Shares issued: Class A - 17,034,489 Class B - 3,104,838
HALIFAX, May 16 /CNW/ - (TSX: HII.A HII.B AEX: HII) - Homburg Invest
Inc. ("Homburg Invest" or the "Company") announced today its financial
results for the first quarter ended March 31, 2011, prepared under
International Financial Reporting Standards ("IFRS").
"We recorded an increase in unrealized valuation changes during the
first quarter, indicating that some stability has returned to European
real estate markets particularly in the Baltics; although continuing
difficulties in the Dutch real estate markets are apparent," said Jan
Schöningh, President and Chief Executive Officer. "We believe that our
assets are of high quality and will recover when European business
"We recently received an unsolicited, non-binding proposal from
controlling shareholder Richard Homburg and Homburg Canada Inc., to
eliminate the control block in HII, internalize management and optimize
the balance sheet. An independent committee of the Board has been
formed to review Mr. Homburg's proposal. The Committee will seek to
engage an independent financial advisor to assist it in evaluating the
Proposal and any eventual transaction. Our Board of Directors and the
Independent Committee has indicated that they will consider the
Proposal carefully in the best interests of all stakeholders, including
minority shareholders," concluded Mr. Schöningh.
Financial Results (Quarter ended March 31, 2011)
Property revenues from continuing operations were $32.3 million during
the first quarter ended March 31, 2011, compared to $35.6 million for
the same quarter in 2010. The decrease is due primarily to a 6.6%
decrease in the average value of the Euro against the Canadian dollar
in the first quarter of 2011.
Net operating income (NOI) was $25.8 million in the first quarter of
2011, compared to $30.1 million in the first quarter of 2010. The
decrease is primarily due to property revenue fluctuations in Europe
and increased head lease commitments in the first quarter, compared to
the first quarter in 2010.
The Company recorded pre-tax earnings from continuing operations of $0.3
million for the first quarter ended March 31, 2011, compared to pre-tax
earnings of $16.0 million for the first quarter in 2010. The decrease
is due primarily to a $15.6 million net increase in the fair value of
investment properties, an increase in the value of investment
properties under development and lower interest expense; offset in part
by a $10.2 million foreign exchange loss compared to a $13.2 million
foreign exchange gain in 2010, and a $9.6 million first quarter loss on
the Company's share of income in relation to a bought deal by an
associated company, which resulted in a deemed disposal of the
Company's investment and a decrease in ownership.
Net loss for the first quarter of 2011 was $3.5 million or $0.21 per
share, compared to net earnings of $17.8 million or $0.84 per share in
the first quarter of 2010.
Funds from operations (FFO), net of the sale of properties developed for
resale, were $0.2 million for the three-month period ended March 31,
2011, compared to $2.9 million recorded in the same period in 2010.
Net asset value per share stood at $4.98 at March 31, 2011.
Key Financial Results for the Quarters Ended March 31
March 31, 2011
March 31, 2010
(millions of CDN $, except per share items)
Sale of properties developed for resale
Net operating income
Basic earnings per share
Diluted earnings per share
Funds from operations, net of the sale of properties developed for
Funds from operations per share
For complete financial statements, along with the Management's
Discussion and Analysis of Results as at and for the quarter ended
March 31, 2011, please refer to the Company's website at www.homburginvest.com or www.sedar.com.
About Homburg Invest
Homburg Invest Inc. owns and develops a diversified portfolio of quality
commercial real estate including office, retail, industrial and
development properties throughout Europe and the United States, as well
as 23.1% of the units of Homburg Canada Real Estate Investment Trust.
The head office of the Company is located in Halifax, Nova Scotia.
Forward Looking Statements
This news release may contain statements which by their nature are
forward looking and express the Company's beliefs, expectations or
intentions regarding future performance, future events or trends.
Forward looking statements are made by the Company in good faith, given
management's expectations or intentions. They are however subject to
market conditions, acquisitions, occupancy rates, capital requirements,
sources of funds, expense levels, operating performance and other
matters. Forward looking statements therefore contain assumptions which
are subject to various factors including: unknown risks and
uncertainties, general economic conditions, local market factors,
performance of other third parties, environmental concerns and interest
rates, any of which may cause actual results to differ from the
Company's good faith beliefs, expectations or intentions which have
been expressed in or may be implied from this news release. Forward
looking statements are therefore not guarantees of future performance
and are subject to known and unknown risks. Information and statements
in this document, other than historical information, should be
considered forward-looking and reflect management's current views of
future events and financial performance that involve a number of risks
and uncertainties. Factors that could cause actual results to differ
materially include, but are not limited to, the following: general
economic conditions and developments within the real estate industry,
competition and the management of growth. The Toronto Stock Exchange
has neither approved nor disapproved of the information contained
Non-IFRS Financial Measures
This news release includes measures widely accepted within the real
estate industry which are not defined under IFRS. These measures
include funds from operations, funds from operations per share,
property net operating income, and net asset value per share. As these
are not defined measures under IFRS, other issuers may have different
calculations from those used by the Company.
The Company considers these amounts to be measures of operating and
Funds from operations ("FFO") and FFO per share are presented by the
Company as net income (loss) from continuing operations adjusted for
amortization, non-recurring stock based compensation, deferred and
capital income taxes, gain on sale of investment properties, net
adjustments to fair value of investment properties, held for trading
financial assets and derivative financial instruments and net exchange
differences divided by the weighted average number of shares
Property net operating income ("NOI") is presented by the Company as
property revenue less property operating expenses.
Net asset value per share is presented by the Company as shareholders
equity divided by the number of shares outstanding at period end.
SOURCE HOMBURG INVEST INC.
For further information:
Paul de la Plante
NATIONAL Public Relations