Canada NewsWire
QUÉBEC CITY, May 6, 2019
QUÉBEC CITY, May 6, 2019 /CNW Telbec/ - Cominar Real Estate Investment Trust ("Cominar" or the "REIT") (TSX: CUF.UN) is pleased to announce its results for the first quarter ended March 31, 2019.
"During the first quarter of 2019 we continued to make progress on our objective of driving stronger operating performance with improvement in many key metrics including in-place occupancy which increased to 89.7%, rent increases on renewals of 3% and growth of same property NOI of 1.9%," said Sylvain Cossette, President and Chief Executive Officer of Cominar. "We have been actively moving ahead with our strategic review and are focused on portfolio optimization, cost rationalization and increasing the efficiency of our platform."
"Our first quarter results provide us with heightened confidence in achieving our goals of accelerated NOI growth, balance sheet de-risking, and selective dispositions in order to drive performance", stated Heather C. Kirk, Executive Vice President and Chief Financial Officer. "We remain focused on the execution of our refinancing strategy and initiatives to streamline and structure operations in order to enhance capital allocation, drive revenue growth and control costs".
FINANCIAL AND OPERATING HIGHLIGHTS
BALANCE SHEET AND LIQUIDITY HIGHLIGHTS
INVESTMENT HIGHLIGHTS
NON-IFRS FINANCIAL MEASURES
Net operating income, funds from operations (FFO), adjusted funds from operations (AFFO) and adjusted net income are not measures recognized by International Financial Reporting Standards ("IFRS") and do not have standardized meanings prescribed by IFRS. Such measures may differ from similar computations as reported by similar entities and, accordingly, may not be comparable to similar measures reported by such other entities.
RESULTS OF OPERATIONS | ||||||
For the quarters ended March 31 | 2019 | 2018(1) | ||||
($000) | ($000) | |||||
Operating revenues | 181,944 | 208,865 | ||||
Operating expenses | (95,259) | (108,319) | ||||
Net operating income(2) | 86,685 | 100,546 | ||||
Finance charges | (36,751) | (43,802) | ||||
Trust administrative expenses | (5,453) | (5,255) | ||||
Change in fair value of investment properties | (221) | (4,331) | ||||
Share of joint ventures' net income | 1,388 | 1,085 | ||||
Transaction costs | (1,339) | (18,554) | ||||
Net income before income taxes | 44,309 | 29,689 | ||||
Income taxes | ||||||
Current | — | (6,251) | ||||
Deferred | — | 6,539 | ||||
— | 288 | |||||
Net income | 44,309 | 29,977 | ||||
(1) The quarter ended March 31, 2018 includes results of 95 non-core properties sold to Slate for total consideration of $1.14 billion. | ||||||
(2) Non-IFRS financial measure. |
SAME PROPERTY NET OPERATING INCOME(1) | |||||
For the quarters ended March 31 | 2019 | 2018(2) | |||
($000) | ($000) | % Δ | |||
Net operating income – Financial statements | 86,061 | 84,675 | |||
Joint-ventures | 2,358 | 2,113 | |||
Same Property – Net operating income – Cominar's proportionate share(1) | 88,419 | 86,788 | |||
Breakdown | |||||
Same property portfolio | |||||
Office | 34,222 | 33,498 | 2.2 | ||
Retail | 31,735 | 32,484 | (2.3) | ||
Industrial and flex | 22,462 | 20,806 | 8.0 | ||
Same property portfolio | 88,419 | 86,788 | 1.9 | ||
Other | 659 | 15,839 | |||
Net operating income – Cominar's proportionate share(1) | 89,078 | 102,627 | |||
(1) Non-IFRS financial measure. | |||||
(2) The quarter ended March 31, 2018 includes results of 95 non-core properties sold to Slate for total consideration of $1.14 billion. |
FUNDS FROM OPERATIONS (FFO) AND ADJUSTED FUNDS FROM OPERATIONS (AFFO)
The following table presents a reconciliation of net income, as determined in accordance with IFRS, and funds from operations and adjusted funds from operations:
For the quarters ended March 31 | 2019 | 2018(1) | ||
($000) | ($000) | |||
Net income | 44,309 | 29,977 | ||
Taxes on disposition of properties | — | 6,251 | ||
Deferred income taxes | — | (6,539) | ||
Initial and re-leasing salary costs | 844 | 1,009 | ||
Change in fair value of investment properties(2) | 221 | 4,331 | ||
Capitalizable interest on properties under development – joint ventures | 174 | 154 | ||
Transaction costs | 1,339 | 18,554 | ||
Funds from operations(2)(3) | 46,887 | 53,737 | ||
Provision for leasing costs | (8,429) | (7,153) | ||
Recognition of leases on a straight-line basis(2) | (163) | (623) | ||
Capital expenditures – maintenance of rental income generating capacity | (4,768) | (3,682) | ||
Adjusted funds from operations(2)(3) | 33,527 | 42,279 | ||
Per unit information | ||||
FFO (FD)(3)(4) | 0.26 | 0.29 | ||
AFFO (FD)(3)(4) | 0.18 | 0.23 | ||
Payout ratio of adjusted funds from operations(3)(4) | 100.0% | 108.7% | ||
(1) FFO and AFFO for periods ended March 31, 2018 include results of 95 non-core properties sold to Slate for total consideration of $1.14 billion. | ||||
(2) Including Cominar's proportionate share in joint ventures. | ||||
(3) Non-IFRS financial measure. | ||||
(4) Fully diluted. |
Excluding a severance allowance of $1.0 million paid in 2019 following the departure of an executive officer, FFO would have been $47.9 million and AFFO would have been $34.6 million, or $0.19 per unit, and AFFO payout ratio would have been 94.7%.
OCCUPANCY RATES | |||||||||
Montreal | Québec City | Ottawa | Total | ||||||
As at March 31, 2019 | Committed | In-place | Committed | In-place | Committed | In-place | Committed | In-place | |
Property type | |||||||||
Office | 89.7% | 85.6% | 97.9% | 95.0% | 93.4% | 85.4% | 92.3% | 87.8% | |
Retail | 95.0% | 87.7% | 92.1% | 85.1% | 83.4% | 53.7% | 93.5% | 85.4% | |
Industrial and flex | 94.8% | 93.8% | 95.9% | 94.7% | N/A | N/A | 95.0% | 94.0% | |
Total | 93.5% | 90.1% | 95.0% | 90.9% | 92.3% | 80.6% | 93.8% | 89.7% |
ADDITIONAL FINANCIAL INFORMATION
Cominar's condensed interim consolidated financial statements and interim management's discussion and analysis for the first quarter of 2019 are filed with SEDAR at sedar.com and are available on Cominar's website at cominar.com.
CONFERENCE CALL ON MAY 6, 2019
On Monday, May 6, 2019 at 11 a.m. (ET), Cominar's management will hold a conference call to present the results for the first quarter of 2019. In order to participate please dial 1 888 390‑0546. A presentation will be available before the conference call on the REIT's website at cominar.com, under the Conference Call header. In addition, a replay of the conference call will be available from Monday, May 6, 2019 at 2 p.m. to Monday, May 13, 2019 at 11:59 p.m., by dialing 1 888 390-0541 and entering passcode: 000558#.
PROFILE AS AT MAY 6, 2019
Cominar is one of the largest diversified real estate investment trust in Canada and is the largest commercial property owner in the Province of Québec. The REIT owns a real estate portfolio of 346 properties in three different market segments, that is, office properties, retail properties and industrial and flex properties. Cominar's portfolio totals 37.3 million square feet located in the Montreal, Québec City and Ottawa areas. Cominar's primary objectives are to maximize unit value through the proactive management of its properties.
FORWARD-LOOKING STATEMENTS
This press release may contain forward-looking statements with respect to Cominar and its operations, strategy, financial performance and financial position. These statements generally can be identified by the use of forward-looking words such as "may", "will", "expect", "estimate", "anticipate", "intend", "believe" or "continue" or the negative thereof or similar variations and the use of conditional and future tenses. The actual results and performance of Cominar discussed herein could differ materially from those expressed or implied by such statements. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Some important factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors, competition, changes in government regulation and the factors described under "Risk Factors" in Cominar's Annual Information Form. The cautionary statements qualify all forward-looking statements attributable to Cominar and persons acting on its behalf. Unless otherwise stated, all forward-looking statements speak only as of the date of this press release. Cominar does not assume any obligation to update the aforementioned forward-looking statements, except as required by applicable laws.
SOURCE COMINAR REAL ESTATE INVESTMENT TRUST
View original content: http://www.newswire.ca/en/releases/archive/May2019/06/c2958.html
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