Crown Capital Partners Announces Q1 2024 Financial Results
Q1 2024 Financial & Operating Highlights
- Crown recognized a net loss of
$(0.6) million ($0.11 loss per basic share) in Q1 2024 compared to a net loss of$(0.7) million ($0.13 loss per basic share) in Q1 2023. - Distribution services revenue of
$8.2 million in Q1 2024 compared with$8.2 million in Q4 2023. This segment reported a net loss before income taxes of$(0.5) million (Q4 2023 –$(1.2) million ), inclusive of depreciation and amortization expense totaling$1.5 million (Q4 2023 -$1.5 million ), with the net loss attributable to start-up costs in respect of certain facilities of Go Direct Global that are in various stages of achieving scale. Capacity utilization was 52% atMarch 31, 2024 compared with 42% atDecember 31, 2023 . - Network services revenue in Q1 2024 was
$6.7 million , compared with$5.4 million in Q4 2023, with the increase due primarily to non-recurring hardware sales fromGalaxy Broadband Communications in the first quarter. This segment reported a net loss before income taxes of$(0.03) million (Q4 2023 –$(0.7 million) , inclusive of depreciation and amortization expense totaling$0.9 million (Q4 2023 -$1.3 million ) and accrued restructuring costs of $nil (Q4 2023 –$0.5 million ). - Revenue from the Real Estate segment was
$1.6 million in Q1 2024 (Q4 2023 -$1.4 million ) with the quarter-over-quarter increase attributable to property management contracts added during Q1 2024. This segment recorded net income before income taxes of$0.7 million (Q4 2023 -$0.3 million ), inclusive of depreciation and amortization expense of$0.2 million (Q4 2023 -$0.2 million ). -
The Distributed Power segment recorded revenues of$0.8 million in Q1 2024 (Q4 2023 -$0.5 million ) with the increase primarily relating to growth in merchant power revenue. This segment reported net income before income taxes of$0.003 million (Q4 2023 –$(2.7) million net loss before income taxes) inclusive of asset impairment charges totaling $nil (Q4 2023 -$6.1 million ). - In Q1 2024, the Specialty Finance segment recognized earnings of
$2.2 million (Q4 2023 –$0.5 million ) in relation to its investment inCrown Partners Fund , including$1.2 million in respect of its limited partnership interest and$1.0 million in respect of its general partnership interest in the fund. The quarter-over-quarter improvement is primarily due to the recognition of larger unrealized gains during the first quarter of 2024. - Total equity at quarter-end decreased to
$37.5 million , from$38.2 million at the end of 2023, due to a net loss attributable to shareholders of$0.6 million . Total equity per share decreased to$6.72 per basic share from$6.84 per basic share as atDecember 31, 2023 . - Since
September 30, 2023 , Crown has not satisfied certain financial covenant clauses of its credit agreement with its bank. Accordingly, the bank is contractually entitled to request immediate repayment of the outstanding loan in the amount of$24.6 million and the outstanding balance is presented as a current liability as atMarch 31, 2024 . The Corporation's bank has not requested early repayment of the loan. Management is currently in discussions with lenders regarding replacing its current credit facility and multiple financing options are being considered; however, there is no assurance that such arrangements will become available. - In Q1 2024, Crown's subsidiary,
Community Network Partners , received the grant funding related to the completion of its first fibre network segment under the Province ofOntario's Accelerated High-Speed Internet Program. Construction and testing of the second segment under this program is expected to be completed in Q3 2024 with receipt of the related grant funding expected in Q4 2024.
"From an operational perspective, Q1 was a good quarter for the Company as we achieved meaningful progress in all our operating divisions. We're expecting progress to continue this year, particularly in our Network Services segment, which is being driven by our contracts to develop new fibre optic networks, and in our Distribution Services segment, where we are increasing capacity utilization. We are also actively working to generate liquidity from our portfolio of assets to reduce debt, presently focused on our bank debt as well as the debentures due at the end of 2024," added
Q1 2024 Financial Results Summary
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Selected Quarterly Information |
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AS AT AND FOR THE THREE MONTHS ENDED |
2024 |
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2023 |
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Revenue: |
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Distribution services revenue |
$ 8,209 |
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$ 8,357 |
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Network services revenue |
6,719 |
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7,273 |
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Fees and other income |
2,011 |
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883 |
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Distributed power interest revenue |
183 |
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542 |
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Merchant power revenue |
604 |
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- |
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Total revenue |
17,726 |
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17,055 |
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Share of earnings of |
2,227 |
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1,350 |
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Net loss attributable to Shareholders |
(604) |
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(712) |
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Comprehensive loss attributable to Shareholders |
(684) |
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(712) |
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Total assets |
174,619 |
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172,763 |
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Total equity |
37,544 |
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49,943 |
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Per share: |
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- Net loss to Shareholders - basic |
$ (0.11) |
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$ (0.13) |
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- Net loss to Shareholders - diluted |
(0.11) |
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(0.13) |
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- Total equity per share - basic |
6.72 |
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8.85 |
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Number of common shares: |
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- Outstanding at end of period |
5,588,646 |
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5,640,546 |
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- Weighted average outstanding - basic |
5,588,646 |
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5,642,524 |
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- Weighted average outstanding - diluted |
5,588,646 |
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5,642,524 |
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FORWARD-LOOKING STATEMENTS
This news release contains certain "forward looking statements" and certain "forward looking information" as defined under applicable Canadian and
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