Cagim Real Estate Corporation

Cagim Real Estate Corporation

May 31, 2006 20:31 ET

Cagim Real Estate Corporation Announces First Quarter Consolidated Results for Fiscal Year 2006

QUEBEC CITY, QUEBEC--(CCNMatthews - May 31, 2006) - Cagim Real Estate Corporation (TSX VENTURE:CIM) (the "Corporation") is pleased to announce its first quarter results for fiscal year 2006.

During this first quarter, the Corporation virtually completed the development of Place d'Affaires Lebourgneuf. This project entails the construction of a 180,000 square feet commercial building at a cost of approximately $13 million. This project is a tremendous success to date, as long term leases have been signed for 79% of the building, and tenants already occupy 122,000 square feet. This property's operations will be included in our results starting in the third quarter, and we expect it to contribute significantly to our net income.

This project demonstrates the expertise of the Cagim management team, which recently announced the acquisition of a commercial lot in the Lebourgneuf sector in Quebec City in furtherance to its strategic expansion plan. The Corporation is planning construction of an approximately 95,000 square foot building with the same design parameters as Place d'Affaires Lebourgneuf. Subject to certain special conditions, this second project should be ready for the first occupants by March 2007.

Acquisitions completed in 2005 significantly increased rental revenue (NOI) in the first quarter of 2006. Revenues totaled $1,199,876 compared to $637,489 for the first quarter of 2005-an 88% increase over the same period last year.

Operating income from real estate assets before administrative charges and depreciation increased 75% to $346,965 in the first quarter of 2006. Income from the Place d'Affaires Lebourgneuf project will be included in our results starting in the third quarter. We expect this property to contribute significantly to our revenue from real estate assets (NOI), which should reach nearly $2 million for fiscal year 2006.

Net income for the first quarter of 2006 totaled $53,707 or $0.004 per share-a 20% increase compared to net income of $44,902 or $0.004 per share for the 3 month period ended March 31, 2005. In 2005, the Corporation enjoyed unrecorded tax benefits without which the increase in net income for the first quarter of 2006 would have been 38%.

Consolidated Results Three-month Period ended March 31,
2006 2005
$ $

Rental revenues 1,199,876 637,489
Operating expenses 622,985 344,539

Gross operating profit 576,891 292,950

Financial charges 229,926 94,661

Operating income from real estate assets
before the undernoted items 346,965 198,289

Other charges
Administrative 64,286 46,629
Charges related to stock market and
shareholders' communication 18,210 7,181
Capital taxes 15,000 10,500
Depreciation of income properties 165,560 77,633
Amortization of deferred expenses 6,082 -

269,138 141,943


Income before income taxes 77,827 56,346

Income taxes (note 2) 24,120 11,444

Net income 53,707 44,902


Basic and diluted net income per share 0.004 0.004

Average-weighted shares outstanding 12,370,341 10,790,293

The Corporation remains faithful to its strategy of increasing its value by using its expertise to develop new properties on strategic sites and acquire properties with short term income growth potential.

About Cagim Real Estate Corporation

The Corporation has been listed on the TSX Venture Exchange since September 21, 2004, and conducts real estate management and acquisition activities. The Corporation operates through its subsidiaries ADG Immobilier Inc., Centre d'Affaires Le Mesnil Inc., Place Donnacona Inc. and Place d'Affaires Lebourgneuf Inc.

The TSX Venture Exchange has not approved and is not responsible for the truth or accuracy of this press release.

Contact Information

  • Cagim Real Estate Corporation
    Guy Boutin
    President and chief executive officer
    (418) 622-6644