VANCOUVER, British Columbia, November 26, 2021 (GLOBE NEWSWIRE) – Pender Growth Fund Inc. (the âCompanyâ or âPenderâ) today announced its financial and operating results for the three months and nine months ended 30 September 2021.
Financial Highlights (unaudited)
- Net income was $ 75,339,050 for the quarter ended September 30, 2021 (September 30, 2020 – $ 2,730,979), primarily due to a positive investment performance during the quarter.
- Net earnings per share for the quarter ended September 30, 2021 was $ 9.89 (September 30, 2020 – $ 0.35).
- Shareholders’ equity per Class C common share (âshareâ) was $ 17.31 as at September 30, 2021 (December 31, 2020 – $ 6.11).
- The Company’s total equity stood at $ 131.9 million as at September 30, 2021, an increase from December 31, 2020 ($ 47.3 million) which is mainly due to the positive return on investments during the year. period.
- The number of shares outstanding was 7,616,529, a decrease compared to December 31, 2020 (7,740,129) resulting from share buybacks as part of the public buyback offer in the normal course of the company. (âOPRAâ) which was renewed on February 11, 2021.
- As of September 30, 2021, 85.8% of the investment portfolio is in private companies and 14.2% in listed companies.
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- The management expense ratio (âMERâ) was 4.30% for the quarter ended September 30, 2021, up from 2.96% for the same period of the previous period, mainly due to the increase in management costs due to the increase in total net asset costs, plus additional financing costs.
We believe that the Company is uniquely positioned today to pursue its investment objectives in the context of the current volatility in the markets and the valuations of micro and small cap stocks in North America.
During the period, we continued to be active in public markets where we saw what we believed to be strong opportunities in both long term compounds and potentially shorter term close out positions. discount. Given the continued strength of the small cap markets, we have reduced some positions and continue to work on new opportunities to deploy capital at attractive rates of return.
As always, this quarter we have worked closely with our private holding companies and some of our public holding companies. We are excited to see the private technology companies in our portfolio prosper and create value, including having the opportunity to go public.
In particular, Copperleaf Technologies Inc., a holding company that we own both directly and indirectly through our investment in Pender Private Investments Inc., listed on the Toronto Stock Exchange at $ 15.00 per share under the symbol “CPLF” at the beginning of October.
As of September 30, 2021, the Company owned approximately 97% or 16.7 million shares inherited from Pender Private Investments Inc. (âPPIâ), formerly Working Opportunity Fund (EVCC) Ltd. (“WOF”). These shares were acquired from WOF shareholders (âexiting shareholdersâ) as part of the previously announced transaction (the âWOF transactionâ). The second scheduled payment for the remaining 50% of the proceeds from the sale of their shares has been issued to former WOF shareholders.
By virtue of the rights to the inherited shares, PPI is required to repurchase them, in proportion to the net asset value, upon receipt by PPI of the cash proceeds from the sale of one of its portfolio investments. PPI recently received cash proceeds from its divestiture of Redlen Technologies Inc. and Teradici Corporation, and repurchased approximately 58.49% of the shares of Legacy on a pro rata basis. In October, the Company received a total of $ 63,197,947 on the repurchase of 9.8 million inherited shares it held. This redemption triggered the obligation for the Company to make an additional cash payment of $ 21,136,513, or $ 1.2661 per share, to outgoing shareholders and the Company made the payment effective October 13, 2021. .
On February 11, 2021, the Company launched a new public tender offer, under which the Company may purchase a maximum of 700,866 shares, or 10% of the Company’s free float on the launch date, during the fiscal year ending February 11, 2022. During the period in which we continued to acquire shares of the Company in the market as part of our issuer bid because we believe the shares are trading at a discount to to their intrinsic value.
We encourage you to refer to the Management’s Discussion and Analysis and unaudited quarterly financial statements of the Company for September 30, 2021 and to the audited annual financial statements for the year ended December 31, 2020 as well as other information available under the profile of the Company at www.sedar. com for more information.
Redlen Technologies Inc, (“Redlen”)
On September 9, 2021, Redlen, one of PPI’s leading long-term private investors, entered into an agreement with Canon Inc. (âCanonâ) to enter into a share transfer agreement, with the aim of enabling Canon accelerate the development of photon counting. computed tomography systems and continue to contribute to the advancement of diagnostic imaging. The acquisition was finalized on September 28, 2021, resulting in the divestiture of Redlen by PPI, with Redlen becoming a wholly-owned subsidiary of Canon.
Teradici Company (“Teradici”)
During the quarter, Teradici, one of PPI’s leading long-term private investors, entered into a definitive agreement to be acquired by HP Inc. (âHPâ) to enhance HP’s capabilities in the category. personal systems by providing new models of computers and digital services based on software adapted to hybrid work. The acquisition was finalized on October 1, 2021, resulting in the sale by PPI of this stake.
Copperleaf Technologies Inc. (“Copperleaf”)
As of September 30, 2021, the Company held 12.9% of the issued and outstanding shares of Copperleaf, both directly and through its investment in PPI. On October 7, 2021, the common shares of Copperleaf began trading on the TSX under the symbol “CPLF”. The company raised $ 161.1 million at $ 15.00 per common share.
About the company
The Company’s objective is to achieve long-term capital appreciation for its investors. The Company uses its low capital base and long term horizon to invest in unique situations, primarily small cap companies, special situations and illiquid public and private companies. The Company is listed on the TSX Venture Exchange under the symbol âPTFâ. The Company publishes its Reporting Nav on its website, generally within five business days of the end of each month.
Please visit www.pendergrowthfund.com.
For more information, please contact:
PenderFund Capital Management Ltd.
Toll free: (866) 377-4743
Neither the TSX Venture Exchange 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.
This press release may contain forward-looking statements (within the meaning of applicable securities laws) relating to the activities of the Company and the environment in which it operates. Forward-looking statements are identified by words such as “believe”, “anticipate”, “plan”, “expect”, “intend”, “plan”, “will”, “may”, ” estimate âand other similar expressions. These statements are based on the Company’s expectations, estimates, forecasts and projections and include, without limitation, statements regarding the benefits of the WOF Transaction, the Company’s belief that its shares are trading for less than their intrinsic value, investment and liquidation opportunities in the public markets and future investment opportunities. The forward-looking statements contained in this press release are based on certain assumptions; they are not guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. A number of factors could cause actual results to differ materially from the results discussed in forward-looking statements, including, but not limited to, the risk that the valuations of small and small capitalization public companies will change, general volatility in the public markets as well as the factors discussed under the heading âRisk Factorsâ in the Company’s Annual Information Form and MD&A available at www.sedar.com. There can be no assurance that forward-looking statements will prove to be accurate, as actual results may differ materially from those expressed in such forward-looking statements. Therefore, readers should not place undue reliance on these forward-looking statements. In addition, these forward-looking statements are made as of the date of this press release and, except as expressly required by applicable law, the Company assumes no obligation to publicly update or revise any forward-looking statement, whether at following new information, future events or the like.