EDMONTON, July 30 /CNW/ -
SECOND QUARTER RESULTS
Melcor Developments Ltd., an Alberta-based real estate development
Company achieved net earnings of $8,075,000 or $0.26 per share (basic) on
revenue of $40,711,000 for the six months ended June 30, 2008 compared to net
earnings of $22,394,000 or $0.72 per share (basic) on revenue of $83,377,000
for the same period in 2007. Diluted earnings per share were $0.26 for the six
months ended June 30, 2008 compared to $0.71 during the same period in the
Earnings for the three months ending June 30, 2008 were $3,702,000 or
$0.12 per share ($0.12 per share diluted) compared to earnings of $15,953,000
or $0.51 per share ($0.50 per share diluted) during the same period in 2007.
Revenue for the second quarter was $19,779,000 compared to the second quarter
in 2007 when revenues were $50,526,000.
The comparatively lower levels of company revenues and earnings to date
in 2008 is due to the general slowdown that has occurred in the Alberta
residential real estate sector for new homes. Earnings are behind the
Company's 2008 business plan but generally consistent with our cautionary
outlook noted in the Annual Report to Shareholders.
The Company's retail commercial and office portfolio continues to grow
and have improved performance as vacancies decline and rents climb to meet
market demand. The Company adds new assets to its Investment Property Division
as properties are successfully built, leased and financed by its Property
Development Division from our strong inventory of commercial and office
The Company received notice that two annexations involving lands owned by
Melcor, were approved by the Alberta Government on July 21, 2008 including 127
acres by the Town of Penhold and 129 acres by the Town of Innisfail.
On July 15, 2008, the Company announced the sale of its Crowfoot West
Business Centre, a recently completed 113,500 sq. ft. office building in
northwest Calgary, Alberta to an institutional buyer at a sale price of
$49,675,000. The sale of this asset will generate a material gain of
approximately $0.60 per share and will be included in the third quarter
financial results of the Company.
The Company paid a semi-annual dividend of $0.25 per share on June 30,
2008. This compares to a semi-annual dividend of $0.20 per share paid on June
The Company remains confident that it has the appropriate assets, capital
resources and experienced management team to handle the current real estate
adjustment and to benefit from the strong anticipated demand for real estate
in our growing markets in Western Canada. The economies of Alberta,
Saskatchewan and British Columbia remain strong with continued capital
spending, job growth and strong per capita incomes. Melcor anticipates that
the rebalancing of the overheated residential markets will continue over the
next 12 months and that housing demand will absorb most of the excess supply
in that timeframe.
For further information:
For further information: please contact the undersigned: Business
Contact: Ralph B. Young, President & CEO, Melcor Developments Ltd.,
email@example.com, Tel: (780) 423-6931, Fax: (780) 426-1796; Investor Relations:
Michael D. Shabada, C.A., Vice-President, Finance & CFO, Melcor Developments
Ltd., firstname.lastname@example.org, Tel: (780) 945-2819, Fax: (780) 426-1796