Proventure Income Fund announces results for third quarter of 2011

Symbol: PVT.UN (TSX-V)

CALGARY, Nov. 8, 2011 /CNW/ - Proventure Income Fund (the "Fund") is pleased to report its financial results for the nine month period ended September 30, 2011.

Overall Performance

We reported a loss for the period of $255 thousand or $0.03 per basic unit when compared to a loss of $1,418 thousand or $0.19 per basic unit for 2010.  In addition, our EBITDA (see "Non-IFRS Financial Measures") increased to $649 thousand from a loss of $867 thousand in for the third quarter of 2011 when compared to the same period of 2010.

The difference in the net loss reported in the third quarter of 2011 when compared to the third quarter of 2010 is $1.16 million.  The primarily reasons for the change in the net loss between periods is a combination of a write-down in real estate held for development and sale of $1.78 million recorded in 2010, a decrease in finance income related to the net change in fair value of a fund unit liability of $229 thousand recorded in 2010, and income taxes of $351 thousand related to SIFT tax recorded in 2011.

Proposed Transactions

The Fund has entered into an agreement with Cervus Equipment Corporation ("Cervus"), a related party, to complete a series of transactions, including the sale to Cervus of certain real estate assets that Proventure currently leases to Cervus in the amount of approximately $25.9 million.  The sale is conditional upon receipt of regulatory approval and the approval of disinterested unitholders of Proventure.

In addition, Cervus has agreed to loan ProDev Trust ("ProDev") approximately $11.2 million, the proceeds of which will be applied to pay off a Promissory Note between ProDev and Proventure.  The loan is expected to be repaid in December 2012.  As a result of the repayment of this loan, Proventure will qualify as a REIT for the period commencing January 1, 2012.

Selected Quarterly Information              
               
  Three Months Ended   Nine Months Ended
In $thousands, except per unit
   amounts
September 30,
2011
September 30,
2010
% Change   September 30,
2011
September 30,
2010
% Change
Revenue and other income 856 839 2.0   2,530 2,504 1.0
Profit (loss) for the period (255) (1,418) 82.0   751 3,427 (78.1)
  Per unit - Basic (0.03) (0.19) 84.2   0.10 0.45 (77.8)
  Per unit - Diluted (0.03) (0.15) 80.0   0.08 0.35 (77.1)
Cash provided by operating activities (187) (73) (156.2)   812 1,144 (24.2)
  Per unit - Basic (0.02) (0.01) (100.0)   0.10 0.15 (13.3)
EBITDA 649 (867) -   2,774 5,053 (45.1)
EBITDA margin1 75.8% (103.3)% -   109.6% 201.8% (45.7)
  Per Unit - Basic 0.08 (0.11) -   0.28 0.78 (64.1)
Weighted average units outstanding              
  Basic 7,817 7,639 2.3   7,749 7,610 1.8
  Diluted 9,918 9,740 1.8   9,850 9,712 1.4
  Actual units outstanding         7,817 7,638 2.3
Closing market price         1.90 1.72 10.5
Total assets         54,142 57,003 (5.0)
Total long-term liabilities         25,460 32,929 (22.7)
Unitholders' equity         24,460 19,943 27.6
Net book value per unit - basic         3.16 2.62 20.6

Note: (1) These financial measures are identified and defined under the section "Non-IFRS Financial Measures" in the MD&A.

The Non-IFRS measures identified in this Press Release do not have any standardized meaning prescribed by International Financial Reporting Standards ("IFRS"), and are therefore, unlikely to be comparable to similar measures presented by other issuers. These non-IFRS measures are more fully defined and discussed, together with reconciliation to the most directly related IFRS measure in the MD&A of the Fund on the results of operations for the nine month period ended September 30, 2011.

Copies of Proventure Income Fund's unaudited financial statements and related MD&A are available on the SEDAR website at www.sedar.com.

Proventure Income Fund is an open-ended mutual fund trust established on December 31, 2005 under laws of the Province of Alberta.  The Fund is in the commercial property development business and leases real estate to Cervus LP.  The units of Proventure Income Fund are listed on the TSX Venture Exchange and trade under the symbol "PVT.UN".

Neither the TSX Venture 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.

SOURCE Proventure Income Fund

For further information:

Peter Lacey - President & CEO
Telephone: (403) 567-0339 Ext: 245
Fax: 403 567-0497
Email: peter.lacey@cervuscorp.com


















Randy Muth - Chief Financial Officer
Telephone: (403) 567-0339 Ext: 244
Fax: 403 567-0497
Email: rmuth@cervuslp.com

 

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Proventure Income Fund

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