MONTREAL, QUEBEC--(Marketwired - April 4, 2014) - (TSX VENTURE:GAZ.UN) - Fronsac Real Estate Investment Trust ("Fronsac REIT" or "Fronsac") today released its audited consolidated financial statements for the year ended December 31st, 2013.
For the financial year ended December 31, 2013, Fronsac reported funds from operations ("FFO") of $581,977, an increase of 113% over the year of 2012 ($273,456 in 2012). For the year 2013, FFO per unit was 1.77¢ (1.73¢ per unit diluted), compared to 1.30¢ per unit for the year ended December 31, 2012 (1.30¢ per unit diluted), an increase of 36% over the year 2012. The acquisitions completed in 2013 mainly explain the strong increase in the FFO.
Fronsac reported FFO of $119,269 for the three months ended December 31, 2013, an increase of 261% over the same period in the prior year ($33,078 in 2012). FFO per unit was 0.36¢ for the quarter ended December 31, 2013 (0.35¢ per unit diluted) compared to 0.15¢ per unit for the quarter ended December 31, 2012 (0.15¢ per unit diluted), an increase of 140% over Q4 2012. The acquisitions mentioned above mainly explain the strong increase in the FFO.
Michel Lassonde President and CEO said: "We are very pleased with our performance and growth for the quarter and the year. Our performance for 2013 has led to an annual distribution increase for 2014 from 1.35¢ to 1.48¢ cents per unit. This represents the third consecutive annual distribution increase for Fronsac. Fronsac's success is a confirmation of our business strategy and solid financial structure."
For its 2013 financial year, Fronsac recorded a net profit attributable to unitholders of $1,250,170 or 3.81¢ per unit compared to a net profit of $1,062,419 or 5.06¢ per unit for 2012. Profit was mainly affected by the same factors affecting FFO as well as non-cash gains of $575,903 [2012: 999,361] and $97,896 [2012: nil] related to the increase in value of the investment properties recorded respectively in the accounts of "Investment properties" and "Investment in joint-ventures".
The AFFO/FFO summary and the highlights for the years ended December 31, 2013 and 2012 as well as for the quarters ending at the same dates are presented in the tables below :
Financial results highlights
AFFO/FFO Reconciliation *
| 31-12-2013 | 31-12-2012 | 31-12-2013 | 31-12-2012 | |||||
| 3 months | 3 months | 12 months | 12 months | |||||
| Net income attributable to unitholders | 959,081 | 929,738 | 1,250,170 | 1,062,419 | ||||
| Variation of fair value of investment properties | 769,240 | 999,361 | 575,903 | 999,361 | ||||
| Variation of fair value of investments properties recorded in joint ventures | 58,309 | - | 97,896 | - | ||||
| Unit-based compensation | (200 | ) | (3,200 | ) | (22,950 | ) | 4,606 | |
| Adjustment to the liability component of the convertible preferred units | 8,309 | 567 | 17,344 | 2,036 | ||||
| Variation of fair value of derivative financial instrument | (17,875 | ) | (6,500 | ) | (69,180 | ) | 19,500 | |
| Unrealized (gains) on interest rates swaps | (2,000 | ) | (2,400 | ) | (7,900 | ) | (13,400 | ) |
| Variation of fair value of warrants | (340 | ) | (4,475 | ) | (2,700 | ) | 3,594 | |
| Amortization intangible assets | 1,853 | 1,851 | 7,406 | 7,404 | ||||
| Current income taxes | 7,776 | 4,668 | 7,776 | 4,668 | ||||
| Deferred income taxes | (9,786 | ) | 112,190 | 75,810 | 181,990 | |||
| AFFO/FFO - basic | 119,269 | 33,078 | 581,977 | 273,456 | ||||
| Distributions paid on convertible preferred units | 15,350 | - | 59,888 | - | ||||
| AFFO/FFO - diluted | 184,619 | 33,078 | 641,865 | 273,456 | ||||
| Weighted average number of units outstanding - basic | 33,138,894 | 22,405,529 | 32,817,956 | 20,985,587 | ||||
| Weighted average number of units outstanding - diluted | 37,929,094 | 22,405,529 | 37,093,456 | 20,985,587 | ||||
| AFFO/FFO per unit - basic | 0.0036 | 0.0015 | 0.0177 | 0.0130 | ||||
| AFFO/FFO per unit - diluted | 0.0035 | 0.0015 | 0.0173 | 0.0130 | ||||
| EBITDA | 241,594 | 89,871 | 926,380 | 456,330 | ||||
| Interest coverage | 2.2 | 1.5 | 2.8 | 2.7 | ||||
| Debt coverage | 1.7 | 1.1 | 2.1 | 1.9 |
* = For the three (3) and twelve (12) months periods ending December 31, 2013 and 2012, FFO and AFFO were equal.
Financial position
| 31-12-2013 | 31-12-2012 | |||
| Investment properties (at fair value) | 20,398,786 | 11,521,954 | ||
| Investments in joint ventures (at fair value) | 761,729 | - | ||
| Total assets | 22,131,533 | 14,333,024 | ||
| Total debts and loans | 9,967,130 | 4,119,972 | ||
| Total liabilities | 11,263,993 | 4,832,944 | ||
| Leverage Ratio | 45.0 | % | 28.7 | % |
| Weighted Average Cost of Debt | 4.93 | % | 4.91 | % |
About Fronsac - Fronsac Real Estate Investment Trust is an open-ended trust that acquires and owns high quality commercial real estate properties, rented to strong tenants under long term, management free and net leases.
Forward-Looking Statements - This press release contains forward-looking statements and information as defined by applicable securities laws, including statements relating to Fronsac and expectations of the management regarding a proposed transaction and the expected benefits thereof. There is no assurance that the proposed transaction will be carried out and that the anticipated benefits will materialize. The proposed transaction is subject to approval and consent of stakeholders and there is no certainty that these will be achieved. 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) accept any responsibility for the adequacy or accuracy of this release.
The December 31, 2013 financial statements of Fronsac REIT may be viewed on SEDAR at www.sedar.com
Contact Information:
President
(450) 536-5328