Chesswood Group, a North American commercial equipment finance provider for small and medium-sized businesses, reported its results for Q1/18.
The company posted a number of strong metrics in the quarter along with the launch of a new business:
Chesswood’s results for the first quarter were highly influenced by large changes, year-over-year, in two non-cash items, the allowance for credit losses and the mark-to-market valuation on interest rate swaps and caps. These two items increased significantly over the first quarter of last year, reducing operating income by $2.5 million and income before taxes by $3.8 million. Neither of these two non-cash items (or their changes from 2018) affected free cash flow for the period.
“While our financial results were negatively impacted by these two non-cash items this quarter, we’re pleased that our operating earnings before this effect and before the expenses from Tandem increased over the first quarter of last year,” said Barry Shafran, Chesswood’s president and CEO. “We have chosen to remain focused on risk levels in our traditional business at this time in the business cycle while launching our new efforts in the vendor-channel of equipment finance, in the U.S. Tandem is the first provider of funding to this market that can truly offer its vendor partners proven in-house expertise in approving, funding and administering transactions in all credit tiers. This value proposition is attractive to current and prospective equipment vendor customers and is a competitive advantage that we intend to take advantage of.”
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