BEK.B Becker Milk Co Ltd

The Becker Milk Company Limited (the “Company”) (TSX-BEK.B) is pleased to report the results for the six months ended October 31, 2019.

HIGHLIGHTS

• Total revenues for the six months ended October 31, 2019 were $1,618,664 compared to $1,522,067 for the same period in 2018;
• Net operating income for Q2 fiscal 2020 was $1,328,088 compared to $1,247,974 in fiscal 2019;
• Net income for Q2 fiscal 2020 was $0.25 per share, compared to $0.23 per share in fiscal 2019.

FINANCIAL HIGHLIGHTS

Net operating income for the six months ended October 31, 2019 increased $80,114 compared with the previous year to $1,328,088, principally as a result of improved revenue.

	Six months ended
	October 31
	2019	2018
Property revenue	$1,546,575	$1,478,029
Finance income	72,089	44,038
Total revenues	$1,618,664	$1,522,067
Property revenue	$1,546,575	$1,478,029
Property operating expenses	(218,487)	(230,055)
Net operating income	$1,328,088	$1,247,974
Adjusted funds from operations	$610,365	$524,795
Net income attributable to common and special shareholders	$447,900	$406,908
Average common and special shares outstanding	1,808,360	1,808,360
Income per share	$0.25	$0.23

Components of the $40,992 increase in net income for the six months ended October 31, 2019 compared to the six months ended October 31, 2018 are:

Changes in net income - Six months ended October 31, 2019 compared to six months ended October 31, 2018
Increase in recovery of deferred taxes on investment properties	$206,582
Increase in net operating income	80,114
Increase in finance income	28,051
Increase in strategic expenses	(4,534)
Increase in administrative expenses	(6,640)
Increase in negative fair value adjustment	(16,844)
Increase in loss on disposal	(19,017)
Increase in current taxes	(226,720)
Increase in net income	$40,992

ADJUSTED FUNDS FROM OPERATIONS

For the six months ended October 31, 2019 the Company recorded adjusted funds from operations of $610,365 ($0.34 per share) compared to $524,795 ($0.29 per share) in 2018.

Adjusted funds from operations
		Six months ended
		October 31
		2019	2018
Funds from operations		$616,837	$550,889
Items not affecting cash:
	Expenses related to strategic review	(6,472)	(1,938)
	Sustaining capital expenditures		(24,156)
Adjusted funds from operations		$610,365	$524,795
Adjusted funds from operations per share		$0.34	$0.29

STRATEGIC REVIEW

Since 2014 the Board of Directors has been evaluating strategic directions for the company and has engaged in discussions with potential acquirors. None of those discussions are active at this time. During this period a programme of divesting less desirable sites has resulted in the sale of 20 investment properties. The Company continues to review its strategic alternatives and will update the market as appropriate, and as required.

The Company’s interim financial statements for the six months ended October 31, 2019, along with the Management’s Discussion and Analysis will be filed with SEDAR at www.sedar.com.

SPECIAL DIVIDEND

The Directors of the Company have declared a special dividend on Class B Special and Common Shares of $2.00 per share. This dividend will be paid to those shareholders of record as of December 30, 2019 and payable on January 20, 2020.

The dividends will be considered as an eligible dividend for Canadian tax purposes.

Readers are cautioned that although the terms “Net Operating Income”, and “Funds From Operations” are commonly used to measure, compare and explain the operating and financial performance of Canadian real estate companies and such terms are defined in the Management’s Discussion and Analysis, such terms are not recognized terms under Canadian generally accepted accounting principles. Such terms do not necessarily have a standardized meaning and may not be comparable to similarly titled measures presented by the other publicly traded entities.

For the Board of DirectorsG.W.J. Pottow, PresidentTel: 416-698-2591