Record Portfolio Growth and Income Before Taxes

TORONTO, May 8, 2018 – Chesswood Group Limited (“Chesswood” or “the Company”) (TSX: CHW), a North American commercial equipment finance provider for small and medium-sized businesses, today reported its results for the first quarter ended March 31, 2018.

The Company generated record quarterly Income before tax, along with strong operating earnings of $8.3 million, compared to $8.0 million last year. Chesswood generated these record Canadian dollar results even though the U.S. exchange rate during the quarter (1.26:1) was significantly lower than in the first quarter of 2017 (1.32:1). The effect of the weaker U.S. dollar on operating income for the quarter was $490,000. Chesswood’s finance receivables grew to $750 million in the quarter, driven by record quarterly originations of $94 million, a 19% increase from $79 million in the first quarter of last year.

“Our first quarter results not only reflect record portfolio growth and excellent operating income but they also reflect an improvement in our U.S. delinquency markers that was better than expected,” said Barry Shafran, Chesswood’s President and CEO. “We continue to look with optimism on the business climate and activity, especially in the U.S., following the recent lowering of tax rates, the easing of regulations and the very low unemployment numbers,” added Shafran.

Financial Highlights (in CDN $000’s, except EPS )	For the Three Months Ended March 31,
	2019	2018
Adjusted Operating Income(1) Increase (decrease) in Allowance Tandem Net Expenses	$7,487 $1,825 $435	$7,711 (628) 0
Operating Income(1) Mark-to-market Swaps/Caps Expense (Gain) Other Non-cash Items	$5,587 $503 $445	$8,339 (759) 671
Income before Taxes	$4,639	$8,427
Net Income	$3,071	$5,900
Earnings Per Share – basic	$0.17	$0.33

(1) See “Non-GAAP Measures” below.

While our financial results were negatively impacted by these two non-cash items this quarter, we’re pleased that our operating earnings before this effect and before the expenses from Tandem increased over the first quarter of last year” said Barry Shafran, Chesswood’s President and CEO. “We have chosen to remain focused on risk levels in our traditional business at this time in the business cycle while launching our new efforts in the vendor-channel of equipment finance, in the U.S. Tandem is the first provider of funding to this market that can truly offer its vendor partners proven in-house expertise in approving, funding and administering transactions in all credit tiers. This value proposition is attractive to current and prospective equipment vendor customers and is a competitive advantage that we intend to take advantage of” said Shafran.
 

Non-GAAP Measures

Operating Income is not a recognized measure under International Financial Reporting Standards and does not have standard meanings. Accordingly, this measure may not be comparable to similar measures presented by other issuers. Please refer to the Company’s Management Discussion and Analysis in Chesswood’s 2017 Annual Report and 2018 First Quarter Report for additional information concerning this measure and a reconciliation of this measure to the Company’s consolidated net income.

 

About Chesswood

Through three wholly-owned subsidiaries in the U.S. and Canada, Chesswood Group Limited is North America’s only publicly-traded commercial equipment finance company focused on small and medium-sized businesses. Our Colorado-based Pawnee Leasing Corporation, founded in 1982, finances a highly diversified portfolio of commercial equipment leases and loans through relationships with over 600 independent brokers in the U.S. In Canada, Blue Chip Leasing Corporation has been originating and servicing commercial equipment leases and loans since 1996, and today operates through a nationwide network of more than 50 independent brokers. Located in Houston, Texas, Tandem Finance Inc. provides equipment financing to small and medium sized businesses in the U.S. through the equipment vendor channel.

Based in Toronto, Canada, Chesswood’s shares trade on the Toronto Stock Exchange under the symbol CHW.

Learn more at, visit www.ChesswoodGroup.com , www.PawneeLeasing.com and www.BlueChipLeasing.com.
 

For more information contact:
Barry Shafran
Chesswood Group Limited
416-386-3099
bshafran@chesswoodgroup.com

This press release contains forward-looking statements that involve a number of risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. Many factors could cause actual results and developments to differ materially from those expressed or implied by these forward looking statements. By its nature, this information is subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct and that objectives, strategic goals and priorities will not be achieved. Additional information about the risks and uncertainties of the Company’s businesses and material factors or assumptions on which information contained in forward looking statements is based is provided in its publicly filed documents, including the Company’s annual information form and management’s discussion and analysis of the financial condition and performance,which are available electronically through the System for Electronic Document Analysis and Retrieval at www.sedar.com.

NO STOCK EXCHANGE, SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED THE INFORMATION CONTAINED HEREIN.

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First U.S. Vendor Channel Funder to Offer Equipment Sellers and Distributors Proven Expertise in Funding Commercial Customers in All Credit Grades

TORONTO, March 20, 2019 – Chesswood Group Limited (“Chesswood”) (TSX: CHW) today announced further expansion of its equipment finance footprint in the U.S., with the launch of Tandem Finance Inc. (“Tandem Finance”). Tandem Finance, based in Houston, Texas, provides small and medium sized businesses of all credit profiles with financing for their equipment purchases, through equipment vendors and distributors.

“We identified a significant opportunity to become the first funder in this channel that truly underwrites, funds and administers leases and loans in all credit tiers, leveraging our more than thirty years of unique expertise in both prime and non-prime commercial lending and leasing” said Barry Shafran, Chesswood’s CEO.

“Most funders in this channel find it difficult to accommodate non-prime credit applicants so that these applicants are often declined or their transactions are syndicated or sold to other funders. This results in slower processing and lower approval rates for these applicants, disappointing both the equipment vendor and the applicant” added Shafran. “We have been successfully underwriting non-prime credits for small and medium sized businesses for decades, and Tandem Finance will bring this full breadth of product expertise and service to the vendor market.”

Chesswood is very pleased to also announce that Mike Sheehan has joined our team as President of Tandem Finance. Mike has more than thirty years in the equipment finance industry, and in the vendor channel specifically and brings a wealth of expertise and experience to Tandem Finance and Chesswood. Mike is working out of Tandem Finance’s new offices in Houston. “We sought out a channel expert that would fit well with our culture, and Mike was a perfect match. We are thrilled to have Mike join our team and lead the way for Tandem Finance” Shafran said.

About Chesswood Group Limited

Through three wholly-owned subsidiaries in the U.S. and Canada, Chesswood Group Limited is North America’s only publicly-traded commercial equipment finance company focused on small and mediumsized businesses. Our Colorado-based Pawnee Leasing Corporation, founded in 1982, finances a highly diversified portfolio of commercial equipment leases and loans through relationships with over 600 independent brokers in the U.S. In Canada, Blue Chip Leasing Corporation has been originating and servicing commercial equipment leases and loans since 1996, and today operates through a nationwide network of more than 50 independent brokers. Located in Houston, Texas, Tandem Finance Inc. provides equipment financing to small and medium sized businesses in the U.S. through the equipment vendor channel. Based in Toronto, Canada, Chesswood’s shares trade on the Toronto Stock Exchange under the symbol CHW.

Learn more at www.ChesswoodGroup.com, www.PawneeLeasing.com, www.BlueChipLeasing.com, www.TandemFinance.com

For more information contact: Barry Shafran Chesswood Group Limited 416-386-3099 bshafran@chesswoodgroup.com

Tandem Finance 25700 I-45 Suite 4084 The Woodlands, TX 77386 844 612 7499 Info@TandemFinance.com

This press release contains forward-looking statements that involve a number of risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. Many factors could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements. By its nature, this information is subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct and that objectives, strategic goals and priorities will not be achieved. Additional information about the risks and uncertainties of the Company’s businesses and material factors or assumptions on which information contained in forward-looking statements is based is provided in its publicly filed documents, including the Company’s annual information form and management’s discussion and analysis of the financial condition and performance, which are available electronically through the System for Electronic Document Analysis and Retrieval at www.sedar.com.

NO STOCK EXCHANGE, SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED THE INFORMATION CONTAINED HEREIN.

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Eighth Consecutive Year of Record Operating Income and Originations

Income before Taxes of $32.7 million vs $27.8 in 2017

TORONTO, March 13, 2019 – Chesswood Group Limited (“Chesswood” or “the Company”) (TSX: CHW), a North American commercial equipment finance provider for small and medium-sized businesses, today reported its results for the fourth quarter and year ended December 31, 2018.

“Once again we had an extremely busy year that culminated in our eighth successive year of record operating income and originations. If not for last year’s one-time $9.4 million tax recovery due to the U.S. Tax Cuts and Jobs Act, this year’s net earnings would also have been another record” said Barry Shafran, Chesswood’s President and CEO. “Our finance receivables exceeded $900 million for the first time, reflecting our annual originations record this year of $400 million, 16% ahead of last year’s originations” added Shafran.

“Our shareholders have relied on us for sustainable dividends for more than a decade. In 2018 we paid out $15.1 million in dividends, providing our shareholders with an annual yield of 7.65% based on our average share price in 2018 of $10.98. Just as importantly, the percentage of our free cash flow that we paid out in dividends was approximately 65% at the end of the fourth quarter” Shafran said.

This year’s results include in Operating Income the interest expense on $20 million of additional revolving debt that was used to retire the Company’s convertible debentures in early January 2018. Interest on the convertible debentures was not included in the calculation of Operating Income in prior years. The additional interest included in Operating Income in 2018 totaled approximately $900,000, or $225,000 a quarter.

Financial Highlights (in CDN $000’s, except EPS)	For the Three Months Ended December 31		For the Years Ended December 31
	2018	2017	2018	2017
Operating Income(1)(2)	$7,904(2)	$8,018(2)	$33,704(2)	$32,075(2)
Net Income(3)	$5,277	$13,798(3)	$22,885	25,431(3)
Adjusted EBITDA(1)	$8,280	$8,010	$35,013	$31,860
Earnings Per Share – basic(3)	$0.30	$0.76(3)	$1.28	$1.41(3)

(1) – See “Non-GAAP Measures” below.

(2) – 2016 operating income includes $1.6 million of pre-tax income from Windset compared to $514K in 2017; while in Q4 of 2016, operating income includes $96K of pre-tax income from Windset compared to $193K in Q4 2017, as Windset winds down.

(3) – 2017 net income includes tax recovery of $9.4 million as a result of the revaluation of our U.S. subsidiaries’ net deferred tax liabilities due to the Tax Cuts and Jobs Act passed in December 2017.

Non-GAAP Measures

Operating Income is not a recognized measure under International Financial Reporting Standards and does not have a standard meaning. Accordingly, this measure may not be comparable to similar measures presented by other issuers. Please refer to the Company’s Management Discussion and Analysis in Chesswood’s 2018 Annual Report for additional information concerning these measures and a reconciliation of these measures to the Company’s consolidated net income.

About Chesswood Group Limited

Through three wholly-owned subsidiaries in the U.S. and Canada, Chesswood Group Limited is North America’s only publicly-traded commercial equipment finance company focused on small and medium-sized businesses. Our Colorado-based Pawnee Leasing Corporation, founded in 1982, finances a highly diversified portfolio of commercial equipment leases and loans through relationships with over 600 independent brokers in the U.S. In Canada, Blue Chip Leasing Corporation has been originating and servicing commercial equipment leases and loans since 1996, and today operates through a nationwide network of more than 50 independent brokers. Located in Houston, Texas, Tandem Finance Inc. provides equipment financing to small and medium sized businesses in the U.S. through the equipment vendor channel. Based in Toronto, Canada, Chesswood’s shares trade on the Toronto Stock Exchange under the symbol CHW.

Learn more at www.ChesswoodGroup.com, www.PawneeLeasing.com, www.BlueChipLeasing.com, www.TandemFinance.com

For more information contact:
Barry Shafran
Chesswood Group Limited
416-386-3099
bshafran@chesswoodgroup.com

This press release contains forward-looking statements that involve a number of risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. Many factors could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements. By its nature, this information is subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct and that objectives, strategic goals and priorities will not be achieved. Additional information about the risks and uncertainties of the Company’s businesses and material factors or assumptions on which information contained in forward-looking statements is based is provided in its publicly filed documents, including the Company’s annual information form and management’s discussion and analysis of the financial condition and performance, which are available electronically through the System for Electronic Document Analysis and Retrieval at www.sedar.com.

NO STOCK EXCHANGE, SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED THE INFORMATION CONTAINED HEREIN.

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Operating Income of $9.4 million in the Quarter

Portfolio Exceeds $850 Million with More Than 32,000 Finance Contracts

TORONTO, November 12, 2018 – Chesswood Group Limited (“Chesswood” or “the Company”) (TSX: CHW), a North American commercial equipment finance provider for small and medium-sized businesses, today reported its record third quarter results for the periods ended September 30, 2018.

“Our third quarter operating income of $9.4 million helped deliver strong quarterly net income of $6.1 million, up significantly from $3.2 million in the third quarter of 2017” said Barry Shafran, Chesswood’s President and CEO. “Our results this quarter were helped by a small recovery in our allowance for doubtful accounts, stemming from improved delinquency, while in the third quarter of last year we added $2.4 million to our allowance” added Shafran. For the nine months ended September 30, the Company generated $17.6 million of net income, an increase of 51% or $6.0 million compared to net income of $11.6 million in the same period last year.

Chesswood’s gross finance receivables grew to a record $854 million in the quarter driven by excellent quarterly originations of $98.6 million, a 21% increase from $81.1 million in the third quarter of last year.

Financial Highlights (In CDN $000’s, Except EPS)	For the Three Months Ended September 30th		For the Nine Months Ended September 30th
	2018	2017	2018	2017
Operating Income(1)	$9,415	$6,718	$25,800	$24,057
Net Income	$6,092	$3,188	$17,608	$11,633
Adjusted EBITDA(1)	$9,224	$9,088	$26,733	$25,369
Earnings Per Share – basic	$0.34	$0.18	$0.98	$0.65

(1) – See “Non-GAAP Measures” below.

“We continue to see the benefits of our long-term growth in strong earnings, while this quarter was also helped by the seasonally lower delinquencies we usually experience at this time of year” added Shafran. The Company generally experiences higher delinquencies and provision for credit losses in the final quarter of the year due primarily to reduced collection time in December.

Between the adoption of IFRS 9 in 2018, the repayment of the Company’s convertible debenture in early January 2018, and the changing foreign exchange rates compared to last year, there are a number of meaningful adjustments required in order to compare Chesswood’s third quarter and nine month operating income this year with the same periods in 2017. These adjustments are provided for in the chart below.

Financial Highlights (In CDN $000’s, Except FX Rate)	For the Three Months Ended September 30th		For the Nine Months Ended September 30th
	2018	2017	2018	2017
Average FX Rate	1.3070	1.2528	1.2876	1.3074
Operating Income(a)	$9,415	$6,718	$25,800	$24,057
IFRS 9 Impact(b)	(278)	–	919	–
Impact of Exchange Rate Difference	(416)	–	519	–
Interest Expense on Conv Deb(c)	–	(328)	–	(978)
Normalized Operating Income	$8,721	$6,390	$27,238	$23,079

(a) See “Non-GAAP Measures”, below

(b) The provision for credit losses for the three and nine months ended September 30, 2018 was calculated in accordance with IFRS 9. Prior period comparatives were prepared in accordance with IAS 39, and have not been restated. The Company’s provision for credit losses would have been $919,000 lower in the nine months ended September 30, 2018 if the sameaccounting guidelines, used in the prior year, had been used in 2018.

(c) Prior to redemption in January 2018, convertible debenture interest expense was not part of operating income whereas the interest expense on the funds used to repay the debenture (from the corporate credit facility) is deducted as an expense in calculating operating income in 2018.

Non-GAAP Measures

Operating Income is not a recognized measure under International Financial Reporting Standards and does not have a standard meaning. Accordingly, this measure may not be comparable to similar measures presented by other issuers. Please refer to the Company’s Management Discussion and Analysis in Chesswood’s 2017 Annual Report and 2018 Third Quarter Report for additional information concerning these measures and a reconciliation of these measures to the Company’s consolidated net income.

About Chesswood

Through two wholly-owned subsidiaries in the U.S. and Canada, Chesswood Group Limited is North America’s only publicly-traded commercial equipment finance company focused on small and medium-sized businesses. Our Colorado-based Pawnee Leasing Corporation, founded in 1982, finances a highly diversified portfolio of commercial equipment leases and loans through established relationships with over 600 independent brokers in U.S. In Canada, Blue Chip Leasing Corporation has been originating and servicing commercial equipment leases and loans since 1996, and today operates through a nationwide network of more than 50 independent brokers. Based in Toronto, Canada, Chesswood’s shares trade on the Toronto Stock Exchange under the symbol CHW.

Learn more at www.chesswoodgroup.com, www.PawneeLeasing.com and www.BlueChipLeasing.com.

For more information contact:
Barry Shafran
Chesswood Group Limited
416-386-3099
bshafran@chesswoodgroup.com

This press release contains forward-looking statements that involve a number of risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. Many factors could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements. By its nature, this information is subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct and that objectives, strategic goals and priorities will not be achieved. Additional information about the risks and uncertainties of the Company’s businesses and material factors or assumptions on which information contained in forward-looking statements is based is provided in its publicly filed documents, including the Company’s annual information form and management’s discussion and analysis of the financial condition and performance, which are available electronically through the System for Electronic Document Analysis and Retrieval at www.sedar.com.

NO STOCK EXCHANGE, SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED THE INFORMATION CONTAINED HEREIN.

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Improved and Expanded Funding for U.S. Prime Receivables

TORONTO, August 20, 2018 – Chesswood Group Limited (TSX: CHW) (“Chesswood” or the “Company”) announced today that its largest subsidiary, Pawnee Leasing Corporation (“Pawnee”), has closed a US$250 million warehouse facility specifically to fund Pawnee’s growing prime portfolio. The warehouse facility will hold Pawnee’s prime receivables before they are securitized and provides an improved cost of capital and better advance rate than the Company’s revolving facility, which was primarily structured for non-prime commercial leases and loans and will continue to be utilized for those originations.

Established in 1982, Pawnee specializes in equipment leasing and financing for assets up to US$250,000, for a full range of credit profiles to small businesses across the U.S. including “start-up entrepreneurs” and more established businesses in the A, B, and C credit market segments.

“Our consistent growth since 2009 has driven the evolution of our treasury resources. That began with our corporate revolving facility in late 2014 that expanded our access to capital and is now complemented by this additional facility which better meets the needs of our U.S. prime business, launched in 2015” said Barry Shafran, Chesswood’s President and CEO.

Mike Prenzlow, Pawnee’s Chief Financial Officer added “We began this process months ago, with Royal Bank of Canada (“RBC”) as our lead partner once again. We were very happy to also include Bank of Montreal and SunTrust as the other two members of the loan syndicate. Both RBC and Bank of Montreal are also our partners in Chesswood’s revolving credit line and we’re grateful for the continued support they have shown Chesswood and Pawnee through their participation in this second facility.”

About Chesswood Group Limited
Through two wholly-owned subsidiaries in the U.S. and Canada, Chesswood Group Limited is North America’s only publicly-traded commercial equipment finance company focused on small and medium-sized businesses with a portfolio exceeding $800 million in gross finance receivables. Our Colorado-based Pawnee Leasing Corporation, founded in 1982, finances a highly diversified portfolio of commercial equipment leases and loans through established relationships with over 600 independent brokers in the U.S. In Canada, our subsidiary Blue Chip Leasing Corporation has been originating and servicing commercial equipment leases and loans since 1996, and today operates through a nationwide network of more than 50 independent brokers.

Based in Toronto, Canada, Chesswood’s shares trade on the TSX under the symbol CHW.

To learn more about Chesswood Group Limited, visit www.ChesswoodGroup.com.
The separate websites of Chesswood Group Limited’s operating businesses are at www.PawneeLeasing.com and www.BlueChipLeasing.com
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Contact:
Barry Shafran
Chesswood Group Limited
416-386-3099
bshafran@chesswoodgroup.com

This press release contains forward-looking statements that involve a number of risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. Many factors could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements.

NO STOCK EXCHANGE, SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED THE INFORMATION CONTAINED HEREIN.