Lakeview Hotel Investment Corp Announces Second Quarter Results

WINNIPEG, Aug. 28, 2015 /CNW/ - Lakeview Hotel Investment Corp ("LHIC") is pleased to report its financial results for the Quarter ended June 30, 2015. The following comments in regard to the financial results should be read in conjunction with the June 30, 2015 financial statements and Management Discussion and Analysis which are available on the SEDAR website www.sedar.com.

The decline in drilling activity in Western Canada which began late in 2014 continued through the second quarter of 2015 and negatively impacted Lakeview Hotel Investment Corps' operating results. Less crew business at many of the properties resulted in occupancy declining to 51.69% compared to the second quarter of 2014 when occupancy was 63.51%. The second quarter is historically the weakest quarter for Lakeview Hotel Investment Corp. because of road restrictions which have an adverse effect on drilling activity. The results this year were unusually weak.

The decline in drilling activity in Western Canada will continue to have a negative impact on Lakeview Hotel Investment Corp. and there remains a lack of visibility on when this activity may resume. The actions taken over the past two years to refinance debt and reduce leverage will help Lakeview Hotel Investment Corp. withstand the current downturn and be positioned for growth when market conditions improve.

Following is a comparison of the operating results for the three and six months ended June 30, 2015 and the comparable periods in 2014:

	Three months ended June 30,		Six months ended June 30,
	2015	2014	2015	2014
Hospitality Revenue
Room	6,147,647	7,479,519	13,046,628	15,525,937
Food & Beverage	936,497	1,121,776	1,974,599	2,283,859
Other	394,597	456,640	811,292	936,802
Total Revenue	7,478,741	9,057,935	15,832,519	18,746,598
Expenses	(8,081,923)	(8,844,295)	(17,841,767)	(18,003,662)
Gain on sale of income properties	-	336,223	-	1,007,514
Net income (Loss)	(603,182)	549,863	(2,009,248)	1,750,450
Basic and diluted income (loss) before income tax per share	(0.031)	0.028	(0.103)	0.090
Reconciliation to funds from Operations
Add (deduct)
Amortization of income properties	762,421	763,664	1,521,727	1,520,106
Amortization of franchise fees	1,192	1,192	2,384	2,384
Gain on sale of income properties	-	(336,223)	-	(1,007,514)
Distributions from Lakeview Flag Licensing General Partnership	26,950	259,700	147,980	401,800
Distributions from Lakeview Flag Management General Partnership	27,000	161,250	127,250	338,750
Income from Lakeview Flag Licensing General Partnership	(134,849)	(157,971)	(277,573)	(328,486)
Income from Lakeview Flag Management General Partnership	(85,279)	(102,950)	(180,364)	(212,602)
Unrealized loss on change in fair value of interest rate swap	(264,618)	-	812,048	-
Amortization of discount on bankers' acceptance	-	-	198,712	-
Funds from Operations	(270,365)	1,138,525	342,916	2,464,888
Basic and diluted funds from Operations per share	(0.014)	0.058	0.018	0.126
Contributions to reserve account	(229,820)	(188,564)	(388,117)	(351,577)
Adjusted funds from Operations	(500,185)	949,961	(45,201)	2,113,311
Basic and diluted adjusted funds from Operations per share	(0.026)	0.049	(0.002)	0.108
Reconciliation to distributable income
Accretion of debentures	39,433	36,116	79,081	72,559
Accretion of mortgages payable	22,741	21,846	47,496	45,829
Loss on derecognition of income properties	10,124	568	16,905	1,887
Accretion of other long-term debt	46,377	-	100,688	-
Distributable income	(381,510)	1,008,491	198,969	2,233,586
Basic and diluted distributable income per share	(0.020)	0.052	0.01	0.114
Distributions	-	-	-	-

Lakeview Hotel Investment Corp is listed on the TSX Venture Exchange under the symbol "LHR".  Lakeview Hotel Investment Corp receives income from ownership, management and licensing of hotel properties.

The TSX Venture Exchange nor its Regulation Service Provider (as the term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE Lakeview Hotel Investment Corp

Avrum Senensky, Executive Vice President, Tel: [phone], Fax: [phone], Email [email protected]