund to investors. Notes: The trailer fee pays the salesperson for providing the investor with ongoing investment advice and services. , a one time origination fee A charge imposed by a lending institution or a bank for the service of processing a loan. For example, a bank might charge an individual who has applied for a student loan an origination fee of one percent for processing the application and granting the loan. and a renewal fee every time the customer renews with Cervus. This creates income security for the mortgage professional allowing a long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. relationship to be developed with the borrower. This long-term relationship subsequently gets passed along to the institutional investor Institutional Investor A non-bank person or organization that trades securities in large enough share quantities or dollar amounts that they qualify for preferential treatment and lower commissions. of the mortgage security, creating a higher yield long-term investment cash flow stream. The Cervus "Customer for Life" model creates profitable relationships for the borrowers, mortgage professionals, institutional investors and for Cervus. About Cervus Cervus Financial Group Inc. is a Canadian financial services company created as an industry initiative with leading mortgage broker companies and fixed income investment banks The following is a list of investment banks Financial conglomerates Large financial-services conglomerates combine commercial banking and investment banking, and sometimes insurance. to become a high-yield Adj. 1. high-yield - yielding a large amount of agricultural or industrial production fruitful - productive or conducive to producing in abundance; "be fruitful and multiply" residential mortgage producer and the largest mortgage broker lender of conventional insured and insurable in·sure v. in·sured, in·sur·ing, in·sures v.tr. 1. a. To provide or arrange insurance for: a company that insures homeowners and businesses. b. mortgages in Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of . Our new and innovative business model demonstrates contracted asset accumulation Accumulation 1) In the context of individual investing, it is the process of contributing cash to invest in securities over a period of time in order to build a portfolio of desired value. Dividends and capital gains are also reinvested during this process. of $30B in mortgages over five to seven years by fusing In electrophotography, making the toner adhere permanently to the paper. Heat fusing melts the toner, which is pressed into the paper. Cold fusing presses the toner into the paper without applying any heat. Flash fusing melts the toner with light, and no heat or pressure is used. industry ownership, technology, service delivery and long term recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. revenue for the mortgage brokers. Cervus works on the basis of a "Customer for Life" model, where the borrower is the client of the mortgage broker and Cervus is effectively the "Back Office - Servicer" between borrowers and investors. Cervus has assembled as·sem·ble v. as·sem·bled, as·sem·bling, as·sem·bles v.tr. 1. To bring or call together into a group or whole: assembled the jury. 2. an experienced management team and board of directors who are knowledgeable in banking, financial services and related businesses. Cervus is focused on funding and servicing insurable conventional and high ratio insured residential mortgages originated through mortgage brokers. Cervus is currently licensed under Ontario Ontario, city, United States Ontario, city (1990 pop. 133,179), San Bernardino co., S Calif., near Los Angeles, in a region of vineyards; inc. 1891. , Quebec Quebec, city, Canada Quebec, Fr. Québec, city (1991 pop. 167,517), provincial capital, S Que., Canada, at the confluence of the St. Lawrence and St. Charles rivers. , British Columbia British Columbia, province (2001 pop. 3,907,738), 366,255 sq mi (948,600 sq km), including 6,976 sq mi (18,068 sq km) of water surface, W Canada. Geography and Alberta Alberta (ălbûr`tə), province (2001 pop. 2,974,807), 255,285 sq mi (661,188 sq km), including 6,485 sq mi (16,796 sq km) of water surface, W Canada. mortgage broker/lender legislation and is seeking similar regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. approvals in other Canadian Provinces Noun 1. Canadian province - Canada is divided into 12 provinces for administrative purposes province, state - the territory occupied by one of the constituent administrative districts of a nation; "his state is in the deep south" as required. Cervus' head office and Ontario operations centre is located in Toronto, with additional sales offices in Vancouver Vancouver, city, Canada Vancouver, city (1991 pop. 471,844), SW British Columbia, Canada, on Burrard Inlet of the Strait of Georgia, opposite Vancouver Island and just N of the Wash. border. , Calgary Calgary (kăl`gərē), city (1991 pop. 710,677), S Alta., Canada, at the confluence of the Bow and Elbow rivers. The largest city in Alberta and the fastest-growing major city in Canada, Calgary is a corporate, transportation, and financial and in Montreal Montreal (mŏn'trēôl`), Fr. Montréal (môNrāäl`), city (1991 pop. 1,017,666), S Que., Canada, on Montreal island, surrounded by St. Lawrence River and Rivière des Prairies. . Cervus Financial Group Inc. conducts all lending operations through its wholly-owned subsidiary, Cervus Financial Corp. Forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. (safe harbour) statement Statements made in this news release that relate to future plans, events or performances are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. . Any statement containing words such as "believes," plans," "expects" or "intends" and other statements which are not historical facts contained in this release are forward-looking, and these statements involve risks and uncertainties and are based on current expectations. Consequently, actual results could differ materially from the expectations expressed in these forward-looking statements. Additional information about Cervus is available on SEDAR SEDAR System for Electronic Document Analysis and Retrieval SEDAR Southeast Data, Assessment, and Review (www.sedar.com). The TSX does not accept responsibility for the adequacy or accuracy of this release. Cervus Financial Group Inc. (TSX:CFG) |
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