Fronsac Real Estate Investment Trust
TSX VENTURE : GAZ.UN

Fronsac Real Estate Investment Trust

November 07, 2017 18:19 ET

Fronsac Announces Very Solid Results for the Quarter Ended September 30th, 2017 and the December 29th, 2017 Regular Quarterly Distribution

MONTREAL, QUEBEC--(Marketwired - Nov. 7, 2017) - Fronsac Real Estate Investment Trust (TSX VENTURE:GAZ.UN) ("Fronsac REIT" or "Fronsac") today announced its results for the quarter ended September 30th, 2017 and a distribution of 0.45¢ per unit to unitholders of record on December 15th, 2017 and payable on December 29th, 2017.

For the quarter ended September 30th, 2017, Fronsac reported recurring funds from operations ("Recurring FFO") per unit of 0.84¢ compared to 0.64¢ per unit for the quarter ended September 30th, 2016, an increase of 30%. Recurring FFO was $581,433, an increase of 57% ($369,586 in Q3 2016). During Q3 2017 the Trust's property rental income was $1,096,653 compared to $713,597 in Q3 2016, an increase of 54%. NOI (Net operating Income) was $882,492 compared to $623,255 in Q3 2016, an increase of 42%. Fronsac recorded a net income attributable to unitholders of $538,675, or 0.78¢ per unit, compared to a gain of $1,474,531, or 2.57¢ per unit, in Q3 2016.

For the nine months ended September 30th, 2017, Fronsac reported recurring funds from operations ("Recurring FFO") per unit of 2.47¢ compared to 1.80¢ per unit for the period ended September 30th, 2016, an increase of 37%. Recurring FFO was $1,589,175, an increase of 76% ($902,450 in Q3 2016). During Q3 2017 the Trust's property rental income was $3,042,700 compared to $1,962,143 in Q3 2016, an increase of 55%. NOI (Net operating Income) was $2,466,520 compared to $1,843,029 in Q3 2016, an increase of 34%. Fronsac recorded a net income attributable to unitholders of $2,701,756, or 4.2¢ per unit, compared to net income of $2,517,907, or 5.03¢ per unit, in Q3 2016.

Jason Parravano President and CEO said: "2017 has been a very active year for Fronsac. We have continued to grow our per unit results as well as 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, 2017 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, 2017 and September 30th, 2016.

SUMMARY OF SELECTED ANNUAL INFORMATION
9 months
Periods ended September 30 2017 2016 Change %
Financial info
Property rental income 3,042,700 1,962,143 1,080,557 55 %
Total revenue 3,052,700 2,117,493 935,207 44 %
NOI (1) 2,466,520 1,843,029 623,491 34 %
FFO (1)(4) 1,599,175 817,808 781,367 96 %
Recurring FFO (1)(4) 1,589,175 902,450 686,725 76 %
AFFO (1) 1,484,966 1,023,961 461,005 45 %
EBITDA (1) 2,185,929 1,309,322 876,607 67 %
Investment properties (2) 59,266,139 43,419,703 15,846,436 36 %
Total assets 59,101,842 43,883,680 15,218,162 35 %
Total mortgage/loans/long term debt (3) 29,731,526 20,896,070 8,835,456 42 %
Total exchangeable preferred units 977,268 935,817 41,451 4 %
Total convertible debentures 253,975 252,566 1,409 1 %
Total equity 27,864,885 20,981,836 6,883,049 33 %
Weighted average units o/s - basic 64,372,724 50,105,285 14,267,439 28 %
Amounts on a per unit basis
FFO 0.0248 0.0163 0.0086 53 %
Recurring FFO 0.0247 0.0180 0.0067 37 %
AFFO 0.0231 0.0204 0.0026 13 %
Distributions 0.0135 0.0120 0.0014 11 %
(1) Non-IFRS financial measures
(2) Includes value of investment properties owned through joint ventures
(3) Excludes convertible debentures and exchangeable preferred units
(4) Q1 2016 included revenues of $150K related to a one-time payment received for the renewal of a lease. This amount was subtracted from the Trust's FFO to arrive at the Recurring FFO for Q3 2016
RECONCILIATION OF NET INCOME TO FFO
3 months 9 months
Periods ended September 30 2017 2016 Change 2017 2016 Change
Net income (loss) attributable to unitholders 538,675 1,474,531 (935,856 ) 2,701,756 2,517,907 183,849
Change in value of investment properties 37,050 (1,327,506 ) 1,364,556 (1,386,873 ) (1,804,671 ) 417,798
Change in value of investment properties in joint ventures
-

(27,984
)
27,984

(141,641
)
(27,984
)
(113,657
)
Unit based compensation (200 ) - (200 ) 67,825 41,075 26,750
Change in liability component of exchangeable preferred units
14,838

13,888

950

36,264

33,474

2,790
Change in fair value of derivative financial instruments
-

(3,100
)
3,100

294,614

53,135

241,479
Change in fair value of other financial components
(8,930
)
(235
)
(8,695
)
27,230

4,650

22,580
Income taxes - - - - 222 (222 )
FFO(1) - basic 581,433 129,594 349 % 1,599,175 817,808 96 %
FFO per unit - basic 0.0084 0.0023 271 % 0.0248 0.0163 52 %
Distributions paid on exchangeable units (if dilutive)
13,896

-

13,896

49,190

44,635

4,555
FFO - diluted 595,329 129,594 359 % 1,648,365 862,443 91 %
FFO per unit - diluted 0.0082 0.0023 263 % 0.0244 0.0162 51 %
Recurring FFO - basic 581,433 369,586 57 % 1,589,175 902,450 76 %
Recurring FFO per unit - basic 0.0084 0.0064 30 % 0.0247 0.0180 37 %
Distributions 312,765 241,441 71,324 892,377 610,356 282,021
Distributions per unit 0.0045 0.0041 10 % 0.0135 0.0120 12 %
FFO - basic after distributions 0.0039 (0.0018 ) 0.0057 0.0113 0.0043 0.0070
Recurring FFO - basic after distributions 0.0039 0.0024 0.0015 0.0112 0.0060 0.0052
Distributions as a % of FFO - basic 54 % 181 % (127 %) 54 % 74 % (19 %)
Distributions as a % of Recurring FFO - basic 54 % 63 % (10 %) 55 % 67 % (12 %)
Weighted avg. units o/s
Basic 69,503,343 57,437,669 12,065,674 64,372,724 50,105,285 14,267,439
Diluted 72,591,543 57,437,669 15,153,874 67,460,924 53,193,485 14,267,439
(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 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, 2017 financial statements and management discussion & analysis of Fronsac REIT may be viewed on SEDAR at www.sedar.com.

Contact Information

  • Jason Parravano
    (450) 536-5328