anyone with thoughts on Q4 results and go-forward strategy?Q4 results were bad. Both the US EF ("equipment finance") businsess and Canadian AF ("auto finance") business posted operating losses (revenue less expenses less provisions) for the quarter. Seems like losses in both units should continue for the foreseeable future and the outlook for the remaining Canadian business does not look great given unemployment is rising.
the big unknown is the strategic review, which I believe is scheduled to conclude by March 31 (though we should note that the asset sales to the Wafra JV were scheduled to begin in Q4, but they didn't). US equipment finance employee count has declined significantly in the past year so I am guessing that it will be sold or discontinued. I personally do not see how asset sales to the Wafra JV can be completed w/o a loss, but maybe there is an agreement w/Wafra as I believe they got a pretty good deal (warrants plus 95% of the JV - i.e. we will give you all this if you buy these at par)
Also - it seems like most of the asset sales are going to Daniel Wittlin (board member) and not Varde and Castlelake. Further, the asset management fees seem kinda skinny. If you take most of this stuff off the balance sheet, you will still incur many of the existing operating costs. This businsess just seems really subscale.
If you are long - what do you reasonably think can happen over the next 1-3 years?