This news 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.
TORONTO, Aug. 06, 2019 (GLOBE NEWSWIRE) -- DREAM INDUSTRIAL REIT (DIR.UN-TSX) or (“Dream Industrial REIT”, the “Trust” or “we”) today announced its financial results for the three and six months ended June 30, 2019. Management will host a conference call to discuss the financial results on August 7, 2019 at 11:00 a.m. (ET).
“We continue to transform and improve the overall quality of Dream Industrial REIT’s portfolio,” said Brian Pauls, Chief Executive Officer of Dream Industrial REIT. “The sale of our Eastern Canada portfolio provides significant flexibility to pursue attractive opportunities and add further scale in our target markets. At the same time, our focus on driving internal growth has led to strong comparative property NOI growth in all our regions, and we expect this trend to continue going forward.”
FINANCIAL HIGHLIGHTS
SELECTED FINANCIAL INFORMATION | |||||||||||||
(unaudited) | Three Months Ended | Six Months Ended | |||||||||||
(in thousands of dollars except per Unit amounts) | June 30, 2019 | June 30, 2018 | June 30, 2019 | June 30, 2018 | |||||||||
Operating results | |||||||||||||
Net income | $ | 84,017 | $ | 16,242 | $ | 75,756 | $ | 61,113 | |||||
Funds from operations (“FFO”)(1) | 27,617 | 20,125 | 52,568 | 41,357 | |||||||||
Net rental income | 35,185 | 27,719 | 66,884 | 55,366 | |||||||||
Comparative properties net operating income (“NOI”)(1)(2) | 27,166 | 25,940 | 53,356 | 51,813 | |||||||||
Per Unit amounts | |||||||||||||
Distribution rate | $ | 0.17 | $ | 0.17 | $ | 0.35 | $ | 0.35 | |||||
FFO – diluted(1)(3) | 0.20 | 0.21 | 0.41 | 0.43 | |||||||||
FFO payout ratio – diluted(1) | 87.1 | % | 82.9 | % | 85.6 | % | 80.6 | % | |||||
See footnotes at end. |
SELECTED BALANCE SHEET & PORTFOLIO INFORMATION | ||||||
(unaudited) | As at | |||||
(in thousands of dollars except per Unit amounts) | June 30, 2019 | December 31, 2018 | ||||
Available liquidity(1) | $ | 95,364 | $ | 103,162 | ||
Level of debt (net debt-to-assets ratio)(1) | 37.4 | % | 43.5 | % | ||
Net asset value (“NAV”) per Unit(1) | $ | 11.04 | $ | 10.54 | ||
Total portfolio(4) | ||||||
Investment properties | $ | 2,273,401 | $ | 2,138,411 | ||
Gross leasable area (“GLA”) (in millions of sq. ft.) | 21.6 | 20.2 | ||||
Occupancy rate – in-place and committed | 96.9 | % | 97.1 | % | ||
Occupancy rate – in-place | 96.3 | % | 95.7 | % | ||
See footnotes at end. |
QUARTERLY AND YEAR-TO-DATE FINANCIAL AND OPERATIONAL HIGHLIGHTS
At June 30, 2019, vacant space committed for future occupancy was approximately 146,000 square feet, bringing our overall in-place and committed occupancy to 96.9%. Substantially all of the Trust’s future committed occupancy is scheduled to take occupancy during the remainder of 2019.
INVESTMENT HIGHLIGHTS
CAPITAL HIGHLIGHTS
Key performance indicators | June 30, 2019 | December 31, 2018 | ||||
Level of debt (net debt-to-assets ratio)(1) | 37.4 | % | 43.5 | % | ||
Net debt-to-adjusted EBITDAFV (years)(1) | 6.4 | 7.2 | ||||
Interest coverage ratio (times)(1)(5) | 3.7 | 3.3 | ||||
Weighted average face interest rate on debt (period-end)(6) | 3.69 | % | 3.65 | % | ||
Weighted average remaining term to maturity on debt (years) | 4.4 | 4.4 | ||||
Unencumbered assets(1)(7) | $ | 381,108 | $ | 194,594 | ||
Available liquidity(1) | 95,364 | 103,162 | ||||
See footnotes at end. |
“Our second quarter operating results were strong and highlighted the continued improvement in our portfolio quality,” said Lenis Quan, Chief Financial Officer of Dream Industrial REIT. “Along with strong comparative property NOI growth, the Trust’s NAV per Unit has increased almost 10% year-over-year, reflecting the strength of our Greater Toronto and Montréal markets and our ability to capture higher rents. Our FFO per Unit is a little lower as we have decreased our leverage by more than 10% since the beginning of 2018 in order to have a stronger balance sheet, with ample financial flexibility to execute on strategies that will generate higher cash flows as well as NAV per Unit growth.”
CONFERENCE CALL
Senior management will host a conference call to discuss the results on Wednesday, August 7, 2019 at 11:00 a.m. (ET). To access the conference call, please dial 1-888-465-5079 in Canada and the U.S. or 416-216-4169 elsewhere and use passcode 7922 847#. To access the conference call via webcast, please go to Dream Industrial REIT’s website at www.dreamindustrialreit.ca and click on the link for News & Events, then click on Calendar of Events. A taped replay of the conference call and the webcast will be available for ninety (90) days following the call.
Other information
Information appearing in this news release is a select summary of results. The condensed consolidated financial statements and management’s discussion and analysis for the Trust will be available at www.dreamindustrialreit.ca and on www.sedar.com.
Dream Industrial REIT is an unincorporated, open-ended real estate investment trust. To date, Dream Industrial REIT owns and operates a portfolio of 210 geographically diversified light industrial properties comprising approximately 21.8 million square feet of gross leasable area in key markets across Canada and the U.S. Its objective is to build upon and grow its portfolio and to provide stable and sustainable cash distributions to its unitholders. For more information, please visit www.dreamindustrialreit.ca.
FOOTNOTES
(1) | FFO, comparative properties NOI, diluted FFO per Unit, diluted FFO payout ratio, available liquidity, level of debt (net debt-to-assets ratio), NAV per Unit, net debt-to-adjusted EBITDAFV, interest coverage ratio and unencumbered assets are non-GAAP measures used by Management in evaluating operating and financial performance. Please refer to the cautionary statements under the heading “Non-GAAP Measures” in this press release. | |
(2) | Excludes Eastern Canada portfolio in the respective periods. | |
(3) | A description of the determination of diluted amounts per Unit can be found in our Management’s Discussion and Analysis for the three and six months ended June 30, 2019, in the section “Non-GAAP measures and other disclosures”, under the heading “Weighted average number of Units”. | |
(4) | Total portfolio excludes assets held for sale in the respective periods. | |
(5) | Interest coverage ratio has been restated in the comparative period to conform to current period presentation. | |
(6) | Weighted average face interest rate on debt is calculated as the weighted average face interest rate of all interest-bearing debt. | |
(7) | Unencumbered assets exclude assets held for sale in the current period. |
Non-GAAP Measures
The Trust’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, the Trust discloses and discusses certain non-GAAP financial measures, including FFO, comparative properties NOI, diluted FFO per Unit, diluted FFO payout ratio, available liquidity, level of debt (net debt-to-assets ratio), NAV per Unit, net debt-to-adjusted EBITDAFV, interest coverage ratio and unencumbered assets as well as other measures discussed elsewhere in this release. These non-GAAP measures are not defined by IFRS, do not have a standardized meaning and may not be comparable with similar measures presented by other income trusts. The Trust has presented such non-GAAP measures as Management believes they are relevant measures of the Trust’s underlying operating and financial performance. Non-GAAP measures should not be considered as alternatives to net income, net rental income, cash flows generated from (utilized in) operating activities, cash and cash equivalents, total assets, non-current debt, total equity, or comparable metrics determined in accordance with IFRS as indicators of the Trust’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-GAAP measures and other disclosures” in Dream Industrial REIT’s MD&A for the three and six months ended June 30, 2019.
Forward looking information
This press release may contain forward-looking information within the meaning of applicable securities legislation, including statements regarding our objectives and strategies and plans to expand our presence in our existing and target markets, strategies and plans to generate higher cash flows as well as NAV per Unit growth, expected comparative properties NOI growth in our markets, and the potential acquisition opportunities. 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 Industrial REIT’s control, which could cause actual results to differ materially from those that are disclosed in or implied by such forward-looking information. These risks and uncertainties include, but are not limited to, general and local economic and business conditions; the financial condition of tenants; our ability to refinance maturing debt; leasing risks, including those associated with the ability to lease vacant space; interest and currency rate fluctuations; and with respect to the acquisition pipeline, the failure to satisfy or waive customary conditions on closing as well as the risk that the acquired properties may not perform as anticipated. Our 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. Dream Industrial REIT 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 contained in Dream Industrial REIT’s filings with securities regulators, including its latest annual information form and MD&A. These filings are also available at Dream Industrial REIT’s website at www.dreamindustrialreit.ca.
For further information, please contact:
Dream Industrial REIT
Brian Pauls | Lenis Quan | |
Chief Executive Officer | Chief Financial Officer | |
(416) 365-2365 | (416) 365-2353 | |
bpauls@dream.ca | lquan@dream.ca |