TORONTO, April 26, 2023 (GLOBE NEWSWIRE) — Fountain Asset Corp. (TSXV:FA) (“Fountain” or the “Company”) would like to announce its financial results for the three months ended December 31, 2022 (“Q4/22”) and for the year ended December 31, 2022 (“Fiscal 2022”).
Highlights from Q4/22:
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Net asset value (“NAV”) of $11.84 million ($0.19 per share) at December 31, 2022 compared to $13.33 million ($0.22 per share) at September 30, 2022, representing an 14% decrease quarter over quarter on a per share basis. NAV is calculated as the value of total assets less the value of total liabilities;
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Net comprehensive loss of $1.57 million for the three months ended December 31, 2022, compared to net comprehensive loss of $3.61 million for three months ended December 31, 2021 (“Q4/21”);
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Total loss from investment activity was $0.95 million compared to total loss of $3.01 million for Q4/21;
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Net realized losses on the sale of portfolio investments of $3.5 million compared to net realized gains of $1.19 million for Q4/21;
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Net unrealized gains on portfolio investments of $2.55 million compared to net unrealized losses of $4.27 million for Q4/21;
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Total expenses of $0.4 million, which included $0.07 million of stock-based compensation, compared to $0.60 million for Q4/21 which included $0.03 of stock-based compensation; and
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Operating expenses of $0.31 million compared to $0.54 million for Q4/21.
Highlights from Fiscal 2022:
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NAV of $11.84 million ($0.19/share) at December 31, 2022 compared to $20.22 million ($0.33/share) at December 31, 2021, representing a 42% decrease year over year on a per share basis;
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Net comprehensive losses of $8.51 million compared to income of $0.80 million for the year ended December 31, 2021 (“Fiscal 2021”);
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Total losses from investment activity was $7.18 million compared to total revenue of $2.40 million for Fiscal 2021;
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Net realized losses on the sale of portfolio investments of $5.68 million compared to net realized gains of $3.32 million for Fiscal 2021;
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Net unrealized losses on portfolio investments of $1.53 million compared to net unrealized losses of $1.10 million for Fiscal 2021;
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Total expenses of $1.37 million, which included a foreign exchange gain of $0.04 million and stock-based compensation of $0.13 million, compared to $1.57 million for Fiscal 2021, which included foreign exchange loss of $0.04 million, and $0.16 million of stock-based compensation; and
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Operating expenses of $0.88 million compared to $1.36 million for Fiscal 2021.
During 2022, the company saw a decrease in its portfolio of private and publicly traded companies as a result of increased volatility and uncertainty that plagued the market throughout the year. These decreases were slightly offset by increased valuations at December 31, 2022 in Fyllo and SRG Mining Inc.
The Company reported total expenses of $1.37 million for Fiscal 2022 compared to $1.57 million in the prior year. Operating expenses were maintained year over year at $0.88 million for Fiscal 2022 compared to $0.97 million excluding the annual incentive plan expense for Fiscal 2021 of $0.39 million.
The Company saw net comprehensive loss of $8.51 million for Fiscal 2022 compared to net comprehensive income of $0.80 million for Fiscal 2021. As at December 31, 2022, the Company’s adjusted net assets were valued at $16.71 million or $0.27 per share compared to $24.44 million or $0.40 per share at December 31, 2021.
“Fiscal 2022 presented a unique set of challenges as a result of volatile and uncertain market conditions. During the year, the Fountain NAV declined inline with the TSX Venture. The Company was focused on maintaining its investments to preserve value for the Company and its shareholders, while continuing to take advantage of relationships and new opportunities. We believe that with our current investment portfolio, the Company has positioned itself well to capitalize on new investment opportunities and realize economic benefits from the positions we currently hold,” said Andrew Parks, CEO of Fountain.
A full set of the 2022 audited financial statements and the management discussion & analysis are available on SEDAR.
About Fountain Asset Corp.
Fountain Asset Corp. is a merchant bank which provides equity financing, bridge loan services (asset back/collateralized financing) and strategic financial consulting services to companies across many industries such as marijuana, oil & gas, mining, real estate, manufacturing, retail, financial services, and biotechnology.
Forward-Looking Statements
Certain information contained in this press release constitutes forward-looking information, which is information relating to possible events, conditions or results of operations of the Company, which are based on assumptions and courses of action and which are inherently uncertain. All information other than statements of historical fact may be forward-looking information. Forward-looking information in this press release includes, but is not limited to, growing Fountain’s capital base and a strong pipeline going forward. These forward-looking statements reflect the current expectations or beliefs of the Company based on information currently available to the Company. Forward-looking statements are subject to a number of risks and uncertainties that may cause the actual results of the Company to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on, the Company. Factors that could cause actual results or events to differ materially from current expectations include, among other things: the level of bridge loans and equity investments completed, the nature and credit quality of the collateral security and the nature and quality of equity investments, and the other risks disclosed under the heading “Risk Factors” and elsewhere in the Company’s annual information form dated August 17, 2022 filed on SEDAR at www.sedar.com. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.
Neither TSX Venture Exchange Inc. nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For further information: please contact Andrew Parks at (416) 456-7019 or visit Fountain Asset Corp.’s website at www.fountainassetcorp.com.
