MONTREAL, March 20, 2020 (GLOBE NEWSWIRE) -- (TSX-V: FRO.UN) Fronsac Real Estate Investment Trust (“Fronsac REIT” or “Fronsac”) announces its results for the year ended December 31st, 2019 and that it will make monthly cash distributions of 0.213¢ per unit, representing 2.555¢ per unit on an annualized basis, on April 30th, May 29th and June 30th, 2020 to unitholders of record on April 15th, May 15th and June 15th, 2020, respectively.
For the quarter ended December 31, 2019, Fronsac reported recurring funds from operations ("Recurring FFO") per unit of 1.10¢ compared to 0.91¢ per unit for the quarter ended December 31, 2018, an increase of 21%. Recurring FFO was $1,295,716, an increase of 40% ($923,414 in Q4 2018). During Q4 2019, the Trust’s property rental income was $2,738,295 compared to $1,719,184 in Q4 2018, an increase of 59%. NOI (Net operating Income) was $2,001,059 compared to $1,489,661 in Q4 2018, an increase of 34%. Fronsac recorded a net loss attributable to unitholders of $997,612, or (0.85¢) per unit, compared to a net loss of $4,085,302, or (4.02¢) per unit, in Q4 2018.
For the 12-month period ended December 31, 2019, Fronsac reported Recurring FFO per unit of 4.14¢ compared to 3.66¢ per unit for the same period in 2018, an increase of 13%. Recurring FFO was $4,615,394, an increase of 38% ($3,336,550 for the same period in 2018). During the 12-month period ended December 31, 2019, the Trust’s property rental income was $9,388,326 compared to $6,275,277 for the same period in 2018, an increase of 50%. Net operating Income was $7,144,022 compared to $5,112,675 for the same period in 2018, an increase of 40%. Fronsac recorded a net income attributable to unitholders of $4,081,269, or 3.66¢ per unit, compared to a net loss of $1,889,131, or (2.07¢) per unit for the same period in 2018.
Jason Parravano President and CEO said: “We are pleased to share with everyone our results for the year ended 2019. We have demonstrated our ability to continue to deliver accretive per unit results and this highlighted by a 13% increase to our per unit Recurring FFO. In addition, we recently closed our largest financing, a fully subscribed $18M equity offering of Trust units which was made possible as a result of the confidence of new and existing unitholders alike.”
The tables below represent other financial highlights as well as the reconciliation from net income to FFO for the periods ended December 31th, 2019 and its comparative period. This information should be read in conjunction with the Consolidated Financials Statements and MD&A for the quarters ended December 31th, 2019 and December 31th, 2018.
| SUMMARY OF SELECTED ANNUAL INFORMATION | ||||||
| 12 months | ||||||
| Periods ended December 31 | 2019 | 2018 | Δ | % | ||
| Financial info | ||||||
| Property rental income | 9,388,326 | 6,275,277 | 3,113,049 | 50 | % | |
| Total revenue | 9,388,326 | 6,290,277 | 3,098,049 | 49 | % | |
| Net income (loss) and comprehensive income (loss) | 4,081,269 | (1,889,131 | ) | 5,970,400 | (316 | %) |
| NOI (1) | 7,144,022 | 5,112,675 | 2,031,347 | 40 | % | |
| FFO (1) | 4,615,394 | 3,351,550 | 1,263,844 | 38 | % | |
| Recurring FFO (1)(2) | 4,615,394 | 3,336,550 | 1,278,844 | 38 | % | |
| AFFO (1) | 4,524,363 | 3,038,111 | 1,486,252 | 49 | % | |
| EBITDA (1) | 6,672,288 | 4,749,213 | 1,923,075 | 40 | % | |
| Investment properties (3) | 134,376,091 | 107,174,824 | 27,201,267 | 25 | % | |
| Total assets | 129,118,708 | 98,890,349 | 30,228,359 | 31 | % | |
| Total mortgage/loans/long term debt (4) | 60,382,953 | 50,895,481 | 9,487,472 | 19 | % | |
| (including revolving line of credit) | 70,828,653 | 53,365,481 | 17,463,172 | 33 | % | |
| Total convertible debentures | 3,023,326 | 1,593,481 | 1,429,845 | 90 | % | |
| Total equity | 51,342,040 | 41,302,149 | 10,039,891 | 24 | % | |
| Weighted average units o/s - basic | 111,384,880 | 91,163,634 | 20,221,246 | 22 | % | |
| Amounts on a per unit basis | ||||||
| FFO | 0.0414 | 0.0368 | 0.0047 | 13 | % | |
| Recurring FFO | 0.0414 | 0.0366 | 0.0048 | 13 | % | |
| AFFO | 0.0406 | 0.0333 | 0.0073 | 22 | % | |
| Distributions | 0.0222 | 0.0202 | 0.0020 | 10 | % | |
| (1) See appropriate sections for reconciliation to the closest IFRS measure and section "Explanation of non-IFRS financial measures" | ||||||
| (2) Recurring FFO excludes ''Other income'' items as presented on the Consolidated Financial Statements | ||||||
| (3) Includes value of investment properties owned through joint ventures; Refer to Note 4 (Investment Properties) and Note 5 ([1] value of developed properties, [2] leased properties and [3] properties under development) in Fronsac's financial statements | ||||||
| (4) Excludes convertible debentures | ||||||
| RECONCILIATION OF NET INCOME TO FFO | ||||||||||||
| 3 months | 12 months | |||||||||||
| Periods ended December 31 | 2019 | 2018 | Δ | 2019 | 2018 | Δ | ||||||
| Net income attributable to unitholders | (997,612 | ) | (4,085,302 | ) | 3,087,690 | 4,081,269 | (1,889,131 | ) | 5,970,400 | |||
| Debenture issuance costs | - | - | - | 30,660 | 53,171 | (22,511 | ) | |||||
| Δ in value of investment properties | 501,678 | 5,008,010 | (4,506,332 | ) | (1,546,054 | ) | 4,862,229 | (6,408,283 | ) | |||
| Δ in value of investment properties in joint ventures | 427,047 | 6,681 | 420,366 | 583,734 | 163,104 | 420,630 | ||||||
| Unit based compensation | 78,540 | (1,485 | ) | 80,025 | 259,845 | 79,025 | 180,820 | |||||
| Δ in liability component of convertible debentures | 55,828 | 17,068 | 38,760 | 54,845 | 27,950 | 26,895 | ||||||
| Δ in fair value of derivative financial instruments | 1,210,590 | (26,615 | ) | 1,237,205 | 1,104,060 | 45,105 | 1,058,955 | |||||
| Accretion of lease payments | 9,057 | - | 9,057 | 38,395 | - | 38,395 | ||||||
| Income taxes | 10,588 | 5,057 | 5,531 | 8,640 | 10,097 | (1,457 | ) | |||||
| FFO(1) - basic | 1,295,716 | 923,414 | 40 | % | 4,615,394 | 3,351,550 | 38 | % | ||||
| FFO per unit - basic | 0.0110 | 0.0091 | 21 | % | 0.0414 | 0.0368 | 13 | % | ||||
| Distributions paid on convertible debentures (if dilutive) | - | 7,500 | (7,500 | ) | 127,234 | 15,000 | 112,234 | |||||
| FFO - diluted | 1,295,716 | 930,914 | 39 | % | 4,742,628 | 3,366,550 | 41 | % | ||||
| FFO per unit - diluted | 0.0106 | 0.0089 | 19 | % | 0.0413 | 0.0359 | 15 | % | ||||
| Recurring FFO(2) - basic | 1,295,716 | 923,414 | 40 | % | 4,615,394 | 3,336,550 | 38 | % | ||||
| Recurring FFO per unit - basic | 0.0110 | 0.0091 | 21 | % | 0.0414 | 0.0366 | 13 | % | ||||
| Distributions | 651,590 | 512,014 | 139,576 | 2,457,083 | 1,834,111 | 622,972 | ||||||
| Distributions per unit | 0.0056 | 0.0050 | 12 | % | 0.0222 | 0.0202 | 10 | % | ||||
| FFO - basic after distributions | 0.0055 | 0.0040 | 0.0014 | 0.0192 | 0.0166 | 0.0026 | ||||||
| Recurring FFO - basic after distributions | 0.0055 | 0.0040 | 0.0014 | 0.0192 | 0.0164 | 0.0028 | ||||||
| Distributions as a % of FFO - basic | 50 | % | 55 | % | (5 | %) | 54 | % | 55 | % | (1 | %) |
| Distributions as a % of Recurring FFO - basic | 50 | % | 55 | % | (5 | %) | 54 | % | 55 | % | (1 | %) |
| Weighted avg. units o/s | ||||||||||||
| Basic | 117,403,566 | 101,590,060 | 15,813,506 | 111,384,880 | 91,163,634 | 20,221,246 | ||||||
| Diluted | 121,699,451 | 104,094,743 | 17,604,708 | 114,803,229 | 93,668,317 | 21,134,912 | ||||||
| (1) See appropriate sections for reconciliation to the closest IFRS measure and section "Explanation of of non-IFRS financial measures" | ||||||||||||
| (2) Recurring FFO excludes ''Other income'' as presented on the Consolidated Financial Statements | ||||||||||||
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 31th, 2019 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.