Dream Unlimited Corp T.DRM

Alternate Symbol(s): DRUNF

Dream Unlimited Corp. is a Canada-based company, which is a developer of office and residential assets in Toronto, owns assets in both Canada and the United States, and has an asset management business, inclusive of $26 billion of assets under management across four Toronto Stock Exchange listed trusts, its private asset management business and numerous partnerships. It also develops land, residential and assets in Western Canada. Its segment includes Recurring income and Development. The Recurring income segment comprised of its asset management and development management agreements with Dream Industrial REIT, Dream Residential REIT and various development partners. The Development segment comprised of mixed-use developments in the Greater Toronto Area and National Capital Region, land, housing, retail/commercial, hospitality asset and multi-family rental developments in Saskatchewan and Alberta. Its projects include Distillery District, 262 Jarvis, 70 Park, Weston Common and others.

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Post by retiredcfon Aug 11, 2022 11:42am

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Post# 34888461

TD

Currently have a $46.00 target. GLTA

Dream Unlimited Corp.

(DRM-T) C$32.67

Q2/22 First Look: EPS Beat; Businesses Continue to Perform Well

Event

Q2/22 results.

Impact: SLIGHTLY POSITIVE

Our Initial Take: Dream's Q2/22 results represented a slight beat on earnings and while market volatility and macro concerns persist, many parts of the business continue to perform well – including on the development side, Arapahoe Basin, and in private capital fund raising.

Q1 Results vs. Estimate: Q2/22 EPS (standalone basis) of $0.45 slightly beat our $0.40 estimate. The main sources of the beat were:

EBITDA at Arapahoe Basin increasing $4.5mm y/y (+200%) to $6.7mm (despite below-average snowfall), and;
a $2.8mm advisory fee for Dream Residential REIT IPO, which was settled in DRR units.

Additionally, higher equity-accounted earnings and lower taxes were partially offset by the absence of fair value gains.

Asset Management

Total AUM increased $1.3bln q/q and over $2bln YTD to $17bln and fee-earning AUM is $10bln (up slightly q/q). In addition to growth at DIR and the DRR IPO, Dream continues to grow private capital AUM, with the previously-announced $1.5bln GTA industrial development JV with a global sovereign wealth fund. Subsequent to quarter-end, Dream secured $110mm of commitments for the second close of the Dream Impact Fund (new size: $255mm), with new investors including Meridian, AIMCo and RBC.

Condominium Development

Completion of Canary Commons enabled Dream to repay the $127.5mm (100% basis) related construction facility and receive $27.5mm in cash distributions subsequent to quarter-end. At Forma Condos on King Street West in downtown Toronto, half of the East tower units have been pre-sold and at prices we believe to set market records. Both towers will include over 2,000 units and significant office and retail space as well as a two-level space for OCAD University.

Western Canada Development

Lot sales were unusually low at 28 (y/y: 91) but this was offset by the sale of 13 acres. However, the near-term outlook remains strong with Dream having secured sales commitments for an additional 799 lots and 32 acres to contribute to earnings in 2022.

Balance Sheet

Dream's debt-to-total-assets ratio increased to 40.1% (Q1/22: 39.5%). NCIB activity slowed since Q1/22 (YTD repurchases remain 0.4mm shares). Liquidity at August 9 totals $246mm.