Lakeview Hotel Investment Corp Announces Year End Results

/NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES./ 

WINNIPEG, April 29, 2016 /CNW/ - Lakeview Hotel Investment Corp ("LHIC") is pleased to report its financial results for the Year ended December 31, 2015. The following comments in regard to the financial results should be read in conjunction with the December 31, 2015 financial statements and Management Discussion and Analysis which are available on the SEDAR website www.sedar.com.

The sharp decline in oil prices that occurred late in 2014 had an adverse impact on operating results throughout 2015. The important metrics of Funds from Operations, Adjusted Funds from Operations, and Distributable Income all turned negative in 2015. The duration of the downturn is still not clearly known. Although improvements may occur earlier, Management of Lakeview Hotel Investment Corp. is assuming that operating results will not show meaningful improvement until at least 2017 and is taking the measures it deems necessary to function through this downturn, without sacrificing the standard of operations at its hotels and restaurants.

Prior to the slowdown, Lakeview Hotel Investment Corp. had been focused on reducing its overall leverage in order to improve balance sheet ratios and to position the Corporation for future growth.  These efforts will continue. Total liabilities have been reduced by $32 million since the end of 2012, largely through the sale of assets and the refinancing of debt. The Corporation has also been focused on cost saving measures to improve bottom line performance. The Corporation benefits greatly from the support of related parties that own over 59% of the outstanding shares of Lakeview Hotel Investment Corp., and from the agreement of related parties to defer fees. This has allowed the Corporation to remain current on all payments to all unrelated parties. The Corporation is current on all debt service payments to mortgage holders, other long-term debt holders, on all payments to debenture holders, and on all property tax and tax payments to all government agencies. The related parties remain committed to the welfare of the Corporation and will continue to provide the support necessary to benefit the Corporation and its Shareholders.

Following is a comparison of the operating results for the three months and year ended December 31, 2015 and the comparable period in 2014:


Three months ended
December 31

Year ended
December 31


2015

2014

2015

2014


$

$

$

$

Hospitality Revenue






Room

5,069,763

8,317,561

25,005,838

32,915,994


Food & Beverage

934,265

1,216,923

3,745,560

4,695,419


Other

329,783

476,346

1,544,966

1,933,032

Total Revenue

6,333,811

10,010,830

30,296,364

39,544,445

Expenses

(8,535,197)

(9,682,067)

(35,276,757)

(38,359,661)

Gain on sale of income properties

-

-

-

1,007,514

Net Income (Loss)

(2,201,386)

328,763

(4,980,393)

2,192,298

Basic and diluted income (loss) per share

(0.1126)

0.017

(0.255)

0.112

Reconciliation to Funds from Operations





Add (deduct)





Provision for impairment of income property

400,000


400,000


Amortization of income properties

765,462

768,235

3,050,018

3,056,260

Amortization of franchise fees

1,192

1,192

4,768

4,768

Impairment of Income Property

-

-

-

-

Unrealized loss (gain) on change in fair value of interest rate 


 

410,933

 

895,849

 

660,478


swap

(121,667)

Compensation Costs of Stock Options

28,525

-

28,525

-

Distributions from Lakeview Flag Licensing General


 

164,150

 

234,710

 

759,010


Partnership

53,900

Distributions from Lakeview Flag Management General  


 

120,000

 

163,500

 

605,250


Partnership

8,750

Income from Lakeview Flag Licensing General Partnership

(115,398)

(168,735)

(557,403)

(706,763)

Income from Lakeview Flag Management General


 

(109,165)

 

(345,463)

 

(445,130)


Partnership

(72,053)

Gain on sale of income properties

-

-

-

(1,007,514)

Amortization of discount on bankers' acceptance

-

-

198,712

-

Funds from Operations

(1,252,675)

1,515,373

(907,177)

5,118,657

Basic and diluted funds from operations per share

(0.064)

0.077

(0.046)

0.262

Loss on derecognition of financial liability

-

-

-

580,732

Contributions to reserve account

(138,754)

(224,864)

(776,896)

(760,767)

Adjusted Funds from Operations

(1,391,429)

1,290,509

(1,684,073)

4,938,622

Basic and diluted adjusted funds from operations per share

(0.071)

0.066

(0.086)

0.253

Reconciliation to Distributable Income





Accretion of other long-term debt

39,635

40,662

178,857

53,397

Accretion of debentures

40,586

37,032

159,785

146,213

Accretion of mortgages payable

24,264

23,427

94,723

111,398

Loss on derecognition of income properties

44,144

14,244

151,627

25,834

Distributable income

(1,242,800)

1,405,874

(1,099,081)

5,275,464

Basic and diluted distributable income per share

(0.064)

0.072

(0.056)

0.270

Dividends

0

0

0

0

 

Lakeview Hotel Investment Corp is listed on the TSX Venture Exchange under the symbol "LHR".  Lakeview Hotel Investment Corp receives income from ownership, management and licensing of hotel properties. 

The TSX Venture Exchange nor its Regulation Service Provider (as the term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE Lakeview Hotel Investment Corp

For further information: Avrum Senensky, Executive Vice President, Tel: (204) 947-1161, Fax: (204) 957-1697, Email asenensky@lakeviewhotels.com

RELATED LINKS
http://www.lakeviewhotels.com

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