OneREIT
TSX : ONR.UN

OneREIT

November 06, 2015 16:22 ET

OneREIT Announces Third Quarter 2015 Results

TORONTO, ONTARIO--(Marketwired - Nov. 6, 2015) -

NOT FOR DISSEMINATION IN THE UNITED STATES OR TO ANY NON-CANADIAN SOURCE

OneREIT (TSX:ONR.UN) today announced results for the third quarter ended September 30, 2015.

Highlights:

  • Net operating income ("NOI") increased 14.7% and 15.6%, respectively for the three and nine months ended September 30, 2015, compared with the similar periods in 2014.
  • Funds from Operations ("FFO") increased 12.4% to $9.3 million for the three months ended September 30, 2015, and 14.5% to $27.5 million for the nine months ending September 30, 2015, compared with the similar periods in 2014.
  • On August 26, 2015, the REIT sold Mountainview Mall and Kenora Shoppers Mall for gross proceeds of $16.1 million.
  • Weighted average cost of mortgage debt at September 30, 2015 decreased to 4.56% compared to 4.87% at September 30, 2014.
  • Debt to gross book value ratio (excluding convertible debentures) as at September 30, 2015 was 52.0% compared to 52.2% at June 30, 2015 and debt to gross book value ratio (including convertible debentures) as at September 30, 2015 was 57.9% compared to 58.2% at June 30, 2015.
  • Portfolio occupancy on September 30, 2015 stood at 88.3% compared to 84.6% on September 30, 2014.

Subsequent to quarter end:

  • On October 7, 2015 the REIT obtained a non-revolving credit facility for $35 million to fully finance the redevelopment of Golden Mile Shopping Centre.

Richard Michaeloff, President and CEO of OneREIT, said "During the third quarter we continued our strategy of improving the quality of our portfolio. We completed the disposal of two non-core properties and kicked off the revitalization of our Golden Mile Shopping Centre, our largest development project to date. Our leasing team is focused on driving higher occupancy and continuing to build on our quality tenant profile."

Financial Highlights

Three months ended
September 30
Nine months ended
September 30
(all amounts in $000's, except per unit amounts and ratios) 2015 2014 2015 2014
Rental revenue and other income 30,463 27,151 92,528 82,461
Property operating expenses 12,185 11,289 37,809 35,328
Property operating income 18,278 15,862 54,719 47,133
Share of joint venture net operating income 452 462 1,364 1,394
Net operating income (1) 18,730 16,324 56,083 48,527
Trust expenses 1,112 1,137 3,366 3,592
Finance costs - joint venture operations 190 203 585 615
Finance costs - operations 8,132 6,714 24,685 20,351
Finance costs - distributions on Class B Units 827 1,161 3,307 3,371
Income before fair value gains (losses) and other income 8,469 7,109 24,140 20,598
Fair value gains (losses) associated with financial instruments 4,726 3,813 4,120 (2,439 )
Fair value (losses) on investment property (2,571 ) (5,101 ) (5,541 ) (8,135 )
Fair value gains (losses) on joint venture property (366 ) 322 273 699
Loss from other items on disposition of investment property (712 ) - (712 ) -
Net Income for the period 9,546 6,143 22,280 10,723
FFO (2) 9,323 8,292 27,532 24,048
FFO per unit $ 0.108 $ 0.104 $ 0.321 $ 0.324
FFO payout ratio (historical) (3) 108.2 % 104.2 %
FFO payout ratio (pro forma) (4) 69.4 % 70.1 %

Full Financial Results and MD&A will be available on SEDAR (www.sedar.com) as well as the Investors Relations section of the REIT's website (www.onereit.ca).

(1) A non-IFRS measurement, calculated by the REIT as rental revenue (net rents, property tax and operating cost recoveries, as well as other miscellaneous income from tenants) less operating expenses for properties.
(2) The reconciliations from net income (loss) to Funds from Operations are included in the REIT's MD&A.
(3) FFO payout ratio (historical) has been calculated based on the REIT's previous annualized distribution rate of $0.45 per unit.
(4) FFO payout ratio (pro-forma) has been calculated on a pro forma basis as determined by the REIT's new distribution policy.

The REIT's management considers Net Operating Income, Funds from Operations and Debt to Gross Book Value ratio to be indicative measures in evaluating the REIT's performance. The table above includes non-IFRS information that should not be construed as an alternative to net income or cash flows from operations and may not be comparable to similar measures presented by other issuers as there is no standardized meaning prescribed by IFRS.

Conference Call

OneREIT will hold a conference call on Monday, November 9, 2015 at 10:00 am (ET). Participating on the call will be members of the REIT's senior management.

Investors are invited to access the call by dialling 416-847-6330 or 1-866-530-1553. A recording of this call will be made available Monday, November 9, 2015 beginning at 1:00 pm (ET) through to Monday, November 23, 2015 ending at 1:00pm (ET). To access the recording, please call 647-436-0148 or 1-888-203-1112 and use the reservation number 269790.

About OneREIT

OneREIT is an unincorporated, open-end real estate investment trust which focuses on owning and acquiring retail properties across Canada with the goal of enhancing long-term Unitholder value.

Forward-Looking Information

This press release contains forward-looking statements, which reflect management's expectations regarding the REIT's future growth, results of operations, performance, and business prospects and opportunities. These statements relate to, but are not limited to, the REIT's expectations, intentions, plans and beliefs . In some cases, forward-looking statements can be identified by the use of words such as "may", "will", "should", "expect", "plan", "intend", "anticipate", "believe", "estimate", "predict", "potential", "continue" or the negative or grammatical variations of these terms or other comparable terminology. Readers should be aware that these statements are subject to known and unknown risks, uncertainties and other factors, including, but not limited to: those discussed or referenced under the heading "Risk Factors" in the REIT's Management's Discussion and Analysis for the three and six months ended June 30, 2015, as well as competition within the commercial real estate sector, the effective international, national and regional economic conditions and the availability of capital to fund further investments in the REIT's business. Actual events or results may differ materially from those suggested by any forward-looking statements. Readers should not place undue reliance on any forward-looking statements contained in this press release. By their nature, forward-looking statements involve numerous assumptions, inherent risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and various future events will not occur. Although management of the REIT believes that the expectations reflected in the forward-looking statements are reasonable, there can be no assurance that future results, levels of activity, performance or achievements will occur as anticipated. Neither the REIT nor any other person assumes responsibility for the accuracy and completeness of any forward-looking statements, and no one has any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or such other factors which affect this information, except as required by law.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, which may be made only by means of a prospectus, nor shall there be any sale of the Units in any state, province or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under securities laws of any such state, province or other jurisdiction. The Units of the OneREIT have not been, and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered, sold or delivered in the United States absent registration or an exemption from the registration requirements of U.S. securities laws.

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