Altus Group Income Fund
TSX : AIF.UN

Altus Group Income Fund

May 12, 2008 12:57 ET

Altus Group Income Fund Announces First Quarter Results

Management to Hold Conference Call on Monday, May 12, 2008 at 4 p.m. EDT

TORONTO, ONTARIO--(Marketwire - May 12, 2008) - Altus Group Income Fund ("Fund") (TSX:AIF.UN) today announced financial and operating results for the quarter ended March 31, 2008.

Performance Highlights:

- Year-over-year revenue growth of 46%

- Adjusted distributable cash of $0.39 per unit and distributions of $0.30 per unit to unitholders resulting in a payout ratio of 76.6%

- Successfully integrated three accretive acquisitions with an aggregate value of $8 million

"As we close our first quarter of 2008, we are pleased with the demonstrated strength of our business units," said Gary Yeoman, CEO of Altus Group Income Fund. "Altus is on the right track, as these results clearly reflect our balanced objective of sustained growth and accretive acquisitions."

Revenue for the first quarter 2008 was $46.9 million, compared to $32.2 million for the comparable period in 2007, a 46% increase, of which 31% is attributable to revenue from entities acquired in 2007 and 2008 and 15% from organic growth.

Salaries and benefits were $27.5 million for the first quarter, compared to $18.2 million in the same period last year, reflecting the growth in staff which numbered 1,144 at quarter end. The ratio of salaries and benefits compared to revenue increased to 58.7% for the quarter ended March 31, 2008, compared to 56.5% for the same period last year. This is in part due to the accrual of the salary expense related to an equity-based Executive Compensation Plan, which is subject to unitholders' approval at the Fund's Annual and Special Meeting on May 12, 2008 (with a corresponding impact to EBITDA).

Net earnings for the first quarter 2008 were $1.7 million or $0.11 per unit, compared to $1.1 million or $0.10 per unit, for the same quarter 2007. Net earnings per unit are basic and diluted.

In the first quarter 2008, the Fund generated $7.1 million of adjusted distributable cash, or $0.39 per unit compared to $5.3 million or $0.35 per unit for the first quarter 2007. Distributions declared to the Fund unitholders and the unitholders of the Class B limited partnership units of Altus Group Limited Partnership were $0.30 per unit, and resulted in a payout ratio of 76.6% compared to 86.1% for the same period 2007.

Altus made three acquisitions in the first quarter of 2008:

- Acquisition of HealthTrust Canada ULC - a valuation and consulting company specializing in the seniors' housing field closed February 1, 2008. It also assists clients with site selection, product offering, expansion, exit strategies and property re-positioning.

- Acquisition of Geocom Recherche Inc. - a Quebec-based company, providing retail research and market analysis closed March 1, 2008.

- Acquisition of 2038951 Ontario Ltd., operating as Doug Dorey, Real Estate Appraiser - a valuation and consulting practice that specializes in the seniors' housing field closed March 1, 2008.

Subsequent to quarter end, Altus announced that it had entered into a non-binding letter of intent to acquire the business assets of Integra Realty Resources ("Integra"), for purposes of combining Integra with Altus. Integra is a property valuation and counseling firm based in the United States with over 800 employees in 55 offices coast to coast. The transaction is subject to the satisfactory completion of due diligence, the execution of definitive documents and receipt of regulatory approvals. There can be no assurances the transaction will be completed.

"Our achievements continue to establish a strong base for strategic expansion to meet the demands of an increasingly global real estate market," said Yeoman. "We anticipate continued strength from our core businesses, fuelling increased opportunity and even greater value-added for our clients."

Analyst Call Details

Altus Group Income Fund will hold an analyst conference call at 4:00 p.m. Eastern Daylight Time on Monday, May 12, 2008, to discuss these financial results and current industry conditions. Please dial 1-866-902-2211 (toll free) or 416-695-9748 (GTA) to access the call. You will be required to identify yourself and your organization. Should you be unable to participate, a recording of this call will be made available beginning at 6:00 PM EDT. To access the recording, please call 1-800-408-3053 or 416-695-5800 (passcode: 3260737). The recording will also be available at www.altusgroupincomefund.com.

About Altus Group Income Fund

Altus Group Income Fund is the leading multidisciplinary provider of independent real estate consulting and professional advisory services worldwide. With a staff of over 1,100, Altus has 31 offices in 23 cities throughout Canada and 6 offices throughout the UK. Altus operates as: Altus Research, Valuation and Advisory; Altus Cost Consulting; Altus Realty Tax Consulting; Altus InSite; Altus Geocom; Altus Geomatics; and Altus Edwin Hill Altus UK LLP. Altus' clients include banks, financial institutions, governments, pension funds, asset and fund managers, developers and landlords, as well as companies engaged in the oil and gas industry.

Forward-Looking Statements

Certain statements in this press release may constitute "forward-looking" statements, which involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the Fund and its subsidiary entities, including Altus Group Limited Partnership, Altus Group Limited and All West Surveys Limited Partnership, or the industry, to be materially different from any future results, performance or achievements expressed or implied by such forward looking statements. When used in this press release, such statements use words such as "may", "will", "expect", "believe", "plan" and other similar terminology. These statements are not guarantees of future performance and are subject to numerous risks and uncertainties, including those described in the Fund's publicly filed documents, including the Annual Information Form, Form 51-102F2, dated March 31, 2007 (which are available on SEDAR at www.sedar.com) and in this document under "Key Factors Affecting the Business". Those risks and uncertainties include: currency risk; general state of the economy; reliance on and retention of professionals; ability to maintain profitability and manage growth; competition in the industry; performance of obligations / maintenance of client satisfaction; fixed price and contingency engagements; revenue and cash flow volatility; protection of intellectual property; dependence on multi-residential market; dependence on oil & gas sector; possible acquisitions; interest rate risk; currency risk; credit risk; seasonality and weather; appraisal mandates; customer concentration; restrictions on potential growth; operating risks; risks of future legal proceedings; insurance limits; and legislative and regulatory changes. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results. These statements reflect management's current expectations regarding future events and operating performance and speak only as of the date of this press release. Although the forward-looking statements contained in this press release are based upon what management believes to be reasonable assumptions, the Fund cannot assure investors that actual results will be consistent with these forward-looking statements. These forward-looking statements are made as of the date of this press release, and, except in accordance with applicable law, the Fund assumes no obligations to update or revise them to reflect new events or circumstances. Additionally, the Fund undertakes no obligation to comment on analyses, expectations or statements made by third parties in respect of the Fund, its financial or operating results, or its securities.

Non-GAAP Measures

Distributable Cash does not have a standardized meaning prescribed by GAAP, but is a measure generally used by Canadian open-ended income funds as an indicator of financial performance. The Fund calculates Distributable Cash in accordance with the interpretive release "Standardized Distributable Cash in Income Trusts and Other Flow-through Entities" issued by the Canadian Institute of Chartered Accountants.

Earnings before Interest, Taxes, Depreciation and Amortization, ("EBITDA"), represents revenue less salaries, general and administrative expenses but before interest, taxes, depreciation, amortization and non-controlling interest.

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