Return on average shareholders' equity1 reaches 18.16% for the quarter

 MCAN Mortgage Corporation d/b/a MCAN Financial Group ("MCAN", the "Company" or "we") (TSX: MKP) reported net income of $26.9 million ($0.70 earnings per share) for the third quarter of 2024, an increase from net income of $18.5 million ($0.53 earnings per share) in the third quarter of 2023.

Third quarter 2024 return on average shareholders' equity1 was 18.16% compared to 14.20% for the same period in the prior year.

Our Q3 results were mainly impacted by higher unrealized fair value gains on our REIT portfolio and higher income from our investment in MCAP compared to the same prior year period. 

For year to date 2024, we reported net income of $69.9 million ($1.87 earnings per share), an increase from net income of $57.6 million ($1.66 earnings per share) for the same prior year period.

Return on average shareholders' equity1 was 16.29% for year to date 2024 compared to 15.06% for the same prior year period.

We reported higher total net income for the year to date mainly as a result of higher unrealized fair value gains on our REIT portfolio, higher income from MCAP and higher net securitized mortgage spread income partially offset by slightly lower net corporate mortgage spread income compared to the same prior year period. We continued to manage our portfolio in a declining interest rate environment.

We are committed to a strategy of managing controllable factors to protect our bottom line and taking advantage of opportunities that arise in the current market environment.  

The Board of Directors declared a fourth quarter regular cash dividend of $0.39 per share to be paid on January 2, 2025 to shareholders of record as of December 13, 2024. As a mortgage investment corporation, we pay out all of our taxable income to shareholders through dividends. 

"We had a strong quarter, with total assets surpassing $5.2 billion and net income exceeding last year's figures, thanks to the various levers we have in our business during a declining interest rate environment as well as better performance from our investment in MCAP. We also successfully raised additional capital in the quarter through our at-the-market program to help us grow," said CEO Don Coulter. "In this environment, we are continuing to see solid origination and renewal volumes across the entire loan book as well as good credit quality. Looking ahead, we are focused on MCAN's strategic growth and positioning in the Canadian mortgage market."

HIGHLIGHTS

FINANCIAL UPDATE

Credit Quality

Capital

FURTHER INFORMATION

Complete copies of the Company's 2024 Third Quarter Report will be filed on the System for Electronic Document Analysis and Retrieval ("SEDAR+") at www.sedarplus.ca and on the Company's website at www.mcanfinancial.com.

For our Outlook, refer to the "Outlook" section of the 2024 Third Quarter Report.

MCAN is a public company listed on the Toronto Stock Exchange under the symbol MKP and is a reporting issuer in all provinces and territories in Canada.  MCAN also qualifies as a mortgage investment corporation ("MIC") under the Tax Act. MCAN is the largest MIC in Canada and the only federally regulated MIC.  

The Company's primary objective is to generate a reliable stream of income by investing in a diversified portfolio of Canadian mortgages, including residential mortgages, residential construction, non-residential construction and commercial loans, as well as other types of securities, loans and real estate investments. MCAN employs leverage by issuing term deposits that are eligible for Canada Deposit Insurance Corporation deposit insurance. MCAN is Investing in Communities and Homes for Canadians.

For how to enroll in the DRIP, please refer to the Management Information Circular dated March 15, 2024 or visit our website at www.mcanfinancial.com/investors/regulatory filings/dividends - historical. Under the DRIP, dividends paid to shareholders are automatically reinvested in common shares issued out of treasury at the weighted average trading price for the five days preceding such issue less a discount of 2% until further notice from MCAN.

NON-GAAP AND OTHER FINANCIAL MEASURES

This news release references a number of non-generally accepted accounting principles ("non-GAAP") and other financial measures and ratios to assess our performance such as return on average shareholders' equity, net corporate mortgage spread income, net securitized mortgage spread income, impaired corporate mortgage ratio, impaired total mortgage ratio, and arrears total mortgage ratio.  These measures are not calculated in accordance with International Financial Reporting Standards ("IFRS"), are not defined by IFRS and do not have standardized meanings that would ensure consistency and comparability between companies using these measures.  These metrics are considered to be non-GAAP and other financial measures and are incorporated by reference and defined in the "Non-GAAP and Other Financial Measures" section of our 2024 Third Quarter Management's Discussion and Analysis of Operations ("MD&A") available on SEDAR+ at www.sedarplus.ca. Below are reconciliations for our non-GAAP financial measures included in this news release using the most directly comparable IFRS financial measures.

Net Corporate Mortgage Spread Income Non-GAAP financial measure that is an indicator of net interest profitability of income-earning assets less cost of funding for our corporate mortgage portfolio.  It is calculated as the difference between corporate mortgage interest and term deposit interest and expenses.

Net Securitized Mortgage Spread IncomeNon-GAAP financial measure that is an indicator of net interest profitability of income-earning securitization assets less cost of securitization liabilities for our securitized mortgage portfolio.  It is calculated as the difference between securitized mortgage interest and interest on financial liabilities from securitization. 

A CAUTION ABOUT FORWARD-LOOKING INFORMATION AND STATEMENTS

This news release contains forward-looking information within the meaning of applicable Canadian securities laws.  All information contained in this news release, other than statements of current and historical fact, is forward-looking information. All of the forward-looking information in this news release is qualified by this cautionary note. Often, but not always, forward-looking information can be identified by the use of words such as "may," "believe," "will," "anticipate," "expect," "planned," "estimate," "project," "future," and variations of these or similar words or other expressions that are predictions of, or indicate, future events and trends and that do not relate to historical matters. Forward-looking information in this news release includes, among others, statements and assumptions with respect to:

Forward-looking information is not, and cannot be, a guarantee of future results or events. Forward-looking information reflects management's current beliefs and is based on information currently available to management. Forward-looking information is based on, among other things, opinions, assumptions, estimates and analyses that, while considered reasonable by us at the date the forward-looking information is provided, inherently are subject to significant risks, uncertainties, contingencies and other factors that may cause actual results and events to be materially different from those expressed or implied by the forward-looking information. 

The material factors or assumptions that we identified and were applied by us in drawing conclusions or making forecasts or projections set out in the forward-looking information, include, but are not limited to: 

External geopolitical conflicts, and government and Bank of Canada economic policy have resulted in uncertainty relating to the Company's internal expectations, estimates, projections, assumptions and beliefs, including with respect to the Canadian economy, employment conditions, interest rates, supply chain issues, inflation, levels of housing activity and household debt service levels. There can be no assurance that such expectations, estimates, projections, assumptions and beliefs will continue to be valid. The impacts that any further or escalating geopolitical conflicts will have on our business is uncertain and difficult to predict. 

Reliance should not be placed on forward-looking information because it involves known and unknown risks, uncertainties and other factors, which may cause actual results to differ materially from anticipated future results expressed or implied by such forward-looking information. Factors that could cause actual results to differ materially from those set forth in the forward-looking information include, but are not limited to, the risk that any of the above opinions, estimates or assumptions are inaccurate and the other risks and uncertainties referred to in our Annual Information Form for the year ended December 31, 2023, our MD&A and our other public filings with the applicable Canadian regulatory authorities.

Subject to applicable securities law requirements, we undertake no obligation to publicly update or revise any forward-looking information after the date of this news release whether as a result of new information, future events or otherwise or to explain any material difference between subsequent actual events and any forward-looking information.  However, any further disclosures made on related subjects in subsequent reports should be consulted.

SOURCE MCAN Mortgage Corporation

SOURCE: MCAN Mortgage Corporation

For further information, please contact: MCAN Financial Group, Website:
www.mcanfinancial.com, e-mail: mcanexecutive@mcanfinancial.com; Donald Coulter,
President and Chief Executive Officer, (416) 203-5931; Santokh Birk, Senior Vice
President and Chief Financial Officer, (289) 454-4196

COMTEX_459700225/2197/2024-11-11T18:59:00