Chesswood Announces Financial Results for 2017

Seventh Consecutive Year of Record Operating Income and Portfolio Size
Strong 4^th Quarter Results

TORONTO, March 12, 2018 /CNW/ - 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, 2017.

The Company generated operating earnings of $8.0 million in the quarter and $32.1 million for the year, compared to $6.0 million and $30.3 million respectively, last year. The results for the prior year included $1.1 million of greater operating earnings from Windset Capital, which has been wound down in 2017.

"Chesswood once again enjoyed a record year by most financial measures including originations, total portfolio size, finance margin and operating income," said Barry Shafran, Chesswood's President and CEO. "Our gross finance receivables reached almost $700 million at year-end, and while our net income was also a record at $25.4 million. Our fourth quarter operating earnings of $8.0 million were $2.0 million over last year's fourth quarter results and were helped significantly by our very effective collections efforts.  Our fourth quarter and annual net income benefited from a $9.4 million one-time recovery of deferred taxes as a result of the reduction in the U.S. corporate income tax rates from the Tax Cuts and Jobs Act," added Shafran.

Chesswood will benefit directly from the new lower U.S. corporate income tax rates in 2018 as our largest subsidiary, Pawnee Leasing Corporation, is a U.S. taxpayer. The Company estimates that based on 2017 taxable income, the 13% lower U.S. corporate tax rate would have generated an increase in net income of approximately $3.0 million.

Non-GAAP Measures

Adjusted EBITDA and Operating Income are not recognized measures under International Financial Reporting Standards and do not have standard meanings. Accordingly, these measures 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 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 48 U.S. states. 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.

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. 

SOURCE Chesswood Group Limited