TORONTO, August 30, 2013 – Difference Capital Financial Inc., a leading Canadian specialty financial services company, (“DCF”) (TSXV: DCF) today announces its financial results for the quarter ended June 30, 2013. Highlights, including the public offerings initiated during this period, are:
- DCF raised capital of over $101,000,000
- Advisory services continue to grow
- Tom Liston joined as a Managing Partner
During the summer, Difference Capital closed its previously announced public offering of common shares of the Company pursuant to which the Company sold 12,000,000 shares with gross proceeds of $45,000,000. The common share offering was completed following the closing of the previously announced offering of convertible unsecured subordinated debentures for aggregate gross proceeds of $56,079,000. The total gross aggregate capital raised from the two public offerings was $101,079,000.
Advisory services revenue to DCF amounted to $180,000 for the quarter, bringing the total revenue to $424,000 in 2013. Advisory clients at quarter end totaled 13, up from 6 at January 1, 2013.
Additionally, as of July 1, 2013, DCF is to receive 40% of all advisory revenue generated by Difference Capital Management (DCM”), whether from investee companies or not. “We are committed to the alignment of interests between DCF and DCM and our business model ensures DCF benefits from the expertise of management,” said Neil Johnson, Chief Executive Officer.
Revenue for the second quarter was ($1,110,435), down from $1,977,441 in the previous quarter. This resulted in a net loss of ($2,056,154) compared with net income of $869,668 in the previous quarter. DCF’s valuation policy requires mark-to-market for its publicly traded positions while private companies are generally held at cost until there is external evidence to support a change in valuation. This quarter was impacted in large part by four public positions being marked to market, resulting in a temporary unrealized loss, some of which have subsequently rebounded. These unrealized losses can be explained in part by Q2 market conditions, as the S&P/TSX Venture Composite Index fell 19% during this quarter.
This summer Difference Capital also welcomed Tom Liston as Managing Partner of DCM. Mr. Liston is a leading Canadian technology analyst and his presence adds to the growing bench-strength of the Difference team.
Executive Chairman Michael Wekerle stated, “Our $100,000,000 of new capital well positions us to take advantage of the renewed interest in growth technology, media and healthcare companies in Canada and around the world. We are confident in the continued growth of our investee companies and remain excited about the unique advisory business model we bring to the marketplace.”
The interim unaudited June 30, 2013 financial statements and management’s discussion and analysis are available at http://www.sedar.com
About Difference Capital Financial Inc.
Difference Capital Financial Inc. is a public-listed, Toronto-based specialty finance company focused on creating shareholder value through strategic investments in, and advisory services for, growth companies, particularly in the technology, media and healthcare sectors, as well as opportunistic investments in undervalued financial assets and real property.