Welcome!

News Feed Item

Melcor REIT Announces Second Quarter Results

EDMONTON, ALBERTA -- (Marketwired) -- 08/06/14 --



---------------------------------------------------------------------------
Quarter Highlights                    Year-to-date Highlights

- Rental revenue of $11.12 million    - Rental revenue of $21.77 million,
  for growth of 14% over Q2-2013        exceeding YTD-2013 by 12%

- Net operating income of $7.20       - Net operating income of $13.93
  million for growth of 13% over Q2-    million for growth of 10% over YTD-
  2013                                  2013

- Adjusted funds from operations      - Adjusted funds from operations
  (AFFO) of $3.90 million or $0.19      (AFFO) grew 10% to $7.68 million or
  per unit compared to $0.19 per unit   $0.39 per unit compared to $0.37
  in Q2-2013                            per unit YTD-2013

- Debt to Gross Book Value (GBV)      - Occupancy at 92.0% compared to
  ratio of 46%, below our target        90.6% at the end of 2013
  range of 50-55%

- Gross leasable area increased by 4% - Distributions of $0.05625 per unit
  through 3 property acquisitions       per month paid YTD
---------------------------------------------------------------------------

Melcor REIT (TSX: MR.UN) announced results for the second quarter and first half of 2014, which ended June 30, 2014. Year-to-date rental revenue increased 12% to $21.77 million compared to $19.46 million in the first half of 2013. Adjusted funds from operations (AFFO) grew 10% to $7.68 million or $0.39 per unit for the first half of 2014.

Darin Rayburn, CEO of Melcor REIT commented: "We continue to execute our strategy and deliver as promised. Throughout the first half of 2014, we've increased our portfolio GLA by 9% through a number of external acquisitions as well as our first acquisition via the Melcor pipeline, which is unique to Melcor REIT. Our focus on leasing activity has been successful as well, with 77% of our expiring GLA renewed by the end of June. This contributed to an increase in occupancy and strong results overall.

We are pleased with our performance to date and will continue to take a disciplined and focused approach to achieving our objectives."

Financial Highlights for the quarter include:


--  On May 7, 2014 we successfully completed a bought deal issuance of
    1,900,000 trust units at $10.65 for gross proceeds of $20.24 million.
    The underwriters subsequently exercised their over allotment option for
    an additional 245,000 trust units at $10.65 for gross proceeds of $2.61
    million. The proceeds were used in part to fund two property
    acquisitions from Melcor, with the remainder used to pay down our
    revolving credit facility to support future acquisitions and for general
    trust purposes.

--  We continued to execute on our growth strategy and increased gross
    leasable area (GLA) by 4% to 1,837,439 sq. ft.

    --  We made our first acquisition via our proprietary Melcor pipeline,
        purchasing two multi-tenant retail properties for a purchase price
        of approximately $13.50 million (excluding transaction costs). The
        properties include Market Mall, a 42,586 sq. ft. retail community
        strip centre in Regina, Saskatchewan and phase three of Kingsview
        Market, a 11,555 sq. ft. retail complex in Airdrie.

    --  We acquired 107 Avenue Building, a 23,432 sq. ft. office building in
        Edmonton, Alberta for a purchase price of $5.55 million (excluding
        transaction costs).

--  We continue to focus on property management and asset enhancement
    initiatives in order to maintain and improve our assets. These
    initiatives led to improved occupancy and retention rates during the
    second quarter, with period end rates of 92.0% and 78.3% respectively.

--  We have achieved strong leasing activity year-to-date, with 71,754 sq.
    ft. in new leasing. 76.8% of the GLA expiring in 2014 was renewed at
    June 30, 2014.

The successful execution of these strategies contributed to:


--  Revenue growth of 14% over Q2-2013 as a result of our expanded
    portfolio. Weighted average base rent (per sq. ft.) and occupancy
    remained steady during the period. Higher revenue translated into
    increased NOI, which grew by 13% over Q2-2013. Direct operating expenses
    increased by 15%, primarily as a result of the new property additions in
    conjunction with timing and allocation differences in the comparative
    period.

--  FFO and AFFO of $4.43 million and $3.90 million, an 8% increase over Q2-
    2013. FFO and AFFO per unit were $0.22 and $0.19 respectively, and
    consistent over Q2-2013. Growth in FFO and AFFO was offset by the
    dilutive impact of the trust unit issuance during the period. We
    continue to pursue third party acquisition opportunities and monitor
    properties in the Melcor development pipeline to support future growth.

--  Distributions of $0.05625 per trust unit were paid in April, May and
    June. Distributions made during Q2-2014 represent a payout ratio of 89%.

--  As at June 30, 2014 we have funds available under our revolving credit
    facility, providing the REIT with the near term capacity to capitalize
    on future acquisition opportunities.

Selected Quarter Highlights



----------------------------------------------------------------------------
Financial Highlights
----------------------------------------------------------------------------
                      Three months ended          Six months ended
                            June 30                    June 30
----------------------------------------------------------------------------
($000s)                    2014     2013   delta%     2014     2013   delta%
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Non-standard KPIs
Net operating income
 (NOI)                    7,203    6,379      13%   13,937   12,721      10%
Funds from operations
 (FFO)                    4,431    4,109       8%    8,719    8,104       8%
Adjusted funds from
 operations (AFFO)        3,902    3,604       8%    7,679    6,991      10%

Rental revenue           11,119    9,773      14%   21,766   19,461      12%
Income before fair
 value adjustments and
 taxes                    2,125    2,488    (15)%    4,264    5,905    (28)%
Fair value adjustment
 on investment
 properties                 568    1,792    (68)%      737    4,386    (83)%
Distributions to
 unitholders              1,782    1,027      74%    3,323    1,027     224%
Cash flows from
 operations               1,806    2,105    (14)%    4,102    9,141    (55)%

Per unit metrics(1)
Income - diluted           0.22     0.10     120%     0.43     0.10     330%
FFO                        0.22     0.22     (1)%     0.45     0.43       5%
AFFO                       0.19     0.19       -%     0.39     0.37       5%
Distributions             0.169    0.113      50%    0.338    0.113     199%


----------------------------------------------------------------------------
($000s)                        30-Jun-14         31-Dec-13            delta%
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Total assets ($000s)             476,468           454,743                5%
Equity ($000s)(2)                216,852           186,608               16%
Debt ($000s)(3)                  207,522           215,601              (4)%
Weighted average
 interest rate on debt             3.97%             3.98%                -%
Debt to GBV ratio                    46%               51%             (10)%
Finance costs coverage
 ratio(4)                           2.95              2.96                -%
Debt service coverage
 ratio(5)                           2.82              2.83                -%


----------------------------------------------------------------------------
Operational Highlights
----------------------------------------------------------------------------
($000s)                       30-June-14         31-Dec-13                r%
----------------------------------------------------------------------------
----------------------------------------------------------------------------
  Number of properties                32                29               10%
   Gross leasable area
       (GLA) (sq. ft.)         1,837,439         1,691,920                9%
 Occupancy % (weighted
               by GLA)             92.0%             90.6%                2%
 Retention % (weighted
               by GLA)             78.3%             75.5%                4%
      Weighted average
  remaining lease term
               (years)              4.65              4.75              (2)%
 Weighted average base
    rent (per sq. ft.)            $16.23            $16.63              (2)%

(1)   The comparative 2013 figures are calculated as if the trust units and
      Class B LP Units which were issued in 2013 were outstanding during the
      entire comparative period.

(2)   Calculated as the sum of trust units and Class B LP Units at their
      book value.

(3)   Calculated as the sum of total amount drawn on revolving credit
      facility, mortgages payable and Class C LP Units, excluding
      unamortized fair value adjustment on Class C LP Units, unamortized
      transaction costs and unamortized discount on bankers acceptance.

(4)   Calculated as the sum of FFO and finance costs; divided by finance
      costs, excluding distributions on Class B LP Units.

(5)   Calculated as FFO; divided by sum of contractual principal repayments
      on mortgages payable and distributions of Class C LP Units, excluding
      amortization of fair value adjustment on Class C LP Units.

MD&A and Financial Statements

Information included in this press release is a summary of results. This press release should be read in conjunction with Melcor REIT's Q2-2014 report to unitholders, including the consolidated financial statements and management's discussion and analysis for the three- and six-months ended June 30, 2014 which can be found on the REIT's website at www.MelcorREIT.ca or on SEDAR (www.sedar.com).

About Melcor REIT

Melcor REIT is an unincorporated, open-ended real estate investment trust. Melcor REIT owns, acquires, manages and leases quality retail, office and industrial income-generating properties with exposure to high growth Canadian markets. Its portfolio is currently made up of interests in 32 properties representing approximately 1.84 million square feet of gross leasable area located across Alberta and in Regina, Saskatchewan and Kelowna, British Columbia. For more information, please visit www.melcorREIT.ca.

Non-Standard Measures

NOI, FFO and AFFO are key measures of performance used by real estate operating companies; however, they are not defined by International Financial Reporting Standards ("IFRS"), do not have standard meanings and may not be comparable with other industries or income trusts. These non-IFRS measures are more fully defined and reconciled in the REIT's Management Discussion and Analysis for the period ended June 30, 2014, which is available on SEDAR at www.sedar.com.

Forward-Looking Statements

This press release may contain forward-looking information within the meaning of applicable securities legislation, which reflects the REIT's current expectations regarding future events. 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 the REIT's control, that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. Such risks and uncertainties include, but are not limited to, general and local economic and business conditions; the financial condition of tenants; the REIT's ability to refinance maturing debt; leasing risks, including those associated with the ability to lease vacant space; and interest rate fluctuations. The REIT's 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. The REIT does not undertake to update any such forward-looking information whether as a result of new information, future events or otherwise. Additional information about these assumptions and risks and uncertainties is contained in the REIT's filings with securities regulators.

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
The cloud competition for database hosts is fierce. How do you evaluate a cloud provider for your database platform? In his session at 18th Cloud Expo, Chris Presley, a Solutions Architect at Pythian, will give users a checklist of considerations when choosing a provider. Chris Presley is a Solutions Architect at Pythian. He loves order – making him a premier Microsoft SQL Server expert. Not only has he programmed and administered SQL Server, but he has also shared his expertise and passion w...
With the proliferation of both SQL and NoSQL databases, organizations can now target specific fit-for-purpose database tools for their different application needs regarding scalability, ease of use, ACID support, etc. Platform as a Service offerings make this even easier now, enabling developers to roll out their own database infrastructure in minutes with minimal management overhead. However, this same amount of flexibility also comes with the challenges of picking the right tool, on the right ...
SYS-CON Events announced today that FalconStor Software® Inc., a 15-year innovator of software-defined storage solutions, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. FalconStor Software®, Inc. (NASDAQ: FALC) is a leading software-defined storage company offering a converged, hardware-agnostic, software-defined storage and data services platform. Its flagship solution FreeStor®, utilizes a horizonta...
SYS-CON Events announced today that Interoute, owner-operator of one of Europe's largest networks and a global cloud services platform, has been named “Bronze Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2015 at the Javits Center in New York, New York. Interoute is the owner-operator of one of Europe's largest networks and a global cloud services platform which encompasses 12 data centers, 14 virtual data centers and 31 colocation centers, with connections to 195 ad...
SYS-CON Events announced today that (ISC)²® (“ISC-squared”) will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Two leading non-profits focused on cloud and information security, (ISC)² and Cloud Security Alliance (CSA), developed the Certified Cloud Security Professional (CCSP) certification to address the increased demand for cloud security expertise due to rapid growth in cloud. Recently named “The Next...
The Art of DevOps provides a fun overview to help teams understand DevOps. Written in the style of the famous 6th century Chinese manuscript “The Art of War,” this eBook describes DevOps in the form of a mission to continuously deliver assets to the operational battlegrounds safely, securely, and quickly. It’s a fun read with valuable insights.
SYS-CON Events announced today that Alert Logic, Inc., the leading provider of Security-as-a-Service solutions for the cloud, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Alert Logic, Inc., provides Security-as-a-Service for on-premises, cloud, and hybrid infrastructures, delivering deep security insight and continuous protection for customers at a lower cost than traditional security solutions. Ful...
Join us at Cloud Expo | @ThingsExpo 2016 – June 7-9 at the Javits Center in New York City and November 1-3 at the Santa Clara Convention Center in Santa Clara, CA – and deliver your unique message in a way that is striking and unforgettable by taking advantage of SYS-CON's unmatched high-impact, result-driven event / media packages.
The Quantified Economy represents the total global addressable market (TAM) for IoT that, according to a recent IDC report, will grow to an unprecedented $1.3 trillion by 2019. With this the third wave of the Internet-global proliferation of connected devices, appliances and sensors is poised to take off in 2016. In his session at @ThingsExpo, David McLauchlan, CEO and co-founder of Buddy Platform, will discuss how the ability to access and analyze the massive volume of streaming data from mil...
SYS-CON Events announced today that Commvault, a global leader in enterprise data protection and information management, has been named “Bronze Sponsor” of SYS-CON's 18th International Cloud Expo, which will take place on June 7–9, 2016, at the Javits Center in New York City, NY, and the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Commvault is a leading provider of data protection and information management...
WebSocket is effectively a persistent and fat pipe that is compatible with a standard web infrastructure; a "TCP for the Web." If you think of WebSocket in this light, there are other more hugely interesting applications of WebSocket than just simply sending data to a browser. In his session at 18th Cloud Expo, Frank Greco, Director of Technology for Kaazing Corporation, will compare other modern web connectivity methods such as HTTP/2, HTTP Streaming, Server-Sent Events and new W3C event APIs ...
With an estimated 50 billion devices connected to the Internet by 2020, several industries will begin to expand their capabilities for retaining end point data at the edge to better utilize the range of data types and sheer volume of M2M data generated by the Internet of Things. In his session at @ThingsExpo, Don DeLoach, CEO and President of Infobright, will discuss the infrastructures businesses will need to implement to handle this explosion of data by providing specific use cases for filte...
SYS-CON Events announced today that Pythian, a global IT services company specializing in helping companies adopt disruptive technologies to optimize revenue-generating systems, has been named “Bronze Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2015 at the Javits Center in New York, New York. Founded in 1997, Pythian is a global IT services company that helps companies compete by adopting disruptive technologies such as cloud, Big Data, advanced analytics, and DevO...
SYS-CON Events announced today that Avere Systems, a leading provider of enterprise storage for the hybrid cloud, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Avere delivers a more modern architectural approach to storage that doesn’t require the overprovisioning of storage capacity to achieve performance, overspending on expensive storage media for inactive data or the overbuilding of data centers ...
In most cases, it is convenient to have some human interaction with a web (micro-)service, no matter how small it is. A traditional approach would be to create an HTTP interface, where user requests will be dispatched and HTML/CSS pages must be served. This approach is indeed very traditional for a web site, but not really convenient for a web service, which is not intended to be good looking, 24x7 up and running and UX-optimized. Instead, talking to a web service in a chat-bot mode would be muc...