MONTREAL, May 8, 2024
/CNW/ - PRO Real Estate Investment Trust ("PROREIT" or the "REIT")
(TSX: PRV.UN) today reported its financial and operating results
for the three months ended March 31, 2024 ("first
quarter" or "Q1").
First Quarter of Fiscal 2024 Highlights
- Property revenue increased by 1.7% in Q1 year-over-year
- Net operating income (NOI) was up 1.9% in Q1
year-over-year
- Same property NOI* was up 7.8% in Q1 year-over-year
- Sale of three non-core properties for gross proceeds of
$26.1 million in Q1
- Entered into binding agreements in Q1 for the sale of two
non-core retail properties, which are expected to close in Q2, for
gross proceeds of $7.0 million
- 55.6% of gross leasable area ("GLA") maturing in 2024 renewed
at average spread of 33.5%
- Occupancy rate at 97.7% at March 31,
2024 (including committed space)
- Total debt (current and non-current) of $493.6 million at March
31, 2024, a decrease of $25.1
million, compared to $518.7
million at the same date last year
- Adjusted Debt to Gross Book Value* was 49.5% at March 31, 2024, compared to 50.2% at December 31, 2023
- $39.5 million in available credit
facility and $11.6 million in cash at
March 31, 2024
"PROREIT started the year on solid footing, continuing to reap
the benefits of our stated strategy to focus on the industrial
sector. In the first quarter of 2024, we delivered 7.8% Same
Property NOI* growth year-over-year for our industrial assets,
mainly driven by robust lease renewal spreads and rental steps,"
said Gordon G. Lawlor, President and CEO, PROREIT.
"In the quarter, we further optimized our portfolio with the
disposition of three non-core properties for gross proceeds of
$26.1 million and by entering
into binding agreements for the sale of two non-core retail
properties for gross proceeds of $7.0 million, scheduled to close in Q2 2024.
This will increase our industrial segment exposure to 83.1% of
total GLA, on a proforma basis.
"Our successful property sales in the first quarter also allowed
us to reduce total debt year-over-year by $25.1 million to $493.6 million, bringing our Adjusted Debt to
Gross Book Value* of 49.5% at quarter-end. For the remainder of
2024, mortgage maturities amount to $17.8 million and we expect to renew at
market terms.
"Leasing activities have been very positive. We have now renewed
or replaced 55.6% of GLA maturing in 2024 at a positive average
spread of 33.5% for the entire portfolio, including a robust 47.7%
positive average spread for the industrial sector. We are also
pleased to have signed a 15-year lease with a new quality
international tenant starting in February
2025 following the expiry of the current lease for a
128,000-square-foot property with annual rent steps and a base rent
that is in excess of 30% over the expiring lease.
"While our occupancy rate was strong at 97.7%, it was
temporarily impacted by transitional vacancies in a few industrial
properties which are experiencing strong leasing momentum.
"Finally, we are pleased to have published our third
Sustainability Report. As we adapt to evolving stakeholder
expectations, we maintained our focus on sustainable business
objectives and the implementation of additional best practices. We
are proud of our achievements over the past year and are committed
to continuing to improve as we move forward on our ESG journey.
"With 2024 well underway, we will continue to focus on recycling
capital and further increasing our footprint in the attractive
industrial sector as the market stabilizes. We will pursue this
strategy while managing our balance sheet and allocating capital
prudently to the benefit of our unitholders and, ultimately, all
our stakeholders," concluded Mr. Lawlor.
* Measures followed by
the suffix "*" in this press release are non-IFRS measures. See
"Non-IFRS Measures".
|
Financial Results
Table 1- Financial
Highlights
(CAD $ thousands
except unit, per unit amounts and unless otherwise
stated)
|
3 Months
Ended
March 31
2024
|
3 Months
Ended
March 31
2023
|
Financial
data
|
|
|
Property
revenue
|
$
25,702
|
$
25,278
|
Net operating income
(NOI)
|
$
14,822
|
$
14,540
|
Same Property NOI
(1)
|
$
14,522
|
$
13,477
|
Net income (loss) and
comprehensive income (loss)
|
$
(9,452)
|
$
13,048
|
Net income (loss) and
comprehensive income (loss) per Unit - Basic
(2)
|
$
(0.1560)
|
$
0.2057
|
Net income (loss) and
comprehensive income (loss) per Unit - Diluted
(2)
|
$
(0.1549)
|
$
0.2028
|
Total assets
|
$
1,001,575
|
$
1,054,881
|
Total debt
|
$
493,624
|
$ 518,668
|
Total debt to total
assets
|
49.3 %
|
49.2 %
|
Adjusted Debt to Gross
Book Value (1)
|
49.5 %
|
49.2 %
|
Interest Coverage Ratio
(1)
|
2.5x
|
2.7x
|
Debt Service Coverage
Ratio (1)
|
1.6x
|
1.6x
|
Adjusted Debt to
Annualized Adjusted EBITDA Ratio (1)
|
9.0x
|
9.6x
|
Weighted average
interest rate on mortgage debt
|
3.89 %
|
3.70 %
|
Net cash flows provided
from operating activities
|
$
9,743
|
$
10,582
|
Funds from Operations
(FFO) (1)
|
$
7,722
|
$
4,948
|
Basic FFO per unit
(1)(2)
|
$
0.1274
|
$
0.0819
|
Diluted FFO per unit
(1)(2)
|
$
0.1266
|
$
0.0805
|
Adjusted Funds from
Operations (AFFO) (1)
|
$
7,441
|
$
7,814
|
Basic AFFO per unit
(1)(2)
|
$
0.1228
|
$
0.1293
|
Diluted AFFO per unit
(1)(2)
|
$
0.1220
|
$
0.1271
|
AFFO Payout Ratio –
Basic (1)
|
91.6 %
|
87.0 %
|
AFFO Payout Ratio –
Diluted (1)
|
92.2 %
|
88.5 %
|
(1)
|
Represents a non-IFRS
measure. See "Non-IFRS Measures".
|
(2)
|
Total basic units
consist of trust units of the REIT and Class B LP Units (as defined
herein). Total diluted units also includes deferred trust units and
restricted trust units issued under the REIT's long-term incentive
plan.
|
At March 31, 2024, PROREIT owned 120 investment
properties (including a 50% ownership interest in
42 investment properties), compared to 130 investment
properties (including a 50% ownership interest in
42 investment properties) at March 31, 2023. The
decrease in total properties is a result of the sale of a 100%
interest in ten investment properties during the twelve months
ended March 31, 2024. At March 31, 2024, total
assets amounted to $1.00 billion, compared to $1.05 billion as at
March 31, 2023.
For the first quarter ended March 31, 2024:
- Property revenue amounted to $25.7
million in Q1 2024, an increase of $0.4 million or 1.7%, compared to $25.3 million for the same prior year period. The
increase was mainly due to contractual increases in rent and higher
rental rates on lease renewals and new leases, offset by the
decrease in the number of properties in the portfolio.
- Net operating income (NOI) amounted to $14.8 million for the quarter, compared to
$14.5 million in Q1 2023, an increase
of $0.3 million or 1.9%, which was
mainly driven by the same factors impacting property revenue
described above.
- Same Property NOI*, which represented all 120 properties in the
portfolio, reached $14.5 million for
the quarter, an increase of $1.0
million or 7.8%, compared to the same quarter last year. The
increase was largely a result of contractual increases in rent and
higher rental rates on lease renewals and new leases across all
asset classes, along with higher occupancy rates in the office
asset class, offset by the slight decrease in occupancy in the
industrial asset class.
- Net cash flows provided from operating activities for the
quarter was $9.7 million, compared to
$10.6 million for Q1 2023.
- AFFO* totaled $7.4 million for
the quarter, down slightly from $7.8
million for Q1 2023.
- AFFO Payout Ratio – Basic* stood at 91.6% for the quarter,
compared to 87.0% for Q1 2023, the increase was primarily driven by
the reduction in the number of properties owned and higher interest
expense and leasing costs, partially offset by contractual
increases in rent and higher rental rates on lease renewals.
TABLE 2- Reconciliation of net operating income to net income
and comprehensive income
(CAD $
thousands)
|
3
Months
Ended
March
31
2024
|
3 Months
Ended
March 31
2023
|
|
|
|
Net operating
income
|
14,822
|
14,540
|
|
|
|
General and
administrative expenses
|
1,385
|
3,518
|
Long-term incentive
plan expense
|
1,358
|
581
|
Depreciation of
property and equipment
|
148
|
105
|
Amortization of
intangible assets
|
61
|
93
|
Interest and financing
costs
|
5,793
|
5,131
|
Distributions - Class B
LP Units
|
152
|
157
|
Fair value adjustment -
Class B LP Units
|
975
|
(28)
|
Fair value adjustment -
investment properties
|
13,275
|
(7,651)
|
Fair value adjustment -
derivative financial instrument
|
1,505
|
–
|
Other income
|
(1,034)
|
(835)
|
Other
expenses
|
478
|
421
|
Debt settlement
costs
|
178
|
–
|
Net income (loss)
and comprehensive income (loss)
|
$
(9,452)
|
$
13,048
|
For the three months ended March 31, 2024, net loss
and comprehensive loss was $9.5 million, compared to net income and
comprehensive income of $13.0 million during the same prior year
period. The $22.5 million
variance was mainly related to the $20.9 million impact in the non-cash fair
market value adjustment on investment properties between
Q1 2024 and Q1 2023.
Sustained Operating Environment
At March 31, 2024, PROREIT's portfolio totaled
120 investment properties (including a 50% ownership interest
in 42 investment properties), aggregating
6.2 million square feet of GLA, with a weighted
average lease term of 3.9 years.
The occupancy rate of the portfolio was 97.7% as at
March 31, 2024 (including committed space), compared
to 98.6% at the same date last year. The decrease in occupancy
rate is mainly due to a few vacancies in industrial properties
where management is currently experiencing strong leasing
momentum.
The weighted average in‐place rent for industrial properties at
March 31, 2024 was $8.53 per square foot, an increase
of 9.4% compared to $7.80 per square foot at the same
date last year.
At March 31, 2024, PROREIT had renewed 55.6% of GLA
maturing in 2024 at a positive average spread of 33.5% and, for the
industrial sector, at a positive average spread of 47.7%.
In addition, for a tenant expiry in January 2025, PROREIT secured a lease for the
128,000 square foot space with a new quality
international tenant for a 15-year term with annual rent steps and
base rent in excess of 30% over the expiring lease.
Portfolio Transactions
In the first quarter of 2024, PROREIT completed the sales of
three non-core properties for total gross proceeds of $26.1 million (excluding closing
costs), as follows:
On February 2 and 9, 2024, PROREIT completed the sales
of two non-core properties in Upper
Tantallon, Nova Scotia and Montreal, Quebec totalling approximately
124,000 square feet for gross proceeds of $20.7 million (excluding closing
costs). Proceeds of the sales were used to repay approximately
$16.0 million in related
mortgages, with the balance used for general business purposes.
On March 15, 2024, PROREIT sold a non-core retail
property in Courtenay, British
Columbia for gross proceeds of $5.4 million (excluding closing costs). The
net proceeds of the sale were used to partially repay a
$9.4 million mortgage secured by
additional retail properties.
Also in the first quarter, PROREIT entered into binding
agreements for the sale of two non-core retail properties, for
gross proceeds of $7.0 million (excluding closing costs),
which are expected to close in Q2 2024, subject to standard
closing conditions.
The first agreement was entered into on
March 19, 2024, PROREIT with a third-party purchaser to
sell one non-core retail property in Regina, Saskatchewan totalling approximately
11,000 square feet for gross proceeds of $4.7 million (excluding closing costs).
Net proceeds of the sale will be used to prepay a portion of the
outstanding credit facility or for general business purposes.
The second agreement was entered into on
March 26, 2024, with a third-party purchaser to sell one
non-core retail property in Pincher
Creek, Alberta totalling approximately 8,500 square
feet for gross proceeds of about $2.3 million (excluding closing costs).
Net proceeds of the sale will be used to prepay a portion of the
outstanding credit facility or for general business purposes.
At March 31, 2024, the industrial segment accounted
for 82.9% of GLA and 75.3% of net operating income (NOI). Following
the close of the sales of the two properties under binding
agreement expected to close in Q2 2024, the industrial segment
will represent 83.1% of GLA and 76.1% of net operating income
(NOI).
Financial Position
At March 31, 2024, PROREIT had $39.5 million in available credit facility
and $11.6 million in cash.
Total debt (current and non-current) was $493.6 million at
March 31, 2024, down from $518.7 million at the same date last year, a
reduction of $25.1 million,
including a reduction of its indebtedness under its credit
facility by $24.0 million in
Q1 2024.
The $17.8 million of
remaining mortgages expiring in 2024 are expected to be renewed at
market terms.
Debt to Gross Book Value* was 49.5% at March 31, 2024,
compared to 49.2% at the same date last year. The weighted average
interest rate on mortgage debt was 3.89% at
March 31, 2024, compared to 3.70% at the same date last
year and 3.88% at December 31, 2023.
Sustainability
PROREIT released its 2023 Sustainability Report on
May 8, 2024, which highlights our commitments, strategy
and accomplishments relating to the Environmental, Social and
Governance (ESG) aspects of our organization. The report has been
prepared with references to recognized disclosure guidelines,
including the Sustainability Accounting Standards Board (SASB)
Standards for the real estate industry and the recommendations of
the Task Force on Climate-related Financial Disclosures (TCFD), in
addition to relevant industry-leading standards and benchmarks,
such as GRESB, to ensure alignment with industry-applicable ESG
best practices. The full report is available on PROREIT's website
on its Sustainability page at
https://proreit.ca/en/about/sustainability/.
Distributions
Distributions to unitholders of $0.0375 per trust unit of the REIT
were declared monthly during the three months ended
March 31, 2024, representing distributions of
$0.45 per unit on an annual
basis. Equivalent distributions are paid on the Class B limited
partnership units of PRO REIT Limited Partnership ("Class B LP
Units"), a subsidiary of the REIT.
On April 19, 2024, PROREIT announced a cash
distribution of $0.0375 per trust
unit for the month of April 2024. The distribution is payable
on May 15, 2024, to unitholders of record as at
April 30, 2024.
Strategy
PROREIT remains focused on the successful execution of its
strategy for growth by expanding the portfolio organically and
through disciplined acquisition, while optimizing its balance sheet
and capital allocation. Management continues to evaluate
acquisition opportunities under strict criteria, while also
implementing its capital recycling program to move assets away from
non-core properties to increase holdings in quality industrial
properties in strong secondary markets. In the medium-term, PROREIT
is targeting a goal of $2 billion in assets, 90% industrial
base rent and 45% Adjusted Debt to Gross Book Value* in the next
three to five years. These targets are based on the REIT's current
business plan and strategies and are not intended to be a forecast
of future results. See "Forward-Looking Statements".
Investor Conference Call and Webcast Details
PROREIT will hold a conference call to discuss its first quarter
results for Fiscal 2024 on May 9, 2024 at
9:00 a.m. EDT. There will be a question period reserved
for financial analysts. To access the conference call, please
dial 888-664-6383 or 416-764-8650. A recording of the call
will be available until May 16, 2024 by
dialing 888-390-0541 or 416-764-8677 and using access
code: 864949#.
The conference call will also be accessible via live webcast on
PROREIT's website at www.proreit.com or at
https://app.webinar.net/DlA8L05OvJ1
Annual Meeting of Unitholders
PROREIT will host its annual meeting on June 4, 2024
at 11:00am (EDT) in Montréal, Québec at The Germain Hotel
at 2050 Mansfield Street in the Pavillon Room. An audio webcast of the meeting
will also be available at https://app.webinar.net/oXR4xKzOrlY.
Additional information regarding the meeting is contained in the
REIT's information circular, which has been prepared in connection
with the meeting and is available on PROREIT's website in the
Investors section under Annual Meeting and under PROREIT's profile
on SEDAR+ at www.sedarplus.ca.
About PROREIT
PROREIT (TSX:PRV.UN) is an unincorporated open-ended real estate
investment trust established pursuant to a declaration of trust
under the laws of the Province of Ontario. Founded in 2013, PROREIT owns a
portfolio of high-quality commercial real estate properties in
Canada, with a strong industrial
focus in robust secondary markets.
For more information on PROREIT, please visit the website at:
https://proreit.com.
Non-IFRS Measures
PROREIT's consolidated financial statements are prepared in
accordance with International Reporting Standards ("IFRS"), as
issued by the International Accounting Standards Board. In addition
to reported IFRS measures, industry practice is to evaluate real
estate entities giving consideration, in part, to certain non-IFRS
financial measures, non-IFRS ratios and other specified financial
measures (collectively, "non-IFRS measures"). Without limitation,
measures followed by the suffix "*" in this press release are
non-IFRS measures.
As a complement to results provided in accordance with IFRS,
PROREIT discloses and discusses in this press release (i) certain
non-IFRS financial measures, including: Adjusted Debt, adjusted
earnings before interest, tax, depreciation and amortization
("Adjusted EBITDA"); adjusted funds from operations ("AFFO");
annualized adjusted earnings before interest, tax, depreciation and
amortization ("Annualized Adjusted EBITDA"); funds from operations
("FFO"); gross book value ("Gross Book Value"); and Same Property
NOI and (ii) certain non-IFRS ratios, including: Adjusted Debt to
Annualized Adjusted EBITDA Ratio; Adjusted Debt to Gross Book
Value; AFFO Payout Ratio – Basic; AFFO Payout Ratio – Diluted;
Basic AFFO per Unit; Diluted AFFO per Unit; Basic FFO per Unit;
Diluted FFO per Unit; Debt Service Coverage Ratio; and Interest
Coverage Ratio. These non-IFRS measures are not defined by IFRS and
do not have a standardized meaning under IFRS. PROREIT's method of
calculating these non-IFRS measures may differ from other issuers
and may not be comparable with similar measures presented by other
income trusts or issuers. PROREIT has presented such non-IFRS
measures and ratios as management believes they are relevant
measures of PROREIT's underlying operating and financial
performance. For information on the most directly comparable
financial measure disclosed in the primary financial statements of
the REIT, composition of the non-IFRS measures, a description of
how PROREIT uses these measures and an explanation of how these
measures provide useful information to investors, refer to the
"Non-IFRS Measures" section of PROREIT's management's discussion
and analysis for the three months ended March 31, 2024,
dated May 8, 2024, available on PROREIT's SEDAR+ profile
at www.sedarplus.ca, which is incorporated by reference into this
press release. As applicable, the reconciliations for each non-IFRS
measure are outlined below. Non-IFRS measures should not be
considered as alternatives to net income, cash flows provided by
operating activities, cash and cash equivalents, total assets,
total equity, or comparable metrics determined in accordance with
IFRS as indicators of PROREIT's performance, liquidity, cash flow
and profitability.
Table 3 - Reconciliation of Same Property NOI to net
operating income (as reported in the consolidated financial
statements)
(CAD $
thousands)
|
3
Months
Ended
March
31
2024
|
3 Months
Ended
March 31
2023
|
Property
revenue
|
$
25,702
|
$ 25,278
|
Property operating
expenses
|
10,880
|
10,738
|
Net operating income
(NOI) as reported in the financial statements
|
14,822
|
14,540
|
Straight-line rent
adjustment
|
(142)
|
(121)
|
NOI after straight-line
rent adjustment
|
14,680
|
14,419
|
|
|
|
NOI sourced
from:
|
|
|
Dispositions
|
(158)
|
(942)
|
Same Property NOI
(1)
|
$
14,522
|
$ 13,477
|
Number of same
properties
|
120
|
120
|
(1)
|
Represents a non-IFRS
measure. See "Non-IFRS Measures".
|
Table 4 - Reconciliation of AFFO and FFO to net income and
comprehensive income
(CAD $ thousands
except unit, per unit amounts and unless otherwise
stated)
|
3
Months
Ended
March
31
2024
|
3 Months
Ended
March 31
2023
|
Net income and
comprehensive income for the period
|
$
(9,452)
|
$ 13,048
|
Add:
|
|
|
Long-term incentive
plan
|
1,206
|
(671)
|
Distributions - Class
B LP Units
|
152
|
157
|
Fair value adjustment
- investment properties
|
13,275
|
(7,651)
|
Fair value adjustment
- Class B LP Units
|
975
|
(28)
|
Fair value adjustment
- derivative financial instrument
|
1,505
|
–
|
Amortization of
intangible assets
|
61
|
93
|
FFO (1)
|
$
7,722
|
$ 4,948
|
Deduct:
|
|
|
Straight-line rent
adjustment
|
$
(142)
|
$ (121)
|
Maintenance capital
expenditures
|
(63)
|
(185)
|
Stabilized leasing
costs
|
(888)
|
(506)
|
Add:
|
|
|
Long-term incentive
plan
|
152
|
1,252
|
Amortization of
financing costs
|
389
|
186
|
Accretion expense -
Convertible Debentures
|
93
|
–
|
Debt settlement
costs
|
178
|
–
|
CEO Succession plan
costs
|
–
|
2,240
|
AFFO (1)
|
$
7,441
|
$ 7,814
|
Basic FFO per unit
(1)(2)
|
$ 0.1274
|
$ 0.0819
|
Diluted FFO per unit
(1)(2)
|
$ 0.1266
|
$ 0.0805
|
Basic AFFO per unit
(1)(2)
|
$ 0.1228
|
$ 0.1293
|
Diluted AFFO per
unit (1)(2)
|
$ 0.1220
|
$ 0.1271
|
Distributions
declared per Unit and Class B LP unit
|
$ 0.1125
|
$ 0.1125
|
AFFO Payout Ratio –
Basic (1)
|
91.6 %
|
87.0 %
|
AFFO Payout Ratio –
Diluted (1)
|
92.2 %
|
88.5 %
|
Basic weighted
average number of units (2)(3)
|
60,606,896
|
60,447,230
|
Diluted weighted
average number of units (2)(3)
|
61,015,319
|
61,469,854
|
(1)
|
Represents a non-IFRS
measure. See "Non-IFRS Measures".
|
(2)
|
FFO and AFFO per unit
is calculated as FFO or AFFO, as the case may be, divided by the
total of the weighted average number of basic or diluted units, as
applicable, added to the weighted average number of Class B LP
Units outstanding during the period.
|
(3)
|
Total basic units
consist of trust units of the REIT and Class B LP Units. Total
diluted units also includes deferred trust units and restricted
trust units issued under the REIT's long-term incentive
plan.
|
Table 5 - Reconciliation of Adjusted EBITDA to net income and
comprehensive income
(CAD $
thousands)
|
3
Months
Ended
March
31
2024
|
3 Months
Ended
March 31
2023
|
Net income and
comprehensive income
|
$
(9,452)
|
$ 13,048
|
Interest and financing
costs
|
5,793
|
5,131
|
Depreciation of
property and equipment
|
148
|
105
|
Amortization of
intangible assets
|
61
|
93
|
Fair value adjustment -
Class B LP Units
|
975
|
(28)
|
Fair value adjustment -
investment properties
|
13,275
|
(7,651)
|
Fair value adjustment -
derivative financial instrument
|
1,505
|
–
|
Distributions - Class B
LP Units
|
152
|
157
|
Straight-line
rent
|
(142)
|
(121)
|
Long-term incentive
plan expense
|
1,358
|
581
|
Debt settlement
costs
|
178
|
–
|
CEO succession plan
costs
|
–
|
2,240
|
Adjusted EBITDA
(1)
|
$
13,851
|
$ 13,555
|
Annualized Adjusted
EBITDA (1)
|
$
55,404
|
$ 54,220
|
(1)Represents a non-IFRS measure.
See "Non-IFRS Measures".
|
Table 6 - Calculation of Adjusted Debt to Annualized Adjusted
EBITDA Ratio
(CAD $
thousands)
|
3
Months
Ended
March
31
2024
|
3 Months
Ended
March 31
2023
|
Adjusted Debt
(1)
|
$
497,117
|
$
520,864
|
|
|
|
Adjusted EBITDA
(1)
|
$
13,851
|
$
13,555
|
Annualized Adjusted
EBITDA (1)
|
$
55,404
|
$
54,220
|
Adjusted Debt to
Annualized Adjusted EBITDA Ratio (1)
|
9.0x
|
9.6x
|
(1)
|
Represents a non-IFRS
measure. See "Non-IFRS Measures".
|
Table 7 - Calculation of the Interest Coverage Ratio
(CAD $
thousands)
|
3
Months
Ended
March
31
2024
|
3 Months
Ended
March 31
2023
|
Adjusted EBITDA
(1)
|
$
13,851
|
$
13,555
|
Interest
expense
|
$
5,474
|
$ 5,021
|
Interest Coverage
Ratio (1)
|
2.5x
|
2.7x
|
(1)
|
Represents a non-IFRS
measure. See "Non-IFRS Measures".
|
Table 8 - Calculation of the Debt Service Coverage
Ratio
(CAD $
thousands)
|
3
Months
Ended
March
31
2024
|
3 Months
Ended
March 31
2023
|
Adjusted EBITDA
(1)
|
$
13,851
|
$
13,555
|
Interest expense
|
5,474
|
5,021
|
Principal
repayments
|
3,219
|
3,340
|
Debt Service
Requirements
|
$
8,693
|
$ 8,361
|
Debt Service
Coverage Ratio (1)
|
1.6x
|
1.6x
|
(1)
|
Represents a non-IFRS
measure. See "Non-IFRS Measures".
|
Table 9 - Calculation of Adjusted Debt
(CAD $
thousands)
|
March
31
2024
|
March 31
2023
|
Debt (non-current and
current portion) as reported in the financial
statements
|
$
493,624
|
$
518,668
|
Reconciling
items:
|
|
|
Unamortized financing
costs
|
4,721
|
2,196
|
Cumulative accretion
expense - Convertible Debenture (1)
|
(310)
|
–
|
Cumulative
fair value adjustment - derivative financial instrument
(1)
|
(918)
|
–
|
Adjusted Debt
(2)
|
$
497,117
|
$
520,864
|
(1)
|
Represents the
cumulative amounts since issuance of the convertible debentures of
the REIT on May 26, 2023.
|
(2)
|
Represents a non-IFRS
measure. See "Non-IFRS Measures".
|
Table 10 - Calculation of Gross Book Value and Adjusted Debt
to Gross Book Value
(CAD $ thousands
unless otherwise stated)
|
March
31
2024
|
March 31
2023
|
Total assets, including
investment properties stated at fair value
|
$
1,001,575
|
$
1,054,881
|
Accumulated
depreciation on property and equipment and intangible
assets
|
3,409
|
3,251
|
Gross Book Value
(1)
|
1,004,984
|
1,058,132
|
|
|
|
Adjusted Debt
(1)
|
$
497,117
|
$
520,864
|
Adjusted Debt to
Gross Book Value (1)
|
49.5 %
|
49.2 %
|
(1)
|
Represents a non-IFRS
measure. See "Non-IFRS Measures".
|
Forward-Looking Statements
This press release contains forward-looking statements and
forward-looking information (collectively, "forward-looking
statements") within the meaning of applicable securities
legislation, including statements relating to certain expectations,
projections, growth plans and other information related to REIT's
business strategy and future plans. Forward-looking statements are
based on a number of assumptions and are subject to a number of
risks and uncertainties, many of which are beyond PROREIT's
control, that could cause actual results and events to differ
materially from those that are disclosed in or implied by such
forward-looking statements.
Forward-looking statements contained in this press release
include, without limitation, statements pertaining to the execution
by PROREIT of its growth strategy, the future financial and
operating performance of PROREIT, the medium-term goals of the
REIT, the expected renewal of mortgages and the terms thereof and
the anticipated reduction of interest rates. PROREIT's objectives
and forward-looking statements are based on certain assumptions,
including that (i) PROREIT will receive financing on
favourable terms; (ii) the future level of indebtedness of
PROREIT and its future growth potential will remain consistent with
the REIT's current expectations; (iii) there will be no
changes to tax laws adversely affecting PROREIT's financing
capacity or operations; (iv) the impact of the current
economic climate and the current global financial conditions on
PROREIT's operations, including its financing capacity and asset
value, will remain consistent with PROREIT's current expectations;
(v) the performance of PROREIT's investments in Canada will proceed on a basis consistent with
PROREIT's current expectations; and (vi) capital markets will
provide PROREIT with readily available access to equity and/or
debt.
The medium-term goals of the REIT disclosed under "Strategy" are
based on the REIT's current business plan and strategies and are
not intended to be a forecast of future results. The medium-term
goals contemplate the REIT's historical growth and certain
assumptions including but not limited to (i) current global
capital market conditions, (ii) access to capital,
(iii) interest rate exposure, (iv) availability of
high-quality industrial properties for acquisitions,
(v) dispositions of retail and office properties, and
(vi) capacity to finance acquisitions on an accretive
basis.
The forward-looking statements contained in this news release
are expressly qualified in their entirety by this cautionary
statement. All forward-looking statements in this press release are
made as of the date of this press release. PROREIT does not
undertake to update any such forward-looking information whether as
a result of new information, future events or otherwise, except as
required by law.
Additional information about these assumptions and risks and
uncertainties is contained under "Risk Factors" in PROREIT's latest
annual information form and "Risk and Uncertainties" in PROREIT's
management's discussion and analysis for the three months ended
March 31, 2024, which are available under PROREIT's
profile on SEDAR+ at www.sedarplus.ca.
SOURCE PROREIT