Parkbridge announces first quarter results
CALGARY, Feb. 4 /CNW/ - Parkbridge Lifestyle Communities Inc. ("Parkbridge" or the "Corporation"), (TSX: PRK) today announced its results for the three months ended December 31, 2009.
Financial Highlights
($000's except per share amounts)
December 31 September 30
Balance Sheet Data 2009 2009
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Income properties 421,230 400,120
Development properties 67,354 67,559
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488,584 467,679
Secured debt 287,555 279,495
Number of shares issued and outstanding (000's) 66,899 66,769
Three Months Ended December 31
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Income Summary Data 2009 2008
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Total revenues from all operations 26,346 22,701
Income from property operations 10,497 9,818
Home Sales income 680 351
Income from operations 11,117 10,169
Net income 3,549 2,404
Net income per share - diluted(1) 0.05 0.04
Funds from operations (FFO)(2) 5,624 5,108
FFO per share - diluted(1) 0.08 0.08
Weighted average no. of shares - diluted (000's)(1) 67,754 61,769
Three Months Ended December 31
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Operational Highlights 2009 2008
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Occupancy %
Communities 99 99
Resorts(3) 95 92
Sites leased 50 33
Home Sales volume 50 32
Home Sales backlog(4) - end of period 127 122
Operational Sites - end of period 17,101 15,816
Developed Sites - end of period 829 898
Expansion Sites - end of period 4,645 4,100
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(1) The weighted average number of shares issued and outstanding
calculation utilizes the average trading price of the Corporation's
shares during the period evaluated. During the three months ended
December 31, 2008, the exercise price pertaining to the majority of
outstanding stock option grants was above the average trading price
of the Corporation's shares. Accordingly, the impact of "in the
money" stock options on the dilution calculation was nominal. As a
result, the number of weighted average common shares outstanding, for
basic and diluted calculations, is identical for that period. For the
three months ended December 31, 2009, a portion of the Corporation's
stock options were "in the money", thereby resulting in a difference
between the basic and diluted calculation.
(2) 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. Users should be
cautioned that this performance measure should not be construed as an
alternative to net income and differs from the Real Property
Association of Canada's definition of FFO. 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.
(3) The percentage occupancy for Cottage and RV Resorts represents the
average annual occupancy level of seasonal Sites and overnight Sites
within a particular Resort. In general, overnight Sites comprise 10%
or less of the total Sites within a particular Resort. Typically, the
average occupancy achievable in respect of overnight Sites is 45 to
75 days out of the total of the approximately 120 days the Resort is
open in a given season. Consequently, the total occupancy level for a
particular Resort property will generally be less than 100%.
(4) Includes 81 firm and 46 conditional sales contracts at January 31,
2010 compared to 66 firm and 56 conditional sales contracts at
January 31, 2009.
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Income from property operations rose 7% to $10.5 million for the three months ended December 31, 2009 as compared to $9.8 million for the comparable period in 2008. The majority of this increase (approximately 75%) was generated internally and reflects contributions from rent increases, the lease-up of Developed Sites and operational improvements. The remainder of the increase was attributable to properties acquired within the current and prior fiscal years. Parkbridge continues to enjoy virtually full occupancy in its Communities and Resorts and, during the recent quarter, has been successful in implementing a 4% average rent increase across its portfolio.
Income from Home Sales operations increased 94% to $0.7 million in the first quarter as compared to $0.4 million generated in the same quarter last year (quarterly Home Sales volumes increased 61% to 50 sales compared to 31 sales in the prior year). This improvement, when combined with the increase in the backlog of firm lease and Home Sales commitments (further discussed below), is encouraging and is broadly seen across most projects. Prospective homebuyers appear to be showing renewed confidence, and there is increasing awareness of the quality of the Parkbridge brand and the benefits of owning a Home or Resort Unit within one of Parkbridge's well managed properties.
Funds from operations ("FFO") for the three months ended December 31, 2009 rose 10% to $5.6 million as compared to the $5.1 million achieved during the same three month period a year earlier. FFO growth was negatively impacted by a $0.4 million increase in general and administrative expense pertaining to "marking to market" the Corporation's outstanding deferred share units. FFO per share amounted to $0.08 per share for the first quarter and remained flat when compared with the comparable period last year. The per share results reflect the dilutive effects of the equity issue completed on September 30, 2009 which increased the Corporation's issued and outstanding shares by 8%.
Highlights
- Occupancy levels across the portfolio remained high at 99% for
Communities and 95% for Resorts.
- Fiscal 2010 rent increases averaging 4% have been implemented across
the portfolio.
- During the current quarter $3.6 million was invested in the 18
projects under active development. The phased build out of
development projects resulted in the completion of 49 new Developed
Sites in the quarter. For the remainder of the 2010 fiscal year,
Parkbridge anticipates investing a further $15.0 million in
development projects.
- New Home Sales and the lease up of Developed Sites showed
improvements in the first quarter of fiscal 2010, with 50 new Homes
sold and 50 Developed Sites leased, including a healthy backlog of
firm lease and Home Sales commitments. As of January 31, 2010, 127
lease and Home Sales contracts were in hand (81 firm and 46
conditional contracts).
- During the quarter, the first 7 Home Sales closed at the
Corporation's newest community Country Meadows in Wasaga Beach,
Ontario. Country Meadows will be a 168 site retirement townhouse
community. The single level, 1,200 square foot, townhomes are geared
for carefree living and targeted to the 65 to 70 year old
demographic. Sales activity for this project continues to be strong,
and an additional 26 lease and Home Sales contracts were in hand as
of January 31, 2010.
- During the quarter, three operating properties were acquired (1,200
Operational and Developed Sites and 418 Expansion Sites) at an
aggregate purchase price of $16.8 million. Included is the
acquisition of Parkbridge's first Resort property in Alberta, Leisure
RV Resort, a 272 site property on Pine Lake, close to Red Deer. Also
completed were the acquisition of our third Resort in Quebec, Camping
Domaine de la Chute, a 674 site Resort close to Quebec City, and
Bellwood, a 254 site All Age Community in Ottawa.
- The Corporation's capital structure remains conservative and debt
maturities are well spaced out. The majority of fiscal 2010 debt
maturities amounting to $5.7 million have been renewed or refinanced.
As of December 31, 2009, Parkbridge had cash and cash equivalents of
$6.5 million on hand, $26.0 million available under the Operating
Facility (net of letter of credit drawings), and $25.0 million
available under the Acquisition Facility.
- Parkbridge continues to examine initiatives which may help surface
additional value for shareholders. These initiatives include
continuing efforts to secure CMHC-backed financing, and alternative
structures that will more appropriately recognize the risk-adjusted
value embedded in the Corporation's assets.
Outlook
The principal elements of Parkbridge's fiscal 2010 outlook, which refer to growth from three sources, remains unchanged: (i) projected rent increases averaging 4% have been implemented across most properties, (ii) the Corporation continues to see signs of economic improvement and is maintaining its estimate of the lease-up of Developed Sites and new Home Sales in the range of 300 units, and (iii) the Corporation continues to actively pursue select and accretive acquisitions in addition to those recently completed.
Parkbridge is pleased to see a continuation of the positive trends which began to take hold in the latter part of its 2009 fiscal year. "Parkbridge's core business, the rental of Community and Resort Sites, continues to provide stable, predictable income growth, and our Home Sales operations results are showing early signs of recovery, with improvements in sales volumes and income and a healthy backlog of firm sales" commented Mr. Iain Stewart, President, Western Operations and Co-Chief Executive Officer.
For a complete discussion of the foregoing please refer to the Corporation's December 31, 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 80 properties containing approximately 17,900 sites with a capacity to add more than 4,600 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 SHEETS
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December 31 September 30
($000's) 2009 2009
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Assets
Income properties 421,230 400,120
Development properties 67,354 67,559
Cash and cash equivalents 6,514 15,628
Accounts receivable 14,596 5,176
Inventory and other assets 24,430 24,298
Defeasance collateral 10,217 10,361
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544,341 523,142
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Liabilities and Shareholders' Equity
Secured debt 287,555 279,495
Accounts payable and other liabilities 31,580 23,463
Future income tax liability and deferred credit 17,673 16,747
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336,808 319,705
Shareholders' Equity 207,533 203,437
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544,341 523,142
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CONSOLIDATED STATEMENTS OF INCOME AND FUNDS FROM OPERATIONS
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Three Months Ended December 31
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($000's) 2009 2008
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PROPERTY OPERATIONS
Rental and other property revenues 17,458 16,220
Property operating expenses and taxes (7,031) (6,494)
Brokerage and resale income (net) 70 92
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10,497 9,818
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HOME SALES OPERATIONS
Sales revenue 8,041 5,054
Cost of sales (7,047) (4,274)
Operating expenses (314) (429)
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680 351
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INCOME FROM OPERATIONS BEFORE THE UNDERNOTED 11,177 10,169
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Interest expense 4,128 3,894
Depreciation and amortization 2,341 1,973
General and administrative expenses 1,519 1,280
Stock-based compensation 173 224
Interest income (94) (113)
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8,067 7,258
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INCOME BEFORE INCOME TAXES 3,110 2,911
Provision for (recovery of) future income
taxes, net of deferred credit (439) 507
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NET INCOME 3,549 2,404
Add (Deduct):
Depreciation and amortization 2,341 1,973
Stock based compensation 173 224
Future income taxes, net of deferred credit (439) 507
FUNDS FROM OPERATIONS 5,624 5,108
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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 December 31, 2009 Unaudited Interim Consolidated Financial Statements, the most recent Management's Discussion and Analysis in the interim report for the period ended December 31, 2009, the Annual Information Form dated November 19, 2009, and Management's Discussion and Analysis and Audited Consolidated Financial Statements for the year ended September 30, 2009. All reports may be viewed on Parkbridge's website www.parkbridge.ca or on the SEDAR website www.sedar.com.
For further information: Mr. Iain Stewart, President, Western Operations and Co-CEO, Telephone: (403) 215-2109, Email: [email protected]; Mr. Calvin Wilson, Chief Financial Officer, Telephone: (403) 215-2105, Email: [email protected]; 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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