RE:RE:RE:RE:RE:Q4 Streaming Contracts UpdateEffing stockhouse :(. Try this one....
Input Capital Corp. Publishes Q4 Operations Update
2016-04-11 05:13:00 PM ET (CNW Group)
Input Capital Corp. ("Input", or the "Company") (TSX Venture: INP) (US: INPCF), is releasing its quarterly operations update for Q4 of its 2016 fiscal year, which provides a preliminary summary of quarterly canola sales and a summary of capital deployed in the acquisition of new canola streams during the quarter ending March 31, 2016. The final accounting of quarterly results will be published in Input's Q4 and year-end financial statements and MD&A when these are finalized and released in due course.
Quarterly Revenue from Canola Streaming Sales
Input sold 5,884 metric tonnes ("tonnes" or "MT") of canola equivalent volume from streaming during the quarter at an average price of $448 per MT, for quarterly streaming revenue of $2.6 million. This brings Input's total streaming revenue for fiscal 2016 to a record $30.1 million, on the sale of 62,235 MT at an average price of $483 per MT.
Year-over-year, Input's streaming revenue has increased by 173% on an increase in canola streaming volume of 160%.
"This is the first time in Input's history that we have been able to accomplish a total and complete sale of all of our tonnes of canola by fiscal year end, and it is as a result of a pro-active on-farm pick up and canola delivery program instituted by our management and logistics team this year," said President & CEO Doug Emsley. "This supports our objective of converting canola to cash as quickly as possible in order to fund our ongoing deployment efforts, but it also creates strong loyalty and buy-in from our farmer partners who are able to free up storage space and reduce on-farm handling costs."
The following table summarizes canola equivalent sales for the 2016 fiscal year, compared to the 2015 fiscal year:
Fiscal
Quarter Q1 Q2 Q3 Q4 FY Total
-------- --- --- --- --- --------
FY2015
Canola
Streaming
Volume
(MT) 4,585 4,146 8,182 7,011 23,924
Average
Net
Realized
Price $493 $463 $441 $465 $462
--------- ---- ---- ---- ---- ----
FY2016
Canola
Streaming
Volume
(MT) 6,079 18,382 31,889 5,884 62,235
Average
Net
Realized
Price $468 $487 $490 $448 $483
--------- ---- ---- ---- ---- ----
% Change
(in
Volume) +33% +343% +290% -16% +160%
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$11.0 Million in New Capital Deployment
During the quarter, Input signed 38 canola streaming contracts for total up-front payments of $11.0 million.
Of the 38 contracts signed in the quarter, 17 are with new clients in Alberta (6) and Saskatchewan (11) and 21 contracts are renewals/expansions in Alberta (1), Saskatchewan (19) and Manitoba (1). This brings Input's streaming portfolio to 94 active canola streams in Alberta (14), Saskatchewan (75) and Manitoba (5).
A summary of the capital deployment for the previous three fiscal years is summarized in the table below:
Fiscal Year 2013 2014 2015 2016 Total
----------- ---- ---- ---- ---- -----
Deployment ($ millions) $6.1 $25.0 $49.1 $35.1 $115.3
Total Number of Active
Streams 5 15 68 94 94
Total Number of Inactive
Streams - - - 3 3
------------------------ --- --- --- --- ---
Total Active Canola Reserves
(MT) 22,000 134,000 303,000 280,000
Total Inactive Canola
Reserves (MT) - - - 67,000
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These newly announced investments increase Input's total capital deployment to date to $115.3 million. Input's longest streaming contract has a 12 year term until 2026, and the portfolio average contract length for active streams is 6.6 years.
A higher level of sales activity and farmer interactions over the last year led to an 18% increase in the number of individual contracts signed with farmers during the year (from 73 to 86), and a 38% increase in the number of active streams in Input's portfolio (from 68 to 94). Portfolio and counterparty risk continues to be reduced as a result of improved process and underwriting procedures during due diligence and by significantly reducing the average streaming contract size.
"As the founders of Input Capital and significant shareholders in our own right, the management team has always intended to focus on building a strong business for the long-term," said President & CEO Doug Emsley. "We are in the foundational growth period for the company, and it is on the strength of contracts that we write today that the future success of our business lies. It is our intention to ensure that Input's streaming portfolio is strong as we continue to build our streaming business."
Update on Terminated Streaming Contracts
On November 12, 2015, Input announced the termination of three streaming contracts and which are now classified as inactive contracts. Input immediately began legal proceedings to begin the process of recovering its investment in these three contracts.
Management is pleased to report that the recovery process is proceeding smoothly and is either on track or ahead of previously expected timeframes.
On the largest of the contracts, Input has now taken titled possession of 12.3 quarters of farmland (approximately 2,000 acres), and the foreclosure process on the balance of the land associated with the security package for this contract is proceeding ahead of schedule. Input is in the process of finalizing rental arrangements with local farmers for the upcoming growing season to ensure that the land is maintained in good condition in preparation for a sale of the entire property once the foreclosure process is fully complete. In the interim, the farmers will pay a market rental rate to the benefit of Input for the use of the land this year.
In addition, Input has consigned a significant number of pieces of farm equipment to a regularly scheduled auction to be held on May 1. An additional batch of equipment associated with this contract will be auctioned this summer.
The recovery efforts associated with the two smaller terminated contracts are progressing and are on track with previous expectations. Management continues to expect to fully recover all of the capital associated with the three terminated contracts.
Canola Reserves Update
Periodically, Input updates its projections for anticipated canola streaming tonnes to be sold in the current fiscal year. Due to the fact that this year's capital deployment season remains ongoing, projections for F2017 canola deliveries will be published in the next quarterly operational update, scheduled for early July 2016.
The table below updates Input's Total Active Canola Reserves, which is the sum of all contracted canola streaming tonnes for all contract years on all active contracts, less canola streaming tonnes sold to date.
Tonnes Avg Crop Payment
------ ----------------
Total Active Canola
Reserves (MT) 280,000 $60 / MT
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