Cervus Financial Group Inc. Announces Financial Results for the Six Months Ended March 31, 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 -- 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 ), which 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 through selected leading mortgage brokers, announced results of operations for the quarter ended March 31, 2005. Cervus had revenues of $829,122 and originated $59,372,371 in residential mortgages. Assets under administration increased to $96,075,678 as at March 31, 2005. Net loss for the period was $2,305,319 or $0.05 per share. Highlights for the quarter ended March 31, 2005: -Assets under Administration increased by $64,400,928 in the quarter and $96,075,678 since September September: see month. 30, 2004. - Execution of Mortgage Origination Origination The process through which a mortgage lender creates a mortgage secured by some amount of the mortgagor's real property. Notes: Also known as loan origination, everyone must go through the origination process when securing a mortgage for a piece of real Volume Agreements with mortgage brokers representing an additional $1.5 billion in mortgage origination volume bringing the total of such agreements to $21.5 billion over five years from the date of commencement of the agreements. - Completed four whole loan sales, totaling $65.7 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 sales and servicing agreements signed in the first quarter. - The Company has future mortgage commitments of $85,900,094, compared to $23,691,360 and $11,344,537 at December December: see month. 31, 2004 and September 30, 2004, respectively. - The Company was approved for operating as a mortgage lender in the provinces of 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. and 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. . - Cervus was approved for trading on the Toronto Stock Exchange Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. and commenced trading on Monday Monday: see week. April 11, 2005 under the same trading symbol Trading symbol See: Ticker symbol "CFG". Since it's it's 1. Contraction of it is. 2. Contraction of it has. See Usage Note at its. it's it is or it has it's be ~have first yearend, September 30, 2004 Cervus continued to build its business, gaining recognition and acceptance of the Company's innovative Customer for Life business model with major mortgage brokers in the Canadian mortgage industry.
CERVUS FINANCIAL GROUP INC.
Interim Unaudited Consolidated Balance Sheet
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As at March September
31, 2005 30, 2004
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ASSETS
CURRENT
Cash $ 6,026,545 $ 2,296,206
Restricted cash 1,500,000 2,500,000
Residential mortgages (Note 6) 1,914,740 2,085,752
Accounts receivable 262,941 -
Sales tax receivable 33,361 -
Prepaid expenses 369,098 364,188
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10,106,685 7,246,146
OTHER ASSETS 20,808 22,019
CAPITAL ASSETS (Note 4) 2,574,207 1,037,356
INTANGIBLE ASSETS (Note 5) 3,671,524 3,461,133
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$ 16,373,224 $ 11,766,654
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LIABILITIES
CURRENT
Accounts payable and accrued
expenses $ 2,462,678 $ 1,353,692
Sales tax payable - 134,443
Warehouse credit facility - 2,450,000
Other liabilities 46,119 -
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2,508,797 3,938,135
TRAILER COMMISSIONS 278,916 6,351
LEASE INDUCEMENT 201,077 -
LEASE OBLIGATIONS 9,774 -
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2,998,564 3,944,486
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SHAREHOLDERS' EQUITY
COMMON SHARES (Note 8) 19,267,811 9,993,955
CONTRIBUTED SURPLUS 852,103 301,163
DEFICIT (6,745,254) (2,472,950)
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13,374,660 7,822,168
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$ 16,373,224 $ 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
period from
For the three January 16, For the six
months ended 2004 to months ended
March 31, 2005 March 31, 2004 March 31, 2005
INTEREST INCOME $ 125,891 $ 530 $ 227,122
INTEREST EXPENSE (67,987) - (161,508)
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NET INTEREST INCOME 57,904 530 65,614
PROVISION FOR CREDIT LOSSES (3,171) - (5,275)
GAIN ON SALE OF LOANS 721,913 - 1,202,166
FEES AND OTHER INCOME 52,476 - 56,207
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829,122 530 1,318,712
BROKER COMMISSIONS (665,485) - (987,740)
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163,637 530 330,972
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OPERATING EXPENSES
Human resources 1,073,618 267,788 2,133,285
General and
administrative 1,202,986 320,333 2,172,690
Premises 61,597 31,344 107,530
Amortization 180,945 - 324,465
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2,519,146 619,465 4,737,970
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NET LOSS BEFORE
INCOME TAXES 2,355,509 618,935 4,406,998
Future income tax benefit (50,190) - (134,694)
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NET LOSS FOR THE PERIOD $ 2,305,319 $ 618,935 $ 4,272,304
DEFICIT -
BEGINNING OF PERIOD 4,439,935 - 2,472,950
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DEFICIT - END OF PERIOD $ 6,745,254 $ 618,935 $ 6,745,254
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NET LOSS PER COMMON SHARE
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Basic and diluted
(Note 8(e)) $ (0.05) $ (0.04) $ (0.11)
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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
period from
For the three January 16, For the six
months ended 2004 to months ended
March 31, 2005 March 31, 2004 March 31, 2005
NET INFLOW (OUTFLOW)
OF CASH RELATED TO
THE FOLLOWING
ACTIVITIES
OPERATING
Net loss for the
Period $ (2,305,319) $ (618,935) $ (4,272,304)
Items not
affecting cash
Amortization of
capital assets 86,994 - 139,855
Amortization of
intangibles 93,950 - 184,609
Provision for
credit losses 3,171 - 5,275
Future income tax
benefit (50,190) - (134,694)
Stock option expense 29,748 - 29,748
Lease inducement (4,083) - (4,083)
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(2,145,729) (618,935) (4,051,594)
Net changes in
non-cash working
capital balance
Prepaid expenses 229,495 (9,555) (4,910)
Interest receivable 5,273 - 5
Residential mortgages 6,741,921 - 165,732
Accounts receivable (262,941) - (262,941)
Other assets 554 (250,000) 1,211
Accounts payable
and accrued expenses 673,413 315,762 1,108,986
Sales tax payable (184,559) - (167,804)
Proceeds from
credit facility
borrowings (3,450,000) - (2,450,000)
Trailer commissions 188,084 - 272,565
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1,795,511 (562,728) (5,388,750)
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INVESTING
Lease inducement 245,160 - 245,160
Cash collateral -
restricted cash 1,000,000 - 1,000,000
Acquisition of
capital assets (1,111,593) (77,776) (1,660,194)
Acquisition of
intangible assets (8,232) - (22,092)
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125,335 (77,776) (437,126)
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FINANCING
Proceeds from
issuance of common shares - 1,574,000 10,000,000
Proceeds from
exercise of common
share warrants - - 330,000
Common share issue costs (52,651) - (773,166)
Repayment of
obligations under
capital leases (619) - (619)
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(53,270) 1,574,000 9,556,215
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NET INCREASE IN
CASH FOR THE PERIOD 1,867,576 933,496 3,730,339
CASH, BEGINNING OF PERIOD 4,158,969 - 2,296,206
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CASH, END OF PERIOD $ 6,026,545 $ 933,496 $ 6,026,545
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CASH IS
REPRESENTED BY:
Cash in bank $ 6,026,545 $ 58,496 $ 6,026,545
Short term investments - 875,000 -
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$ 6,026,545 $ 933,496 $ 6,026,545
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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 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 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, 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 mortgage broker/lender legislation and is seeking similar regulatory 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 Exchange does not accept responsibility for the adequacy or accuracy of this release. Cervus Financial Group Inc. (TSX:CFG) |
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