Parkbridge announces third quarter results



    CALGARY, Aug. 10 /CNW/ - Parkbridge Lifestyle Communities Inc.
("Parkbridge" or the "Corporation"), (TSX: PRK) today announced the results
for the third quarter of its 2009 fiscal year ended June 30, 2009.

    
    FINANCIAL HIGHLIGHTS
    -------------------------------------------------------------------------
                                      Three Months Ended   Nine Months Ended
                                             June 30             June 30
                                     -------------------- -------------------
    Unaudited                             2009      2008      2009      2008
    -------------------------------  ---------- --------- --------- ---------
    Income Summary Data
    ($000's, except per
     share amounts)

    Total revenues from all
     operations                         33,092    38,650    77,193    87,220
    Income from property operations     10,604     9,652    29,965    25,879
    Home sales income                      817     2,365     1,633     4,476
    Income from operations              11,421    12,017    31,598    30,355
    Net income                           3,285     4,245     7,251    11,002
    Net income per share - diluted        0.05      0.07      0.12      0.17

    Funds from operations (FFO)(1)       6,117     7,307    15,980    16,885
    FFO per share - diluted               0.10      0.11      0.26      0.26

    Unit Amounts

    Home Sales volume                       71       110       130       231
    Home Sales backlog(2) - end of
     period                                166       178       166       178

    Operational Sites - end of
     period                             15,926    15,465    15,926    15,465
    Developed Sites - end of
     period                                936       805       936       805
    Expansion Sites - end of
     period                              3,952     4,334     3,952     4,334

    Weighted average no. of
     shares - diluted (000's)           61,769    63,605    61,769    63,764
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    (1) Management utilizes a measure called Funds From Operations ("FFO") to
        assess and evaluate its return on each of its projects as well as the
        performance of the enterprise as a whole. FFO does not have a
        standardized meaning prescribed by Canadian generally accepted
        accounting principles ("GAAP"), and therefore may not be comparable
        to similar measures presented by other issuers. Parkbridge defines
        FFO as being net income for the period before depreciation and
        amortization on capital assets, certain defeasance costs, stock-based
        compensation expense, internalization costs, future income tax
        expense and deferred credits in income tax expense.

    (2) Includes 117 firm and 49 conditional sales contracts as at July 31,
        2009, of which 87 of the firm sales are scheduled to close in the
        fiscal year ended September 30, 2009.
    

    Income from property operations rose 10% to $10.6 million for the three
months ended June 30, 2009 as compared to $9.7 million for the comparable
period in 2008 (a 16% increase for the nine months ended June 30, 2009 to
$30.0 million when compared to the $25.9 million for the nine months ended
June 30, 2008). Half of this growth reflected contributions from internal
sources consisting of rent increases, the lease-up of developed sites and
operational improvements. The remainder was contributed by properties acquired
over the last two years. The rate of growth for the quarter was impacted by a
reduction in brokerage and resales income due to fewer listings and resales
and the lower demand for Marina parts and services given the poor weather at
the start of the summer season.
    Income from Home sales operations amounted to $0.8 million during the
three months ended June 30, 2009 as compared to $2.4 million generated in the
same quarter last year ($1.6 million for the nine months ended June 30, 2009
as compared to $4.5 million for the nine months ended June 30, 2008).
Performance at Parkbridge's Home sales operations remains inconsistent from
month to month. Year to date sales volumes are 44% below levels achieved in
2008, and margins on the average sale are lower. While these results are
disappointing and below initial guidance provided by the Corporation, they are
not surprising given the economic conditions. Parkbridge is, however,
cautiously encouraged by recent sales activity which is pointing to a more
positive trend.
    Funds from operations for the three months ended June 30, 2009 decreased
to $6.1 million ($0.10 per share) as compared to the $7.3 million ($0.11 per
share) achieved during the same three month period a year earlier ($16.0
million ($0.26 per share) for the nine months ended June 30, 2009 as compared
to $16.9 million ($0.26 per share) for the nine months ended June 30, 2008).
    Net income for the three months ended June 30, 2009 amounted to $3.3
million ($0.05 per share) as compared to the $4.2 million ($0.07 per share)
achieved during the same three month period a year earlier ($7.3 million
($0.12 per share) for the nine months ended June 30, 2009 as compared to $11.0
million ($0.17 per share for the nine months ended June 30, 2008). The $3.8
million reduction in net income for the nine months ended June 30, 2009 is due
in part to the absence of a one-time future income tax recovery ($2.1 million)
resulting from changes in enacted rates in the second quarter of fiscal 2008,
and a $0.4 million increase in stock-based compensation. The increase in the
future income tax provision did not give rise to a current tax liability, and
neither of the foregoing impacted Parkbridge's cash flows from operations.

    Highlights

    Operating Results

    As previously indicated, all of the Corporation's properties continue to
enjoy high occupancy levels and tenant delinquency and default rates remain
negligible. This performance reflects the quality, affordability and
alternative choice for community and recreational living, resulting in the
stability of income from operations, that Parkbridge's properties provide.

    Lease-up and New Home Sales

    Sales volumes and margins on sales were adversely affected by the
combination of the severe national economic downturn and a change in the mix
of expansion projects. Disparities in the regional economies in which
Parkbridge is active produced varying sales results. Projects located in
southwestern Ontario recorded the weakest sales performance due to the sharp
slowdown in the manufacturing sector in this area, whereas, those projects
located within the Greater Toronto Area ("GTA") and the Wasaga Beach area
performed reasonably well. Poor weather at the start of the summer season has
also contributed to a lower volume of Resort Unit sales.
    Overall, margins averaged $13,000 per home in the nine month period ended
June 30, 2009, compared to $19,000 per home in the same period last year.
Margins were negatively affected due to the combination of lower sales volumes
and a concerted effort in Parkbridge's Alberta projects to reduce inventory
and increase sales volumes and the lease up of Sites.
    The recent pick up in home resales activity in many Canadian cities is,
however, encouraging. Though not enough to indicate the recession is over,
Parkbridge is hopeful these positive trends will continue and anticipate sales
of Homes and Resort Units, and margins on those sales, will gradually improve
over the coming months.
    For the three months ended June 30, 2009, 81 Developed Sites were leased
and 71 new homes were sold which compares to 107 sites leased and 110 homes
sold in the comparable quarter in 2008 (for the nine month period in 2009, 143
sites leased and 130 homes sold as compared to 224 sites leased and 231 homes
sold in the same period of 2008). Apart from the recessionary factors already
noted, sales results for 2009 when compared to 2008 were also impacted by the
sell-out in fiscal 2008 of the successful retirement townhouse project, Wasaga
Meadows.
    Parkbridge continues to maintain a significant backlog of lease and home
sales commitments, although the weighting of conditional contracts is higher
than in past years. As at July 31, 2009, 166 lease and homes sales contracts
were in hand (117 firm and 49 conditional contracts) compared to 178 contracts
at this time last year (137 firm and 41 conditional contracts). The lower
backlog is reflective of the recessionary environment and the mix of expansion
projects currently underway. Of the 117 firm sales commitments at July 31,
2009, 87 are scheduled to close in fiscal 2009, whereas 30 are scheduled to
close after September 30, 2009. There is no certainty that conditional sales
will be converted to firm sales.

    Development Projects

    During the third quarter of fiscal 2009, $8.3 million was invested in the
19 projects under active development. The phased build out of development
projects resulted in the completion of 83 new Developed Sites during the
current quarter. The inventory of Developed Sites on hand and available for
lease-up at June 30, 2009 stands at 936 Sites. For the remainder of the 2009
fiscal year, the Corporation anticipates investing a further $5.7 million in
development projects.
    Parkbridge continues to carefully monitor development outlays and has
scaled back on certain expenditures until such time when presales and
premarketing programs demonstrate adequate market demand. On June 27, 2009,
the Corporation launched the presales and marketing program for Country
Meadows, a project planned for 168 townhouse units and based on a concept
similar to the highly successful Wasaga Meadows project. The Country Meadows
project is located in the Town of Wasaga Beach, Ontario. The single level,
1,200 square foot, townhome is geared for carefree living and targeted to the
65 to 70 year old demographic. Presales are strong; 12 firm and 10 conditional
lease and sale commitments have been concluded to date. This fall will also
bring the opening of the Waterside retirement facility abutting Parkbridge's
Wasaga Meadows project which will bring to completion this master planned
Community. The retirement facility was part of the master plan and a 5-acre
land parcel was previously sold to a local operator who committed to construct
and operate the retirement facility.
    After some delay, the first phase of Fontaine Village, a 167 site project
in Cold Lake, Alberta was completed and year to date sales are exceeding
projections. Zoning approvals for another Alberta project, a 200 site
lifestyle community near Edmonton, are close to being finalized and the
Corporation expects to commence Phase I next spring.

    Acquisitions

    During the first nine months of the 2009 fiscal year, Parkbridge focused
on executing its capital plan and only one property was acquired at a cost of
$5.6 million. Recently the Corporation has begun to once again implement a
selective acquisition initiative and expects to complete some acquisitions
later in calendar 2009.

    Capital

    Parkbridge's capital structure remains conservative and debt maturities
are well spaced out. During the quarter, negotiations were completed for the
early renewal of the operating and acquisition credit facilities. Credit
available under the operating facility will remain at $35 million, however,
the Corporation elected to reduce its acquisition facility from $40 million to
$25 million. Fees and interest rate spreads applicable in the two year renewal
period have increased from the prior arrangement, commensurate with the
current lending environment.
    As of June 30, 2009, $22.8 million was available under the operating
facility (after deducting $6.2 million in outstanding letters of credit) and
$18.4 million was available under the acquisition line as so reduced. All debt
maturing in fiscal 2009 has been refinanced and negotiations are underway for
the refinancing of 2010 debt maturities totaling $7.1 million.
    Late last year, the Canadian Manufactured Housing Institute along with
its members and other owners of land lease communities initiated discussions
with the Canada Mortgage and Housing Corporation ("CMHC") to encourage CMHC to
extend their loan insurance program to financing of land lease Communities.
Financings under a CMHC insured program would result in cost savings, enabling
this form of housing to be more competitive, and increase the availability of
funds for this growing sector of the housing industry. These discussions are
ongoing and there is no indication at this time whether such insurance will be
made available.
    In sum, Parkbridge is pleased that its core business, the rental of
Community and Seasonal Resort Sites, continues to perform well and is proving
to have solid fundamentals suited to both good and bad economic times. "As we
move toward the start of the 2010 fiscal year, we expect our property
operating results to continue to improve and we remain optimistic about the
outlook for new home sales activity in most of the markets which we operate",
commented Mr. Dave Rozycki, President, Eastern Operations and Co-Chief
Executive Officer.
    For a complete discussion of the foregoing please refer to the filings of
the Corporation's June 30, 2009 unaudited interim consolidated financial
statements and Management's Discussion and Analysis, both of which have been
concurrently filed on SEDAR.

    Parkbridge Profile

    Parkbridge is one of Canada's leading owners, operators and developers of
land lease residential communities and seasonal recreational resorts. The
portfolio is concentrated in the provinces of Ontario, Alberta, Quebec and
British Columbia.
    Parkbridge now owns 76 properties containing approximately 16,900 sites
with a capacity to add more than 3,900 additional sites through expansion of
current property holdings.
    Parkbridge is listed on the Toronto Stock Exchange and its head office is
in Calgary, Alberta.

    
    CONSOLIDATED BALANCE SHEET

                                                                       Sept-
                                                           June 30  ember 30
    ($000's)                                                  2009      2008
                                                          --------- ---------
                                                        (Unaudited)
    Assets
      Income properties                                    396,120   381,057
      Development properties                                65,822    65,103
      Cash and cash equivalents                              1,963     9,243
      Accounts receivable                                    6,052     5,914
      Inventory and other assets                            28,491    32,323
      Defeasance collateral                                 10,500    10,931
                                                          --------- ---------
                                                           508,948   504,671
                                                          --------- ---------
                                                          --------- ---------
    Liabilities and Shareholders' Equity
      Secured debt                                         274,096   266,454
      Bank indebtedness                                     12,591    26,683
      Accounts payable and other liabilities                17,020    20,773
      Deferred revenue                                       9,427     4,906
      Future income tax liability and deferred credit       16,513    14,889
                                                          --------- ---------
                                                           329,647   333,705
      Shareholders' Equity                                 179,301   170,866
                                                          --------- ---------
                                                           508,948   504,571
                                                          --------- ---------
                                                          --------- ---------



    INTERIM STATEMENT OF INCOME AND FUNDS FROM OPERATIONS

                                      Three Months Ended   Nine Months Ended
                                             June 30             June 30
                                           (Unaudited)         (Unaudited)
                                     -------------------- -------------------
    ($000's)                              2009      2008      2009      2008
                                     ---------- --------- --------- ---------
    PROPERTY OPERATIONS
      Rental and other property
       revenues                         18,700    17,624    50,275    44,267
      Property operating expenses
       and taxes                        (8,540)   (8,451)  (20,867)  (19,215)
      Brokerage and resale income
       (loss)                              444       479       557       827
                                     ---------- --------- --------- ---------
      Income from property
       operations                       10,604     9,652    29,965    25,879
                                     ---------- --------- --------- ---------
    HOME SALES OPERATIONS
      Home sales revenue                11,258    15,925    21,245    34,657
      Cost of sales                    (10,023)  (12,773)  (18,436)  (28,057)
      Operating expenses                  (418)     (787)   (1,176)   (2,124)
                                     ---------- --------- --------- ---------
      Income from home sales
       operations                          817     2,365     1,633     4,476
                                     ---------- --------- --------- ---------
    INCOME FROM OPERATIONS BEFORE
     THE UNDERNOTED                     11,421    12,017    31,598    30,355
                                     ---------- --------- --------- ---------
      Interest expense                   3,988     3,643    11,642    10,232
      Depreciation and amortization      2,053     1,987     5,990     5,479
      General and administrative
       expenses                          1,431     1,175     4,334     3,618
      Stock-based compensation             180       238     1,121       738
      Interest income                     (115)     (108)     (368)     (380)
                                     ---------- --------- --------- ---------
                                         7,537     6,935    22,729    19,687
                                     ---------- --------- --------- ---------
    INCOME BEFORE INCOME TAXES           3,884     5,082     8,869    10,668

      Income taxes (recovery), net
       of deferred credit                  599       837     1,618      (334)
                                     ---------- --------- --------- ---------
    NET INCOME                           3,285     4,245     7,251    11,002

      Add (Deduct):
      Depreciation on real estate
       assets                            2,053     1,987     5,990     5,479
      Stock based compensation             180       238     1,121       738
      Future income taxes, net of
       deferred credit                     599       837     1,618      (334)
                                     ---------- --------- --------- ---------
    FUNDS FROM OPERATIONS                6,117     7,307    15,980    16,885
                                     ---------- --------- --------- ---------
                                     ---------- --------- --------- ---------


    The TSX has not in any way passed upon the merits of these transactions,
    has not approved or disapproved the contents of this news release, nor
    does it accept any responsibility for the adequacy of this release.
    

    This news release contains forward-looking statements concerning the
Corporation's business and operations. The Corporation cautions that, by their
nature, forward-looking statements involve risk and uncertainty and the
Corporation's results could differ materially from those expressed or implied
in such statements. Reference should be made to the Corporation's June 30,
2009 Unaudited Interim Consolidated Financial Statements, the most recent
Management's Discussion and Analysis in the interim report for the period
ended June 30, 2009, the Annual Information Form dated December 10, 2008, and
the Management's Discussion and Analysis and Audited Consolidated Financial
Statements for the year ended September 30, 2008. All reports may be viewed on
Parkbridge's website www.parkbridge.ca or on the SEDAR website www.sedar.com.





For further information:

For further information: Mr. Iain Stewart, President, Western Operations
and Co-CEO, Telephone: (403) 215-2109, Email: istewart@parkbridge.com; Mr.
Calvin Wilson, Chief Financial Officer, Telephone: (403) 215-2105, Email:
cwilson@parkbridge.com; Parkbridge Lifestyle Communities Inc., Telephone:
(403) 215-2100, Facsimile: (403) 215-2115, 700, 505 - 3rd Street SW, Calgary
AB, T2P 3E6

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PARKBRIDGE LIFESTYLE COMMUNITIES INC.

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