MONTREAL, March 22, 2019 (GLOBE NEWSWIRE) -- (TSX-V: FRO.UN) Fronsac Real Estate Investment Trust (“Fronsac REIT” or “Fronsac”) announces its results for the year ended December 31, 2018 and that it will make monthly cash distributions of 0.185¢ per unit, representing 2.220¢ per unit on an annualized basis, on April 30th, May 31st and June 28th, 2019 to unitholders of record on April 15th, May 15th and June 14th, 2019, respectively.
For the quarter ended December 31st, 2018, Fronsac reported recurring funds from operations ("Recurring FFO") per unit of 0.91¢ compared to 0.72¢ per unit for the quarter ended December 31, 2017, an increase of 26%. Recurring FFO was $923,414, an increase of 69% ($548,042 in Q4 2017). During Q4 2018 the Trust’s property rental income was $1,719,184 compared to $1,316,577 in Q4 2017, an increase of 31%. NOI (Net operating Income) was $1,489,661 compared to $1,021,095 in Q4 2017, an increase of 46%. Fronsac recorded a net income attributable to unitholders of $(3,094,491), or (3.05¢ per unit, compared to a net income of $1,839,189, or 2.41¢ per unit, in Q4 2017.
For the twelve months ended December 31st, 2018, Fronsac reported recurring funds from operations ("Recurring FFO") per unit of 3.66¢ compared to 3.17¢ per unit for the same period in 2017, an increase of 15%. Recurring FFO was $3,336,550, an increase of 56% ($2,137,217 for the same period in 2017). During the period ended December 31, 2018 the Trust’s property rental income was $6,275,277 compared to $4,359,277 for the same period in 2017, an increase of 44%. NOI (Net operating Income) was $5,112,675 compared to $3,487,615 for the same period in 2017, an increase of 47%. Fronsac recorded a net loss attributable to unitholders of $(898,320), or (0.99)¢ per unit, compared to net income of $4,540,944, or 6.74¢ per unit, for the same period in 2017.
Jason Parravano President and CEO said: “2018 marked another year of double digit per unit growth for Fronsac. We added 12 properties to the portfolio while continuing to diversify our asset and tenant base alike. Our portfolio now consists of 47 properties with a value north of $100M. Our balance sheet remains healthy, with a debt to gross book value ratio of 55% and from a cash flow perspective, we have maintained a conservative payout patio of 55%. We continue to identify opportunities that fit into our business model and hope to continue this forward momentum in 2019.”
The tables below represent other financial highlights as well as the reconciliation from net income to FFO for the periods ended December 31st, 2018 and its comparative period. This information should be read in conjunction with the Consolidated Financials Statements and MD&A for the quarters ended December 31st, 2018 and December 31st, 2017.
| SUMMARY OF SELECTED ANNUAL INFORMATION | |||||||
| 12 months | |||||||
| Periods ended December 31 | 2018 | 2017 | Δ | % | |||
| Financial info | |||||||
| Property rental income | 6,275,277 | 4,359,277 | 1,916,000 | 44 | % | ||
| Total revenue | 6,290,277 | 4,369,277 | 1,921,000 | 44 | % | ||
| NOI (1) | 5,112,675 | 3,487,615 | 1,625,060 | 47 | % | ||
| FFO (1) | 3,351,550 | 2,147,217 | 1,204,333 | 56 | % | ||
| Recurring FFO (1) | 3,336,550 | 2,137,217 | 1,199,333 | 56 | % | ||
| AFFO (1) | 3,038,111 | 2,014,775 | 1,023,336 | 51 | % | ||
| EBITDA (1) | 4,749,213 | 3,013,742 | 1,735,471 | 58 | % | ||
| Investment properties (2) | 108,165,635 | 69,588,555 | 38,577,080 | 55 | % | ||
| Total assets | 99,881,160 | 70,006,481 | 29,874,679 | 43 | % | ||
| Total mortgage/loans/long term debt (3) | 53,365,481 | 31,716,924 | 21,648,557 | 68 | % | ||
| Total convertible debentures | 1,593,481 | 250,581 | 1,342,900 | 536 | % | ||
| Total equity | 42,292,960 | 36,708,396 | 5,584,564 | 15 | % | ||
| Weighted average units o/s - basic | 91,163,634 | 67,398,715 | 23,764,919 | 35 | % | ||
| Amounts on a per unit basis | |||||||
| FFO | 0.0368 | 0.0319 | 0.0049 | 15 | % | ||
| Recurring FFO | 0.0366 | 0.0317 | 0.0049 | 15 | % | ||
| AFFO | 0.0333 | 0.0299 | 0.0034 | 11 | % | ||
| Distributions | 0.0202 | 0.0180 | 0.0022 | 12 | % | ||
| (1) Non-IFRS financial measures | |||||||
| (2) Includes value of investment properties owned through joint ventures | |||||||
| (3) Excludes convertible debentures | |||||||
| RECONCILIATION OF NET INCOME TO FFO | |||||||||||||||||
| 3 months | 12 months | ||||||||||||||||
| Periods ended December 31 | 2018 | 2017 | Δ | 2018 | 2017 | Δ | |||||||||||
| Net income (loss) attributable to unitholders | (3,094,491 | ) | 1,839,189 | (4,933,680 | ) | (898,320 | ) | 4,540,944 | (5,439,264 | ) | |||||||
| Debenture issuance costs | - | - | - | 53,171 | - | 53,171 | |||||||||||
| Δ in value of investment properties | 4,017,199 | (787,749 | ) | 4,804,948 | 3,871,418 | (2,174,622 | ) | 6,046,040 | |||||||||
| Δ in value of investment properties in joint ventures | 6,681 | (7,260 | ) | 13,941 | 163,104 | (148,900 | ) | 312,004 | |||||||||
| Unit based compensation | (1,485 | ) | 2,920 | (4,405 | ) | 79,025 | 70,745 | 8,280 | |||||||||
| Δ in liability component of exch. preferred units & debentures | 17,068 | 7,568 | 9,500 | 27,950 | 43,832 | (15,882 | ) | ||||||||||
| Δ in fair value of derivative financial instruments | (26,615 | ) | (511,244 | ) | 484,629 | 45,105 | (189,400 | ) | 234,505 | ||||||||
| Income taxes | 5,057 | 4,618 | 439 | 10,097 | 4,618 | 5,479 | |||||||||||
| FFO(1) - basic | 923,414 | 548,042 | 69 | % | 3,351,550 | 2,147,217 | 56 | % | |||||||||
| FFO per unit - basic | 0.0091 | 0.0072 | 26 | % | 0.0368 | 0.0319 | 15 | % | |||||||||
| Distributions paid on exchangeable preferred units and convertible debentures (if dilutive) | 7,500 | - | 7,500 | 15,000 | 15,000 | - | |||||||||||
| FFO - diluted | 930,914 | 548,042 | 70 | % | 3,366,550 | 2,162,217 | 56 | % | |||||||||
| FFO per unit - diluted | 0.0089 | 0.0072 | 24 | % | 0.0359 | 0.0318 | 13 | % | |||||||||
| Recurring FFO - basic | 923,414 | 548,042 | 69 | % | 3,336,550 | 2,137,217 | 56 | % | |||||||||
| Recurring FFO per unit - basic | 0.0091 | 0.0072 | 26 | % | 0.0366 | 0.0317 | 15 | % | |||||||||
| Distributions | 512,014 | 385,162 | 126,852 | 1,834,111 | 1,277,539 | 556,572 | |||||||||||
| Distributions per unit | 0.0050 | 0.0045 | 11 | % | 0.0202 | 0.0180 | 12 | % | |||||||||
| FFO - basic after distributions | 0.0040 | 0.0027 | 0.0014 | 0.0166 | 0.0139 | 0.0027 | |||||||||||
| Recurring FFO - basic after distributions | 0.0040 | 0.0027 | 0.0014 | 0.0164 | 0.0137 | 0.0027 | |||||||||||
| Distributions as a % of | |||||||||||||||||
| FFO - basic | 55 | % | 63 | % | (7 | %) | 55 | % | 56 | % | (1 | %) | |||||
| Distributions as a % of | |||||||||||||||||
| Recurring FFO - basic | 55 | % | 63 | % | (7 | %) | 55 | % | 57 | % | (2 | %) | |||||
| Weighted avg. units o/s | |||||||||||||||||
| Basic | 101,590,060 | 76,378,013 | 25,212,047 | 91,163,634 | 67,398,715 | 23,764,919 | |||||||||||
| Diluted | 104,094,743 | 76,378,013 | 27,716,730 | 93,668,317 | 67,980,110 | 25,688,207 | |||||||||||
| (1) FFO is a Non-IFRS financial measure | |||||||||||||||||
About Fronsac - Fronsac Real Estate Investment Trust is an open-ended trust that acquires and owns high quality triple net and management-free commercial real estate properties.
Forward-Looking Statements - This press release contains forward-looking statements and information as defined by applicable securities laws. Fronsac warns the reader that actual events may differ materially from current expectations due to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from the results anticipated in such statements. Among these include the risks related to economic conditions, the risks associated with the local real estate market, the dependence to the financial condition of tenants, the uncertainties related to real estate activities, the changes in interest rates, the availability of financing in the form of debt or equity, the effects related to the adoption of new IFRS standards, as well as other risks and factors described from time to time in the documents filed by Fronsac with securities regulators, including the management report. Fronsac does not update or modify its forward-looking statements even if future events occur or for any other reason, unless required by law or any regulatory authority.
Neither the TSX Venture Exchange Inc., nor its Regulatory Services Provider (as that term is defined in the Policy of the TSX Venture Exchange and its Regulatory Services Provide) accepts any responsibility for the adequacy or accuracy of this release.
The December 31st, 2018 financial statements and management discussion & analysis of Fronsac REIT may be viewed on SEDAR at www.sedar.com
For further information please contact Jason Parravano at (450) 536-5328.