High River, Alberta – The Western Investment Company of Canada Limited (“WICC” or “Western”) (TSXV:WI) announces that it has filed its Q2 Financial Statements and MD&A on SEDAR.
In a message to shareholders, WICC CEO Scott Tannas provided the following commentary:
“At the beginning of the second quarter, WICC and its partners were exclusively focused on making sure that each investee company had the resources to come through to the other side of the economic crisis. Whether it was cash, extra help at the executive level, or simply acting as a sounding board, we were there to support our management teams. Difficult decisions had to be made quickly. Creative ways of generating revenue were deployed. As we worked through the worst weeks of the pandemic, it was inspiring to watch our management teams provide calm and decisive leadership.
By the end of Q2, it was clear to us that we had successfully steered through the worst of the pandemic. In fact, business momentum in June was such that we posted a net profit for the quarter roughly equal to 2019’s second quarter result.
In Q2, Fortress Insurance, GlassMasters, Foothills Creamery and Golden Healthcare each delivered net income to Western.
– GlassMasters has remained open for business in their locations and with their extensive mobile service fleet. At the onset of the pandemic, the workforce was quickly and significantly reduced to fit the volume of sales activity. Thanks to some smart and aggressive marketing, sales began to steadily rise week over week. By early June, most of the previously laid off staff members had been recalled to meet surging demand. With June 2020 same store sales exceeding prior year, the company has carried significant momentum into Q3.
– Fortress Insurance continues to add new customers and premiums every month. The pace of growth continues to accelerate. The spring / summer hail season left us unscathed. The equity component of the investment portfolio at Fortress Insurance after initial impacts has performed well, with much of the investment losses incurred near the end of Q1 being recovered in Q2 as the market stabilized. We have stated before that Fortress Insurance is an important cornerstone business for us. The opportunity for us to build value through organic growth is, in our opinion, stronger than before. The insurance market in Canada remains short of capacity. Fortress has an extraordinary chance to establish itself in the coming year. Fortress President Shafeen Mawani and his small team are working hard to capture new business.
– As we have described in previous updates, Ocean Sales has suffered a significant reduction in revenue. As the retail and exhibition channels open up, Ocean will be ready to sell their products in places where people gather in large numbers as before. In the meantime, the company is working its online channels in unique ways, and preparing for a busy 2021. We are involved intimately in the 2021 re-launch plans, and will provide updates in future reports.
– Foothills Creamery experienced a rise in sales during Q2, with low margin-high volume consumer packaged butter sales up significantly over last year, while sales to restaurants and bakeries are down. Foothills’ high margin wholesale ice cream business is down over 2019, as much uncertainty remained over the ice cream scoop shops, and their ability to open and operate in April and May. By June, that end of the business was showing increased activity, generating optimism for a summer rebound.
– Golden Health Care has been successful in protecting their residents from COVID-19, while continuing to provide a steady return on investment in Q1. Together with our partners we are exploring where to go next with this terrific company. The past six months have shone a very bright light on Seniors Care. Management and operations excellence will be highly valued in the new era. We believe Golden Healthcare has a bright future.
We will remain vigilant for any new challenges that this unusual economy may present for our companies. But after our financial and operating success in Q2, we are confident in our abilities to meet whatever is around the corner.
Given all that has happened in the economy, we at Western expect to encounter opportunities for transformational growth within our chosen industries. We intend to watch closely for chances to scale up our company in the next year.”
About The Western Investment Company of Canada
Western is a unique publicly traded, private equity company founded by a group of successful Western Canadian business people, and dedicated to building and maintaining ownership in successful Western Canadian companies, and helping them to grow. The company’s shares are traded on the TSX Venture Exchange under the symbol WI. For more information on the company, please visit its website at www.winv.ca.
The Western Investment Company of Canada Limited
President and Chief Executive Officer
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