Market Newsdesk

April 30, 2021 7:33 am

Cboe Global Markets Reports Results for First Quarter 2021

First Quarter 2021 Highlights*

– Diluted EPS of $1.27, Down 11 percent

– Adjusted Diluted EPS¹ of $1.53, Down 7 percent

– Net revenue of $366 million, Up 2 percent

– Returned $93 million to shareholders through share repurchases and dividends

– The company increases its 2021 organic growth target for recurring non-transaction revenue to 10 to 11 percent, from its previous guidance range of 6 to 7 percent²

PR Newswire

CHICAGO, April 30, 2021 /PRNewswire/ — Cboe Global Markets, Inc. (Cboe: CBOE) today reported financial results for the first quarter of 2021.

“We are off to a strong start this year with continued momentum across the company, achieving quarter-over-quarter increases in net revenue and trading activity for each business segment, as well as meaningful progress executing on multiple growth opportunities. We were excited to announce plans to acquire Chi-X Asia Pacific, enabling us to broaden our geographic and asset class presence, while helping us to further extend the distribution of our product offerings to our global network of customers,” said Edward T. Tilly, Cboe Global Markets Chairman, President and Chief Executive Officer. “We remain confident in our ability to achieve our targeted mid-term organic net revenue growth of 4 to 6 percentage points and to drive additional organic net revenue growth longer-term through our ongoing investment in attractive market opportunities, as demonstrated by the increase in our organic growth target for recurring non-transaction revenue. Cboe has a strong foundation and I am confident that we have the team and capabilities to drive value-enhancing growth as we remain focused on our commitment to create long-term value for our customers and our shareholders.”

“We reported a quarter of strong results, although earnings declined year-over-year against difficult comparisons to last year’s record results. Our robust cash flow generation allowed us to return nearly $93 million to shareholders through share repurchases and dividends in the first quarter,” said Brian N. Schell, Cboe Global Markets Executive Vice President, Chief Financial Officer and Treasurer. “We continue to balance our long-standing disciplined capital allocation priorities to responsibly grow our business while maintaining a healthy balance sheet and preserving financial flexibility to further enhance shareholder value. Our priorities remain focused on prudent organic capital investment, value-enhancing acquisitions, and the return of capital to shareholders.”

*All comparisons are first quarter 2021 compared to the same period in 2020.

⁽¹⁾

A full reconciliation of our non-GAAP results to our GAAP results is included in the attached tables. See “Non-GAAP Information” in the accompanying financial tables.

⁽²⁾

Specific quantifications of the amounts that would be required to reconcile the company’s organic growth guidance, adjusted operating expenses guidance and the effective tax rate on adjusted earnings guidance are not available. The company believes that there is uncertainty and unpredictability with respect to certain of its GAAP measures, primarily related to acquisition-related revenues and expenses that would be required to reconcile to GAAP revenues less costs of revenues, GAAP operating expenses and GAAP effective tax rate, which preclude the company from providing accurate guidance on certain forward-looking GAAP to non-GAAP reconciliations. The company believes that providing estimates of the amounts that would be required to reconcile the range of the company’s organic growth, adjusted operating expenses and the effective tax rate on adjusted earnings would imply a degree of precision that would be confusing or misleading to investors for the reasons identified above.

Consolidated First Quarter Results -Table 1
Table 1 below presents summary selected unaudited condensed consolidated financial information for the company as reported and on an adjusted basis for the three months ended March 31, 2021 and 2020.


Table 1
Consolidated First Quarter Results									1Q21			1Q20
($ in millions except per share)	1Q21			1Q20			Change		Adjusted¹			Adjusted¹			Change
Total Revenues Less Cost of Revenues	$	365.5		$	358.3		2	%	$	365.5		$	358.3		2	%
Total Operating Expenses	$	160.9		$	131.9		22	%	$	124.6		$	98.6		26	%
Operating Income	$	204.6		$	226.4		(10)	%	$	240.9		$	259.7		(7)	%
Operating Margin %		56.0	%		63.2	%	(7.2)	pp		65.9	%		72.5	%	(6.6)	pp
Net Income Allocated to Common Stockholders	$	136.8		$	157.0		(13)	%	$	164.8		$	182.3		(10)	%
Diluted EPS	$	1.27		$	1.42		(11)	%	$	1.53		$	1.65		(7)	%
EBITDA¹	$	246.8		$	264.9		(7)	%	$	250.2		$	265.7		(6)	%
EBITDA Margin % ¹		67.5	%		73.9	%	(6.4)	pp		68.5	%		74.2	%	(5.7)	pp

Total revenues less cost of revenues (referred to as “net revenue”) of $365.5 million increased 2 percent, compared to $358.3 million in the prior-year period, primarily reflecting increases in access and capacity fees and market data fees and a decrease in royalty fees, offset somewhat by lower net transaction and clearing fees¹. Incremental net revenue in the first quarter of 2021 from acquisitions closed in 2020 was $26.8 million.
Total operating expenses were $160.9 million versus $131.9 million in the first quarter of 2020. Adjusted operating expenses¹ of $124.6 million increased 26 percent compared with $98.6 million in the first quarter of 2020, primarily due to acquisitions closed in 2020, resulting in higher compensation and benefits and technology support services.
Operating income decreased by 10 percent to $204.6 million and adjusted operating income¹ decreased by 7 percent to $240.9 million. The operating margin for the first quarter was 56.0 percent versus 63.2 percent in the first quarter of 2020. The adjusted operating margin was 65.9 percent compared to 72.5 percent in the first quarter of 2020.
The effective tax rate for the first quarter of 2021 was 28.9 percent compared with 27.6 percent in the first quarter of 2020 and the effective tax rate on adjusted earnings¹ was 27.9 percent compared with 27.0 percent in last year’s first quarter. The higher effective tax rate in the first quarter of 2021 was primarily due to decreased benefits from foreign derived intangible income as a result of final Section 250 Treasury regulations.
Diluted EPS for the first quarter of 2021 decreased 11 percent to $1.27. Adjusted diluted EPS¹of $1.53 decreased 7 percent compared to 2020’s first quarter results.
The EBITDA margin for the first quarter was 67.5 percent compared to 73.9 percent in the first quarter of 2020. The adjusted EBITDA margin was 68.5 percent compared to 74.2 percent for the same period last year.

Business Segment Information:


Table 2
Total Revenues Less Cost of Revenues by
Business Segment
(in millions)	1Q21		1Q20		Change
Options	$	181.7	$	188.5		(4)	%
North American Equities		96.1		86.6		11	%
Futures		30.6		40.1		(24)	%
Europe		42.1		26.2		61	%
Global FX		14.7		16.9		(13)	%
Corporate		0.3		–		100	%
Total	$	365.5	$	358.3		2	%

⁽¹⁾

A full reconciliation of our non-GAAP results to our GAAP results is included in the attached tables. See “Non-GAAP Information” in the accompanying financial tables.

Discussion of Results by Business Segment:

Options:

Options net revenue of $181.7 million was down $6.8 million, or 4 percent, from the first quarter of 2020, primarily due to a decrease in net transaction and clearing fees¹, as a result of lower trading volume in index options. This decrease was offset somewhat by an increase in access and capacity fees, higher market data fees and lower royalty fees.
Net transaction and clearing fees¹ decreased $18.2 million, or 12 percent, reflecting a 19 percent increase in total options average daily volume (“ADV”), offset by a 24 percent decrease in total options revenue per contract (“RPC”) compared to the first quarter 2020. The decrease in total options RPC was due to a mix shift, with multi-listed options representing a higher percentage of total options volume. The RPC for multi-listed options increased 26 percent, primarily due to pricing changes and a shift in customer concentration. The RPC for index options increased 3 percent, primarily reflecting a shift in mix by order type.
Cboe’s Options business had total market share of 30.2 percent for the first quarter of 2021 compared to 38.3 percent in the first quarter of 2020, primarily reflecting a mix shift resulting from a lower percentage of ADV from index options. In addition, Cboe’s multi-listed options market share for the quarter decreased to 26.9 percent compared to 31.9 percent in the first quarter of 2020.

North American (N.A.) Equities:

N.A. Equities net revenue of $96.1 million was up $9.5 million, or 11 percent, due to the additions of BIDS Trading and MATCHNow, which contributed $12.4 million in net revenue and was the driver of a 9 percent increase in net transaction and clearing fees¹ for the quarter.
Cboe U.S. Equities exchanges had market share of 15.0 percent for the first quarter of 2021 compared to 16.7 percent in the first quarter of 2020. The decrease was primarily due to new highs set in off-exchange trading volume in the first quarter of 2021, averaging 45.2 percent of total market volume compared to 37.6 percent in the first quarter of 2020.

Futures:

Futures net revenue of $30.6 million decreased $9.5 million, or 24 percent, primarily due to a decline in net transaction and clearing fees¹.
Net transaction and clearing fees¹ decreased $10.3 million, or 29 percent, reflecting a 23 percent decrease in ADV and a 6 percent decline in RPC. The RPC decline was primarily due to the addition of Mini-VIX futures, which are one-tenth the size of the standard VIX futures and have a lower fee per contract. The RPC variance also reflects higher volume from corporate bond index futures and associated lead market maker incentives.

Europe:

Europe net revenue of $42.1 million increased by 61 percent, primarily reflecting the addition of EuroCCP, which contributed $12.1 million in net revenue. Average daily notional value (“ADNV”) for the overall market was down 13 percent during the quarter and ADNV traded on Cboe European Equities was €7.5 billion, down 18 percent from last year’s first quarter, while net capture increased 16 percent, reflecting a shift in the mix of volume by order book type.
For the first quarter of 2021, Cboe European Equities had 16.8 percent market share, down from 17.7 percent in the first quarter of 2020, primarily as a result of temporary market profile shifts immediately following the Brexit liquidity transition at the start of the quarter and as activity was re-established in Swiss securities following their re-introduction on Cboe UK order books in February, which increased the aggregate pan-European market volume used to measure market share.

Global FX:

Global FX net revenue of $14.7 million decreased 13 percent, primarily as a result of lower net transaction and clearing fees¹. ADNV traded on the Cboe FX platform was $37.1 billion for the quarter, down 14 percent from last year’s first quarter and net capture per one million dollars traded was $2.65 for the quarter, down 1 percent compared to $2.69 in the first quarter of 2020.
Cboe FX had market share of 16.5 percent for the quarter compared to 15.7 percent in last year’s first quarter.

⁽¹⁾

A full reconciliation of our non-GAAP results to our GAAP results is included in the attached tables. See “Non-GAAP Information” in the accompanying financial tables.

2021 Fiscal Year Financial Guidance

The company updated or reaffirmed its guidance for the 2021 fiscal year as noted below. This guidance does not take into account the company’s planned acquisition of Chi-X Asia Pacific, which is subject to regulatory review and other customary closing conditions. The company plans to further update its guidance for 2021 after the acquisition closes, which is expected in the second or third quarter of this year.

Recurring non-transaction revenue, defined as access and capacity fees plus proprietary market data, is now expected to increase by 11 to 12 percent, from a base of $342 million in 2020, up from previous guidance of 7 to 8 percent, with organic growth targeted in a range of 10 to 11 percent versus previous guidance of 6 to 7 percent.
Reaffirmed that it expects acquisitions closed in 2020 to contribute net revenue growth in a range of 4 to 6 percentage points in 2021.
Reaffirmed that adjusted operating expenses are expected to be in the range of $531 to $539 million. The guidance excludes the expected amortization of acquired intangible assets of $122 million, the company plans to reflect the exclusion of this amount in its non-GAAP reconciliation.¹
Reaffirmed that depreciation and amortization expense, which is included in adjusted operating expenses above, is expected to be in the range of $38 to $42 million, excluding the expected amortization of acquired intangible assets of $122 million.
Reaffirmed that the effective tax rate² on adjusted earnings for the full year is expected to be in the range of 27.5 to 29.5 percent. Significant changes in trading volume, expenses, federal, state and local tax laws or rates and other items could materially impact this expectation.
Reaffirmed that capital expenditures are expected to be in the range of $60 to $65 million, which includes expenditures associated with the company’s trading floor relocation planned for the first half of 2022.

Capital Management

At March 31, 2021, the company had adjusted cash² of $263.9 million. Total debt as of March 31, 2021 was $1,187.8 million.

The company paid cash dividends of $45.3 million, or $0.42 per share, during the first quarter of 2021 and utilized $47.6 million to repurchase 0.5 million shares of its common stock under its share repurchase program at an average price of $96.97 per share. As of March 31, 2021, the company had approximately $352.5 million of availability remaining under its existing share repurchase authorizations.

Earnings Conference Call

Executives of Cboe Global Markets will host a conference call to review its first-quarter financial results today, April 30, 2021, at 8:30 a.m. ET/7:30 a.m. CT. The conference call and any accompanying slides will be publicly available via live webcast from the Investor Relations section of the company’s website at www.cboe.com under Events & Presentations. Participants may also listen via telephone by dialing (877) 255–4313 from the United States, (866) 450–4696 from Canada or (412) 317–5466 for international callers. Telephone participants should place calls 10 minutes prior to the start of the call. The webcast will be archived on the company’s website for replay. A telephone replay of the earnings call also will be available from approximately 11:00 a.m. CT, April 30, 2021, through 11:00 p.m. CT, May 7, 2021, by calling (877) 344–7529 from the U.S., (855) 669–9658 from Canada or (412) 317–0088 for international callers, using replay code 10153209.

⁽¹⁾

Specific quantifications of the amounts that would be required to reconcile the company’s organic growth guidance, adjusted operating expenses guidance and the effective tax rate on adjusted earnings guidance are not available. The company believes that there is uncertainty and unpredictability with respect to certain of its GAAP measures, primarily related to acquisition-related revenues and expenses that would be required to reconcile to GAAP revenues less costs of revenues, GAAP operating expenses and GAAP effective tax rate, which preclude the company from providing accurate guidance on certain forward-looking GAAP to non-GAAP reconciliations. The company believes that providing estimates of the amounts that would be required to reconcile the range of the company’s organic growth, adjusted operating expenses and the effective tax rate on adjusted earnings would imply a degree of precision that would be confusing or misleading to investors for the reasons identified above.

⁽²⁾

A full reconciliation of our non-GAAP results to our GAAP results is included in the attached tables. See “Non-GAAP Information” in the accompanying financial tables.

About Cboe Global Markets

Cboe Global Markets (Cboe: CBOE) provides cutting-edge trading and investment solutions to investors around the world. The company is committed to defining markets through product innovation, leading edge technology and seamless trading solutions.

Cboe offers trading across a diverse range of products in multiple asset classes and geographies, including options, futures, U.S., Canadian and European equities, exchange-traded products (“ETPs”), global foreign exchange (“FX”) and volatility products based on the VIX Index, recognized as the world’s premier gauge of U.S. equity market volatility.

Cboe’s subsidiaries include the largest options exchange and the third largest stock exchange operator in the U.S. In addition, the company operates one of the largest stock exchanges by value traded in Europe, and owns EuroCCP, a leading pan-European equities clearinghouse, BIDS Trading, a leading block-trading alternative trading system (“ATS”) by volume in the U.S., and MATCHNow, a leading equities ATS in Canada. Cboe also is a leading market globally for ETP listings and trading.

The company is headquartered in Chicago with a network of domestic and global offices across the Americas, Europe and Asia, including main hubs in New York, London, Kansas City and Amsterdam. For more information, visit www.cboe.com.

Cautionary Statements Regarding Forward-Looking Information

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve a number of risks and uncertainties. You can identify these statements by forward-looking words such as “may,” “might,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,” and the negative of these terms and other comparable terminology. All statements that reflect our expectations, assumptions or projections about the future other than statements of historical fact are forward-looking statements. These forward-looking statements, which are subject to known and unknown risks, uncertainties and assumptions about us, may include projections of our future financial performance based on our growth strategies and anticipated trends in our business. These statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from those expressed or implied by the forward-looking statements.

We operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible to predict all risks and uncertainties, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

Some factors that could cause actual results to differ include: the impact of the novel coronavirus (“COVID-19”) pandemic, including changes to trading behavior broadly in the market; the loss of our right to exclusively list and trade certain index options and futures products; economic, political and market conditions; compliance with legal and regulatory obligations; price competition and consolidation in our industry; decreases in trading and clearing volumes, market data fees or a shift in the mix of products traded on our exchanges; legislative or regulatory changes; our ability to protect our systems and communication networks from security risks, cybersecurity risks, insider threats and unauthorized disclosure of confidential information; increasing competition by foreign and domestic entities; our dependence on and exposure to risk from third parties; fluctuations to currency exchange rates; our index providers’ ability to maintain the quality and integrity of their indexes and to perform under our agreements; our ability to operate our business without violating the intellectual property rights of others and the costs associated with protecting our intellectual property rights; our ability to attract and retain skilled management and other personnel; our ability to minimize the risks, including our credit and default risks, associated with operating a European clearinghouse; our ability to accommodate trading and clearing volume and transaction traffic, including significant increases, without failure or degradation of performance of our systems; misconduct by those who use our markets or our products or for whom we clear transactions; challenges to our use of open source software code; our ability to meet our compliance obligations, including managing potential conflicts between our regulatory responsibilities and our for-profit status; our ability to maintain BIDS Trading as an independently managed and operated trading venue, separate from and not integrated with our registered national securities exchanges; damage to our reputation; the ability of our compliance and risk management methods to effectively monitor and manage our risks; our ability to manage our growth and strategic acquisitions or alliances effectively; restrictions imposed by our debt obligations and our ability to make payments on or refinance our debt obligations; our ability to maintain an investment grade credit rating; impairment of our goodwill, long-lived assets, investments or intangible assets; and the accuracy of our estimates and expectations. More detailed information about factors that may affect our actual results to differ may be found in our filings with the SEC, including in our Annual Report on Form 10-K for the year ended December 31, 2020 and other filings made from time to time with the SEC.

We do not undertake, and we expressly disclaim, any duty to update any forward-looking statement whether as a result of new information, future events or otherwise, except as required by law. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof.

The condensed consolidated statements of income and balance sheets are unaudited and subject to reclassification.


Cboe Media Contacts:		Analyst Contact:
Angela Tu	Tim Cave	Debbie Koopman
(646) 856–8734	+44 (0) 7593 506 719	(312) 786–7136
[email protected]	[email protected]	[email protected]

CBOE-F

Trademarks
Cboe®, Cboe Global Markets®, Cboe Volatility Index®, Bats®, BIDS Trading®, BZX®, BYX®, EDGX®, EDGA®, EuroCCP®, MATCHNow®, and VIX® are registered trademarks of Cboe Global Markets, Inc. and its subsidiaries. All other trademarks and service marks are the property of their respective owners.

Cboe Global Markets, Inc. Key Performance Statistics by Business Segment


	1Q 2021			4Q 2020			3Q 2020			2Q 2020			1Q 2020
Options
Total industry ADV (in thousands)		41,974			32,197			29,535			28,243			28,014
Total company Options ADV (in thousands)		12,681			10,299			9,569			9,944			10,731
Multi-listed options		10,779			8,705			8,136			8,354			8,069
Index options		1,902			1,595			1,433			1,590			2,663
Total Options Market Share		30.2	%		32.0	%		32.4	%		35.2	%		38.3	%
Multi-listed options		26.9	%		28.5	%		29.0	%		31.4	%		31.9	%
Index options		99.0	%		99.3	%		98.9	%		99.4	%		99.2	%
Total Options RPC:	$	0.177		$	0.182		$	0.173		$	0.182		$	0.234
Multi-listed options	$	0.067		$	0.068		$	0.056		$	0.051		$	0.053
Index options	$	0.803		$	0.809		$	0.842		$	0.870		$	0.781

North American Equities
U.S. Equities – Exchange:
Total industry ADV (shares in billions)		14.7			10.5			9.9			12.4			11.0
Market share %		15.0	%		15.1	%		15.1	%		16.1	%		16.7	%
Net capture (per 100 touched shares)	$	0.015		$	0.015		$	0.017		$	0.025		$	0.026
U.S. Equities – Off-Exchange:
ADV (touched shares, in millions)		99.5			N/A			N/A			N/A			N/A
Net capture (per 100 touched shares)	$	0.121			N/A			N/A			N/A			N/A
Canadian Equities:
ADV (matched shares, in millions)		71.4			45.2			40.0			N/A			N/A
Total market share %		3.1	%		3.3	%		3.3	%		N/A			N/A
Market share % – TSX listed volume		4.6	%		4.7	%		4.7	%		N/A			N/A
Net capture (per 10,000 shares, in Canadian Dollars)	$	7.184		$	8.300		$	8.200			N/A			N/A

Futures
ADV (in thousands)		256			159			172			144			331
RPC	$	1.639		$	1.575		$	1.527		$	1.743		$	1.750

Europe
Equities:
Total industry ADNV (Euros – in billions)	€	44.8		€	37.5		€	31.5		€	40.1		€	51.5
Market share %		16.8	%		17.5	%		17.7	%		15.8	%		17.7	%
Net capture (bps)	€	0.284		€	0.259		€	0.245		€	0.248		€	0.244
EuroCCP:
Traded cleared (in thousands)		298,223.5			290,181.9			255,293.1			N/A			N/A
Fee per trade cleared	€	0.011		€	0.011		€	0.011			N/A			N/A
Net settlement volume (shares in thousands)		2,423.2			2,132.7			1,952.3			N/A			N/A
Net fee per settlement	€	0.865		€	0.803		€	0.785			N/A			N/A

Global FX
Market share %		16.5	%		16.7	%		15.9	%		16.4	%		15.7	%
ADNV ($ in billions)	$	37.1		$	33.7		$	30.2		$	31.8		$	43.3
Net capture (per one million dollars traded)	$	2.65		$	2.64		$	2.70		$	2.77		$	2.69

ADV = average daily volume; ADNV = average daily notional value.
RPC, average revenue per contract, for options and futures represents total net transaction fees recognized for the period divided by total contracts traded during the period.
U.S. Equities – Exchange, “net capture per 100 touched shares” refers to transaction fees less liquidity payments and routing and clearing costs divided by the product of one-hundredth ADV of touched shares on BZX, BYX, EDGX and EDGA and the number of trading days. U.S. Equities – Off-Exchange data reflects Cboe’s acquisition of BIDS Trading, effective December 31, 2020. For U.S. Equities – Off-Exchange, “net capture per 100 touched shares” refers to transaction fees less order and execution management system (OMS/EMS) fees and clearing costs divided by the product of one-hundredth ADV of touched shares on BIDS Trading and the number of trading days for the period.
Canadian Equities data reflects the acquisition of MATCHNow effective August 4, 2020. Canadian Equities, “net capture per 10,000 shares” refers to transaction fees divided by the product of one-ten thousandth ADV of shares for MATCHNow and the number of trading days. Total market share represents MATCHNow volume divided by the total volume of the Canadian Equities market. TSX listed volume market share represents MATCHNow volume divided by the total volume in TSX listed equities.
European Equities, “net capture per matched notional value” refers to transaction fees less liquidity payments in British pounds divided by the product of matched ADNV in British pounds and the number of trading days. EuroCCP data reflects the acquisition of EuroCCP effective July 1, 2020. “Trades cleared” refers to the total number of non-interoperable trades cleared. “Net settlement volume” refers to the total number of settlements executed after netting.
Global FX, “net capture per one million dollars traded” refers to net transaction fees divided by the product of one-millionth of ADNV traded on the Cboe FX market, the number of trading days, and two, which represents the buyer and seller that are both charged on the transaction. Market Share represents Cboe FX volume divided by the total volume of publicly reporting spot FX venues (Cboe FX, EBS, Refinitiv, and Euronext FX).
Average transaction fees per contract can be affected by various factors, including exchange fee rates, volume-based discounts and transaction mix by contract type and product type.

Cboe Global Markets, Inc. and Subsidiaries Condensed Consolidated Statements of Income (Unaudited) Three Months Ended March 31, 2021 and 2020


	Three Months Ended March 31,
(in millions, except per share amounts)	2021		2020
Revenue:
Transaction and clearing fees	$	763.2	$	661.5
Access and capacity fees		66.4		57.7
Market data fees		63.8		56.2
Regulatory fees		101.5		136.8
Other revenue		15.9		9.3
Total Revenues		1,010.8		921.5
Cost of Revenues:
Liquidity payments		501.8		392.4
Routing and clearing		27.1		16.0
Section 31 fees		91.9		127.4
Royalty fees		20.3		27.4
Other		4.2		—
Total Cost of Revenues		645.3		563.2
Revenues Less Cost of Revenues		365.5		358.3
Operating Expenses:
Compensation and benefits		72.3		53.3
Depreciation and amortization		42.0		40.5
Technology support services		17.2		11.9
Professional fees and outside services		15.6		14.9
Travel and promotional expenses		1.6		2.1
Facilities costs		5.3		4.1
Acquisition-related costs		3.4		0.8
Other expenses		3.5		4.3
Total Operating Expenses		160.9		131.9
Operating Income		204.6		226.4
Non-operating Income (Expenses):
Interest expense, net		(12.3)		(7.3)
Other income (expense), net		0.6		(1.6)
Total Non-operating Income (Expenses)		(11.7)		(8.9)
Income Before Income Tax Provision		192.9		217.5
Income tax provision		55.7		60.1
Net Income		137.2		157.4
Net income allocated to participating securities		(0.4)		(0.4)
Net Income Allocated to Common Stockholders	$	136.8	$	157.0
Net Income Per Share Allocated to Common Stockholders:
Basic earnings per share	$	1.27	$	1.42
Diluted earnings per share		1.27		1.42
Weighted average shares used in computing income per share:
Basic		107.3		110.4
Diluted		107.4		110.6

Cboe Global Markets, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (Unaudited) March 31, 2021 and 2020


	March 31,		December 31,
(in millions)	2021		2020
Assets
Current Assets:
Cash and cash equivalents	$	263.3	$	245.4
Financial investments		95.5		92.4
Accounts receivable, net		374.8		337.3
Margin deposits and clearing funds		1,260.0		812.1
Income taxes receivable		—		53.1
Other current assets		39.5		26.5
Total Current Assets		2,033.1		1,566.8

Investments		40.7		42.7
Property and equipment, net		83.4		82.6
Property held for sale		13.0		13.0
Operating lease right of use assets		108.5		111.0
Goodwill		2,898.0		2,895.1
Intangible assets, net		1,698.1		1,729.0
Other assets, net		83.3		76.3
Total Assets	$	6,958.1	$	6,516.5

Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable and accrued liabilities	$	247.5	$	250.0
Section 31 fees payable		92.2		152.9
Deferred revenue		21.2		10.2
Margin deposits and clearing funds		1,260.0		812.1
Income taxes payable		7.2		4.2
Current portion of long-term debt		49.0		68.7
Current portion of contingent consideration liabilities		17.0		15.2
Total Current Liabilities		1,694.1		1,313.3

Long-term debt		1,138.8		1,135.2
Unrecognized tax benefits		174.2		164.7
Deferred income taxes		372.0		377.6
Non-current operating lease liabilities		129.1		132.1
Contingent consideration liabilities		15.1		17.5
Other non-current liabilities		30.6		27.2
Total Liabilities		3,553.9		3,167.6

Stockholders’ Equity:
Preferred stock		—		—
Common stock		1.3		1.2
Treasury stock at cost		(1,303.7)		(1,250.4)
Additional paid-in capital		2,725.1		2,713.3
Retained earnings		1,901.7		1,809.8
Accumulated other comprehensive income, net		79.8		75.0
Total Stockholders’ Equity		3,404.2		3,348.9

Total Liabilities and Stockholders’ Equity	$	6,958.1	$	6,516.5

Non-GAAP Information

In addition to disclosing results determined in accordance with GAAP, Cboe Global Markets has disclosed certain non-GAAP measures of operating performance. These measures are not in accordance with, or a substitute for, GAAP, and may be different from or inconsistent with non-GAAP financial measures used by other companies. The non-GAAP measures provided in this press release include net transaction and clearing fees, adjusted operating expenses, adjusted operating income, organic net revenue, adjusted operating margin, adjusted net income allocated to common stockholders and adjusted diluted earnings per share, effective tax rate on adjusted earnings, adjusted cash, EBITDA, EBITDA margin, adjusted EBITDA and adjusted EBITDA margin.

Management believes that the non-GAAP financial measures presented in this press release, including adjusted operating income, organic net revenue and adjusted operating expenses, provide additional and comparative information to assess trends in our core operations and a means to evaluate period-to-period comparisons. Non-GAAP financial measures disclosed by management are provided as additional information to investors in order to provide them with an alternative method for assessing our financial condition and operating results.

Organic net revenue, organic non-transaction revenue and organic net revenue guidance: These are non-GAAP financial measures that exclude or have otherwise been adjusted for the impact of our acquisitions for the period or guidance, as applicable. Management believes the organic net revenue growth and guidance measures provide users with supplemental information regarding the company’s ongoing and future potential revenue performances and trends by presenting revenue growth and guidance excluding the impact of the acquisitions. Revenues from acquisitions that have been owned for at least one year are considered organic and are no longer excluded from organic net revenue from either period for comparative purposes.

Amortization expense of acquired intangible assets: We amortize intangible assets acquired in connection with various acquisitions. Amortization of intangible assets is inconsistent in amount and frequency and is significantly affected by the timing and size of our acquisitions. As such, if intangible asset amortization is included in performance measures, it is more difficult to assess the day-to-day operating performance of the businesses, the relative operating performance of the businesses between periods and the earnings power of the company. Therefore, we believe performance measures excluding intangible asset amortization expense provide investors with an additional basis for comparison across accounting periods.

Acquisition-related expenses: From time to time, we have pursued acquisitions, which have resulted in expenses which would not otherwise have been incurred in the normal course of the company’s business operations. These expenses include integration costs, as well as legal, due diligence and other third-party transaction costs. The frequency and the amount of such expenses vary significantly based on the size, timing and complexity of the transaction. Accordingly, we exclude these costs for purposes of calculating non-GAAP measures which provide an additional analysis of Cboe’s ongoing operating performance or comparisons in Cboe’s performance between periods.

The tables below show the reconciliation of each financial measure from GAAP to non-GAAP. The non-GAAP financial measures exclude the impact of those items detailed below and are referred to as adjusted financial measures.

Organic Net Revenue Reconciliation


Table 3	Three Months Ended
(in millions)	March 31,
Reconciliation of Revenue Less Cost of Revenue to Organic Net Revenue	2021		2020
Revenues less cost of revenues (net revenue)	$	365.5	$	358.3
Less acquisitions:
Acquisition revenue less cost of revenues	$	(26.8)	$	—
Organic net revenue	$	338.7	$	358.3

Reconciliation of GAAP and non-GAAP Information


	Three Months Ended
Table 4	March 31,
(in millions, except per share amounts)	2021			2020
Reconciliation of Net Income Allocated to Common Stockholders to Non-GAAP (As shown on Table 1)
Net income allocated to common stockholders	$	136.8		$	157.0
Non-GAAP adjustments
Acquisition-related expenses (1)		3.4			0.8
Amortization of acquired intangible assets (2)		32.9			32.5
Total Non-GAAP adjustments		36.3			33.3
Income tax expense related to the items above		(8.2)			(7.6)
Net income allocated to participating securities – effect on reconciling items		(0.1)			(0.4)
Adjusted net income allocated to common stockholders	$	164.8		$	182.3

Reconciliation of Diluted EPS to Non-GAAP
Diluted earnings per common share	$	1.27		$	1.42
Per share impact of non-GAAP adjustments noted above		0.26			0.23
Adjusted diluted earnings per common share	$	1.53		$	1.65

Reconciliation of Operating Margin to Non-GAAP
Revenue less cost of revenue	$	365.5		$	358.3
Non-GAAP adjustments noted above		—			—
Adjusted revenue less cost of revenue	$	365.5		$	358.3
Operating expenses (3)	$	160.9		$	131.9
Non-GAAP adjustments noted above		36.3			33.3
Adjusted operating expenses	$	124.6		$	98.6
Operating income	$	204.6		$	226.4
Non-GAAP adjustments noted above		36.3			33.3
Adjusted operating income	$	240.9		$	259.7
Adjusted operating margin (4)		65.9	%		72.5	%

Reconciliation of Income Tax Rate to Non-GAAP
Income before income taxes		192.9			217.5
Non-GAAP adjustments noted above		36.3			33.3
Adjusted income before income taxes	$	229.2		$	250.8

Income tax expense		55.7			60.1
Non-GAAP adjustments noted above		8.2			7.6
Adjusted income tax expense	$	63.9		$	67.7
Adjusted income tax rate		27.9	%		27.0	%

(1) This amount includes professional fees and outside services, severance, facilities expenses, impairment charges and other costs related to the company’s acquisitions.

(2) This amount represents the amortization of acquired intangible assets related to the company’s acquisitions.

(3) The company sponsors deferred compensation plans held in a trust. The expenses or income related to the deferred compensation plans are included in “Compensation and benefits” ($0.4 million and $2.1 million in expense for the three months ended March 31, 2021 and 2020, respectively), and are directly offset by deferred compensation income, expenses and dividends included within “Other expense, net” ($0.4 million and $2.1 million in income, expense and dividends in the three months ended March 31, 2021 and 2020, respectively), on the consolidated statements of income. The deferred compensation plans’ expenses are not excluded from “adjusted operating expenses” and do not have an impact on “Income before income taxes.”

(4) Adjusted operating margin represents adjusted operating income divided by adjusted revenue less cost of revenue.

EBITDA Reconciliations

EBITDA (earnings before interest, income taxes, depreciation and amortization) and Adjusted EBITDA are widely used non-GAAP financial measures of operating performance. EBITDA margin represents EBITDA divided by revenues less cost of revenues (net revenue). It is presented as supplemental information that the company believes is useful to investors to evaluate its results because it excludes certain items that are not directly related to the company’s core operating performance. EBITDA is calculated by adding back to net income interest expense, income tax expense, depreciation and amortization. Adjusted EBITDA is calculated by adding back to EBITDA acquisition-related expenses. EBITDA and Adjusted EBITDA should not be considered as substitutes either for net income, as an indicator of the company’s operating performance, or for cash flow, as a measure of the company’s liquidity. In addition, because EBITDA and Adjusted EBITDA may not be calculated identically by all companies, the presentation here may not be comparable to other similarly titled measures of other companies. Adjusted EBITDA margin represents Adjusted EBITDA divided by net revenue.



Table 5	Three Months Ended
(in millions)	March 31,
Reconciliation of Net Income Allocated to Common Stockholders to EBITDA and Adjusted EBITDA (Per Table 1)	2021			2020
Net income allocated to common stockholders	$	136.8		$	157.0
Interest expense, net		12.3			7.3
Income tax provision		55.7			60.1
Depreciation and amortization		42.0			40.5
EBITDA	$	246.8		$	264.9
EBITDA Margin		67.5	%		73.9	%

Non-GAAP adjustments not included in above line items
Acquisition-related expenses		3.4			0.8
Adjusted EBITDA	$	250.2		$	265.7
Adjusted EBITDA Margin		68.5	%		74.2	%


Table 6
(in millions)	March 31,			December 31,
Reconciliation of Cash and cash equivalents to Adjusted Cash	2021			2020
Cash and cash equivalents	$	263.3		$	245.4
Financial investments		95.5			92.4
Less deferred compensation plan assets		(24.0)			(24.5)
Less cash collected for Section 31 Fees		(70.9)			(103.0)
Adjusted Cash	$	263.9		$	210.3


Table 7
(in millions)
Reconciliation of Net Transaction and Clearing Fees –Three Months Ended March 31, 2021 and 2020
	Consolidated				Options Segment				N.A. Equities Segment				Futures Segment				Europe Segment				Global FX Segment
	Three Months Ended				Three Months Ended				Three Months Ended				Three Months Ended				Three Months Ended				Three Months Ended
	March 31,				March 31,				March 31,				March 31,				March 31,				March 31,
	2021		2020		2021		2020		2021		2020		2021		2020		2021		2020		2021		2020
Transaction and clearing fees	$	763.2	$	661.5	$	308.7	$	284.2	$	381.8	$	304.0	$	25.6	$	35.9	$	34.7	$	22.3	$	12.4	$	15.1
Liquidity payments		(501.8)		(392.4)		(166.0)		(124.3)		(330.5)		(261.4)		—		—		(5.3)		(6.7)		—		—
Routing and clearing		(27.1)		(16.0)		(5.5)		(4.5)		(17.3)		(11.5)		—		—		(4.3)		—		—		—
Net transaction and clearing fees	$	234.3	$	253.1	$	137.2	$	155.4	$	34.0	$	31.1	$	25.6	$	35.9	$	25.1	$	15.6	$	12.4	$	15.1

View original content to download multimedia:http://www.prnewswire.com/news-releases/cboe-global-markets-reports-results-for-first-quarter-2021-301280839.html

SOURCE Cboe Global Markets, Inc.

April 30, 2021 7:33 am

W. P. Carey Inc. Announces First Quarter 2021 Financial Results

PR Newswire

NEW YORK, April 30, 2021 /PRNewswire/ — W. P. Carey Inc. (NYSE: WPC) (W. P. Carey or the Company), a net lease real estate investment trust, today reported its financial results for the first quarter ended March 31, 2021.

*Financial Highlights*
	*2021 First Quarter*
Net income attributable to W. P. Carey (millions)	$51.6
Diluted earnings per share	$0.29
Net income from Real Estate attributable to W. P. Carey (millions)	$44.6
Diluted earnings per share from Real Estate	$0.25

AFFO (millions)	$216.5
AFFO per diluted share	$1.22
Real Estate segment AFFO (millions)	$210.3
Real Estate segment AFFO per diluted share	$1.19

2021 AFFO guidance range raised and narrowed to $4.87 to $4.97 per diluted share, including Real Estate AFFO of between $4.74 and $4.84 per diluted share
Quarterly cash dividend raised to $1.048 per share, equivalent to an annualized dividend rate of $4.192 per share

Real Estate Portfolio

Investment volume of $399.9 million year to date, including $213.8 million during the first quarter and $186.1 million subsequent to quarter end
Active capital investments and commitments of $181.0 million outstanding at quarter end, including $129.1 million scheduled to be completed in the remainder of 2021
Gross disposition proceeds of $93.1 million year to date, including $13.7 million during the first quarter and $79.4 million subsequent to quarter end
Overall collection rate of 98% for 2021 first quarter rent due
Portfolio occupancy of 98.3%
Weighted-average lease term of 10.6 years

Balance Sheet and Capitalization

Issued $425 million of 2.250% Senior Unsecured Notes due 2033, with proceeds used to prepay mortgage debt totaling $425 million
Issued €525 million of 0.950% Senior Unsecured Notes due 2030, with proceeds used to redeem €500 million of 2.0% Senior Unsecured Notes due 2023
Utilized ATM program to raise approximately $171 million in net proceeds year to date, including $140 million during the first quarter and $31 million subsequent to quarter end

MANAGEMENT COMMENTARY

“The first quarter provided a strong start to the year on a number of fronts — most notably the strength of our investment activity — allowing us to raise our guidance,” said Jason Fox, Chief Executive Officer of W. P. Carey. “Furthermore, the debt issuances we completed during the first quarter locked in our lowest ever coupon rates, both in the U.S. and Europe. Given our cost of capital and liquidity, we’re poised to accelerate externally driven growth, executing on the strongest pipeline we’ve seen in years. And with one of the best-positioned net lease portfolios for embedded rent growth, we could see further long-term upside in an inflationary environment.”

QUARTERLY FINANCIAL RESULTS

Revenues

Total Company: Revenues, including reimbursable costs, for the 2021 first quarter totaled $311.2 million, up 0.7% from $309.0 million for the 2020 first quarter.
Real Estate: Real Estate revenues, including reimbursable costs, for the 2021 first quarter were $306.2 million, up 3.9% from $294.6 million for the 2020 first quarter, due primarily to higher lease revenues resulting from net acquisitions and rent escalations, as well as a stronger euro relative to the U.S. dollar. Lease termination and other revenues were higher during the 2020 first quarter, which included a significant lease-related recovery. Lower operating revenues reflected the disposition of a hotel operating property during the 2020 first quarter and lower occupancy at the Company’s remaining hotel operating property due to the COVID-19 pandemic.
Investment Management: Investment Management revenues, including reimbursable costs, for the 2021 first quarter were $5.0 million, down 65.3% from $14.4 million for the 2020 first quarter, due primarily to lower asset management revenues and reimbursable costs from affiliates resulting from the management internalization by Carey Watermark Investors Incorporated (CWI 1) and Carey Watermark Investors 2 Incorporated (CWI 2) completed during the 2020 second quarter.

Net Income Attributable to W. P. Carey

Net income attributable to W. P. Carey for the 2021 first quarter was $51.6 million, down 21.9% from $66.1 million for the 2020 first quarter. Net income from Real Estate attributable to W. P. Carey was $44.6 million, which decreased due primarily to a loss on extinguishment of debt totaling $59.9 million (comprised largely of prepayment penalties for mortgage loan prepayments and a “make-whole” amount paid to redeem the €500 million of 2.0% Senior Unsecured Notes due 2023) and a deferred tax benefit of $37.2 million related to the Company’s investment in shares of Lineage Logistics (a cold storage REIT) recognized during the prior year period, partly offset by a mark-to-market gain of $23.4 million and a cash dividend of $6.4 million for the Company’s investment in shares of Lineage Logistics, and the impact of net acquisitions. Net income from Investment Management attributable to W. P. Carey was $7.0 million, which increased due primarily to impairment charges totaling $47.1 million recognized on the Company’s equity investments in CWI 1 and CWI 2 during the prior year period, partly offset by the cessation of Investment Management revenues previously earned from CWI 1 and CWI 2. Segment net income also reflects the full allocation of certain operating expenses to the Real Estate segment commencing in the 2020 second quarter.

Adjusted Funds from Operations (AFFO)

AFFO for the 2021 first quarter was $1.22 per diluted share, down 2.4% from $1.25 per diluted share for the 2020 first quarter driven primarily by a reduction in Investment Management revenues, reflecting the Company’s continued move out of this business. The Real Estate segment generated AFFO (Real Estate AFFO) of $1.19 per diluted share, reflecting the accretive impact of net investment activity and rent escalations as well as a cash dividend received from the Company’s investment in shares of Lineage Logistics, which were partly offset by the impact of the COVID-19 pandemic on rents and lower Lease termination and other revenues due to a significant lease-related recovery in the 2020 first quarter. Segment AFFO also reflects the full allocation of general and administrative expenses to the Real Estate segment commencing in the 2020 second quarter.

Note: Further information concerning AFFO and Real Estate AFFO, which are both non-GAAP supplemental performance metrics, is presented in the accompanying tables and related notes.

Dividend

As previously announced, on March 11, 2021 the Company’s Board of Directors declared a quarterly cash dividend of $1.048 per share, equivalent to an annualized dividend rate of $4.192 per share. The dividend was paid on April 15, 2021 to stockholders of record as of March 31, 2021.

AFFO GUIDANCE

The Company has raised and narrowed its guidance range for the 2021 full year and currently expects to report total AFFO of between $4.87 and $4.97 per diluted share, including Real Estate AFFO of between $4.74 and $4.84 per diluted share, based on the following key assumptions:

(i) investments for the Company’s Real Estate portfolio of between $1.25 billion and $1.75 billion, which has been revised higher;

(ii) dispositions from the Company’s Real Estate portfolio of between $250 million and $350 million, which is unchanged; and

(iii) total general and administrative expenses of between $79 million and $83 million, which is unchanged.

Note: The Company does not provide guidance on net income. The Company only provides guidance on total AFFO (and Real Estate AFFO) and does not provide a reconciliation of this forward-looking non-GAAP guidance to net income due to the inherent difficulty in quantifying certain items necessary to provide such reconciliation as a result of their unknown effect, timing and potential significance. Examples of such items include impairments of assets, gains and losses from sales of assets, and depreciation and amortization from new acquisitions.

REAL ESTATE

Investments

During the 2021 first quarter, the Company completed investments totaling $213.8 million, consisting of three acquisitions totaling $149.3 million and three completed capital investments and commitments at a total cost of $64.5 million.
Subsequent to the 2021 first quarter, the Company completed three acquisitions totaling $186.1 million, bringing total investment volume year to date to $399.9 million.
As of March 31, 2021, the Company had seven capital investments and commitments outstanding for an expected total investment of approximately $181.0 million, of which four investments and commitments totaling $129.1 million are currently scheduled to be completed during 2021.

Dividends Received

During the 2021 first quarter, the Company received a $6.4 million cash dividend from its investment in shares of Lineage Logistics.
Subsequent to the 2021 first quarter, the Company received a $3.3 million cash dividend from its investment in preferred shares of Watermark Lodging Trust, the surviving entity from the CWI lodging funds it previously managed.

Dispositions

During the 2021 first quarter, the Company disposed of two properties for gross proceeds of $13.7 million.
Subsequent to the 2021 first quarter, the Company disposed of eight properties for gross proceeds totaling $79.4 million, bringing total gross proceeds year to date to $93.1 million.

COVID-19 Update on Rent Collections

The Company received 98% of contractual base rent that was due in the 2021 first quarter.

Composition

As of March 31, 2021, the Company’s net lease portfolio consisted of 1,261 properties, comprising 146 million square feet leased to 351 tenants, with a weighted-average lease term of 10.6 years and an occupancy rate of 98.3%. In addition, the Company owned 19 self-storage operating properties and one hotel operating property, totaling approximately 1.4 million square feet.

BALANCE SHEET AND CAPITALIZATION

Debt Refinancings

As previously announced, on February 25, 2021, the Company completed an underwritten public offering of $425 million aggregate principal amount of 2.250% Senior Notes due April 1, 2033. The Company used the net proceeds from the offering to prepay $425 million of mortgage debt (including associated prepayment penalties) during the 2021 first quarter, which had a weighted-average interest rate of 5.1%.
As previously announced, on March 8, 2021, the Company completed an underwritten public offering of €525 million aggregate principal amount of 0.950% Senior Notes due June 1, 2030. The Company used the net proceeds from the offering to redeem its €500 million of 2.0% Senior Notes due 2023, including the €22 million “make-whole” amount related to the redemption.
As of March 31, 2021, primarily as a result of the debt refinancings completed during the 2021 first quarter, the Company’s:

weighted-average interest rate on Total Pro Rata Debt Outstanding was lowered to 2.7%, a decrease of 20 basis points compared to the end of the 2020 fourth quarter;
weighted-average debt maturity on Total Pro Rata Debt Outstanding was extended to 5.9 years, up from 4.8 years at the end of the 2020 fourth quarter, with no unsecured debt maturing until 2024; and
secured debt as a percentage of gross assets was reduced to 4.6%, down from 7.2% at the end of the 2020 fourth quarter.

“At-The-Market” (ATM) Program

During the 2021 first quarter, the Company issued 2,020,115 shares of common stock under its ATM program at a weighted-average price of $70.26 per share, for net proceeds of $140 million.
Subsequent to the 2021 first quarter, the Company issued 443,460 shares of common stock under its ATM program at a weighted-average price of $71.67 per share, for net proceeds of approximately $31 million.

Forward Equity Offering

As of March 31, 2021, the Company continued to have the ability to settle the remaining 2,510,709 shares under existing forward sale agreements by December 17, 2021, for anticipated net proceeds of approximately $160 million.

* * * * *

Supplemental Information

The Company has provided supplemental unaudited financial and operating information regarding the 2021 first quarter and certain prior quarters, including a description of non-GAAP financial measures and reconciliations to GAAP measures, in a Current Report on Form 8-K filed with the Securities and Exchange Commission (SEC) on April 30, 2021, and made available on the Company’s website at ir.wpcarey.com/investor-relations.

* * * * *

Live Conference Call and Audio Webcast Scheduled for 10:00 a.m. Eastern Time

Please dial in at least 10 minutes prior to the start time.

Date/Time: Friday, April 30, 2021 at 10:00 a.m. Eastern Time
Call-in Number: 1-877-465-1289 (U.S.) or +1-201-689-8762 (international)

Live Audio Webcast and Replay:
www.wpcarey.com/earnings

* * * * *

W. P. Carey Inc.

W. P. Carey ranks among the largest net lease REITs with an enterprise value of approximately $19 billion and a diversified portfolio of operationally-critical commercial real estate that includes 1,261 net lease properties covering approximately 146 million square feet as of March 31, 2021. For nearly five decades, the company has invested in high-quality single-tenant industrial, warehouse, office, retail and self-storage properties subject to long-term net leases with built-in rent escalators. Its portfolio is located primarily in the U.S. and Northern and Western Europe and is well-diversified by tenant, property type, geographic location and tenant industry.

www.wpcarey.com

* * * * *

Cautionary Statement Concerning Forward-Looking Statements and COVID-19 Update on Rent Collections

Certain of the matters discussed in this communication constitute forward-looking statements within the meaning of the Securities Act of 1933 and the Exchange Act of 1934, both as amended by the Private Securities Litigation Reform Act of 1995. The forward-looking statements include, among other things, statements regarding the intent, belief or expectations of W. P. Carey and can be identified by the use of words such as “may,” “will,” “should,” “would,” “assume,” “outlook,” “seek,” “plan,” “believe,” “expect,” “anticipate,” “intend,” “estimate,” “forecast” and other comparable terms. These forward-looking statements include, but are not limited to, statements made by Mr. Fox regarding our pipeline and externally driven growth, as well as the impact of inflation on future rent growth. These statements are based on the current expectations of our management and it is important to note that our actual results could be materially different from those projected in such forward-looking statements. There are a number of risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Other unknown or unpredictable risks or uncertainties, like the risks related to the effects of pandemics and global outbreaks of contagious diseases or the fear of such outbreaks (such as the current COVID-19 pandemic) and those additional risk factors discussed in reports that we have filed with the SEC could also have material adverse effects on our future results, performance or achievements. Discussions of some of these other important factors and assumptions are contained in W. P. Carey’s filings with the SEC and are available at the SEC’s website at http://www.sec.gov, including Part I, Item 1A. Risk Factors in W. P. Carey’s Annual Report on Form 10-K for the year ended December 31, 2020. In light of these risks, uncertainties, assumptions and factors, the forward-looking events discussed in this communication may not occur. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this communication, unless noted otherwise. Except as required under the federal securities laws and the rules and regulations of the SEC, W. P. Carey does not undertake any obligation to release publicly any revisions to the forward-looking statements to reflect events or circumstances after the date of this communication or to reflect the occurrence of unanticipated events.

In addition, given the significant uncertainty regarding the duration and severity of the impact of the COVID-19 pandemic, the Company is unable to predict its tenants’ continued ability to pay rent. Therefore, information provided regarding historical rent collections should not serve as an indication of expected future rent collections.

* * * * *

W. P. CAREY INC.

Consolidated Balance Sheets (Unaudited)

(in thousands, except share and per share amounts)

March 31, 2021

December 31, 2020

Assets

Investments in real estate:

Land, buildings and improvements ^(a)

$

10,930,595

$

10,939,619

Net investments in direct financing leases

698,852

711,974

In-place lease intangible assets and other

2,295,863

2,301,174

Above-market rent intangible assets

868,242

881,159

Investments in real estate

14,793,552

14,833,926

Accumulated depreciation and amortization ^(b)

(2,572,091)

(2,490,087)

Assets held for sale, net ^(c)

14,983

18,590

Net investments in real estate

12,236,444

12,362,429

Equity investments in the Managed Programs and real estate ^(d)

269,448

283,446

Cash and cash equivalents

229,153

248,662

Due from affiliates

4,027

26,257

Other assets, net

903,927

876,024

Goodwill

905,701

910,818

Total assets

$

14,548,700

$

14,707,636

Liabilities and Equity

Debt:

Senior unsecured notes, net

$

5,451,520

$

5,146,192

Unsecured term loans, net

318,440

321,971

Unsecured revolving credit facility

21,751

82,281

Non-recourse mortgages, net

728,663

1,145,554

Debt, net

6,520,374

6,695,998

Accounts payable, accrued expenses and other liabilities

618,300

603,663

Below-market rent and other intangible liabilities, net

192,029

197,248

Deferred income taxes

138,973

145,844

Dividends payable

188,569

186,514

Total liabilities

7,658,245

7,829,267

Preferred stock, $0.001 par value, 50,000,000 shares authorized; none issued

—

—

Common stock, $0.001 par value, 450,000,000 shares authorized; 177,520,962 and 175,401,757 shares, respectively, issued and outstanding

178

175

Additional paid-in capital

9,061,143

8,925,365

Distributions in excess of accumulated earnings

(1,988,440)

(1,850,935)

Deferred compensation obligation

49,815

42,014

Accumulated other comprehensive loss

(233,889)

(239,906)

Total stockholders’ equity

6,888,807

6,876,713

Noncontrolling interests

1,648

1,656

Total equity

6,890,455

6,878,369

Total liabilities and equity

$

14,548,700

$

14,707,636

________

(a)

Includes $83.5 million of amounts attributable to operating properties as of both March 31, 2021 and December 31, 2020.

(b)

Includes $1.3 billion and $1.2 billion of accumulated depreciation on buildings and improvements as of March 31, 2021 and December 31, 2020, respectively, and $1.3 billion of accumulated amortization on lease intangibles as of both March 31, 2021 and December 31, 2020.

(c)

At March 31, 2021, we had three properties classified as Assets held for sale, net, all of which were sold in April 2021. At December 31, 2020, we had four properties classified as Assets held for sale, net, one of which was sold January 2021.

(d)

Our equity investments in real estate totaled $210.3 million and $226.9 million as of March 31, 2021 and December 31, 2020, respectively. Our equity investments in the Managed Programs totaled $59.1 million and $56.6 million as of March 31, 2021 and December 31, 2020, respectively.

W. P. CAREY INC.

Quarterly Consolidated Statements of Income (Unaudited)

(in thousands, except share and per share amounts)

Three Months Ended

March 31, 2021

December 31, 2020

March 31, 2020

Revenues

Real Estate:

Lease revenues

$

301,765

$

298,235

$

282,110

Lease termination income and other

2,227

2,103

6,509

Operating property revenues

2,179

2,031

5,967

306,171

302,369

294,586

Investment Management:

Asset management and other revenue

3,954

3,864

10,383

Reimbursable costs from affiliates

1,041

1,138

4,030

4,995

5,002

14,413

311,166

307,371

308,999

Operating Expenses

Depreciation and amortization

110,322

110,913

116,194

General and administrative

22,083

18,334

20,745

Reimbursable tenant costs

15,758

13,710

13,175

Property expenses, excluding reimbursable tenant costs

10,883

10,418

10,075

Stock-based compensation expense

5,381

5,795

2,661

Operating property expenses

1,911

1,696

5,223

Reimbursable costs from affiliates

1,041

1,138

4,030

Merger and other expenses

(476)

(418)

187

Impairment charges

—

16,410

19,420

Subadvisor fees

—

—

1,277

166,903

177,996

192,987

Other Income and Expenses

Interest expense

(51,640)

(52,828)

(52,540)

Other gains and (losses) ^(a)

(41,188)

(1,927)

(9,815)

Equity in losses of equity method investments in the Managed

Programs and real estate ^(b)

(9,733)

(8,470)

(45,790)

Gain on sale of real estate, net

9,372

76,686

11,751

Non-operating income (loss) ^(c)

6,356

(858)

5,392

(86,833)

12,603

(91,002)

Income before income taxes

57,430

141,978

25,010

(Provision for) benefit from income taxes

(5,789)

(7,363)

41,692

Net Income

51,641

134,615

66,702

Net income attributable to noncontrolling interests

(7)

(43)

(612)

Net Income Attributable to W. P. Carey

$

51,634

$

134,572

$

66,090

Basic Earnings Per Share

$

0.29

$

0.76

$

0.38

Diluted Earnings Per Share

$

0.29

$

0.76

$

0.38

Weighted-Average Shares Outstanding

Basic

176,640,861

176,366,824

173,249,236

Diluted

176,965,510

176,683,474

173,460,053

Dividends Declared Per Share

$

1.048

$

1.046

$

1.040

__________

(a)

Amount for the three months ended March 31, 2021 is primarily comprised of loss on extinguishment of debt of $(59.9) million (of which $(31.7) million mainly comprised fees for the prepayment of certain non-recourse mortgage loans and $(28.2) million mainly comprised a “make-whole” amount paid in connection with the redemption of €500 million of 2.0% Senior Unsecured Notes due 2023 in March 2021), a mark-to-market unrealized gain for our investment in Lineage Logistics of $23.4 million and net loss on foreign currency transactions of $(7.5) million.

(b)

Amount for the three months ended March 31, 2021 includes a non-cash other-than-temporary impairment charge of $6.8 million recognized on an equity method investment in real estate. Amount for the three months ended December 31, 2020 includes a non-cash other-than-temporary impairment charge of $8.3 million recognized on another equity method investment in real estate. Amount for the three months ended March 31, 2020 includes non-cash other-than-temporary impairment charges totaling $47.1 million recognized on our former equity investments in CWI 1 and CWI 2.

(c)

Amount for the three months ended March 31, 2021 is primarily comprised of a cash dividend of $6.4 million from our investment in shares of Lineage Logistics, realized losses on foreign currency exchange derivatives of $(0.2) million, distributions of $0.1 million from our investment in shares of Guggenheim Credit Income Fund and interest income on deposits and loans to affiliates of less than $0.1 million.

W. P. CAREY INC.

Quarterly Reconciliation of Net Income to Adjusted Funds from Operations (AFFO) (Unaudited)

(in thousands, except share and per share amounts)

Three Months Ended

March 31, 2021

December 31, 2020

March 31, 2020

Net income attributable to W. P. Carey

$

51,634

$

134,572

$

66,090

Adjustments:

Depreciation and amortization of real property

109,204

109,538

114,913

Gain on sale of real estate, net

(9,372)

(76,686)

(11,751)

Impairment charges

—

16,410

19,420

Proportionate share of adjustments to equity in net income of partially owned entities ^{(a) (b) (c)}

10,306

11,819

50,477

Proportionate share of adjustments for noncontrolling interests ^(d)

(4)

(4)

578

Total adjustments

110,134

61,077

173,637

FFO (as defined by NAREIT) Attributable to W. P. Carey ^(e)

161,768

195,649

239,727

Adjustments:

Other (gains) and losses ^(f)

41,188

1,927

9,815

Above- and below-market rent intangible lease amortization, net

12,115

11,504

11,780

Straight-line and other rent adjustments

(8,751)

(9,571)

(7,092)

Stock-based compensation

5,381

5,795

2,661

Amortization of deferred financing costs

3,413

3,209

3,089

Tax (benefit) expense – deferred and other ^{(g) (h)}

(3,387)

32

(47,923)

Merger and other expenses

(476)

(418)

187

Other amortization and non-cash items

29

460

408

Proportionate share of adjustments to equity in net income of partially owned entities ^(c)

5,211

4,246

3,895

Proportionate share of adjustments for noncontrolling interests ^(d)

(5)

(152)

(7)

Total adjustments

54,718

17,032

(23,187)

AFFO Attributable to W. P. Carey ^(e)

$

216,486

$

212,681

$

216,540

Summary

FFO (as defined by NAREIT) attributable to W. P. Carey ^(e)

$

161,768

$

195,649

$

239,727

FFO (as defined by NAREIT) attributable to W. P. Carey per diluted share ^(e)

$

0.91

$

1.11

$

1.38

AFFO attributable to W. P. Carey ^(e)

$

216,486

$

212,681

$

216,540

AFFO attributable to W. P. Carey per diluted share ^(e)

$

1.22

$

1.20

$

1.25

Diluted weighted-average shares outstanding

176,965,510

176,683,474

173,460,053

W. P. CAREY INC.

Quarterly Reconciliation of Net Income from Real Estate to Adjusted Funds from Operations (AFFO) from Real Estate (Unaudited)

(in thousands, except share and per share amounts)

Three Months Ended

March 31, 2021

December 31, 2020

March 31, 2020

Net income from Real Estate attributable to W. P. Carey

$

44,587

$

129,790

$

100,914

Adjustments:

Depreciation and amortization of real property

109,204

109,538

114,913

Gain on sale of real estate, net

(9,372)

(76,686)

(11,751)

Impairment charges

—

16,410

19,420

Proportionate share of adjustments to equity in net income of partially owned entities ^{(a) (c)}

10,306

11,819

3,365

Proportionate share of adjustments for noncontrolling interests ^(d)

(4)

(4)

578

Total adjustments

110,134

61,077

126,525

FFO (as defined by NAREIT) Attributable to W. P. Carey – Real Estate ^(e)

154,721

190,867

227,439

Adjustments:

Other (gains) and losses ^(f)

42,189

1,475

10,973

Above- and below-market rent intangible lease amortization, net

12,115

11,504

11,780

Straight-line and other rent adjustments

(8,751)

(9,571)

(7,092)

Stock-based compensation

5,381

5,795

1,970

Amortization of deferred financing costs

3,413

3,209

3,089

Tax benefit – deferred and other ^(g)

(2,595)

(1,595)

(37,956)

Merger and other expenses

(491)

(724)

(132)

Other amortization and non-cash items

29

460

209

Proportionate share of adjustments to equity in net income of partially owned entities ^(c)

4,322

4,458

(274)

Proportionate share of adjustments for noncontrolling interests ^(d)

(5)

(152)

(7)

Total adjustments

55,607

14,859

(17,440)

AFFO Attributable to W. P. Carey – Real Estate ^(e)

$

210,328

$

205,726

$

209,999

Summary

FFO (as defined by NAREIT) attributable to W. P. Carey – Real Estate ^(e)

$

154,721

$

190,867

$

227,439

FFO (as defined by NAREIT) attributable to W. P. Carey per diluted share – Real Estate ^(e)

$

0.88

$

1.08

$

1.31

AFFO attributable to W. P. Carey – Real Estate ^(e)

$

210,328

$

205,726

$

209,999

AFFO attributable to W. P. Carey per diluted share – Real Estate ^(e)

$

1.19

$

1.16

$

1.21

Diluted weighted-average shares outstanding

176,965,510

176,683,474

173,460,053

__________

(a)

Amount for the three months ended March 31, 2021 includes a non-cash other-than-temporary impairment charge of $6.8 million recognized on an equity method investment in real estate. Amount for the three months ended December 31, 2020 includes a non-cash other-than-temporary impairment charge of $8.3 million recognized on another equity method investment in real estate.

(b)

Amount for the three months ended March 31, 2020 includes non-cash other-than-temporary impairment charges totaling $47.1 million recognized on our former equity investments in CWI 1 and CWI 2.

(c)

Equity income, including amounts that are not typically recognized for FFO and AFFO, is recognized within Equity in earnings of equity method investments in the Managed Programs and real estate on the consolidated statements of income. This represents adjustments to equity income to reflect FFO and AFFO on a pro rata basis.

(d)

Adjustments disclosed elsewhere in this reconciliation are on a consolidated basis. This adjustment reflects our FFO or AFFO on a pro rata basis.

(e)

FFO and AFFO are non-GAAP measures. See below for a description of FFO and AFFO.

(f)

Adjustment amounts for the three months ended March 31, 2021 are primarily comprised of loss on extinguishment of debt of $(59.9) million (of which $(31.7) million mainly comprised fees for the prepayment of certain non-recourse mortgage loans and $(28.2) million mainly comprised a “make-whole” amount paid in connection with the redemption of €500 million of 2.0% Senior Unsecured Notes due 2023 in March 2021), a mark-to-market unrealized gain for our investment in Lineage Logistics of $23.4 million and net loss on foreign currency transactions of $(7.5) million. Amounts from period to period will not be comparable due to unpredictable fluctuations in these gains and losses.

(g)

Amount for the three months ended March 31, 2020 includes a non-cash deferred tax benefit of $37.2 million as a result of the release of a deferred tax liability relating to our investment in shares of Lineage Logistics, which converted to a REIT during that period and is therefore no longer subject to federal and state income taxes.

(h)

Amount for the three months ended March 31, 2020 includes a one-time tax benefit of $7.2 million as a result of carrying back certain net operating losses in accordance with the CARES Act, which was enacted on March 27, 2020.

Non-GAAP Financial Disclosure

Funds from Operations (FFO) and Adjusted Funds from Operations (AFFO)

Due to certain unique operating characteristics of real estate companies, as discussed below, the National Association of Real Estate Investment Trusts, Inc. (NAREIT), an industry trade group, has promulgated a non-GAAP measure known as FFO, which we believe to be an appropriate supplemental measure, when used in addition to and in conjunction with results presented in accordance with GAAP, to reflect the operating performance of a REIT. The use of FFO is recommended by the REIT industry as a supplemental non-GAAP measure. FFO is not equivalent to, nor a substitute for, net income or loss as determined under GAAP.

We define FFO, a non-GAAP measure, consistent with the standards established by the White Paper on FFO approved by the Board of Governors of NAREIT, as restated in December 2018. The White Paper defines FFO as net income or loss computed in accordance with GAAP, excluding gains or losses from sales of property, impairment charges on real estate, gains or losses on changes in control of interests in real estate and depreciation and amortization from real estate assets; and after adjustments for unconsolidated partnerships and jointly owned investments. Adjustments for unconsolidated partnerships and jointly owned investments are calculated to reflect FFO.

We also modify the NAREIT computation of FFO to adjust GAAP net income for certain non-cash charges, such as amortization of real estate-related intangibles, deferred income tax benefits and expenses, straight-line rent and related reserves, other non-cash rent adjustments, non-cash allowance for credit losses on loans receivable and direct financing leases, stock-based compensation, non-cash environmental accretion expense, amortization of discounts and premiums on debt and amortization of deferred financing costs. Our assessment of our operations is focused on long-term sustainability and not on such non-cash items, which may cause short-term fluctuations in net income but have no impact on cash flows. Additionally, we exclude non-core income and expenses, such as gains or losses from extinguishment of debt and merger and acquisition expenses. We also exclude realized and unrealized gains/losses on foreign currency exchange transactions (other than those realized on the settlement of foreign currency derivatives), which are not considered fundamental attributes of our business plan and do not affect our overall long-term operating performance. We refer to our modified definition of FFO as AFFO. We exclude these items from GAAP net income to arrive at AFFO as they are not the primary drivers in our decision-making process and excluding these items provides investors a view of our portfolio performance over time and makes it more comparable to other REITs that are currently not engaged in acquisitions, mergers and restructuring, which are not part of our normal business operations. AFFO also reflects adjustments for unconsolidated partnerships and jointly owned investments. We use AFFO as one measure of our operating performance when we formulate corporate goals, evaluate the effectiveness of our strategies and determine executive compensation.

We believe that AFFO is a useful supplemental measure for investors to consider as we believe it will help them to better assess the sustainability of our operating performance without the potentially distorting impact of these short-term fluctuations. However, there are limits on the usefulness of AFFO to investors. For example, impairment charges and unrealized foreign currency losses that we exclude may become actual realized losses upon the ultimate disposition of the properties in the form of lower cash proceeds or other considerations. We use our FFO and AFFO measures as supplemental financial measures of operating performance. We do not use our FFO and AFFO measures as, nor should they be considered to be, alternatives to net income computed under GAAP, or as alternatives to net cash provided by operating activities computed under GAAP, or as indicators of our ability to fund our cash needs.

Institutional Investors:

Peter Sands

W. P. Carey Inc.
212-492-1110
[email protected]

Individual Investors:
W. P. Carey Inc.
212-492-8920
[email protected]

Press Contact:

Anna McGrath

W. P. Carey Inc.
212-492-1166
[email protected]

View original content to download multimedia:http://www.prnewswire.com/news-releases/w-p-carey-inc-announces-first-quarter-2021-financial-results-301280856.html

SOURCE W. P. Carey Inc.

Posted on April 30, 2021 7:33 am
Global Fashion Retailer Selects Pivotree to Accelerate Its Unified Commerce Journey

PR Newswire

Standardizing Order Management processes between SAP Commerce and POS system will provide customers with a more frictionless experience

TORONTO, April 30, 2021 /PRNewswire/ – Pivotree Inc. (TSXV: PVT) (“Pivotree” or the “Company”), a leading provider of Frictionless Commerce solutions, today announced that one of North America’s leading fashion and accessory retailers and a longstanding client has selected Pivotree to modernize its unified commerce platform and further evolve its Frictionless Commerce strategy.

Leveraging their deep knowledge of the retail industry, eCommerce strategy and cutting-edge online technologies, Pivotree will replace the retailer’s legacy order management system with a next-generation solution based on Fluent Commerce. The goal is to seamlessly integrate the front end experience from both digital (SAP Commerce) and in-store (POS) with a unified back end processes enabling a better customer experience through inventory visibility across locations, ability to order and pick up in different locations or channels, splitting orders, and other features. This will give the retailer the flexibility it needs to easily adapt to fluctuations in inventory and other changes in the marketplace. The new unified commerce foundation will also provide customers with a single, optimized ordering experience across in-store and online channels, reducing transaction friction and driving sales.

The retailer will also reap the benefits that come with greater platform efficiency. By eliminating its aging order management technology, the company will enjoy decreased support costs, reduce the time it takes for its development team to launch customer-facing innovations, and bring it another step closer to offering a true omnichannel experience.

Given the long and trusted partnership, the client knew Pivotree had the understanding of its business and the strategic vision needed to help it complete this important part of its frictionless commerce journey, which requires a holistic view of both the customer journey and the ever-changing technology landscape in order to build business agility into every step of the process.

More information on how Pivotree can help retailers deliver seamless e-commerce experiences can be found at https://pivotree.com/services/by-industry/retail/. To learn more about Pivotree’s strategy for frictionless thinking, click here.

About Pivotree

Pivotree is a leading global commerce and MDM services provider. It is an end-to-end vendor supporting clients from strategy, platform selection, deployment, and hosting through to ongoing support. It operates as a single expert resource to help companies adapt relentlessly in an ever-changing digital commerce landscape. Leading and innovative clients rely on Pivotree’s deep expertise to choose enterprise-proven solutions and design, build, and connect critical systems to run smoothly at defining moments in a commerce business. Pivotree serves as a trusted partner to over 170 market-leading brands and forward-thinking B2C and B2B companies, including many companies in the Fortune 1000. With offices and customers in the Americas, EMEA, and APAC, Pivotree is widely recognized as a high-growth company and industry leader around the globe. For more information, visit http://www.pivotree.com.

Neither 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.

View original content to download multimedia:http://www.prnewswire.com/news-releases/global-fashion-retailer-selects-pivotree-to-accelerate-its-unified-commerce-journey-301280829.html

SOURCE Pivotree Inc.

Posted on April 30, 2021 7:33 am
Fannie Mae Reports Net Income of $5.0 Billion for First Quarter 2021

PR Newswire

WASHINGTON, April 30, 2021 /PRNewswire/ — Fannie Mae (OTCQB: FNMA) today reported its first quarter 2021 financial results and filed its first quarter 2021 Form 10-Q with the Securities and Exchange Commission. The filing provides condensed consolidated financial statements for the quarter ended March 31, 2021. The following documents are now available on Fannie Mae’s website at www.fanniemae.com.

News release reporting f
irst qu
arter 20
21
financial results

Fannie Mae’s Form 10-
Q
for the
quarter
ended
March
31, 202
1

Q
1
202
1
Financial Supplement

Fannie Mae will host a conference call to discuss the company’s results today at 8:00 a.m., ET. Other participants may join the conference call in listen-only mode in one of the following formats:

Listen-only webcast:

https://event.webcasts.com/starthere.jsp?ei=1449813&tp_key=18286208a4

Click on the link above to attend the presentation from your laptop, tablet, or mobile device. Audio will stream through your selected device. If you have difficulty accessing the webcast, please click the “Listen by Phone” button on the webcast player and dial the number provided.

Listen-only phone line:

It is not necessary to dial into the audio conference unless you are unable to join the webcast via the URL above.
United States:   888-204-4368
Passcode:         6638904#

About Fannie Mae
Fannie Mae helps make the 30-year fixed-rate mortgage and affordable rental housing possible for millions of people in America. We partner with lenders to create housing opportunities for families across the country. We are driving positive changes in housing finance to make the home buying process easier, while reducing costs and risk. To learn more, visit:
fanniemae.com | Twitter | Facebook | LinkedIn | Instagram | YouTube | Blog

Fannie Mae Newsroom

https://www.fanniemae.com/news

Photo of Fannie Mae

https://www.fanniemae.com/resources/img/about-fm/fm-building.tif

Fannie Mae Resource Center
1-800-2FANNIE

View original content:http://www.prnewswire.com/news-releases/fannie-mae-reports-net-income-of-5-0-billion-for-first-quarter-2021–301281137.html

SOURCE Fannie Mae

Posted on April 30, 2021 7:33 am
Medivolve Announces Appointment of David Preiner as New Chief Executive Officer

TORONTO, April 30, 2021 (GLOBE NEWSWIRE) — Medivolve Inc. (“Medivolve”) (NEO:MEDV; OTC:COPRF; FRA:4NC) a healthcare investment management company that seeks out disruptive technologies, ground-breaking innovations and exclusive partnerships to help combat COVID-19, today announced that David Preiner has been appointed Chief Executive Officer (CEO), effective immediately. Preiner will succeed Doug Sommerville, who will assist as a transitionary advisor to the new CEO. As Medivolve’s CEO, Preiner will lead a team of computer scientists, engineers, and physicians to build a next-generation, data-driven healthcare system set to transform human health management across the United States.

Harvard educated BLA candidate in Biology, Preiner is experienced in the intersectionality of biotechnology, artificial intelligence and nanotechnology to accelerate translational science and molecular discovery. Successful entrepreneur with a track record in bootstrapping, leading and scaling startups into multimillion dollar companies, Preiner’s appointment reflects Medivolve’s commitment to searching for and investing in breakthrough sciences, technologies, research, and resolutions to shape the future of healthcare.

“It’s been a great privilege to lead Medivolve and to have overseen the company’s transformation from investment issuer to a leader in disruptive medical technologies focused on the prevention, detection and treatment of COVID-19, and future delivery of medical technology and services,” said Doug Sommerville, former CEO and ongoing Medivolve advisor. “David’s appointment comes at a critical inflection point in Medivolve’s evolution, and we are thrilled to have someone with such a unique blend of proven scientific and entrepreneurial experience build on the company’s momentum and take advantage of the market opportunities ahead.”

Preiner will serve concurrently as CEO of Xenomics, a private biotechnology company he founded in 2019, where he leads a PhD-level team focused on advancing breakthroughs in genetics and biomanufacturing to combat global sustainability issues in food, energy, and health. Preiner’s role as CEO of Medivolve and Xenomics is a strategic decision structured to enable both companies to capitalize on opportunities to leverage high-performance computing partnerships and talent, while drastically reducing capital requirements.

“I am incredibly excited and honored to lead our mission-driven company into the next wave of growth,” said David Preiner, CEO, Medivolve. “It has been a formative year for almost every person on the planet. Confronted with the reality of a fragile societal infrastructure and gaping health disparities, the COVID-19 pandemic magnified an already existing need to reimagine how healthcare is designed, offered and customized to align with the world we live in and the unique needs of the people who live in it. We have a tremendous opportunity here at Medivolve to leverage emerging technologies, scientific discoveries and data-driven insights to transform and sustainably manage American healthcare for the long-term.”

Prior to joining Medivolve, Preiner led a series of academic projects, successful startups, and philanthropic endeavors. At Biotii Technologies, he worked to unlock the therapeutic potential of synthetic cannabinoids in treating a broad range of disease conditions. As an academic, Preiner earned accolades as the Microsoft Prize Winner at Hack Harvard in 2015, Intel Prize Winner at Stanford TreeHacks in 2016, and 3rd Place Winner at Yale Hack Health in 2016. While pursuing his studies at Harvard, he worked as a clinical technician in the Neurology Department at Boston Children’s Hospital. Before resuming his education, he co-founded, led and successfully grew four startups.

Outside of healthcare innovation, Preiner is also known for his humanitarian work. In the wake of the 2010 Haitian earthquake, he took on leadership roles in partnership with local NGOs to distribute fresh water and rebuild and restore nearly 15 schools.

Sommerville is stepping down as Medivolve CEO and a director to pursue personal interests and to focus on his board and advisory roles.

The Company has granted 1,000,000 stock options to Preiner pursuant to the Company’s stock option plan. The stock options vest immediately and may be exercised at a price of $0.155 per common share for a period of five years from the date of grant.

About Medivolve Inc.

Medivolve Inc. (NEO:MEDV; OTC:COPRF; FRA:4NC) focuses on commercializing technologies to help combat the COVID-19 pandemic. This includes providing convenient and accessible medical services for testing, prevention and treatment. Medivolve is comprised of a team of renowned global medical and business advisors who are committed to helping fulfill Medivolve’s mission of searching for and investing in breakthrough sciences, technologies, research or resolutions to empower the betterment of mankind. This panel includes prominent Stanford neurologist and immunologist Dr. Lawrence Steinman as well as Dr. Glenn Copeland, one of North America’s most prominent orthopedic treatment and sports medicine specialists. Through its braintrust of industry specialists, thought leaders, influencers, and opinion makers, Medivolve has also developed a proprietary strategy to capitalize on high-margin opportunities across three areas: the prevention, detection, and treatment of COVID-19.

For investing inquiries, please contact:
[email protected]

For U.S. media inquiries, please contact:
Sophia Powe
[email protected]

Cautionary Note Regarding Forward-looking Information

This press release contains “forward-looking information” within the meaning of applicable Canadian securities legislation. Forward-looking information includes, but is not limited to, statements with respect to the appointment and resignation of officers and directors; the pursuit by Medivolve of opportunities; and the merits or potential returns of any such opportunities. Generally, forward-looking information can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved”. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company, as the case may be, to be materially different from those expressed or implied by such forward-looking information. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws.

NEITHER THE NEO EXCHANGE NOR ITS REGULATION SERVICES PROVIDER HAS REVIEWED OR ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

Posted on April 30, 2021 7:33 am
United Fire Group, Inc. Updates Catastrophe Loss Estimates for First Quarter 2021

CEDAR RAPIDS, Iowa, April 30, 2021 (GLOBE NEWSWIRE) — United Fire Group, Inc. (the “Company” or “UFG”) (Nasdaq: UFCS) announced today that the first quarter 2021 results include estimated pre-tax catastrophe losses of $29 million. The higher than average catastrophe losses in the first quarter of 2021 were primarily from winter storm Uri. As previously released as an estimate on March 1, 2021, this catastrophic event was a full retention loss, with losses in excess of our stated reinsurance retention of $20.0 million.

United Fire Group, Inc. will report first quarter 2021 earnings before the market opens on May 5, 2021, and will host a conference call to discuss its financial results at 9:00 a.m. Central Time on that date.

————————————————————————————————————————————————-
About UFG

Founded in 1946 as United Fire & Casualty Company, UFG, through its insurance company subsidiaries, is engaged in the business of writing property and casualty insurance.

Through our subsidiaries, we are licensed as a property and casualty insurer in 50 states, plus the District of Columbia, and we are represented by approximately 1,000 independent agencies. A.M. Best Company assigns a rating of “A” (Excellent) for members of the United Fire & Casualty Group.

For more information about UFG visit www.ufginsurance.com.

Contact:
Randy Patten, AVP & Controller, 319-286-2537 or [email protected]

Disclosure of Forward-Looking Statements

This release may contain forward-looking statements about our operations, anticipated performance and other similar matters. The Private Securities Litigation Reform Act of 1995 provides a safe harbor under the Securities Act of 1933 and the Securities Exchange Act of 1934 for forward-looking statements. The forward-looking statements are not historical facts and involve risks and uncertainties that could cause actual results to differ from those expected and/or projected. Such forward-looking statements are based on current expectations, estimates, forecasts and projections about the Company, the industry in which we operate, and beliefs and assumptions made by management. Words such as “expect(s),” “anticipate(s),” “intend(s),” “plan(s),” “believe(s),” “continue(s),” “seek(s),” “estimate(s),” “goal(s),” “remain(s) optimistic,” “target(s),” “forecast(s),” “project(s),” “predict(s),” “should,” “could,” “may,” “will,” “might,” “hope,” “can” and other words and terms of similar meaning or expression in connection with a discussion of future operations, financial performance or financial condition, are intended to identify forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed in such forward-looking statements. Information concerning factors that could cause actual outcomes and results to differ materially from those expressed in the forward-looking statements is contained in Part I, Item 1A “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2020, filed with the Securities and Exchange Commission (“SEC”) on February 26, 2021. The risks identified in our Annual Report on Form 10-K and in our other SEC filings are representative of the risks, uncertainties, and assumptions that could cause actual outcomes and results to differ materially from what is expressed in the forward-looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release or as of the date they are made. Except as required under the federal securities laws and the rules and regulations of the SEC, we do not have any intention or obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise.

Posted on April 30, 2021 7:33 am
Pipestone Energy Corp. Announces it Has Successfully Renewed Its $225 Million Reserve Based Loan

CALGARY, Alberta, April 30, 2021 (GLOBE NEWSWIRE) — (PIPE – TSX) Pipestone Energy Corp. (“Pipestone Energy” or the “Company”) is pleased to announce that is has successfully renewed and extended its Reserve Based Loan (“RBL” or “Credit Facility”) with its syndicate of banks, re-affirming its borrowing base at $225 million.

Pipestone Energy has closed on its RBL renewal with its corporate banking syndicate, consisting of National Bank Financial Inc., Bank of Montreal, ATB Financial, and Canadian Western Bank. The Credit Facility’s borrowing base and available capacity has been maintained at $225 million on a fully conforming basis. The revolving period for the RBL has been extended to May 31, 2022 with a maturity of May 31, 2023. The next borrowing base redetermination is scheduled for November 2021. The RBL renewal and extension ensures Pipestone Energy is fully funded to execute its previously released growth plans.

First Quarter 2021 Conference Call

Following our Q1 2021 financial and operations update release, a conference call has been scheduled for May 12^th, 2021 at 9:00 a.m. Mountain Daylight Time (11:00 a.m. Eastern Daylight Time) to update interested investors, analysts, brokers, and media representatives on the Company’s operations and Q1 2021 highlights.

Conference Call Details:

Toll-Free: (866) 953-0776
International: (630) 652-5852
Conference ID: 8981815

An archived recording of the conference call will be available shortly after the event and will be available until May 19, 2021. To access the replay please dial toll free in North America (855) 859-2056 or International (404) 537-3406 and enter 8981815 when prompted.

Advisory Regarding Forward-Looking Statement

In the interest of providing shareholders of Pipestone Energy and potential investors information regarding Pipestone Energy, this news release contains certain information and statements (“forward-looking statements”) that constitute forward-looking information within the meaning of applicable Canadian securities laws. Forward-looking statements relate to future results or events, are based upon internal plans, intentions, expectations and beliefs, and are subject to risks and uncertainties that may cause actual results or events to differ materially from those indicated or suggested therein. All statements other than statements of current or historical fact constitute forward-looking statements. Forward-looking statements are typically, but not always, identified by words such as “anticipate”, “estimate”, “expect”, “intend”, “forecast”, “continue”, “propose”, “may”, “will”, “should”, “believe”, “plan”, “target”, “objective”, “project”, “potential” and similar or other expressions indicating or suggesting future results or events.

Forward-looking statements are not promises of future outcomes. There is no assurance that the results or events indicated or suggested by the forward-looking statements, or the plans, intentions, expectations or beliefs contained therein or upon which they are based, are correct or will in fact occur or be realized (or if they do, what benefits Pipestone Energy may derive therefrom).

In particular, but without limiting the foregoing, this news release contains forward-looking statements pertaining to the execution of future growth plans.

With respect to the forward-looking statements contained in this news release, Pipestone Energy has assessed material factors and made assumptions regarding, among other things: future commodity prices and currency exchange rates, including consistency of future oil, natural gas liquids (NGLs) and natural gas prices with current commodity price forecasts; the economic impacts of the COVID-19 pandemic and volatility caused by OPEC; Pipestone Energy’s continued ability to obtain qualified staff and equipment in a timely and cost-efficient manner; the predictability of future results based on past and current experience; the predictability and consistency of the legislative and regulatory regime governing royalties, taxes, environmental matters and oil and gas operations, both provincially and federally; Pipestone Energy’s ability to successfully market its production of oil, NGLs and natural gas; the timing and success of drilling and completion activities (and the extent to which the results thereof meet expectations); Pipestone Energy’s future production levels and amount of future capital investment, and their consistency with Pipestone Energy’s current development plans and budget; future capital expenditure requirements and the sufficiency thereof to achieve Pipestone Energy’s objectives; the successful application of drilling and completion technology and processes; the applicability of new technologies for recovery and production of Pipestone Energy’s reserves and other resources, and their ability to improve capital and operational efficiencies in the future; the recoverability of Pipestone Energy’s reserves and other resources; Pipestone Energy’s ability to economically produce oil and gas from its properties and the timing and cost to do so; the performance of both new and existing wells; future cash flows from production; future sources of funding for Pipestone Energy’s capital program, and its ability to obtain external financing when required and on acceptable terms; future debt levels; geological and engineering estimates in respect of Pipestone Energy’s reserves and other resources; the accuracy of geological and geophysical data and the interpretation thereof; the geography of the areas in which Pipestone Energy conducts exploration and development activities; the timely receipt of required regulatory approvals; the access, economic, regulatory and physical limitations to which Pipestone Energy may be subject from time to time; and the impact of industry competition.

The forward-looking statements contained herein reflect management’s current views, but the assessments and assumptions upon which they are based may prove to be incorrect. Although Pipestone Energy believes that its underlying assessments and assumptions are reasonable based on currently available information, undue reliance should not be placed on forward-looking statements, which are inherently uncertain, depend upon the accuracy of such assessments and assumptions, and are subject to known and unknown risks, uncertainties and other factors, both general and specific, many of which are beyond Pipestone Energy’s control, that may cause actual results or events to differ materially from those indicated or suggested in the forward-looking statements. Such risks and uncertainties include, but are not limited to, volatility in market prices and demand for oil, NGLs and natural gas and hedging activities related thereto; the ability to successfully integrate Blackbird’s and Pipestone Oil’s historical businesses and operations; general economic, business and industry conditions; variance of Pipestone Energy’s actual capital costs, operating costs and economic returns from those anticipated; the ability to find, develop or acquire additional reserves and the availability of the capital or financing necessary to do so on satisfactory terms; and risks related to the exploration, development and production of oil and natural gas reserves and resources. Additional risks, uncertainties and other factors are discussed in Pipestone Energy’s MD&A for the year ended December 31, 2020 dated March 10, 2021 and in Pipestone Energy’s annual information form dated March 10, 2021, copies of which are available electronically on Pipestone Energy’s SEDAR at www.sedar.com.

The forward-looking statements contained in this news release are made as of the date hereof and Pipestone Energy assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by applicable securities laws. All forward-looking statements herein are expressly qualified by this advisory.

Pipestone Energy Corp.

Pipestone Energy Corp. is an oil and gas exploration and production company with its head office located in Calgary, Alberta. The company is focused on developing its pure-play condensate-rich Montney asset in the Pipestone area near Grande Prairie. Pipestone Energy is committed to building long term value for our shareholders and values the partnerships that it is developing within its operating community. Pipestone Energy shares trade under the symbol PIPE on the TSX. For more information, visit www.pipestonecorp.com.

Pipestone Energy Contacts:

Paul Wanklyn
President and Chief Executive Officer
(587) 392-8407
[email protected] Craig Nieboer
Chief Financial Officer
(587) 392-8408
[email protected]

Dan van Kessel
VP Corporate Development
(587) 392-8414
[email protected]

Posted on April 30, 2021 7:33 am
Level One Bancorp, Inc. reports first quarter 2021 net income of $9.0 million, representing $1.10 diluted earnings per common share

FARMINGTON HILLS, Mich., April 30, 2021 (GLOBE NEWSWIRE) — Level One Bancorp, Inc. (“Level One”) (Nasdaq: LEVL) today reported its financial results for the first quarter of 2021, which included net income of $9.0 million, or $1.10 diluted earnings per common share. This compares to net income of $8.4 million, or $1.02 diluted earnings per common share, in the preceding quarter and $4.1 million, or $0.53 diluted earnings per common share, in the first quarter of 2020.

Patrick J. Fehring, President and Chief Executive Officer of Level One, commented, “We are pleased to report record quarterly earnings for the first quarter of 2021. Net income in the first quarter of 2021 was $9.0 million, which represents an increase of 117.98% over the first quarter of the prior year and an increase of 7.00% over the prior quarter. During the quarter we experienced continued loan growth, a high level of residential loan production, moderately improving credit trends, stable core net interest margin, and strong deposit growth. Throughout this pandemic we continue to grow our business by meeting the needs of our current clients and significantly growing the number of new clients we serve. In 2021, we have provided solid support to local businesses and communities with our participation in the second round of the Paycheck Protection Program (“PPP”). Our participation in the second round of the program has resulted in the Level One team originating close to 1,500 loans to businesses for approximately $230.5 million from January 18, 2021 through April 27, 2021. An estimated 20,000 jobs were supported through these efforts. In addition to meeting the needs of existing Level One clients, we also assisted over 600 new business clients obtain critical funding to support their operations through this second round of PPP funding. I am appreciative of the extraordinary efforts of the Level One team during this COVID-19 pandemic as we continue to provide needed financial services to our community.”

First
Quarter 2021 Highlights

Net income of $9.0 million increased 7.00% from $8.4 million in the preceding quarter

Diluted earnings per common share of $1.10 increased 7.84% compared to $1.02 in the preceding quarter

Net interest margin, on a fully taxable equivalent (“FTE”) basis, was 3.33%, compared to 3.27% in the preceding quarter

Noninterest income decreased $832 thousand to $7.3 million in the first quarter of 2021, compared to $8.1 million in the preceding quarter

Noninterest expense decreased $322 thousand to $15.1 million in the first quarter of 2021, compared to $15.5 million in the preceding quarter

Provision for loan loss decreased $1.3 million to $265 thousand in the first quarter of 2021, compared to $1.5 million in the preceding quarter

Total assets increased 5.31% to $2.57 billion at March 31, 2021, compared to $2.44 billion at December 31, 2020

Total loans increased 8.02% to $1.86 billion at March 31, 2021, compared to $1.72 billion at December 31, 2020

Total deposits increased 6.65% to $2.09 billion at March 31, 2021, compared to $1.96 billion at December 31, 2020

Book value per common share increased 1.03% to $25.40 per common share at March 31, 2021, compared to $25.14 per common share at December 31, 2020

Tangible book value per common share increased 0.76% to $19.78 per common share at March 31, 2021, compared to $19.63 per common share at December 31, 2020

Net Interest Income and Net Interest Margin

Level One’s net interest income increased $51 thousand, or 0.27%, to $19.2 million in the first quarter of 2021, compared to $19.1 million in the preceding quarter, and increased $4.3 million, or 29.26%, compared to $14.8 million in the first quarter of 2020. The increase in net interest income compared to the first quarter of 2020 was primarily due to increases of $1.8 million of interest income on loans and $178 thousand of interest income on investment securities partially offset by a $239 thousand decrease of interest income on fed funds sold and other investments. In addition, interest expense on deposits decreased $2.4 million primarily due to the target federal funds rate dropping 150 basis points in March 2020 in response to the COVID-19 pandemic.

Level One’s net interest margin, on a FTE basis, was 3.33% in the first quarter of 2021, compared to 3.27% in the preceding quarter and 3.42% in the first quarter of 2020. The increase in the net interest margin compared to the preceding quarter was primarily a result of the slight increase in loan interest rates during the first quarter of 2021. Loan yield on non-PPP loans was 4.33% for the first quarter of 2021 compared to 4.17% in the preceding quarter. The decrease in the net interest margin compared to the first quarter of 2020 was a result of lower yields across most interest-earning assets, mostly reflecting the impact of lower market interest rates. Average loan yield decreased 65 basis points to 4.35% for the first quarter of 2021 from 5.00% for the first quarter of 2020, primarily due to the target federal funds rate dropping 150 basis points in March 2020 in response to the COVID-19 pandemic. The decrease in loan yields was accompanied by a corresponding decrease in the cost of funds, which declined 93 basis points to 0.63% in the first quarter of 2021, compared to 1.56% in the first quarter of 2020 primarily due to lower interest rates paid as a result of revised internal deposit rates, mainly driven by the decreases in the target federal funds rate.

Noninterest Income

Level One’s noninterest income decreased $832 thousand, or 10.26%, to $7.3 million in the first quarter of 2021, compared to $8.1 million in the preceding quarter, and increased $2.6 million, or 55.44%, compared to $4.7 million in the first quarter of 2020. The decrease in noninterest income compared to the preceding quarter was primarily attributable to a decrease of $999 thousand in mortgage banking activities partially offset by an increase of $129 thousand in service charges on deposits. The decrease in the mortgage banking activities income compared to the fourth quarter of 2020 was primarily due to the increase in interest rates and secondary market pricing.

The increase in noninterest income year over year was primarily due to an increase of $3.2 million in mortgage banking activities and an increase of $143 thousand in service charges on deposits. This was partially offset by decreases of $509 thousand in net gains on sales of investment securities and $269 thousand in other charges and fees. The increase in mortgage banking activities compared to the first quarter of 2020 was primarily due to $65.5 million higher residential loan originations held for sale and $90.1 million higher residential loans sold primarily as a result of higher volumes caused by the lower interest rate environment. The decrease in net gains on sales of investment securities was due to fewer securities sold in the first quarter of 2021 than in the first quarter of 2020. The decrease in other charges and fees was primarily due to a decrease in interest rate swap fees.

Noninterest Expense

Level One’s noninterest expense decreased $322 thousand, or 2.08%, to $15.1 million in the first quarter of 2021, compared to $15.5 million in the preceding quarter, and increased $577 thousand, or 3.96%, compared to $14.6 million in the first quarter of 2020. The decrease in noninterest expense compared to the preceding quarter was primarily attributable to decreases of $292 thousand in salary and employee benefits, $151 thousand in professional service fees, and $114 thousand in marketing expense. These decreases were partially offset by an increase of $365 thousand in data processing expense. The decrease in salary and employee benefits compared to the fourth quarter of 2020 was primarily due to decreases of $425 thousand in incentive compensation, $111 thousand in supplemental employee retirement plan (“SERP”) expense, and $79 thousand in restricted stock expense. This was partially offset by a $154 thousand increase in mortgage commissions and a $197 thousand increase in social security taxes due to the new year resetting taxable income caps. The decrease in professional service fees was due primarily to internal audit fees and the cyclical nature of services performed. The decrease in marketing expense was primarily due to higher than usual donations during the preceding quarter and advertising. The increase in data processing expense was due primarily to the new loan processing system used for the PPP loans.

The increase in noninterest expense year over year was mainly attributable to increases of $1.3 million in salary and employee benefits, $377 thousand in data processing expense, $251 thousand in professional service fees, $180 thousand in occupancy and equipment expense, and $113 thousand in FDIC premium expense. These increases were partially offset by decreases of $1.5 million in acquisition and due diligence fees and $149 thousand in other expense. The increase in salary and employee benefits between the periods was primarily due to increases of $1.2 million in mortgage commissions expense and $170 thousand in contract labor expenses incurred for the PPP loan program. The increase in data processing expense was due to the same reasons mentioned above. The increase in professional service fees was primarily related to increased residential mortgage volumes and consulting fees for residential mortgage systems incurred as well as increased audit fees. The increase in occupancy and equipment expense was primarily attributable to additional software maintenance and licensing. The increase in FDIC premium expense was primarily due to a lower leverage ratio and an increase in assets year over year. The decrease in acquisition and due diligence fees was primarily due to the merger with Ann Arbor State Bank in the first quarter of 2020. The decrease in other expense was primarily due to the provision on unfunded commitments.

The efficiency ratio, which is a measure of operating expenses as a percentage of net interest income and noninterest income, for the first quarter of 2021 was 57.27%, compared to 56.81% for the preceding quarter and 74.64% in the first quarter of 2020. The decrease in the efficiency ratio year over year was primarily driven by the additional income provided by the acquisition of Ann Arbor State Bank without adding a proportional amount of expense as well as the increase in mortgage banking income, net of commissions, as a result of higher loan volumes.

Income Tax Expense

Level One’s income tax provision was $2.1 million, or 18.78% of pretax income, in the first quarter of 2021, as compared to $1.8 million, or 18.05% of pretax income, in the preceding quarter and $349 thousand, or 7.83% of pretax income, in the first quarter of 2020. The increase in income tax provision year over year was primarily as a result of tax benefits recognized during the first quarter of 2020 that did not occur again in the first quarter of 2021. There was a $290 thousand tax benefit related to the Ann Arbor State Bank net operating loss (NOL) resulting from the CARES Act provision that allowed for NOLs generated in 2018-2020 to be carried back five years. Additionally, disqualified dispositions of Ann Arbor State Bank’s stock options generated a $175 thousand tax benefit.

Loan Portfolio

Total loans were $1.86 billion at March 31, 2021, an increase of $138.2 million, or 8.02%, from $1.72 billion at December 31, 2020, and up $395.3 million, or 26.96%, from $1.47 billion at March 31, 2020. Total loans, excluding PPP loans, increased by $22.5 million, or 1.57%, compared to December 31, 2020. In addition, PPP loans increased $115.6 million, net of SBA forgiveness, compared to December 31, 2020 due to the second round of PPP funding. The growth in total loans compared to March 31, 2020 was primarily due to the origination of $649.6 million of PPP loans during the second and third quarters of 2020 and first quarter of 2021, partially offset by $243.8 million of PPP loans forgiven by the SBA. This was partially offset by a net decrease of $10.5 million in the remainder of the portfolio.

Investment Securities

The investment securities portfolio grew $43.5 million, or 14.38%, to $346.3 million at March 31, 2021, from $302.7 million at December 31, 2020, and up $115.6 million, or 50.11%, from $230.7 million at March 31, 2020. The increase in the investment securities portfolio compared to December 31, 2020 was primarily due to the purchase of $59.1 million of investment securities, offset in part by $2.7 million of sales, calls, or maturity of investment securities. The increase in investment securities compared to March 31, 2020, was primarily due to the purchase of $163.2 million of securities between the two dates using the excess cash balances generated by the payoffs of PPP loans, partially offset by $25.9 million of sales, calls, or maturity of investment securities.

Deposits

Total deposits were $2.09 billion at March 31, 2021, an increase of $130.7 million, or 6.65%, from $1.96 billion at December 31, 2021, and up $623.4 million, or 42.39%, from $1.47 billion at March 31, 2020. The growth in deposits compared to December 31, 2020 and March 31, 2020 was primarily due to organic deposit growth as a result of customers increasing their liquidity. Total deposit composition at March 31, 2021 consisted of 42.28% of demand deposit accounts, 31.14% of savings and money market accounts and 26.58% of time deposits.

Borrowings

Total debt outstanding was $231.0 million at March 31, 2021, an increase of $764 thousand, or 0.35%, from $230.3 million at December 31, 2020, and down $25.2 million, or 9.83%, from $256.2 million at March 31, 2020. The increase in debt outstanding compared to December 31, 2020 was primarily due an increase in repurchase agreements. The decrease in total borrowings compared to March 31, 2020 was primarily due to decreases of $25.0 million in long-term FHLB advances and $4.0 million in short-term FHLB advances that resulted from excess liquidity from higher deposit levels partially offset by an increase of $3.8 million in repurchase agreements.

Asset Quality

Nonaccrual loans were $15.4 million, or 0.83% of total loans, at March 31, 2021, a decrease of $3.5 million from nonaccrual loans of $18.8 million, or 1.09% of total loans, at December 31, 2020, and an increase of $140 thousand from nonaccrual loans of $15.2 million, or 1.04% of total loans, at March 31, 2020. The decrease in nonaccrual loans compared to the prior quarter-end was primarily due to a $2.7 million paydown of a commercial loan relationship and two residential loan relationships totaling $500 thousand moving to accrual status.

Level One had no other real estate owned assets at March 31, 2021 and December 31, 2020, compared to $2.1 million at March 31, 2020. Nonperforming assets, consisting of nonaccrual loans and other real estate owned, as a percentage of total assets were 0.60% at March 31, 2021, compared to 0.77% at December 31, 2020, and 0.89% at March 31, 2020.

Performing troubled debt restructured loans, which are not reported as nonaccrual loans but rather as part of impaired loans, were $765 thousand at March 31, 2021, $1.0 million at December 31, 2020, and $1.1 million at March 31, 2020. Loans to borrowers who are in financial difficulty and who have been granted concessions that may include interest rate reductions, forbearance agreements, and principal deferral or reduction, are categorized as troubled debt restructured loans. In accordance with bank regulatory guidance, troubled debt restructurings do not include short-term modifications made on a good-faith basis in response to the COVID-19 pandemic to borrowers who were current prior to any relief. As of March 31, 2021, there were $22.2 million of loans that remained on a COVID-related deferral compared to $19.8 million as of December 31, 2020. As of March 31, 2021, $10.7 million of those loans had payments deferred greater than six months compared to $11.4 million as of December 31, 2021.

Net recoveries in the first quarter of 2021 were $17 thousand, compared to $496 thousand of net chargeoffs, or 0.11% of average loans on an annualized basis, for the preceding quarter and $174 thousand of net chargeoffs, or 0.05% of average loans on an annualized basis, in the first quarter of 2020. The change compared to the fourth quarter of 2020 was due primarily to decreases of $378 thousand in commercial loan chargeoffs and $176 thousand in residential loan chargeoffs. The year over year change was primarily due to commercial loan chargeoffs in the first quarter of 2020.

Level One’s provision for loan losses in the first quarter of 2021 was a provision expense of $265 thousand, compared to $1.5 million in the preceding quarter and $489 thousand in the first quarter of 2020. The decrease in the provision expense quarter over quarter was primarily due to a decrease of $1.7 million in general reserves as a result of a larger reserve increase in the fourth quarter of 2020 related to the impact of the COVID-19 pandemic on the loan portfolio, as well as a $513 thousand decrease in net chargeoffs, partially offset by an increase in specific reserves of $661 thousand. The decrease in the provision expense year over year was primarily due to a decrease in general reserves of $250 thousand as well as a decrease of $191 thousand in net chargeoffs. This was partially offset by a $215 thousand increase in specific reserves. The Company will continue to evaluate the fluid situation in regard to the COVID-19 pandemic and will take further action to appropriately record additional provision for loan losses or decrease the level of the provision for loan losses should there be any indications of changes in the credit quality of our portfolio as a result of the COVID-19 pandemic.

The allowance for loan losses was $22.6 million, or 1.21% of total loans, at March 31, 2021, compared to $22.3 million, or 1.29% of total loans, at December 31, 2020, and $13.0 million, or 0.89% of total loans, at March 31, 2020. Excluding $405.8 million and $290.1 million of PPP loans, respectively, the allowance for loan losses as a percentage of total loans was 1.55% in the first quarter of 2021, compared to 1.56% in the preceding quarter (See section entitled “GAAP Reconciliation of Non-GAAP Financial Measures” for further details). The allowance for loan losses as a percentage of total loans increased compared to March 31, 2020, primarily due to the trends in delinquencies and nonaccrual loans as well as the stress on the commercial and industrial and commercial real estate owner occupied portfolios, primarily in the restaurant and transportation industries, as a result of the uncertainty surrounding the COVID-19 pandemic. As of March 31, 2021, the allowance for loan losses as a percentage of nonaccrual loans was 146.95%, compared to 118.50% at December 31, 2020, and 85.32% at March 31, 2020. The Company will re-evaluate the appropriateness of the allowance for loan losses in future quarters as needed.

Capital

Total shareholders’ equity was $217.2 million at March 31, 2021, an increase of $1.9 million, or 0.86%, compared with $215.3 million at December 31, 2020 primarily as a result of an increase in retained earnings partially offset by a decrease in accumulated other comprehensive income. Total shareholders’ equity increased $41.4 million, or 23.56%, from $175.8 million at March 31, 2020 attributable to the issuance of preferred stock in the third quarter of 2020 as well as an increase in retained earnings.

Recent Developments

First Quarter Common Stock Dividend

: On March 17, 2021, Level One’s Board of Directors declared a quarterly cash dividend of $0.06 per share. This dividend was paid on April 15, 2021, to stockholders of record at the close of business on March 31, 2021.

Second Quarter Preferred Stock Dividend:
On April 20, 2021, Level One’s Board of Directors declared a quarterly cash dividend of $46.88 per share on its 7.50% Non-Cumulative Perpetual Preferred Stock, Series B. Holders of depositary shares will receive $0.4688 per depositary share. The dividend is payable on May 15, 2021, to shareholders of record at the close of business on April 30, 2021.

Level One’s Response to the COVID-19 Pandemic

: Level One has taken comprehensive steps to help our customers, team members and communities during the current COVID-19 pandemic health crisis. For our customers, we have provided loan payment deferrals and offered fee waivers, among other actions. In addition, from January 18 through April 27, 2021, Level One has funded 1,487 PPP loans for $230.5 million of which 1.150 applications were for loans $150,000 or below.

We are continuing to enable the vast majority of our main office team members to work remotely each day. We have also taken significant actions to help ensure the safety of our team members whose roles require them to come into the office, which includes the development, implementation and communication of protocols necessary for those who return. As of March 31, 2021, we opened branches for walk in services. We will continue to evaluate this fluid situation and take additional actions as necessary.

About Level One Bancorp, Inc.

Level One Bancorp, Inc. is the holding company for Level One Bank, a full-service commercial and consumer bank headquartered in Michigan with assets of approximately $2.57 billion as of March 31, 2021. It operates sixteen banking centers throughout Metro Detroit, Ann Arbor, Grand Rapids, and Jackson and provides a variety of commercial, small business, and consumer banking services. Level One Bank’s success has been recognized both locally and nationally as the U.S. Small Business Administration’s (SBA) “Community Lender of the Year,” one of American Banker Magazine’s “Top 200 Community Banks in the Nation,” one of Metro Detroit’s “Best & Brightest Companies to Work For” and more. Level One Bank’s business banking division provides a broad spectrum of products including lines of credit, term loans, leases, commercial mortgages, SBA loans, MEDC loans, export-import financing, and a full suite of treasury management services. The consumer banking division offers a range of personal checking, savings and CD products and a complete array of consumer loan products including residential mortgages, new construction and renovation loans, home equity lines of credit, auto loans, and credit card services. Level One Bank offers a variety of digital banking services including online banking, robust mobile banking apps, online account opening and online loan applications for individuals and businesses. Level One Bank offers the sophistication of a big bank, the heart of a community bank, and the spirit of an entrepreneur. For more information, visit www.levelonebank.com.

Forward-Looking Statements

This release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect management’s current views of future events and operations. These forward-looking statements are based on the information currently available to the Company as of the date of this release. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “will,” “propose,” “may,” “plan,” “seek,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” “continue” or similar technology. It is important to note that these forward-looking statements are not guarantees of future performance and involve risk and uncertainties, including, but not limited to, the effects of the COVID-19 pandemic, including its potential effects on the economic environment, our customers and our operations, as well as any changes to federal, state or local government laws, regulations or orders in connection with the pandemic, the ability of the Company to implement its strategy and expand its lending operations, changes in interest rates and other general economic, business and political conditions, including changes in the financial markets, changes in benchmark interest rates used to price loans and deposits including the expected elimination of LIBOR, and changes in tax laws, regulations and guidance, as well as other risks described in the Company’s filings with the Securities and Exchange Commission. The Company does not undertake any obligation to update or revise any forward-looking statements to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

Summary Consolidated Financial Information

(Unaudited) As of or for the three months ended,

(Dollars in thousands, except per share data) March 31,
2021 December 31,
2020 September 30,
2020 June 30,
2020 March 31,
2020

Earnings Summary

Interest income $ 21,551 $ 22,181 $ 20,245 $ 20,396 $ 19,817

Interest expense 2,394 3,075 3,648 4,163 4,997

Net interest income 19,157 19,106 16,597 16,233 14,820

Provision for loan losses 265 1,538 4,270 5,575 489

Noninterest income 7,278 8,110 9,125 7,789 4,690

Noninterest expense 15,139 15,461 15,126 15,083 14,562

Income before income taxes 11,031 10,217 6,326 3,364 4,459

Income tax provision 2,072 1,844 1,117 643 349

Net income $ 8,959 $ 8,373 $ 5,209 $ 2,721 $ 4,110

Preferred stock dividends 469 479 — — —

Net income available to common shareholders 8,490 7,894 5,209 2,721 4,110

Net income allocated to participating securities 111 65 40 19 47

Net income attributable to common shareholders $ 8,379 $ 7,829 $ 5,169 $ 2,702 $ 4,063

Per Share Data

Basic earnings per common share $ 1.11 $ 1.02 $ 0.68 $ 0.35 $ 0.53

Diluted earnings per common share 1.10 1.02 0.67 0.35 0.53

Diluted earnings per common share, excluding acquisition and due diligence fees ⁽¹⁾ 1.10 1.02 0.67 0.37 0.68

Book value per common share 25.40 25.14 24.06 23.31 22.74

Tangible book value per common share⁽¹⁾ 19.78 19.63 18.74 18.09 17.54

Preferred shares outstanding (in thousands) 10 10 10 — —

Common shares outstanding (in thousands) 7,630 7,634 7,734 7,734 7,731

Average basic common shares (in thousands) 7,528 7,642 7,675 7,676 7,637

Average diluted common shares (in thousands) 7,612 7,695 7,712 7,721 7,738

Selected Period End Balances

Total assets $ 2,572,726 $ 2,442,982 $ 2,446,447 $ 2,541,696 $ 1,936,823

Securities available-for-sale 346,266 302,732 253,527 217,172 230,671

Total loans 1,861,691 1,723,537 1,843,888 1,815,353 1,466,407

Total deposits 2,093,965 1,963,312 1,943,435 1,821,351 1,470,608

Total liabilities 2,355,539 2,227,655 2,236,979 2,361,437 1,761,055

Total shareholders’ equity 217,187 215,327 209,468 180,259 175,768

Total common shareholders’ equity 193,815 191,955 186.098 180,259 175,768

Tangible common shareholders’ equity⁽¹⁾ 150,887 149,844 144,963 139,913 135,578

Performance and Capital Ratios

Return on average assets (annualized) 1.44 % 1.35 % 0.83 % 0.46 % 0.87 %

Return on average equity (annualized) 16.31 15.61 10.48 6.02 9.40

Net interest margin (fully taxable equivalent)⁽²⁾ 3.33 3.27 2.80 2.98 3.42

Efficiency ratio (noninterest expense/net interest income plus noninterest income) 57.27 56.81 58.81 62.79 74.64

Dividend payout ratio 4.50 4.90 7.41 14.22 7.52

Total shareholders’ equity to total assets 8.44 8.81 8.56 7.09 9.08

Tangible common equity to tangible assets⁽¹⁾ 5.96 6.24 6.03 5.59 7.15

Common equity tier 1 to risk-weighted assets 9.63 9.30 8.83 8.76 8.10

Tier 1 capital to risk-weighted assets 11.11 10.80 10.31 8.76 8.10

Total capital to risk-weighted assets 15.18 14.91 14.39 12.81 11.68

Tier 1 capital to average assets (leverage ratio) 7.15 6.93 7.17 6.21 7.08

Asset Quality Ratios:

Net charge-offs to average loans — % 0.11 % 0.02 % 0.34 % 0.05 %

Nonperforming assets as a percentage of total assets 0.60 0.77 0.79 0.33 0.89

Nonaccrual loans as a percent of total loans 0.83 1.09 1.04 0.46 1.04

Allowance for loan losses as a percentage of total loans 1.21 1.29 1.15 0.94 0.89

Allowance for loan losses as a percentage of nonaccrual loans 146.95 118.50 110.32 206.37 85.32

Allowance for loan losses as a percentage of nonaccrual loans, excluding allowance allocated to loans accounted for under ASC 310-30 142.62 114.95 105.46 195.04 80.34

⁽¹⁾ See section entitled “GAAP Reconciliation of Non-GAAP Financial Measures” below.
⁽²⁾ Presented on a tax equivalent basis using a 21% tax rate.

Consolidated Balance Sheets

As of

March 31, December 31, March 31,

(Dollars in thousands) 2021 2020 2020

Assets
(Unaudited)

(Unaudited)

Cash and cash equivalents $ 224,683 $ 264,071 $ 104,867

Securities available-for-sale 346,266 302,732 230,671

Other investments 14,398 14,398 12,398

Mortgage loans held for sale, at fair value 19,550 43,482 18,305

Loans:

Originated loans 1,647,847 1,498,458 1,188,107

Acquired loans 213,844 225,079 278,300

Total loans 1,861,691 1,723,537 1,466,407

Less: Allowance for loan losses (22,578 ) (22,297 ) (12,989 )

Net loans 1,839,113 1,701,240 1,453,418

Premises and equipment, net 15,523 15,834 16,673

Goodwill 35,554 35,554 36,216

Mortgage servicing rights, net 4,346 3,361 196

Other intangible assets, net 3,028 3,196 3,778

Other real estate owned — — 2,093

Bank-owned life insurance 18,314 18,200 17,848

Income tax benefit 5,823 3,686 630

Interest receivable and other assets 46,128 37,228 39,730

Total assets $ 2,572,726 $ 2,442,982 $ 1,936,823

Liabilities

Deposits:

Noninterest-bearing demand deposits $ 744,688 $ 618,677 $ 410,152

Interest-bearing demand deposits 140,629 127,920 105,197

Money market and savings deposits 652,091 619,900 401,238

Time deposits 556,557 596,815 554,021

Total deposits 2,093,965 1,963,312 1,470,608

Borrowings 186,440 185,684 211,787

Subordinated notes 44,600 44,592 44,447

Other liabilities 30,534 34,067 34,213

Total liabilities 2,355,539 2,227,655 1,761,055

Shareholders’ equity

Preferred stock, no par value per share; authorized-50,000 shares; issued and outstanding – 10,000 shares, with a liquidation preference of $2,500 per share, at March 31, 2021 and December 31, 2020 and 0 at March 31, 2020 23,372 23,372 —

Common stock, no par value per share; authorized – 20,000,000 shares; issued and outstanding – 7,630,342 shares at March 31, 2021, 7,633,780 shares at December 31, 2020 and 7,730,822 shares at March 31, 2020 86,529 87,615 88,910

Retained earnings 104,191 96,158 81,489

Accumulated other comprehensive income, net of tax 3,095 8,182 5,369

Total shareholders’ equity 217,187 215,327 175,768

Total liabilities and shareholders’ equity $ 2,572,726 $ 2,442,982 $ 1,936,823

Consolidated Statements of Income

(Unaudited) For the three months ended

March 31, December 31, March 31,

(In thousands, except per share data) 2021 2020 2020

Interest income

Originated loans, including fees $ 16,822 $ 17,439 $ 14,039

Acquired loans, including fees 3,101 3,234 4,089

Securities:

Taxable 850 747 684

Tax-exempt 623 592 611

Federal funds sold and other 155 169 394

Total interest income 21,551 22,181 19,817

Interest Expense

Deposits 1,387 1,954 3,832

Borrowed funds 466 487 530

Subordinated notes 541 634 635

Total interest expense 2,394 3,075 4,997

Net interest income 19,157 19,106 14,820

Provision expense for loan losses 265 1,538 489

Net interest income after provision for loan losses 18,892 17,568 14,331

Noninterest income

Service charges on deposits 777 648 634

Net gain on sales of securities 20 — 529

Mortgage banking activities 5,811 6,810 2,588

Other charges and fees 670 652 939

Total noninterest income 7,278 8,110 4,690

Noninterest expense

Salary and employee benefits 9,922 10,214 8,630

Occupancy and equipment expense 1,708 1,776 1,528

Professional service fees 643 794 392

Acquisition and due diligence fees — — 1,471

FDIC premium expense 324 397 211

Marketing expense 133 247 222

Loan processing expense 331 245 234

Data processing expense 1,224 859 847

Core deposit premium amortization 168 192 192

Other expense 686 737 835

Total noninterest expense 15,139 15,461 14,562

Income before income taxes 11,031 10,217 4,459

Income tax provision 2,072 1,844 349

Net income 8,959 8,373 4,110

Preferred stock dividends 469 479 —

Net income attributable to common shareholders $ 8,490 $ 7,894 $ 4,110

Earnings per common share:

Basic earnings per common share $ 1.11 $ 1.02 $ 0.53

Diluted earnings per common share $ 1.10 $ 1.02 $ 0.53

Cash dividends declared per common share $ 0.06 $ 0.05 $ 0.05

Weighted average common shares outstanding—basic 7,528 7,642 7,637

Weighted average common shares outstanding—diluted 7,612 7,695 7,738

Net Interest Income and Net Interest Margin

(Unaudited) For the three months ended

March 31, December 31, March 31,

(Dollars in thousands) 2021 2020 2020

Average Balance Sheets:

Gross loans⁽¹⁾ $ 1,856,030 $ 1,832,912 $ 1,458,897

Investment securities: ⁽²⁾

Taxable 214,945 182,522 117,835

Tax-exempt 102,208 92,792 93,858

Interest earning cash balances 168,906 213,502 77,475

Other investments 14,398 14,398 12,387

Total interest-earning assets $ 2,356,487 $ 2,336,126 $ 1,760,452

Non-earning assets 139,100 138,989 121,235

Total assets $ 2,495,587 $ 2,475,115 $ 1,881,687

Interest-bearing demand deposits 132,816 123,201 106,236

Money market and savings deposits 604,491 611,162 403,712

Time deposits 584,085 601,900 547,838

Borrowings 185,688 187,399 185,586

Subordinated notes 44,598 44,569 44,465

Total interest-bearing liabilities $ 1,551,678 $ 1,568,231 $ 1,287,837

Noninterest bearing demand deposits 692,617 659,333 393,519

Other liabilities 31,608 32,990 25,493

Shareholders’ equity 219,684 214,561 174,838

Total liabilities and shareholders’ equity $ 2,495,587 $ 2,475,115 $ 1,881,687

Yields:
⁽³⁾

Earning Assets

Gross loans 4.35 % 4.49 % 5.00 %

Investment securities:

Taxable 1.60 % 1.63 % 2.33 %

Tax-exempt 3.08 % 3.14 % 3.18 %

Interest earning cash balances 0.10 % 0.11 % 1.33 %

Other investments 3.18 % 2.98 % 4.48 %

Total interest earning assets 3.74 % 3.80 % 4.56 %

Interest-bearing liabilities

Interest-bearing demand deposits 0.16 % 0.19 % 0.47 %

Money market and savings deposits 0.25 % 0.35 % 1.10 %

Time deposits 0.66 % 0.89 % 1.91 %

Borrowings 1.02 % 1.03 % 1.15 %

Subordinated notes 4.92 % 5.66 % 5.74 %

Total interest-bearing liabilities 0.63 % 0.78 % 1.56 %

Interest Spread 3.11 % 3.02 % 3.00 %

Net interest margin
⁽⁴⁾ 3.30 % 3.25 % 3.39 %

Tax equivalent effect 0.03 % 0.02 % 0.03 %

Net interest margin on a fully tax equivalent basis 3.33 % 3.27 % 3.42 %

⁽¹⁾ Includes nonaccrual loans.
⁽²⁾ For presentation in this table, average balances and the corresponding average rates for investment securities are based upon historical cost, adjusted for amortization of premiums and accretion of discounts.
⁽³⁾ Average rates and yields are presented on an annual basis and includes a taxable equivalent adjustment to interest income of $152 thousand, $140 thousand, and $130 thousand on tax-exempt securities for the three months ended March 31, 2021, December 31, 2020, and March 31, 2020, respectively, using a federal income tax rate of 21%.
⁽⁴⁾ Net interest margin represents net interest income divided by average total interest-earning assets.

Loan Composition

As of

March 31, December 31, September 30, June 30, March 31,

(Dollars in thousands) 2021 2020 2020 2020 2020

Commercial real estate:
(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

Non-owner occupied $ 449,690 $ 445,810 $ 460,708 $ 451,906 $ 450,694

Owner-occupied 300,175 275,022 269,481 273,577 278,216

Total commercial real estate 749,865 720,832 730,189 725,483 728,910

Commercial and industrial 794,096 685,504 807,923 790,353 469,227

Residential real estate 316,089 315,476 304,088 294,041 262,894

Consumer 1,641 1,725 1,688 5,476 5,376

Total loans $ 1,861,691 $ 1,723,537 $ 1,843,888 $ 1,815,353 $ 1,466,407

Impaired Assets

As of

March 31, December 31, September 30, June 30, March 31,

(Dollars in thousands) 2021 2020 2020 2020 2020

Nonaccrual loans
(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

Commercial real estate $ 4,542 $ 7,320 $ 7,022 $ 3,649 $ 3,721

Commercial and industrial 6,822 7,490 8,078 2,377 9,364

Residential real estate 3,987 3,991 4,151 2,226 2,124

Consumer 13 15 15 16 15

Total nonaccrual loans 15,364 18,816 19,266 8,268 15,224

Other real estate owned — — — 61 2,093

Total nonperforming assets 15,364 18,816 19,266 8,329 17,317

Performing troubled debt restructurings

Commercial and industrial 335 546 550 549 541

Residential real estate 430 432 599 600 599

Total performing troubled debt restructurings 765 978 1,149 1,149 1,140

Total impaired assets $ 16,129 $ 19,794 $ 20,415 $ 9,478 $ 18,457

Loans 90 days or more past due and still accruing $ 328 $ 269 $ 552 $ 903 $ 437

GAAP Reconciliation of Non-GAAP Financial Measures

Some of the financial measures included in this report are not measures of financial condition or performance recognized by GAAP. These non-GAAP financial measures include tangible common shareholders’ equity, tangible book value per common share, the ratio of tangible common equity to tangible assets, net income and diluted earnings per common share excluding acquisition and due diligence fees, and allowance for loan loss as a percentage of total loans, excluding PPP loans. Our management uses these non-GAAP financial measures in its analysis of our performance, and we believe that providing this information to financial analysts and investors allows them to evaluate capital adequacy, as well as better understand and evaluate the Company’s core financial results for the periods in question.

The following presents these non-GAAP financial measures along with their most directly comparable financial measure calculated in accordance with GAAP:

Tangible Common Shareholders’ Equity, Tangible Common Equity to Tangible Assets Ratio and Tangible Book Value Per Common Share

As of

(Dollars in thousands, except per share data) March 31,
2021 December 31,
2020 September 30,
2020 June 30,

2020 March 31,
2020

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

Total shareholders’ equity $ 217,187 $ 215,327 $ 209,468 $ 180,259 $ 175,768

Less:

Preferred stock 23,372 23,372 23,370 — —

Total common shareholders’ equity 193,815 191,955 186,098 180,259 175,768

Less:

Goodwill 35,554 35,554 35,554 35,554 36,216

Mortgage servicing rights, net 4,346 3,361 2,193 1,213 196

Other intangible assets, net 3,028 3,196 3,388 3,579 3,778

Tangible common shareholders’ equity $ 150,887 $ 149,844 $ 144,963 $ 139,913 $ 135,578

Common shares outstanding (in thousands) 7,630 7,634 7,734 7,734 7,731

Tangible book value per common share $ 19.78 $ 19.63 $ 18.74 $ 18.09 $ 17.54

Total assets $ 2,572,726 $ 2,442,982 $ 2,446,447 $ 2,541,696 $ 1,936,823

Less:

Goodwill 35,554 35,554 35,554 35,554 36,216

Mortgage servicing rights, net 4,346 3,361 2,193 1,213 196

Other intangible assets, net 3,028 3,196 3,388 3,579 3,778

Tangible assets $ 2,529,798 $ 2,400,871 $ 2,405,312 $ 2,501,350 $ 1,896,633

Tangible common equity to tangible assets 5.96 % 6.24 % 6.03 % 5.59 % 7.15 %

Adjusted Income and Diluted Earnings Per Share

For the three months ended

(Dollars in thousands, except per share data) March 31,
2021 December 31,
2020 September 30,
2020 June 30,

2020 March 31,
2020

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

Net income, as reported $ 8,959 $ 8,373 $ 5,209 $ 2,721 $ 4,110

Acquisition and due diligence fees — — 17 176 1,471

Income tax (benefit) expense ⁽¹⁾ — 2 (4 ) (34 ) (295 )

Net income, excluding acquisition and due diligence fees $ 8,959 $ 8,375 $ 5,222 $ 2,863 $ 5,286

Diluted earnings per share, as reported $ 1.10 $ 1.02 $ 0.67 $ 0.35 $ 0.53

Effect of acquisition and due diligence fees, net of income tax benefit — — — 0.02 0.15

Diluted earnings per common share, excluding acquisition and due diligence fees $ 1.10 $ 1.02 $ 0.67 $ 0.37 $ 0.68

⁽¹⁾ Assumes income tax rate of 21% on deductible acquisition expenses.

Allowance for Loan Loss as a Percentage of Total Loans, Excluding PPP Loans

As of

(Dollars in thousands, except per share data) March 31,
2021 December 31,
2020 September 30,
2020 June 30,
2020 March 31,
2020

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

Total loans $ 1,861,691 $ 1,723,537 $ 1,843,888 $ 1,815,353 $ 1,466,407

Less:

PPP loans 405,770 290,135 392,521 388,264 —

Total loans, excluding PPP loans $ 1,455,921 $ 1,433,402 $ 1,451,367 $ 1,427,089 $ 1,466,407

Allowance for loan loss $ 22,578 $ 22,297 $ 21,254 $ 17,063 $ 12,989

Allowance for loan loss as a percentage of total loans 1.21 % 1.29 % 1.15 % 0.94 % 0.89 %

Allowance for loan loss as a percentage of total loans, excluding PPP loans 1.55 % 1.56 % 1.46 % 1.20 % 0.89 %

Media Contact: Nicole Ransom (248) 538-2183 Investor Relations Contact: Peter Root (248) 538-2186

Posted on April 30, 2021 7:33 am
Acerus Announces Closing of US$15 Million Secured Loan Facility

TORONTO, April 30, 2021 (GLOBE NEWSWIRE) — Acerus Pharmaceuticals Corporation (the “Company” or “Acerus”) (TSX:ASP; OTCQB:ASPCF) today announced that it has entered into a US$15 million subordinated secured loan facility (the “Loan Facility”), which will be made available to the Company by way of one or more advances under a secured grid promissory note with First Generation Capital Inc. (“First Generation”), a company affiliated with the Chairman of the Board of Directors of Acerus.¹

The Loan Facility is subordinated to the existing facility with SWK Funding LLC (“SWK”) and bears interest at a rate of eight percent (8%) per annum. Subject to the terms of the subordination and intercreditor agreement between First Generation and SWK, the Loan Facility is repayable in full on December 31, 2024, with cash payments of interest and/or principal subject to certain exceptions related to the Company’s market capitalization and the outstanding principal amount of the senior facility with SWK; the Loan Facility can be prepaid in full or in part without penalty following repayment in full of indebtedness owed to SWK. The proceeds from the Loan Facility will be used for ongoing general working capital. A copy of the secured grid promissory note covering the Loan Facility will be filed under the Company’s profile on SEDAR at www.sedar.com.

“We have an ambitious goal of rapidly commercializing NATESTO® in the United States and, as such, need to ensure we have the capital in place to execute on the opportunity at hand. By working with First Generation to establish this Loan Facility, we can focus on leveraging our operations and continuing to implement a successful growth strategy,” said Ed Gudaitis, President and Chief Executive Officer of Acerus. “This financing, combined with our ongoing expansion plans and sales force development efforts, set the stage for success in 2021 and beyond.”

In light of First Generation’s relationship to the Chairman of the Board of Directors of Acerus, the independent members of the Board of Directors, led by the Lead Independent Director, separately met to consider and discuss the Loan Facility. Following the review of such independent members of the Board of Directors, it was unanimously determined that entering into the Loan Facility was in the best interests of Acerus.

About Acerus

Acerus Pharmaceuticals Corporation is a Canadian-based specialty pharmaceutical company focused on the commercialization and development of innovative prescription products that improve patient experience, with a primary focus in the field of men’s health. The Company commercializes its products via its own salesforce in the United States and Canada, and through a global network of licensed distributors in other territories.

Acerus’ shares trade on TSX under the symbol ASP and on OTCQB under the symbol ASPCF. For more information, visit www.aceruspharma.com and follow us on Twitter and LinkedIn.

Notice regarding forward-looking statements

Information in this press release that is not current or historical factual information may constitute forward-looking information within the meaning of securities laws. Implicit in this information are assumptions regarding our future operational results. These assumptions, although considered reasonable by the company at the time of preparation, may prove to be incorrect. Readers are cautioned that actual performance of the company is subject to a number of risks and uncertainties, including with respect to the use of proceeds of the Loan Facility, the anticipated benefits of the Loan Facility and the Company’s ability to meet its obligations under the Loan Facility, and could differ materially from what is currently expected as set out above. For more exhaustive information on these risks and uncertainties you should refer to our annual information form dated March 10, 2021 that is available on www.sedar.com. Forward-looking information contained in this press release is based on our current estimates, expectations and projections, which we believe are reasonable as of the current date. You should not place undue importance on forward-looking information and should not rely upon this information as of any other date. While we may elect to, we are under no obligation and do not undertake to update this information at any particular time, whether as a result of new information, future events or otherwise, except as required by applicable securities laws.

(1) A material change report was not filed at least 21 days prior to the closing of the Loan Facility from First Generation as the terms and conditions of such arrangements were not yet finalized at such time.

Company Contact

[email protected]

Investor Relations Contact

Chris Witty
Acerus Investor Relations
(646) 438-9385
[email protected]

Posted on April 30, 2021 7:33 am
Motus GI Receives FDA Clearance to Market the Pure-Vu® System for Upper GI Endoscopy

FORT LAUDERDALE, Fla., April 30, 2021 (GLOBE NEWSWIRE) — Motus GI Holdings, Inc., (NASDAQ: MOTS) (“Motus GI” or the “Company”), a medical technology company providing endoscopy solutions that improve clinical outcomes and enhance the cost-efficiency associated with the diagnosis and management of gastrointestinal conditions, announced today that it has received 510(k) clearance from the U.S. Food and Drug Administration (“FDA”) for a version of the Pure-Vu® System that is compatible with gastroscopes used during upper gastrointestinal (GI) endoscopy procedures to remove blood, blood clots and debris in order to provide a clear field-of-view for the endoscopist. This proprietary technology is the latest innovation for the Pure-Vu System platform that is specifically designed to integrate with therapeutic gastroscopes to enable safe and rapid cleansing during the procedure, while preserving established procedural workflow and techniques.

“We are pleased to receive FDA clearance for the Pure-Vu System now compatible with gastroscopes for the purpose of providing enhanced visibility during upper GI endoscopies. We believe this regulatory milestone broadens our ability to participate in a larger percentage of procedures performed by our key customers, providing us a natural extension of our commercial strategy. In addition, we have received consistent feedback from leading physicians indicating their view that there is a substantial unmet need in this area, particularly for Upper GI Bleed procedures,” stated Tim Moran, Chief Executive Officer of Motus GI. “This FDA clearance is a testament to our innovation team’s ability to deliver on customer needs in a timely manner.”

Upper GI bleeds occurred in the U.S. at a rate of approximately 400,000 cases per year in 2019, according to iData Research Inc. The existence of blood and blood clots in these patients can impair a physician’s view, making it difficult to identify the bleed source. We believe removing adherent blood clots from the field of view is a significant need in allowing a physician the ability to identify and treat the bleed source. The mortality rate of this condition can reach up to approximately 10%, as noted in Thad Wilkins, MD, et al., American Family Physician (2012).

About the Pure-Vu System

The Pure-Vu System integrates with standard and slim colonoscopes to improve visualization during a colonoscopy while preserving established procedural workflow by irrigating the colon and evacuating debris to provide a better-quality exam. Challenges with bowel preparation for inpatient colonoscopy, particularly patients who are elderly, with comorbidities, or active bleeds, represent a significant area of unmet need that directly affects clinical outcomes and increases the cost of care. Motus GI believes the Pure-Vu System may lead to positive outcomes and lower costs for hospitals by safely and quickly improving visualization of the colon for a quality exam the first time. In multiple clinical studies to date, involving the treatment of challenging inpatient and outpatient cases, the Pure-Vu System has consistently helped achieve adequate bowel cleanliness rates greater than 95% following a reduced prep regimen. Motus GI estimates that in 2021 approximately 4.8 million inpatient colonoscopy procedures will take place worldwide.

The Pure-Vu System has received a CE Mark in the EU and is cleared by the U.S. Food and Drug Administration to help facilitate the cleaning of a poorly prepared colon during the colonoscopy procedure.

About Motus GI

Motus GI Holdings, Inc. is a medical technology company, with subsidiaries in the U.S. and Israel, providing endoscopy solutions that improve clinical outcomes and enhance the cost-efficiency associated with the diagnosis and management of gastrointestinal conditions. For more information, visit www.motusgi.com and connect with the Company on Twitter, LinkedIn and Facebook.

Forward-Looking Statements

This press release contains certain forward-looking statements. Forward-looking statements are based on the Company’s current expectations and assumptions. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements. These statements may be identified by the use of forward-looking expressions, including, but not limited to, “expect,” “anticipate,” “intend,” “plan,” “believe,” “estimate,” “potential,” “predict,” “project,” “should,” “would” and similar expressions and the negatives of those terms, including without limitation, risks related to the Company’s cost reduction plan, the cost savings and the cash expenses related to the implementation of the plan, risks related to the continued impact of the COVID-19 pandemic, risks inherent in the development and commercialization of potential products, uncertainty in the timing and results of clinical trials or regulatory approvals, maintenance of intellectual property rights or other risks discussed in the Company’s Form 10-K filed on March 16, 2021, and its other filings with the Securities and Exchange Commission. Prospective investors are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.

Investor Contact:

Bob Yedid
LifeSci Advisors
(646) 597-6989
[email protected]

Posts pagination

Previous page Page 1 … Page 36,327 Page 36,328 Page 36,329 … Page 46,943 Next page