Melcor REIT Announces First Quarter, Twelve Month Results Exceeding Forecast
09 5월 2014 - 10:00PM
Marketwired
Melcor REIT Announces First Quarter, Twelve Month Results Exceeding
Forecast
EDMONTON, ALBERTA--(Marketwired - May 9, 2014) - Melcor REIT
(TSX:MR.UN) -
Quarter Highlights |
|
12-Month Forecast Highlights |
|
|
|
• Rental revenue of $10.65 million for growth of 10% over
Q1-2013 |
|
• Rental revenue of $40.28 million, exceeding revised forecast by
3% |
|
|
|
• Net operating income of $6.73 million for growth of 6% over
Q1-2013 |
|
• Net rental income of $23.85 million, exceeding revised forecast
by 5% |
|
|
|
• Adjusted funds from operations (AFFO) of $3.78 million or $0.20
per unit compared to $0.18 per unit in Q1-2013 |
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• AFFO of $14.25 million or $0.76 per unit, exceeding forecast by
3% |
|
|
|
• Debt to Gross Book Value (GBV) ratio of 51%, within our target
range of 50-55% |
|
• Distributions of $0.05625 per unit were paid in each of the
REIT's 11 months of operation (as forecast) |
|
|
|
• Gross leasable area increased by 12% since IPO through 3 property
acquisitions |
|
We presented a 12-month forecast (April 2013 - March 2014) in
the prospectus dated April 19, 2013. The three months ended March
31, 2014 was revised on March 10, 2014 to reflect acquisitions
completed throughout the forecast period. The data presented above
is compared to the revised forecast. |
Melcor REIT announced results for the first quarter of 2014,
which ended March 31, 2014. These results are also compared to the
financial forecast disclosed in our prospectus dated April 19, 2013
and revised in our annual management's discussion and analysis
dated March 10, 2014, both of which are available on our website at
MelcorREIT.ca and on SEDAR.com.
Darin Rayburn, CEO of Melcor REIT commented: "As we conclude our
forecast period, I'm pleased to report results exceeding forecast
on key performance metrics. Throughout the past year, we've
delivered as promised while at the same time consistently and
methodologically executing on our strategy. We have initiated and
completed specific actions on each element of our growth strategy -
acquiring both third party and Melcor properties and making
improvements to our overall portfolio through property management
and asset enhancements.
Our team remains committed to executing our strategy and
continuing to deliver solid results."
Financial Highlights for the quarter include:
- We continue to deliver as promised and exceeded IPO forecast
with stable and sustainable growth on key indicators through
Q1-2014. We continued to execute on our growth strategy of
acquiring new properties and improving our existing properties
through both property management and asset enhancement. Building on
the momentum of our first eight months of operations, we:
- Achieved strong leasing activity. We completed 45,715 sq. ft.
in new leases during the period and have renewed 66% of the GLA
expiring in 2014 as of March 31, 2014.
- Grew through acquisition. We completed our third property
acquisition with the purchase of LC Industrial, a 67,610 sq. ft.
industrial warehouse in Lethbridge, Alberta, for $5.93 million
(excluding closing costs). GLA has grown by 12% since IPO.
- The successful execution of these strategies contributed to:
- Revenue growth of 10% over Q1-2013 as a result of our expanded
portfolio. Weighted average base rent (per sq. ft.) and occupancy
remained consistent with year end. NOI also grew by 6% over
Q1-2013.
- FFO and AFFO 4% and 3% ahead of our twelve-month forecast,
respectively.
- Direct operating expenses were up by 13% over the comparative
period as a result of timing differences as well as differences in
allocations in the comparative period. Higher snow removal costs in
2014 also contributed to the increase.
- Distributions of $0.05625 per trust unit (in line with
forecast) were paid in January, February and March. Distributions
made during each of the eleven months of the REIT's operations
represent a payout ratio of 88%.
- We successfully completed a bought deal issuance of 1,900,000
trust units at $10.65 for gross proceeds of $20.24 million
subsequent to the quarter. The funds are to be used to fund two
property acquisitions from Melcor, with the remainder intended to
pay down our revolving credit facility, and for future acquisitions
and for general trust purposes. The two pending property
acquisitions demonstrate execution on our growth strategy via our
proprietary Melcor pipeline.
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Selected Quarter Highlights |
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Financial Highlights |
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|
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Three months ended March 31 |
|
|
($000s) |
2014 |
2013 |
% Change |
|
Non-standard KPIs |
|
|
|
|
Net
operating income (NOI) |
6,734 |
6,342 |
6 |
% |
Funds
from operations (FFO) |
4,288 |
3,995 |
7 |
% |
Adjusted funds from operations (AFFO) |
3,777 |
3,387 |
12 |
% |
|
|
|
|
|
Rental revenue |
10,647 |
9,688 |
10 |
% |
Income before fair value adjustments and taxes |
2,139 |
3,417 |
(37 |
)% |
Fair
value adjustment on investment properties |
169 |
2,594 |
(93 |
)% |
Distributions to unitholders |
1,541 |
n/a |
|
|
Cash
flows from operations |
2,296 |
7,036 |
(67 |
)% |
|
|
|
|
|
Per unit metrics(1) |
|
|
|
|
Income - diluted |
0.10 |
0.26 |
(62 |
)% |
FFO |
0.23 |
0.21 |
10 |
% |
AFFO |
0.20 |
0.18 |
11 |
% |
Distributions |
0.17 |
n/a |
|
|
|
|
|
|
|
|
|
($000s) |
31-Mar-14 |
|
31-Dec-13 |
|
% Change |
|
Total
assets ($000s) |
458,801 |
|
454,743 |
|
1 |
% |
Equity ($000s)(2) |
186,608 |
|
186,608 |
|
- |
% |
Debt
($000s)(3) |
219,496 |
|
215,601 |
|
2 |
% |
Weighted average interest rate on debt |
3.99 |
% |
3.98 |
% |
- |
% |
Debt
to GBV ratio |
51 |
% |
51 |
% |
- |
% |
Finance costs coverage ratio(4) |
2.94 |
|
2.96 |
|
(1 |
)% |
Debt
service coverage ratio(5) |
2.85 |
|
2.72 |
|
5 |
% |
|
|
|
|
|
|
|
Operational Highlights |
|
|
|
|
|
|
($000s) |
31-Mar-14 |
|
31-Dec-13 |
|
% Change |
|
Number of properties |
|
30 |
|
|
29 |
|
3 |
% |
Gross
leasable area (GLA) (sq. ft.) |
|
1,759,761 |
|
|
1,691,920 |
|
4 |
% |
Occupancy % (weighted by GLA) |
|
90.1 |
% |
|
90.6 |
% |
(1 |
)% |
Retention % (weighted by GLA) |
|
76.9 |
% |
|
75.5 |
% |
2 |
% |
Weighted average remaining lease term (years) |
|
4.52 |
|
|
4.75 |
|
(5 |
)% |
Weighted average base rent (per sq. ft.) |
$ |
16.23 |
|
$ |
16.63 |
|
(2 |
)% |
(1) Calculated as if the trust units and Class B LP Units were
outstanding during the entire current and comparative periods.
(2) Calculated as the sum of trust units and Class B LP Units at
their book value of $10.00.
(3) Calculated as the sum of total amount drawn on revolving
credit facility, mortgages payable and Class C LP Units, excluding
unamortized fair value adjustment on Class C LP Units, unamortized
transaction costs and unamortized discount on bankers
acceptance.
(4) Calculated as the sum of FFO and finance costs; divided by
finance costs, excluding distributions on Class B LP Units.
(5) Calculated as FFO; divided by sum of contractual principal
repayments on mortgages payable and distributions of Class C LP
Units, excluding amortization of fair value adjustment on Class C
LP Units.
MD&A and Financial Statements
Information included in this press release is a summary of
results. This press release should be read in conjunction with
Melcor REIT's Q1-2014 report to unitholders, including the
consolidated financial statements and management's discussion and
analysis for the three-months ended March 31, 2014 which can be
found on the REIT's website at www.MelcorREIT.ca or on SEDAR
(www.sedar.com).
About Melcor REIT
Melcor REIT is an unincorporated, open-ended real estate
investment trust. Melcor REIT owns, acquires, manages and leases
quality retail, office and industrial income-generating properties
with exposure to high growth Canadian markets. Its portfolio is
currently made up of interests in 30 properties representing
approximately 1.76 million square feet of gross leasable area
located across Alberta and in Regina, Saskatchewan and Kelowna,
British Columbia. For more information, please visit
www.melcorREIT.ca.
Non-Standard Measures
NOI, FFO and AFFO are key measures of performance used by real
estate operating companies; however, they are not defined by
International Financial Reporting Standards ("IFRS"), do not have
standard meanings and may not be comparable with other industries
or income trusts. These non-IFRS measures are more fully defined
and reconciled in the REIT's Management Discussion and Analysis for
the period ended March 31, 2014, which is available on SEDAR at
www.sedar.com.
Forward-Looking Statements
This press release may contain forward-looking information
within the meaning of applicable securities legislation, which
reflects the REIT's current expectations regarding future events.
Forward-looking information is based on a number of assumptions and
is subject to a number of risks and uncertainties, many of which
are beyond the REIT's control, that could cause actual results and
events to differ materially from those that are disclosed in or
implied by such forward-looking information. Such risks and
uncertainties include, but are not limited to, general and local
economic and business conditions; the financial condition of
tenants; the REIT's ability to refinance maturing debt; leasing
risks, including those associated with the ability to lease vacant
space; and interest rate fluctuations. The REIT's objectives and
forward-looking statements are based on certain assumptions,
including that the general economy remains stable, interest rates
remain stable, conditions within the real estate market remain
consistent, competition for acquisitions remains consistent with
the current climate and that the capital markets continue to
provide ready access to equity and/or debt. All forward-looking
information in this press release speaks as of the date of this
press release. The REIT does not undertake to update any such
forward-looking information whether as a result of new information,
future events or otherwise. Additional information about these
assumptions and risks and uncertainties is contained in the REIT's
filings with securities regulators.
Business ContactMelcor REITDarin RayburnChief Executive
Officer780.423.6931info@melcorREIT.caInvestor RelationsMelcor
REITJonathan Chia, CAChief Financial
Officer1.855.673.6931ir@melcorREIT.ca
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