TORONTO, CANADA, March 10, 2022 - Stack Capital Group Inc., (“Stack Capital” or the “Company”) (TSX: STCK and STCK.WT) today announced its financial results for the fourth quarter and year ended December 31, 2021. Stack Capital reports all amounts in Canadian Dollars unless otherwise stated.
· At year end, the Company had deployed 25% of its capital and had a remaining cash balance of $76 million
· Recent dislocations in the public markets have created investment opportunities across private equity that the Company believes offer strong risk/reward profiles
· Stack Capital will look to capitalize on the market dislocation via primary issuances and secondary market transactions
· In January 2022, the Company press released that Bolt Financial, Inc. completed its Series E1 funding which increased Stack Capital’s BVPS to above $12
“The increase in Stack’s position of SpaceX by nearly $0.9 million this quarter is an early win for shareholders and exemplifies Stack’s mission to democratize access into growth and late-stage private equity for the benefit of all investors. We’re also pleased to welcome Prove into our investment portfolio, another highly innovative and disruptive business”, said Jeff Parks, CEO of Stack Capital. “With our strong cash position of 75% at year-end, we're in great shape to take advantage of opportunities stemming from the recent market decline.”
· As at December 31, 2021, the Book Value of the Company was $102.4 million, and the Book Value per Share was $11.26. A detailed summary of Book Value per Share is as follows:
Breakdown of Book Value per Share as at December 31, 2021:
* The Company announced in January 2022 that Bolt Financial, Inc. completed a primary transaction roughly doubling the book value of this investment.
· Space Exploration Technologies Corp. (“SpaceX”) completed a secondary offering at approximately a $100 billion USD valuation. The Company’s investment in FNEX Ventures LLC – Series 103, which derives substantially all its value from its underlying SpaceX position, increased by approximately by $918,837 from this secondary transaction. SpaceX is one of the largest private technology companies in the world, led by Elon Musk, and currently operates three main business lines which include space transportation, space tourism, and Starlink – its global satellite constellation system which delivers internet service to areas that are unserved or underserved.
· Stack Capital invested in Prove Identity, Inc. (“Prove”), which had a fair value of $5.0 million at year end. Most of the investment consisted of Series E1 preferred shares that were purchased with a fair value of $3.8 million; in addition to common shares, with a fair value of $1.1 million. Prove is a leading provider of digital consumer identity verification and authentication solutions. Currently used by over 1,000 businesses across 200+ countries, including nine of the top ten financial institutions in the United States, Prove’s solutions enable businesses to streamline customer acquisition and provide frictionless servicing, while mitigating fraud and enhancing consumer data privacy and choice. The mobile phone has become the master key of daily life for most of the world, and Prove has embraced that reality, making its phone-centric solutions the modern way of confirming identity.
About Stack Capital
Stack Capital is an investment holding company and its business objective is to invest in equity, debt and/or other securities of growth-to-late-stage private businesses. Through Stack Capital, shareholders have the opportunity to gain exposure to a diversified private investment portfolio; participate in the private market; and have liquidity due to the listing of the Common Shares and Warrants on the TSX. At the same time, the public structure also allows the Company to focus its efforts on maximizing long-term performance through a portfolio of high growth businesses, which are not widely available to most Canadian investors. SC Partners Ltd. (the "Manager") has taken the initiative in creating the Company and acts as the Company's administrator and is responsible to source and advise with respect to all investments for the Company.
For more information please visit our website at www.stackcapitalgroup.com or contact:
VP, Corporate Development and Investor Relations
Non-IFRS Financial Measures
This press release may make reference to the following financial measures which are not recognized under International Financial Reporting Standards (“IFRS”), and which do not have a standard meaning prescribed by IFRS:
· Book Value - the aggregate fair value of the assets of the Company on the referenced date, less the aggregate carrying value of the liabilities, excluding any deferred taxes if applicable, of the Company; and
· Book Value per Share - the Book Value on the referenced day divided by the aggregate number of Common Shares that are outstanding on such day.
The Company’s Book Value per Share is a measure of the performance of the Company as a whole. The Company’s method of determining this financial measure may differ from other issuers’ methods and, accordingly, this amount may not be comparable to measures used by other issuers. This financial measure is not a performance measure as defined under IFRS and should not be considered either in isolation of, or as a substitute for, net earnings per share prepared in accordance with IFRS.
Cautionary Note Regarding Forward-Looking Information
This press release contains forward-looking information. Such forward-looking statements or information are provided for the purpose of providing information about management’s current expectations and plans relating to the future. Readers are cautioned that reliance on such information may not be appropriate for other purposes. Any such forward-looking information may be identified bywords such as “proposed”, “expects”, “intends”, “may”, “will”, and similar expressions. Forward-looking information contained or referred to in this press release includes, but may not be limited to, the exit conditions of the TSX Sandbox; and the business of Stack Capital and the risks associated therewith, including those identified in the Prospectus under the heading “Risk Factors”.
Forward-looking statements or information are based on a number of factors and assumptions which have been used to develop such statements and information, but which may prove to be incorrect. Although Stack Capital believes that the expectations reflected in such forward-looking statements or information are reasonable, undue reliance should not be placed on forward-looking statements because Stack Capital can give no assurance that such expectations will prove to be correct. Factors that could cause actual results to differ materially from those described in such forward-looking information include, but are not limited to, the ability to capitalize on investment opportunities. The forward-looking information in this press release reflects the current expectations, assumptions and/or beliefs of Stack Capital based on information currently available to Stack Capital.
Any forward-looking information speaks only as of the date on which it is made and, except as may be required by applicable securities laws, Stack Capital disclaims any intent or obligation to update any forward-looking information, whether as a result of new information, future events, or results or otherwise. The forward-looking statements or information contained in this press release are expressly qualified by this cautionary statement.