Morguard Real Estate Investment Trust Announces 2014 Annual Results

TSX: MRT.UN

MISSISSAUGA, ON, Feb. 19, 2015 /CNW/ - Morguard Real Estate Investment Trust ("the Trust") (TSX: MRT.UN) today is pleased to announce its 2014 annual financial results. These results have been prepared in accordance with International Financial Reporting Standards ("IFRS").

Highlights

  • Funds from operations ("FFO") for the year ended December 31, 2014 was $106.5 million, up $5.7 million from the $100.8 million reported in 2013
  • On a per unit diluted basis, FFO for the year 2014 was $1.67, as compared to $1.55 reported for the prior year.
  • Net operating income for the year ended December 31, 2014 was $169.7 million, up $8.4 million from the $161.3 million recorded in 2013.
  • Acquisitions during the year and the acquisition of Pine Centre Mall in December 2013, add $8.9 million to net operating income.
  • The disposition of Cedar Pointe Business Park, along with other assets re-classified to "held for sale", reduces net operating income by $5.4 million. However, this net operating income was replaced by operational improvements in the remaining portfolio where net operating income improved by $5.0 million.
  • A focused re-financing program reduces interest on same debt levels, $5.0 million, during the year ended December 31, 2014.  The reduction in interest expense is the direct result of moving the weighted average interest rate from 4.4% (at December 31, 2013) to 4.2% (at December 31 2014).  These savings are offset by additional interest associated with higher debt levels.  These higher debt were the result of both the re-financing program and the additional debt required for acquisitions.  These activities increase interest expense $7.3 million.

Funds from operations is not a term defined under IFRS and may not be comparable to similar measures used by other Trusts. A reconciliation of net income to funds from operations is included.

At December 31, 2014, the Trust's debt consisted of $1.2 billion of fixed-rate debt with weighted average interest rate of 4.2% and weighted average term to maturity of 5.81 years, $146.5 million of 4.85% fixed-rate convertible debentures, $29.7 million debt associated with real estate properties held for sale and $4.9 million utilization of the operating line of credit.  The Trust has a debt to total assets ratio of 45.2%.

  • On February 17, 2015, the Trust completed the sale of 350 Sparks and 361 Queen to Morguard Corporation, for a total price of $37.7 million.  The transaction includes an assumption of the existing mortgage debt of $17.8 million.

NET OPERATING INCOME, FUNDS FROM OPERATIONS
This press release and accompanying financial information make reference to net operating income and funds from operations on a total and per unit basis.  Net operating income is defined as income from property operations after operating expenses have been deducted, but prior to deducting interest expense, general and administrative expenses and fair value gains (losses).   Funds from operations is defined as net income prior to extraordinary items, valuation adjustments, and certain other non-cash items, if any.

FINANCIAL STATEMENTS AND MORGUARD'S DISCUSSION AND ANALYSIS
Morguard REIT's Q4 2014 Consolidated Financial Statement and Management's Discussion and Analysis along with its 2013 Annual Report are available on Morguard REIT's website at www.morguard.com and have been filed with SEDAR at www.sedar.com

CONFERENCE CALL DETAILS:




Date:

Friday, February 20, 2015 at 12:00 p.m. (ET)




Conference Call#:

647.427.7450 or 1.888.231.8191




Conference ID#:

82745003

 

ABOUT MORGUARD REAL ESTATE INVESTMENT TRUST
Morguard REIT is a closed-end real estate investment trust, which owns a diversified portfolio of 49 retail, office and mixed-use income producing properties in Canada with a book value of $2.9 billion and approximately 8.6 million square feet of leaseable space.

Consolidated Balance Sheets

(In thousands of Canadian dollars)

December 31,

December 31,



2014


2013






Assets





Real estate properties

$

2,866,235

$

2,869,358

Equity-accounted investments


30,770


44,857

Amounts receivable


42,635


14,505

Other assets


1,054


1,002

Cash and cash equivalents


12,612


13,077



2,953,306


2,942,799

Real estate properties held for sale


63,190



$

3,016,496

$

2,942,799






Liabilities





Mortgages payable

$

1,182,456

$

1,194,682

Convertible debentures payable


146,541


145,460

Accounts payable and other liabilities


45,761


44,919

Bank indebtedness 


4,927


5,000



1,379,685


1,390,061

Mortgages payable on real estate properties held for sale


29,730


Total liabilities


1,409,415


1,390,061






Unitholders' Equity


1,607,081


1,552,738


$

3,016,496

$

2,942,799

 


Consolidated Statements of Income and Comprehensive Income

(In thousands of Canadian dollars)               





For the years ended December 31

2014

2013






Revenue from real estate properties

$

298,461

$

279,651

Property operating expenses


119,139


109,626

Property management fees


9,583


8,689

Net operating income


169,739


161,336






Interest expense


62,000


59,672

General and administrative


5,414


4,555

Amortization expense



38

Other income


(375)


(9)

Income before fair value gains, (loss)/gain on sale of real estate
properties and net (loss)/income from equity-accounted investments


102,700


97,080






Fair value gains on real estate properties, net


11,239


107,641

(Loss)/gain on sale of real estate properties


(37)


2,058

Net (loss)/income from equity-accounted investments


(20)


5,602

Net income for the year

$

113,882

$

212,381






Other comprehensive income





Items to be reclassified to profit or loss in

 subsequent periods:






Amortization – cash flow hedge


1,010


991

Comprehensive income

$

114,892

$

213,372

 


Reconciliation of Net Income to Funds from Operations

(In thousands of Canadian dollars, except per-unit amounts)

2014

2013






Net income for the year

$

113,882

$

212,381






Add/(deduct) :





Fair value gains on real estate properties(1)         


(7,403)


(109,560)

Loss/(gain) on sale of real estate properties


37


(2,058)

Basic funds from operations

$

106,516

$

100,763






Interest expense on convertible debentures


7,275


7,275

Diluted funds from operations

$

113,791

$

108,038






Funds from operations per unit:






Basic


$1.71


$1.59


Diluted(2)


$1.67


$1.55






Weighted average units outstanding (in thousands)






Basic


62,168


63,456


Diluted(2)


68,265


69,554

(1)

Includes fair value gains from equity-accounted investments

(2)

Includes dilutive impact of convertible debentures

 

SOURCE Morguard Real Estate Investment Trust

For further information: K. (Rai) Sahi, President and Chief Executive Officer, Tel: 905.281.4800, or; Pamela McLean, Chief Financial Officer, Tel: 905.281.4800.

RELATED LINKS
http://www.morguardreit.com

Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890