Year End Financial Results
Toronto, January 15, 2001: Premium Income Corporation (the "Company") today announces results for the year ended October 31, 2000. Net income before distributions amounted to $10.3 million or $2.58 per Unit. Total assets increased from $95.2 million to $109.5 million. Distributions to shareholders in the year amounted to $3.5 million to Preferred shareholders or $0.88 per Preferred Share, and $5.6 million to Class A shareholders or $1.40 per Class A Share which included special distributions of $0.10 per unit in each of January 2000, April 2000, July 2000 and $0.30 per unit in October 2000.
Each Unit consists of one Class A Share and one Preferred Share. Preferred Shares receive dividends at a rate of 5.75% of their par value of $15.00. The Company’s dividend policy on the Class A Shares has been set at a rate of $0.80 per Share, equivalent to 8% based on the Class A Shares initial public offering price of $10.00.
Premium Income Corporation is a mutual fund corporation which invests in the common shares of Bank of Montreal, The Bank of Nova Scotia, Canadian Imperial Bank of Commerce, Royal Bank of Canada, and The Toronto-Dominion Bank. To generate additional returns above the dividend income earned on the Portfolio, the Company from time to time writes covered call options in respect to all or part of the common shares in the portfolio. In addition, the Company may write cash covered put options in respect of securities in which the Company is permitted to invest.
The Company’s investment portfolio is managed by its investment manager, Mulvihill Capital Management Inc. The Company’s Preferred and Class A Shares are listed on the Toronto Stock Exchange under the symbols PIC.PR.A and PIC.A.