MONTREAL, Nov. 08, 2019 (GLOBE NEWSWIRE) -- (TSX-V: FRO.UN) Fronsac Real Estate Investment Trust (“Fronsac REIT” or “Fronsac”) announces its results for the quarter ended September 30th, 2019 and, for an eight consecutive year, an increase in its annual distribution as well as distributions for the months of January, February and March 2020.
Distributions
Starting in January 2020, the annual distribution will go from 2.220¢ to 2.555¢ per unit, representing an increase of 15.1%. The monthly distributions will be of 0.213¢ per unit. This represents a 104% total growth since Fronsac’s first distributions in 2012.
Fronsac also announces that it will make monthly cash distributions of 0.213¢ per unit, representing 2.555¢ per unit on an annualized basis, on January 31st, February 28th and March 31st, 2020 to unitholders of record on January 15th, February 14th and March 16th, 2020, respectively.
For the quarter ended September 30, 2019, Fronsac reported recurring funds from operations ("Recurring FFO") per unit of 1.02¢ compared to 0.95¢ per unit for the quarter ended September 30, 2018, an increase of 8%. Recurring FFO was $1,197,449, an increase of 37% ($871,219 in Q3 2018). During Q3 2019, the Trust’s property rental income was $2,458,451 compared to $1,663,373 in Q3 2018, an increase of 48%. NOI (Net operating Income) was $1,881,747 compared to $1,324,647 in Q3 2018, an increase of 42%. Fronsac recorded a net income attributable to unitholders of $3,891,506, or 3.33¢ per unit, compared to a net income of $544,021, or 0.59¢ per unit, in Q3 2018.
For the 9-month period ended September 30, 2019, Fronsac reported Recurring FFO per unit of 3.04¢ compared to 2.76¢ per unit for the same period in 2018, an increase of 10%. Recurring FFO was $3,319,677, an increase of 38% ($2,413,136 for the same period in 2018). During the 9-month period ended September 30, 2019, the Trust’s property rental income was $6,650,030 compared to $4,556,093 for the same period in 2018, an increase of 46%. Net operating Income was $5,142,963 compared to $3,623,014 for the same period in 2018, an increase of 42%. Fronsac recorded a net income attributable to unitholders of $4,088,070, or 3.74¢ per unit, compared to a net income of $2,196,171, or 2.51¢ per unit for the same period in 2018.
Jason Parravano President and CEO said: “We are pleased to share with everyone our results for Q3 2019. Our per unit growth has allowed us to increase once again our distributions for the following year, and this for the 8th year in a row. During the quarter, we also continued to add to our portfolio and to diversify our tenant base.”
The tables below represent other financial highlights as well as the reconciliation from net income to FFO for the periods ended September 30th, 2019 and its comparative period. This information should be read in conjunction with the Consolidated Financials Statements and MD&A for the quarters ended September 30th, 2019 and September 30th, 2018.
| SUMMARY OF SELECTED ANNUAL INFORMATION | |||||||
| 9 months | |||||||
| Periods ended September 30 | 2019 | 2018 | Δ | % | |||
| Financial info | |||||||
| Property rental income | 6,650,030 | 4,556,093 | 2,093,937 | 46 | % | ||
| Total revenue | 6,650,030 | 4,571,093 | 2,078,937 | 45 | % | ||
| NOI (1) | 5,142,963 | 3,623,014 | 1,519,949 | 42 | % | ||
| FFO (1) | 3,319,677 | 2,428,136 | 891,541 | 37 | % | ||
| Recurring FFO (1) | 3,319,677 | 2,413,136 | 906,541 | 38 | % | ||
| AFFO (1) | 3,276,191 | 2,115,047 | 1,161,144 | 55 | % | ||
| EBITDA (1) | 4,887,851 | 3,372,480 | 1,515,371 | 45 | % | ||
| Investment properties (2) | 133,413,308 | 99,264,996 | 34,148,312 | 34 | % | ||
| Total assets | 126,614,742 | 96,863,007 | 29,751,735 | 31 | % | ||
| Total mortgage/loans/long term debt (3) | 60,553,952 | 47,168,403 | 13,385,549 | 28 | % | ||
| (including revolving line of credit) | 68,379,232 | 47,568,403 | 20,810,829 | 44 | % | ||
| Total convertible debentures | 2,967,498 | 1,576,413 | 1,391,085 | 88 | % | ||
| Total equity | 53,031,403 | 45,899,465 | 7,131,938 | 16 | % | ||
| Weighted average units o/s - basic | 109,356,605 | 87,649,966 | 21,706,639 | 25 | % | ||
| Amounts on a per unit basis | |||||||
| FFO | 0.0304 | 0.0277 | 0.0027 | 10 | % | ||
| Recurring FFO | 0.0304 | 0.0275 | 0.0028 | 10 | % | ||
| AFFO | 0.0300 | 0.0241 | 0.0058 | 24 | % | ||
| Distributions | 0.0167 | 0.0151 | 0.0015 | 10 | % | ||
| (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 | 6 months | ||||||||||
| Periods ended September 30 | 2019 | 2018 | Δ | 2019 | 2018 | Δ | |||||
| Net income (loss) attributable | |||||||||||
| to unitholders | 3,891,506 | 544,021 | 3,347,485 | 4,088,070 | 2,196,171 | 1,891,899 | |||||
| Debenture issuance costs | - | 53,171 | (53,171) | 30,660 | 53,171 | (22,511) | |||||
| Δ in value of investment properties | (2,689,721) | 24,924 | (2,714,645) | (1,056,922) | (145,781) | (911,141) | |||||
| Δ in value of investment | |||||||||||
| properties in joint ventures | 79,560 | 124,712 | (45,152) | 156,687 | 156,423 | 264 | |||||
| Unit based compensation | (275) | 17,600 | (17,875) | 181,305 | 80,510 | 100,795 | |||||
| Δ in liability component of | |||||||||||
| convertible debentures | (20,084) | 10,130 | (30,214) | (983) | 10,882 | (11,865) | |||||
| Δ in fair value of derivative | |||||||||||
| financial instruments | (92,875) | 94,260 | (187,135) | (106,530) | 71,720 | (178,250) | |||||
| Accretion of lease payments | 29,338 | - | 29,338 | 29,338 | - | 29,338 | |||||
| Income taxes | - | 2,401 | (2,401) | (1,948) | 5,040 | (6,988) | |||||
| FFO(1) - basic | 1,197,449 | 871,219 | 37% | 3,319,677 | 2,428,136 | 37% | |||||
| FFO per unit - basic | 0.0102 | 0.0095 | 8% | 0.0304 | 0.0277 | 10% | |||||
| Interest paid on convertible | |||||||||||
| debentures (if dilutive) | - | - | - | - | - | - | |||||
| FFO - diluted | 1,197,449 | 871,219 | 37% | 3,319,677 | 2,428,136 | 37% | |||||
| FFO per unit - diluted | 0.0102 | 0.0093 | 10% | 0.0304 | 0.0269 | 13% | |||||
| Recurring FFO - basic | 1,197,449 | 871,219 | 37% | 3,319,677 | 2,413,136 | 38% | |||||
| Recurring FFO per unit - basic | 0.0102 | 0.0095 | 8% | 0.0304 | 0.0275 | 10% | |||||
| Distributions | 649,344 | 458,528 | 190,816 | 1,805,493 | 1,322,097 | 483,396 | |||||
| Distributions per unit | 0.0056 | 0.0050 | 12% | 0.0167 | 0.0151 | 10% | |||||
| FFO - basic after distributions | 0.0047 | 0.0045 | 0.0002 | 0.0137 | 0.0126 | 0.0011 | |||||
| Recurring FFO - basic after distributions | 0.0047 | 0.0045 | 0.0002 | 0.0137 | 0.0124 | 0.0013 | |||||
| Distributions as a % of | |||||||||||
| FFO - basic | 54% | 53% | 1% | 55% | 55% | - | |||||
| Distributions as a % of | |||||||||||
| Recurring FFO - basic | 54% | 53% | 1% | 55% | 55% | - | |||||
| Weighted avg. units o/s | |||||||||||
| Basic | 117,014,413 | 91,554,473 | 25,459,940 | 109,356,605 | 87,649,966 | 21,706,639 | |||||
| Diluted | 117,014,413 | 94,059,156 | 22,955,257 | 109,356,605 | 90,154,649 | 19,201,956 | |||||
| (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 September 30th, 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.
