IAT Air Cargo Facilities Income Fund announces first quarter 2009 results and declares second quarter 2009 distribution to unitholders

    RICHMOND, BC, May 5 /CNW/ - IAT Air Cargo Facilities Income Fund (the
"Fund") (TSX: ACF.UN), an open-ended, mutual fund trust that owns all of the
shares of International Aviation Terminals Inc. ("IAT"), which owns and leases
air cargo and aviation related buildings on ground-leased land at Canadian
airports in Vancouver, Calgary, Edmonton, Saskatoon and Winnipeg, and all of
the interests in IAT Management Limited Partnership ("IAT Management LP"),
which provides management and operation services to IAT and administrative
services to the Fund, today reported results for the first quarter of 2009 and
declared a distribution to unitholders.

    Consolidated Financial and Operating Results

    For the three months ended March 31, 2009, total rental revenues were
$5.0 million, up 6.7%, from $4.7 million for the same period in 2008. The
increase is due to a higher average lease rate of $9.53 per square foot
compared to $9.30 per square foot for the three months ended March 31, 2008.
IAT's portfolio occupancy was approximately 86.2% as of March 31, 2009 down 80
basis points from March 31, 2008 and 220 basis points from December 31, 2008.
Average occupancy of 86.3% for the first quarter of 2009 was consistent with
the first quarter of 2008.
    For the first quarter of 2009, the Fund reported earnings of $0.06 per
unit as compared to earnings of $0.10 per unit for the first quarter of 2008.
The change of $0.04 per unit is attributable to a lower future income tax
recovery recorded in the first quarter of 2009. Savings from the
internalization of management became effective February 27, 2009 and totaled
approximately $0.1 million for the quarter, but were offset by start-up and
non-recurring transition costs of approximately $0.3 million of which $0.1
million was capital in nature. "This quarter, the IAT team successfully
completed the internalization of IAT's management functions. Our internal
management structure not only aligns the interests of unitholders and
management, reflecting a better governance model, but will also result in an
estimated savings of approximately $1.2 million annually. Looking forward, we
continue to focus on leasing and marketing opportunities in a challenging
environment while striving to improve the quality of service we provide to our
tenants," commented Zachary R. George, IAT's President and Chief Executive

    Supplemental Earnings Measures

    For the first quarter of 2009, earnings before interest, income taxes,
amortization, accretion and non-controlling interest's share of earnings
("EBITDA") was $1.6 million, or $0.23 per unit, as compared to $1.7 million,
or $0.24 per unit, for the same quarter in 2008. For the first quarters of
2009 and 2008, funds from operations ("FFO") were $1.4 million, or $0.20 per
unit and $1.5 million, or $0.21 per unit respectively. The slight decrease was
due to start-up and non-recurring transition costs resulting from the
internalization of management. Normalizing for these costs, EBITDA is
estimated to have been approximately $1.8 million or $0.25 per unit for the
quarter ending March 31, 2009, while FFO is estimated to have been
approximately $1.6 million or $0.23 per unit. Pro-forma savings from
internalization of management are estimated to be approximately $0.04 per unit
on a quarterly basis.
    EBITDA and FFO are not recognized as appropriate earning measures under
Canadian generally accepted accounting principles ("GAAP"), and are not
construed as alternatives to earnings determined in accordance with GAAP, but
are considered useful supplemental indicators of the Fund's performance.
EBITDA is a common non-GAAP supplemental measure while FFO is a more common
measure for the real estate industry. Explanations as to why management
believes FFO is a useful supplemental measure of operating performance and
reconciliations from net income to FFO are provided in the 2008 supplemental
information package filed by the Fund on SEDAR at www.sedar.com.

    Internalization of IAT Management and Operations

    On February 27, 2009, the Fund's management was internalized whereby
property management and operations were transferred from AMB Canada to an IAT
management team. As part of this transition, structural changes have occurred
that have affected the Fund's operations. Specifically, property management
and operations and maintenance fees have been internalized within the Fund and
are no longer paid to a third party. Accordingly, operating costs will
decrease as a result of this change. Leasing and marketing fees, previously
paid to AMB Canada, are no longer incurred by the Fund. However, general and
administration expenses have increased as a result of the internalization
which reflects salaries and office expenses. Overall, the internalization of
management represents a savings of approximately $1.2 million, on an
annualized basis for 2009, gross of transition costs. Non-recurring transition
costs, which are included in general and administration expenses for the three
months ended March 31, 2009, amount to approximately $200,000.

    Second Quarter 2009 Distribution

    A distribution of $0.11 per unit is expected to be payable on July 15,
2009 to unitholders of record at the close of business on June 30, 2009. The
distribution represents interest income on the subordinated notes of IAT for
the first quarter 2009, plus 99.999% profit sharing interest in IAT Management
LP, less estimated administrative expenses of the Fund, and was determined by
the Trustees of the Fund based on anticipated earnings, cash flow and capital
reserves of IAT and anticipated expenses of the Fund. The increase in the
amount of the distribution from the $0.10 per unit distributed in the prior
quarter reflects, in part, the value created from an internalized management.
The payout ratio, computed as a percentage of distributions declared over
funds from operations, rose from 36.8% in the prior quarter to 50.0% in the
current quarter. IAT's increased liquidity will enable management to actively
pursue opportunities that are accretive to unitholders' equity.


    The Fund, and IAT and IAT Management LP, the Fund's wholly-owned
subsidiaries, specialize in the ownership, construction, management and
marketing of aviation-related facilities. IAT currently owns, leases and
manages approximately 1.1 million square feet of air cargo and aviation
related facilities on land leased at five of Canada's leading international
airports. Approximately 65% of the Fund and IAT's holdings are located at
Vancouver International Airport, Canada's second largest airport.

including statements with respect to expected distributions, cash flows,
revenues, earnings, capital expenditures, occupancy rates, growth rates, value
of future lease extensions, ongoing business strategies or prospects. Possible
future Fund and IAT action and other measures are based on information
available at the time they are made, assumptions made by management, and
management's good faith belief with respect to future events, and are subject
to the risks and uncertainties outlined in the Fund's annual information form
that could cause actual performance or results to differ materially from those
reflected in the forward-looking statements, historical results or current
expectations. All forward-looking statements may be affected by and are
subject to the risks set out under Risk Factors in the Fund's annual
information form.

For further information:

For further information: IAT CONTACT: Zachary R. George, President and
Chief Executive Officer, International Aviation Terminals Inc., Direct (604)
249-5119, Fax (604) 249-5101, Email zgeorge@iat-yvr.com

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