Aventus Capital (AVTS) Q3 2024 earnings summary

Executive summary

• Q3 2024 net loss was $1.1M ($0.01 diluted loss per share), down from net income of $23.0M ($0.16 diluted EPS) in Q3 2023; nine-month profit was $5.1M ($0.04 diluted EPS), sharply lower than $148.8M ($1.05 diluted EPS) last year.

• Arena's Q3 2024 net loss attributable was $3.4M, down from net income of $4.1M in Q3 2023; Westaim reported a Q3 2024 net loss of $1.1M versus a $23.0M profit in Q3 2023.

• Completed full divestiture of Skyward Specialty, generating $256.3M in proceeds and boosting cash reserves.

• Announced a $250M private placement and $600M investment in Salem Partners with CC Capital Partners.

• Company to change jurisdiction of incorporation from Alberta to Delaware and consolidate shares 1-for-6.

Financial highlights

• Q3 2024 revenue and net change in value of investments was $11.4M, down from $24.8M in Q3 2023; net expenses rose to $12.5M from $1.8M.

• Cash at September 30, 2024 was $351.7M, up from $135.0M at year-end 2023, mainly due to Skyward Specialty share sales.

• Investments decreased to $182.1M from $414.3M at year-end 2023, reflecting the Skyward Specialty exit.

• Shareholders’ equity was $511.2M at September 30, 2024, down from $518.3M at year-end 2023.

• Book value per fully diluted share rose to $3.90 (C$5.28) at September 30, 2024, from $3.83 (C$5.08) at December 31, 2023.

Outlook and guidance

• Arena's AUM pipeline remains strong, with committed AUM expected to exceed $4B upon closing its third drawdown fund.

• Focus remains on deploying capital in Arena Investors and seeking new investment opportunities.

• Future growth is expected to deliver significant operating leverage as fee-paying AUM increases.

• Arena FINCOs' liquidation will allow redeployment of capital for strategic initiatives.

• Forward-looking statements highlight risks and uncertainties, especially regarding fund closings and strategic transactions.