Firm Capital Property Trust Announces Solid Third Quarter and Year to Date Results and Sixth Distribution Increase in Six Years

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Firm Capital Property Trust Announces Solid Third Quarter and Year to Date Results and Sixth Distribution Increase in Six Years

Canada NewsWire

TORONTO, Nov. 6, 2018 /CNW/ - Firm Capital Property Trust ("FCPT" or the "Trust"), (TSXV: FCD.UN) is pleased to report its financial results for the three and nine months ended September 30, 2018.

4.3% DISTRIBUTION INCREASE 
The Trust is pleased to announce its sixth distribution increase in six years of 4.3% to $0.48 per Trust Unit on an annualized basis or $0.04 per month commencing January 2019.  As a result, the Trust is pleased to announce that it has declared and approved monthly distributions in the amount of $0.04 per Trust Unit for unitholders of record on January 31, 2019, February 28, 2019 and March 29, 2019 payable on or about February 15, 2019, March 15, 2019 and April 15, 2019.

PROPERTY PORTFOLIO HIGHLIGHTS
The portfolio consists of 61 commercial properties with a total GLA of 2,519,761 square feet (1,497,581 square feet on an owned interest basis) and a 50% interest in one apartment complex comprised of 135 apartment units. The portfolio is well diversified in terms of geographies and property asset types. The portfolio is also well diversified by tenant profile with no tenant accounting for more than 5.0% of total net rent. Further, the top 10 tenants are largely comprised of creditworthy and large national tenants and account for 24.5% of total net rent.

THIRD QUARTER AND YEAR TO DATE HIGHLIGHTS

  • Net income for the three months ended September 30, 2018 was approximately $3.1 million in comparison to the $3.7 million reported for the three months ended June 30, 2018 and the $3.7 million reported for the three months ended September 30, 2017. Excluding fair value adjustments, net income is approximately $1.9 million for the three months ended September 30, 2018 compared to the $2.0 million reported for the three months ended June 30, 2018 but a 30% increase over the $1.4 million reported for the three months ended September 30, 2017;

  • Net income for the nine months ended September 30, 2018 was approximately $13.1 million, which is an 18% increase over the $11.1 million reported for the nine months ended September 30, 2017;

  • $7.05 Net Asset Value ("NAV") per Unit based on a IFRS book value of equity of approximately $123.6 million and is a 0.6% increase over the $7.01 NAV per Unit reported at June 30, 2018;

  • On an IFRS basis, NOI for the three months ended September 30, 2018 was approximately $3.3 million largely in line with the $3.4 million reported June 30, 2018, but a 14% increase in comparison to the $2.9 million reported for the three months ended September 30, 2017. NOI for the nine months ended September 30, 2018 was approximately $9.8 million which is a 16% increase over the $8.4 million reported for the nine months ended September 30, 2017;

  • On a cash basis ("Cash NOI"), for the three months ended September 30, 2018 was approximately $3.3 million, largely in line with the $3.4 million reported for the three months ended June 30, 2018, but a 16% increase over the $2.8 million reported for the three months ended September 30, 2017. Cash NOI for the nine months ended September 30, 2018 was approximately $9.7 million which is a 19% increase over the $8.2 reported for the nine months ended September 30, 2017;

  • Funds From Operations ("FFO") for the three months ended September 30, 2018 was approximately $1.9 million, compared to the $2.0 million reported for the three months ended June 30, 2018, but a 28% increase over the $1.5 million reported for the three months ended September 30, 2017;

  • Adjusted Funds From Operations ("AFFO") for the three months ended September 30, 2018 was approximately $1.8 million, compared to the $1.9 million reported for the three months ended June 30, 2018, but a 24% increase in comparison to the $1.4 million reported for the three months ended September 30, 2017;

  • FFO for the nine months ended September 30, 2018 was approximately $5.7 million, a 24% increase in comparison to the $4.6 million reported for the nine months ended September 30, 2017. AFFO for the nine months ended September 30, 2018 was $5.3 million, a 22% increase in comparison to the $4.3 million reported for the nine months ended September 30, 2017;

  • FFO per Unit for the three months ended September 30, 2018 was $0.107 while AFFO per Unit was $0.101. For the nine months ended September 30, 2018 FFO per Unit was $0.347 while AFFO per Unit was $0.323;

  • Commercial and residential occupancy improved to 95.0% and 98.8%, respectively; and

  • Conservative leverage profile with Debt / Gross Book Value ("GBV") at 42.2%.






% Change Over


Three Months


Nine Months


Three Months


Nine Months


Sept 30, 
2018

June 30,
2018

Sept 30, 
2017


Sept 30, 
2018

Sept 30, 
2017


June 30, 
2018

Sept 30, 
2017


Sept 30,
2017

Rental Revenue

$

5,423,802

$

5,546,678

$

4,835,094


$

16,433,972

$

14,293,596


(2%)

12%


15%

NOI












 - IFRS Basis

$

3,269,870

$

3,411,330

$

2,867,718


$

9,751,076

$

8,416,126


(4%)

14%


16%

 - Cash Basis

$

3,258,543

$

3,420,534

$

2,809,432


$

9,738,253

$

8,207,546


(5%)

16%


19%

Net Income

$

3,117,455

$

3,715,744

$

3,704,461


$

13,064,528

$

11,103,703


(16%)

(16%)


18%

FFO

$

1,874,298

$

1,950,304

$

1,460,940


$

5,684,771

$

4,591,562


(4%)

28%


24%

AFFO

$

1,772,699

$

1,904,121

$

1,426,579


$

5,301,706

$

4,342,076


(7%)

24%


22%

























FFO Per Unit

$

0.107

$

0.118

$

0.114


$

0.347

$

0.360


(9%)

(6%)


(4%)

AFFO Per Unit

$

0.101

$

0.116

$

0.111


$

0.323

$

0.340



(9%)


(5%)

























Distributions Per Unit

$

0.115

$

0.115

$

0.110


$

0.345

$

0.330



5%


5%













Payout Ratios












 - FFO

108%

97%

96%


100%

92%






 - AFFO

114%

99%

99%


107%

97%






 

FINANCIAL HIGHLIGHTS

  • $1.9 Million of Equity Issuance Activity: On July 27, 2018, the Trust announced that it closed the final tranche of its previously announced non-brokered private placement. The Trust closed on 296,800 trust units for gross proceeds of approximately $1.9 million;

  • Cash Generating Refinancing Activity: On August 13, 2018, the Trust refinanced its existing mortgage on its Montreal Industrial Portfolio with a Canadian Chartered Bank (the "Bank"). The principal balance of the mortgage at maturity was $29.4 million, while the Trust's portion was $14.7 million. The new mortgage is a $42.0 million first mortgage fixed at an interest rate of 4.0% with a 25 year amortization. In addition a $1.0 million revolving credit facility was also provided by the Bank that is fully secured against the Montreal Industrial Portfolio with an interest rate based on a calculated formula using the Bank's prime lending rate. The Trust's portion of this new mortgage is $21.0 million and $0.5 million for the revolving credit facility, respectively. Net cash received from the refinancing of approximately $6.3 million (pre closing costs) will be used for future acquisitions and for working capital purposes; and

  • Acquisition of a Single Tenanted Industrial Building in Montreal, Quebec: On October 15, 2018, the Trust announced the closing of a 50% interest in a 159,164 square foot single tenant industrial building located in Montreal, Quebec. The acquisition price is approximately $11.0 million, excluding transaction costs. The property will be part of the current Montreal portfolio with all of the existing investors participating in their pro rata share. The Property is being acquired at a 7.5% capitalization rate, is located in the Mount Royal industrial market and is 100% leased to Le Chateau Inc. until April 30, 2026.

For the complete financial statements, Management's Discussion & Analysis and supplementary information, please visit www.sedar.com or the Trust's website at www.firmcapital.com

DISTRIBUTION REINVESTMENT PLAN & UNIT PURCHASE PLAN
The Trust has in place a Distribution Reinvestment Plan ("DRIP") and Unit Purchase Plan (the "Plan"). Under the terms of the DRIP, FCPT's Unitholders may elect to automatically reinvest all or a portion of their regular monthly distributions in additional Units, without incurring brokerage fees or commissions. Under the terms of the Plan, FCPT's Unitholders may purchase a minimum of $1,000 of Units per month and maximum purchases of up to $12,000 per annum. Management and trustees have not participated in the DRIP or Plan to date and own approximately 7% of the issued and outstanding trust units of the Trust.

ABOUT FIRM CAPITAL PROPERTY TRUST
Firm Capital Property Trust is focused on creating long-term value for Unitholders, through capital preservation and disciplined investing to achieve stable distributable income. In partnership with management and industry leaders, The Trust's plan is to co-own a diversified property portfolio of multi-residential, flex industrial, net lease convenience retail, and core service provider professional space. In addition to stand alone accretive acquisitions, the Trust will make joint acquisitions with strong financial partners and acquisitions of partial interests from existing ownership groups, in a manner that provides liquidity to those selling owners and professional management for those remaining as partners.  Firm Capital Realty Partners Inc., through a structure focused on an alignment of interests with the Trust sources, syndicates and property and asset manages investments on behalf of the Trust.

FORWARD LOOKING INFORMATION
This press release may contain forward-looking statements. In some cases, forward-looking statements can be identified by the use of words such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate", "predict", "potential", "continue", and by discussions of strategies that involve risks and uncertainties. The forward-looking statements are based on certain key expectations and assumptions made by the Trust. 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 Trust 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 Trust 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 Firm Capital Property Trust 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 application for exemption from the registration requirements of U.S. securities laws.

Certain financial information presented in this press release reflect certain non- International Financial Reporting Standards ("IFRS") financial measures, which include NOI, FFO and AFFO. These measures are commonly used by real estate investment entities as useful metrics for measuring performance and cash flows, however, they do not have standardized meaning prescribed by IFRS and are not necessarily comparable to similar measures presented by other real estate investment entities. These terms are defined in the Trust's Management Discussion and Analysis ("MD&A") for the quarter and year ended March 31, 2018 as filed on www.sedar.com.

Neither the Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. Additional information about the Trust is available at www.firmcapital.com or www.sedar.com.

SOURCE Firm Capital Property Trust

View original content: http://www.newswire.ca/en/releases/archive/November2018/06/c3793.html

Copyright CNW Group 2018

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