TORONTO – Flow Capital Corp (TSXV:FW) (“Flow Capital” or “Flow”) reports on its investment performance over the 5-year period from March 2018, when the formation of Flow was first announced.
Key highlights:
(1) Includes the impact of the de-recognition of the Deferred Tax Asset in Q4 2019, due to a history of persistent losses in the prior 3 years. The Tax Asset was subsequently re-recognized in Q4 2022, after a sustained improvement in financial performance and the expectation that such continued performance will allow for the Canadian non-capital loses and other deductible temporary differences to be utilized before their expiry date.
(2) Total shares repurchased over the 5-year period as a percentage of the opening balance of shares outstanding after the business combination in June 2018.
(3) Discount to book value estimated by comparing the VWAP for shares repurchased against the average book value per share reported for the most recent corresponding quarters.
Details of Flow’s investment performance since March 2018*
* Data in the table above covers the period of new investments from March 2018 and includes all payments, fees, and equity gains until April 2023.
** Could include warrants and other equity-like bonuses. Warrant values are calculated using Black-Scholes pricing and are not increased unless there is an external equity financing event.
*** Loss ratios calculated based on total capital deployed in the category.
On March 11, 2018, LOGiQ Asset Management Inc. (“LOGiQ”) and Grenville Strategic Royalty Corp. (“Grenville”) entered into a business combination agreement as a plan of arrangement, under the Business Corporations Act (British Columbia) (the “BCBCA”). The combined entity was subsequently renamed Flow Capital Corp.
Since that time, Flow has transitioned its business away from perpetual royalties and mutual fund asset management, to focus exclusively on Venture Debt investing, or more specifically, investing in senior secured debt instruments, in high-growth (primarily technology) companies, with equity upside.
“These returns have been generated from investments in companies that have passed a highly selective process designed to identify the most attractive risk/reward trade-off. Only the best companies get through Flow’s rigorous screening process,” said Alex Baluta, CEO of Flow
“As new investments are made, we expect aggregate returns could dip in the shorter term until such time as new equity exits are realized from portfolio companies which achieve a liquidity event and our equity exposure upside is realized. The higher returns are evident in the investments which have already fully or partially exited,” continued Mr. Baluta.
“Recent market dynamics have created an environment in which the demand for Flow Capital’s funding has grown dramatically. Deal flow has accelerated in recent months, and it is our expectation that much more capital will be deployed into more great growth companies at a faster rate,” said Mr. Baluta.
“Flow helps growth companies scale their business with covenant light, minimally dilutive funding, while taking debt-like risk and generating equity-like returns for our shareholders. These 5 year returns demonstrate the capability of our approach in generating significant returns for our stakeholder,” summarized Mr. Baluta.
About Flow Capital
Flow Capital Corp. is a diversified alternative asset investor and advisor, specializing in providing minimally dilutive capital to high growth businesses primarily in the technology sector. To apply for financing, visit www.flowcap.com.
For further information, please contact:
Flow Capital Corp.
Alex Baluta
Chief Executive Officer
alex@flowcap.com
1 Adelaide Street East, Suite 3002,
PO Box 171, Toronto, Ontario M5C 2V9
Certain statements herein may be “forward-looking” statements that involve known and unknown risks, uncertainties, and other factors that may cause the actual results, performance, or achievements of Flow or the industry to differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether such results will be achieved. A number of factors could cause actual results to vary significantly from the results discussed in the forward-looking statements. These forward-looking statements reflect current assumptions and expectations regarding future events and operating performance and are made as of the date hereof. Flow assumes no obligation, except as required by law, to update any forward-looking statements to reflect new events or circumstances.
