TORONTO, ONTARIO--(Marketwired - Nov. 5, 2015) -
This press release contains forward-looking information that is based upon assumptions and is subject to risks and uncertainties as indicated in the cautionary note contained within this press release.
Dream Unlimited Corp. (TSX:DRM)(TSX:DRM.PR.A) ("Dream", "the Company" or "we") today announced its financial results for the three and nine months ended September 30, 2015. Basic earnings per share ("EPS") for the three months ended September, 2015 were $0.23, up from $0.07 for the three months ended September 30, 2014. Basic EPS for the nine months ended September 30, 2015 were $1.36, up from $0.35 for the nine months ended September 30, 2014. At September 30, 2015, the Company's total equity increased to $719.7 million, up 22% from $591.8 million at December 31, 2014.
Michael Cooper, President & Chief Responsible Officer of Dream commented: "Our third quarter and year to date results are quite strong, despite headwinds as a result of low oil prices, poor crop quality in Saskatchewan, general political and economic uncertainty and continued lower growth expectations for Canada. We continue to extract the highest and best value from our existing assets and outstanding people in both the near and longer term. We are making progress in achieiving development approvals for our lands in Western Canada, our urban development projects in Toronto and Ottawa are progressing well and we are pleased with the continued success and value creation by our new retail division."
A summary of our results for the three and nine months ended September 30, 2015 is included in the table below.
Three months ended September 30, | Nine months ended September 30, | ||||||||
(in thousands of Canadian dollars, except per share amounts) | 2015 | 2014 | 2015 | 2014 | |||||
Revenue | $ | 130,350 | $ | 77,704 | $ | 244,039 | $ | 261,246 | |
Net margin(1) | $ | 25,935 | $ | 14,411 | $ | 55,632 | $ | 65,606 | |
Net margin %(1) | 19.9% | 18.5% | 22.8% | 25.1% | |||||
Earnings before income taxes | $ | 23,193 | $ | 9,272 | $ | 175,504 | $ | 55,587 | |
Earnings for the period (4) | $ | 26,085 | $ | 7,825 | $ | 153,704 | $ | 39,072 | |
Basic earnings per share(2) | $ | 0.23 | $ | 0.07 | $ | 1.36 | $ | 0.35 | |
Diluted earnings per share | $ | 0.22 | $ | 0.07 | $ | 1.29 | $ | 0.35 | |
Net margin by major business segment before eliminations | |||||||||
Land development(3) | $ | 13,127 | $ | 3,854 | $ | 24,380 | $ | 20,055 | |
Housing development(3) | $ | 1,596 | $ | 2,459 | $ | 3,337 | $ | 5,966 | |
Condominium development | $ | 10,538 | $ | 1,485 | $ | 9,720 | $ | 19,779 | |
Investment and recreational properties | $ | (1,976) | $ | (1,390) | $ | 4,256 | $ | 3,636 | |
Asset management and management services | $ | 4,543 | $ | 9,436 | $ | 18,362 | $ | 19,577 | |
September 30, 2015 |
December 31, 2014 |
||||||||
Total assets | $ | 1,446,442 | $ | 1,223,198 | |||||
Total liabilities | $ | 726,732 | $ | 631,365 | |||||
Total equity | $ | 719,710 | $ | 591,833 |
(1) Net margin (see "Additional Items" on page 38 of our management's discussion and analysis ("MD&A") for the period ended September 30, 2015) represents revenue less direct operating costs and asset management and advisory services expenses; including selling, marketing and other operating costs. |
(2) Basic EPS is computed by dividing Dream's earnings attributable to owners of the parent by the weighted average number of Dream Subordinate Voting Shares and Dream Class B shares outstanding during the year. |
(3) Net margin (see "Additional Items") results are shown before eliminations of internal lot sales to our housing division, as the homes have been sold to external customers during the period. Net margin of $1.9 million and $4.4 million for the three and nine months ended September 30, 2015 ($1.4 million and $3.4 million - three and nine months ended September 30, 2014) have been eliminated on consolidation. For additional details, please refer to the discussion on page 9-10 of our MD&A for the period ended September 30, 2015. |
(4) During the three and nine months ended September 30, 2015, the Company recognized a recovery of $9.2 million through income tax expense. For additional details please refer to the discussion on page 31 of our MD&A. |
Key Highlights: Development
Other Advancements & Updates in Western Canada
Asset Management:
Capital Structure & Financing
Select financial operating metrics for the three and nine months ended September 30, 2015 are summarized in the table below.
Three months ended September 30, | Nine months ended September 30, | |||||||
(in thousands of dollars, except average selling price and units) | 2015 | 2014 | 2015 | 2014 | ||||
LAND DEVELOPMENT | ||||||||
Lot revenue | $ | 34,974 | $ | 18,459 | $ | 54,765 | $ | 38,178 |
Acre revenue(1) | $ | 5,993 | $ | 7,225 | $ | 19,066 | $ | 31,515 |
Total revenue(1),(2) | $ | 40,967 | $$ | 25,684 | $ | 73,831 | $ | 69,693 |
Gross margin(1),(2),(6) | $ | 15,558 | $ | 6,582 | $ | 31,849 | $ | 26,859 |
Gross margin (%) | 38.0% | 25.6% | 43.1% | 38.5% | ||||
Net margin(1),(2),(6) | $ | 13,127 | $ | 3,854 | $ | 24,380 | $ | 20,055 |
Net margin (%) | 32.0% | 15.0% | 33.0% | 28.8% | ||||
Lots sold | 285 | 163 | 456 | 336 | ||||
Average selling price - lot | $ | 123,000 | $ | 111,000 | $ | 120,000 | $ | 113,000 |
Undeveloped acres sold | - | - | 45 | - | ||||
Average selling price - undeveloped acres | - | - | 19,000 | - | ||||
Developed acres sold | 7 | 7 | 24 | 40 | ||||
Average selling price - developed acres | $ | 850,000 | $ | 966,000 | $ | 759,000 | $ | 786,000 |
HOUSING DEVELOPMENT | ||||||||
Housing units occupied | 62 | 67 | 168 | 160 | ||||
Revenue(1) | $ | 25,269 | $ | 29,051 | $ | 67,515 | $ | 68,837 |
Gross margin(2),(6) | $ | 4,795 | $ | 5,580 | $ | 12,176 | $ | 14,135 |
Gross margin (%) | 19.0% | 19.2% | 18.0% | 20.5% | ||||
Net margin(2),(6) | $ | 1,596 | $ | 2,459 | $ | 3,337 | $ | 5,966 |
Net margin (%) | 6.3% | 8.5% | 4.9% | 8.7% | ||||
Average selling price - housing units | $ | 408,000 | $ | 434,000 | $ | 402,000 | $ | 430,000 |
Average selling price - per square foot for units occupied | $ | 282 | $ | 280 | $ | 282 | $ | 281 |
CONDOMINIUM DEVELOPMENT | ||||||||
Attributable to Dream, excluding equity accounted investments | ||||||||
Condominium occupancies - units | 172 | 12 | 172 | 169 | ||||
Revenue(3) | $ | 54,727 | $ | 8.430 | $ | 56,745 | $ | 70,857 |
Gross margin(4),(6) | $ | 12,277 | $ | 1,981 | $ | 13,005 | $ | 21,854 |
Gross margin (%) | 22.4% | 23.5% | 22.9% | 30.8% | ||||
Net margin(6) | $ | 10,538 | $ | 1,485 | $ | 9,720 | $ | 19,779 |
Net margin (%) | 19.3% | 17.6% | 17.1% | 27.9% | ||||
Average selling price of condominiums occupied | ||||||||
Per unit | $ | 304,000 | $ | 517,000 | $ | 304,000 | $ | 377,000 |
Per square foot | $ | 470 | $ | 559 | $ | 470 | $ | 503 |
ASSET MANAGEMENT AND MANAGEMENT SERVICES | ||||||||
Total assets under management - listed funds(6) | $ | 11,687,946 | $ | 11,844,327 | $ | 11,687,946 | $ | 11,844,327 |
Fee earning assets under management - listed funds(6) | $ | 4,947,195 | $ | 11,844,327 | $ | 4,947,195 | $ | 11,844,327 |
Revenue | $ | 7,030 | $ | 11,600 | $ | 24,595 | $ | 28,903 |
Net margin(6) | $ | 4,543 | $ | 9,436 | $ | 18,362 | $ | 19,577 |
Net margin (%) | 64.6% | 81.3% | 74.7% | 67.7% | ||||
INVESTMENT INCOME EARNED ON INVESTMENTS IN LISTED FUNDS | ||||||||
Dream Office REIT | $ | 909 | $ | 227 | $ | 2,044 | $ | 681 |
Other distributions from listed funds | $ | 411 | $ | 422 | $ | 1,474 | $ | 1,224 |
INVESTMENT AND RECREATIONAL PROPERTIES | ||||||||
Revenue | $ | 7,412 | $ | 7,111 | $ | 33,702 | $ | 33,177 |
Net margin(5),(6) | $ | (1,976) | $ | (1,390) | $ | 4,256 | $ | 3,636 |
Net margin (%) | (26.7)% | (19.5)% | 12.6% | 11.0% | ||||
(1) Results include revenue and gross margin of $0.8 million and $0.2 million, respectively relating to 45 acres of undeveloped land sold to the Saskatchewan Ministry of Highways and Infrastructure for $0.8 million. See Results of Operations - Land for Regina on page 16 of our MD&A for further details. |
(2) Results include land revenues and net margin on internal lot sales to our housing division as the homes have been sold to external customers by the housing division during the year. Revenue and net margin results of $5.1 million and $1.9 million, and $12.3 million and $4.4 million in the three and nine months ended September 30, 2015 ($4.2 million ($1.4 million) and $10.2 million ($3.4 million) in the same period in the prior year), respectively, recognized in both the land and housing divisions, have been eliminated on consolidation. For more details, please refer to page 9-10 of our MD&A. |
(3) Comparative condominium revenue results include a reclassification of guarantee fees income, previously included in investment and other income. |
(4) Gross margin for condominium operations include interest expense, which is capitalized during the development period and expensed through cost of sale as units are occupied. |
(5) Net margin for investment and recreational properties includes depreciation expense. |
(6) Assets under management and fee earning assets under management are non-IFRS measures used by Management in evaluating operating performance. Please refer to the cautionary statements under the heading "Non-IFRS Measures" in this press release. Refer to "Additional Items" on page 38 of our MD&A for further details on gross margin and net margin. |
Other Information
Information appearing in this press release is a select summary of results. The financial statements and MD&A for the Company for the period ended September 30, 2015 are available at www.dream.ca and on www.sedar.com.
Conference Call
Senior management will host a conference call on November 6, 2015 at 9:oo am. (ET). To access the call, please dial 1-888-465-5079 in Canada and the United States or 416-216-4169 elsewhere and use passcode 6281 674#. To access the conference call via webcast, please go to Dream's website at www.dream.ca and click on the link for News and Events, then click on Calendar of Events. A taped replay of the conference call and the webcast will be available for 90 days.
About Dream Unlimited Corp.
Dream is one of Canada's leading real estate companies with approximately $15 billion of assets under management in North America and Europe. The scope of the business includes residential land development, housing and condominium development, asset management for three TSX-listed real estate investment trusts and one TSX-listed diversified, hard asset alternatives trust, investments in and management of Canadian renewable energy infrastructure and commercial property ownership. Dream has an established track record for being innovative and for its ability to source, structure and execute on compelling investment opportunities.
Non-IFRS Measures
Dream's condensed consolidated financial statements are prepared in accordance with International Financial Reporting Standards ("IFRS"). In this press release, as a complement to results provided in accordance with IFRS, Dream discloses and discusses certain non-IFRS financial measures, including: internal rate of return (IRR), assets under management, fee earning assets under management anddebt-to-total assets as well as other measures discussed elsewhere in this release. These non-IFRS measures are not defined by IFRS, do not have a standardized meaning and may not be comparable with similar measures presented by other issuers. Dream has presented such non-IFRS measures as Management believes they are relevant measures of our underlying operating performance and debt management. Non-IFRS measures should not be considered as alternatives to comparable metrics determined in accordance with IFRS as indicators of Dream's performance, liquidity, cash flow, and profitability. For a full description of these measures and, where applicable, a reconciliation to the most directly comparable measure calculated in accordance with IFRS, please refer to the "Non-IFRS Measures" section in Dream's MD&A for the period ended September 30, 2015.
Forward-Looking Information
This press release may contain forward-looking information within the meaning of applicable securities legislation, including, but not limited to, anticipated lot and developed acres sales results and housing unit occupancies, expected GLA of retail developments, timing of leasing of future retail developments, anticipated sales of condominium units, parking and lockers, the estimated hard construction costs and soft costs associated with the construction of projects including sales and marketing expenses, finance, design and development fees and other direct overhead expenses, development plans of future stages of the Athletes' Village, timing of land acquisitions in connection with our Zibi development and the timing of Alberta housing occupancies.. 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 Dream's control, which could cause actual results to differ materially from those that are disclosed in or implied by such forward-looking information. These assumptions include, but are not limited to: the nature of development lands held and the development potential of such lands, our ability to bring new developments to market, anticipated positive general economic and business conditions, including low unemployment and interest rates, positive net migration, oil and gas commodity prices, our business strategy, including geographic focus, anticipated sales volumes and performance of our underlying business segments. Risks and uncertainties include, but are not limited to, general and local economic and business conditions, employment levels, regulatory risks, mortgage rates and regulations, environmental risks, consumer confidence, seasonality, adverse weather conditions, reliance on key clients and personnel and competition. All forward looking information in this press release speaks as of November 5, 2015. Dream does not undertake to update any such forward looking information whether as a result of new information, future events or otherwise, except as required by law. Additional information about these assumptions and risks and uncertainties is disclosed in filings with securities regulators filed on SEDAR (www.sedar.com).
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