WINNIPEG, March 14, 2013 /CNW/ - Lanesborough Real Estate Investment
Trust ("LREIT") (TSX: LRT.UN) today reported its operating results for
the year ended December 31, 2012. The following comments in regard to
the financial position and operating results of LREIT should be read in
conjunction with Management's Discussion & Analysis and the financial
statements for the year ended December 31, 2012, which may be obtained
from the LREIT website at www.lreit.com or the SEDAR website at www.sedar.com.
OPERATING RESULTS
Comprehensive Income
LREIT completed 2012 with comprehensive income of $20.1 million,
compared to comprehensive income of $5.0 million during 2011. The $15.1
million increase in comprehensive income mainly reflects the profit on
the sale of two seniors' housing complexes, which are included in
discontinued operations.
Continuing Operations
Income before taxes and discontinued operations during 2012 was $0.6
million, compared to $2.4 million in 2011, representing a decrease of
$1.8 million. The decrease mainly reflects the following components:
-
Fair value gains/adjustments: Valuation gains/adjustments related to the fair market value of
investment properties, including Parsons Landing, decreased by
approximately $4.8 million during 2012, compared to 2011. The decrease
is mainly due to a $3.5 million reduction in the fair value of Parsons
Landing.
-
Insurance proceeds: Income for 2012 includes insurance proceeds of $0.9 million related to
the settlement of the claim for furniture and equipment losses in
regard to the fire at Parsons Landing.
-
Forgiveness of debt: The refinancing of mortgage loan debt in 2012 encompassed the
forgiveness of $0.9 million of debt by one of the lenders. The debt
forgiveness is included in income.
-
Interest Income: Interest income increased by $0.6 million during 2012. The increase
mainly reflects interest earned on mortgage loans receivable.
-
Profit on sale of investment properties: During 2012, the profit on sale of investment properties increased by
$0.4 million, compared to 2011.
During 2012, net operating income decreased by $3.3 million, compared to
2011, however, the decrease in net operating income was entirely offset
by a $3.3 million income recovery on Parsons Landing. The decrease in
net operating income is mainly due to elimination of two investment
properties in Fort McMurray from the revenue stream (Sienna was sold
and Parsons Landing was destroyed by fire), partially offset by an
increase in net operating income from the Fort McMurray property
portfolio.
Cash Flow from Operating Activities
During 2012, cash outflow from operating activities, excluding working
capital adjustments, amounted to $2.1 million, compared to a cash
outflow of $2.6 million during 2011, representing a decrease in the
cash outflow of $0.5 million. The decrease in the cash outflow,
excluding working capital adjustments, mainly reflects the receipt of
insurance proceeds of $0.9 million, a decrease in interest "paid" of
$0.8 million, an increase in interest received of $0.3 million and a
$0.3 million decrease in the cash component of trust expense, largely
offset by a $1.9 million increase in income tax expense.
Including working capital adjustments, LREIT completed 2012 with a cash
outflow from operating activities of $4.5 million, compared to a cash
outflow of $1.6 million during 2011.
Mortgage Financing
During 2012, LREIT obtained $105.6 million of new mortgage loan
financing. The new financing, combined with the release of $7 million
of mortgage loan escrow deposits, was primarily used to repay, or
pay-down, existing mortgage loan debt. The new financing enabled LREIT
to resolve a number of debt covenant issues and also served as a source
of interim capital, pending the completion of property sales.
After considering the mortgage loan debt which was eliminated on
property sales, "regular" payments of principal and the net decrease in
mortgage loan debt from other financing activities, the total mortgage
loan debt of LREIT decreased by $76.5 million in 2012. The ratio of
total debt to carrying value of all properties, excluding Parsons
Landing, was 68% as at December 31, 2012, compared to 74% as at
December 31, 2011
Mortgage Loan Covenant
During 2012, LREIT eliminated covenant breaches on $67.2 million of
mortgage loan debt, encumbered against eight properties, including
seven properties in Fort McMurray, Alberta.
As of December 31, 2012, LREIT has $97.3 million of mortgage loan debt
with covenant breaches, comprised of four mortgage loans. It is
anticipated that the covenant breach for three of the loans in Fort
McMurray (all of which are over-holding past maturity with the consent
of the lenders) will be eliminated in 2013 as a result of the
refinancing of the loans. The other mortgage loan in Fort McMurray has
a maturity date of May 1, 2018 and was paid-down by $4.3 million in
2012. The covenant breach is expected to be eliminated through modified
loan terms.
Divestiture Program
In 2009, LREIT initiated a multi-year asset divestiture program with the
objective of reducing debt levels. During 2012, two senior housing
complexes were sold under its divestiture program, as well as one
investment property and nine condominium units at Lakewood Townhomes.
In total, the property sales in 2012 resulted in net sale proceeds of
$21.9 million. The net sale proceeds enabled LREIT to meet all of its
ongoing funding commitments and also substantially reduce the extent of
its working capital deficiency. As of December 31, 2012, LREIT has a
working capital deficiency of approximately $4.5 million, representing
an improvement of approximately $9 million, compared to the working
capital deficiency as of December 31, 2011.
Parsons Landing
The reconstruction of Parsons Landing is expected to be completed during
the fourth quarter of 2013. Following an estimated lease-up period of
90 days, the property will be reclassified as a revenue-generating
investment property. The loss of $3.5 million that LREIT recognized in
2012 in regard to the reduction in the fair value of Parsons Landing is
expected to be substantially recovered in 2013.
Qualification for REIT Exception
Management believes that LREIT will qualify for the REIT Exception for
income tax purposes for the 2013 taxation year. As a result, LREIT will
once again be in a position to reduce its taxable income from capital
gains or otherwise through the payment of cash or "special"
distributions. The reduction of taxable income will have a beneficial
impact on the cash position of LREIT.
Outlook
In 2013, LREIT will continue to focus on the following initiatives:
-
The refinancing of mortgage loan debt, including upward refinancing, in
order to resolve the remaining covenant breaches and reduce interest
rates. During the first two months of 2013, LREIT has replaced $20.4
million of 12% mortgage loan financing with a new 5.0% first mortgage
loan of $21 million; collected $3.2 million of mortgage loan
receivables and reduced the outstanding balance of a 12% blanket second
mortgage loan from $9.5 million to $7.5 million. In addition, a 7%
first mortgage loan of $22.7 million and a 12% second mortgage loan of
$16.3 million are expected to be replaced with a 3.7% five year first
mortgage loan of $42 million by March 31, 2013.
-
The sale of the two remaining seniors' housing complexes under the
divestiture program and the sale of additional condominium units at
Lakewood Townhomes.
-
The improvement of net operating income by maximizing rental rates and
controlling operating costs.
The net proceeds from upward refinancing and property sales, combined
with the draws on the revolving loan commitment from 2668921 Manitoba
Ltd., as required, are expected to be sufficient to enable LREIT to
meet all of its ongoing funding obligations during 2013.
FINANCIAL AND OPERATING SUMMARY
|
|
|
|
December 31
|
|
|
|
|
2012
|
|
2011
|
|
2010
|
|
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
|
$
|
481,552,578
|
|
$
|
555,220,070
|
|
$
|
547,829,176
|
|
|
Total long-term financial liabilities (1)
|
|
|
$
|
323,026,417
|
|
$
|
399,176,274
|
|
$
|
402,006,221
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31
|
|
|
|
|
2012
|
|
2011
|
|
2010
|
|
KEY FINANCIAL PERFORMANCE INDICATORS
|
|
|
|
|
|
|
|
|
|
|
|
Operating Results
|
|
|
|
|
|
|
|
|
|
|
|
|
Rentals from investment properties
|
|
|
$
|
38,410,992
|
|
$
|
41,852,726
|
|
$
|
39,902,688
|
|
|
Net operating income
|
|
|
$
|
22,429,229
|
|
$
|
25,729,391
|
|
$
|
23,361,318
|
|
|
Income (loss), before taxes and discontinued operations
|
|
|
$
|
601,545
|
|
$
|
2,382,662
|
|
$
|
(11,496,252)
|
|
|
Income (loss) and comprehensive income (loss)
|
|
|
$
|
20,098,308
|
|
$
|
5,035,231
|
|
$
|
(9,323,543)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flow from operating activities
|
|
|
$
|
(4,538,612)
|
|
$
|
(1,566,188)
|
|
$
|
(1,565,119)
|
|
|
Funds from Operations (FFO)
|
|
|
$
|
(6,927,383)
|
|
$
|
(6,993,506)
|
|
$
|
(10,333,671)
|
|
|
Adjusted Funds from Operations (AFFO)
|
|
|
$
|
(9,997,160)
|
|
$
|
(8,483,052)
|
|
$
|
(9,670,113)
|
|
|
Distributable loss
|
|
|
$
|
(5,091,215)
|
|
$
|
(5,002,715)
|
|
$
|
(5,652,477)
|
|
(1)
|
Long-term financial liabilities consist of mortgage loans, a swap
mortgage loan, debentures, defeased liability and mortgage
bonds. The swap mortgage loans and mortgage bonds are included at face
value.
|
2012 COMPARED TO 2011
|
Analysis of Income (Loss)
|
|
|
|
|
|
|
Year Ended December 31
|
|
Increase (Decrease)
|
|
|
|
|
2012
|
|
|
2011
|
|
|
Amount
|
|
%
|
|
Rentals from investment properties
|
|
|
$
|
38,410,992
|
|
$
|
41,852,726
|
|
$
|
(3,441,734)
|
|
(8.2)%
|
|
Property operating costs
|
|
|
|
15,981,763
|
|
|
16,123,335
|
|
|
141,572
|
|
0.9%
|
|
Net operating income
|
|
|
|
22,429,229
|
|
|
25,729,391
|
|
|
(3,300,162)
|
|
(12.8)%
|
|
Interest income
|
|
|
|
969,607
|
|
|
328,145
|
|
|
641,462
|
|
195.5%
|
|
Forgiveness of debt
|
|
|
|
859,561
|
|
|
-
|
|
|
859,561
|
|
- %
|
|
Interest expense
|
|
|
|
(33,261,469)
|
|
|
(33,162,993)
|
|
|
(98,476)
|
|
0.3%
|
|
Trust expense
|
|
|
|
(2,323,979)
|
|
|
(2,611,313)
|
|
|
287,334
|
|
(11.0)%
|
|
Income recovery on Parsons Landing
|
|
|
|
3,278,987
|
|
|
-
|
|
|
3,278,987
|
|
- %
|
|
Insurance proceeds
|
|
|
|
925,355
|
|
|
-
|
|
|
925,355
|
|
- %
|
|
Loss before the following
|
|
|
|
(7,122,709)
|
|
|
(9,716,770)
|
|
|
2,594,061
|
|
26.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit on sale of investment properties
|
|
|
|
915,531
|
|
|
487,095
|
|
|
428,436
|
|
88.0%
|
|
Fair value gains
|
|
|
|
10,308,723
|
|
|
11,612,337
|
|
|
(1,303,614)
|
|
11.2%
|
|
Fair value adjustment of Parsons Landing
|
|
|
|
(3,500,000)
|
|
|
-
|
|
|
(3,500,000)
|
|
- %
|
|
Income before taxes & discontinued operations
|
|
|
|
601,545
|
|
|
2,382,662
|
|
|
(1,781,117)
|
|
74.8%
|
|
Current income tax expense
|
|
|
|
49,763
|
|
|
-
|
|
|
(49,763)
|
|
- %
|
|
Deferred income tax expense
|
|
|
|
-
|
|
|
91,922
|
|
|
91,922
|
|
(100.0)%
|
|
Income (loss) before discontinued operations
|
|
|
|
551,782
|
|
|
2,290,740
|
|
|
(1,738,958)
|
|
75.9%
|
|
Income from discontinued operations
|
|
|
|
19,546,526
|
|
|
2,744,491
|
|
|
16,802,035
|
|
612.2%
|
|
Income and comprehensive income
|
|
|
$
|
20,098,308
|
|
$
|
5,035,231
|
|
$
|
15,063,077
|
|
(299.2)%
|
|
Analysis of Total Rental Revenue
|
|
|
|
Year Ended December 31
|
|
|
|
|
|
|
Increase (Decrease)
|
% of Total
|
|
|
2012
|
|
2011
|
|
Amount
|
|
%
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fort McMurray
|
$
|
22,965,656
|
|
$
|
21,068,980
|
|
$
|
1,896,676
|
|
9%
|
|
60%
|
|
50%
|
|
Other investment properties
|
|
14,254,048
|
|
|
14,084,247
|
|
|
169,801
|
|
1%
|
|
37%
|
|
34%
|
|
Sub-total
|
|
37,219,704
|
|
|
35,153,227
|
|
|
2,066,477
|
|
6%
|
|
97%
|
|
84%
|
|
Properties sold
|
|
796,861
|
|
|
2,672,453
|
|
|
(1,875,592)
|
|
(70)%
|
|
2%
|
|
6%
|
|
Impaired property
|
|
394,427
|
|
|
4,027,046
|
|
|
(3,632,619)
|
|
(90)%
|
|
1%
|
|
10%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
$
|
38,410,992
|
|
$
|
41,852,726
|
|
$
|
(3,441,734)
|
|
(8)%
|
|
100%
|
|
100%
|
As disclosed in the chart above, total revenue from investment
properties, excluding properties sold and the impaired property,
increased by $2.1 million during 2012, compared to 2011. The increase
is comprised of an increase in revenue from investment properties in
Fort McMurray of $1.9 million and an increase in revenue from the other
investment properties of $0.2 million.
The increase in revenue from the Fort McMurray property portfolio
reflects an increase in the average occupancy level, as well as an
increase in the average rental rate. As disclosed in the charts below,
the average occupancy level for the Fort McMurray portfolio increased
from 82% during 2011, to 90% in 2012, while the average monthly rental
rate increased by $23 or 1.1%.
Revenue for "properties sold" decreased by $1.9 million during 2012 due
to the sale of Siena Apartments effective May 1, 2012. Revenue from
the "Impaired property" decreased by $3.6 million as the property is
under reconstruction following the fire in February 2012. The recovery
of insurance proceeds for revenue losses is recorded as a separate
income category after the calculation of net operating income.
|
Occupancy Level, by Quarter
|
|
|
|
2012
|
|
|
Q1
|
Q2
|
Q3
|
Q4
|
12 Month
Average
|
|
Fort McMurray
|
92%
|
90%
|
87%
|
88%
|
90%
|
|
Other investment properties
|
98%
|
97%
|
97%
|
98%
|
97%
|
|
Properties sold
|
100%
|
n/a
|
n/a
|
n/a
|
n/a
|
|
Impaired property
|
n/a
|
n/a
|
n/a
|
n/a
|
n/a
|
|
Total
|
95%
|
92%
|
91%
|
92%
|
92%
|
|
|
|
|
|
2011
|
|
|
Q1
|
Q2
|
Q3
|
Q4
|
12 Month
Average
|
|
Fort McMurray
|
64%
|
79%
|
94%
|
93%
|
82%
|
|
Other investment properties
|
98%
|
98%
|
98%
|
99%
|
98%
|
|
Properties sold
|
100%
|
100%
|
100%
|
100%
|
100%
|
|
Impaired property
|
63%
|
91%
|
94%
|
97%
|
86%
|
|
Total
|
75%
|
87%
|
95%
|
95%
|
88%
|
|
Average Monthly Rents, by Quarter
|
|
|
|
2012
|
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
12 Month
Average
|
|
Fort McMurray
|
$2,124
|
|
$2,191
|
|
$2,251
|
|
$2,293
|
|
$2,218
|
|
Other investment properties
|
$1,075
|
|
$1,069
|
|
$1,048
|
|
$1,076
|
|
$1,067
|
|
Properties sold
|
$3,100
|
|
n/a
|
|
n/a
|
|
n/a
|
|
n/a
|
|
Impaired property
|
n/a
|
|
n/a
|
|
n/a
|
|
n/a
|
|
n/a
|
|
Total
|
$1,704
|
|
$1,684
|
|
$1,704
|
|
$1,739
|
|
$1,709
|
|
|
|
|
|
|
2011
|
|
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
|
12 Month
Average
|
|
Fort McMurray
|
$2,260
|
|
$2,211
|
|
$2,180
|
|
$2,129
|
|
$2,195
|
|
Other investment properties
|
$1,034
|
|
$1,065
|
|
$1,050
|
|
$1,064
|
|
$1,050
|
|
Properties sold
|
$3,100
|
|
$3,100
|
|
$3,100
|
|
$3,100
|
|
$3,100
|
|
Impaired property
|
$2,370
|
|
$2,319
|
|
$2,282
|
|
$2,241
|
|
$2,303
|
|
Total
|
$1,790
|
|
$1,784
|
|
$1,759
|
|
$1,743
|
|
$1,767
|
|
Analysis of Property Operating Costs
|
|
|
|
|
|
Year Ended December 31
|
|
Increase (Decrease)
|
|
|
2012
|
|
2011
|
|
Amount
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fort McMurray
|
$
|
8,768,905
|
|
$
|
8,122,304
|
|
$
|
646,601
|
|
8%
|
|
Other investment properties
|
|
6,821,025
|
|
|
6,200,438
|
|
|
620,587
|
|
10%
|
|
Sub-total
|
|
15,589,930
|
|
|
14,322,742
|
|
|
1,267,188
|
|
9%
|
|
Properties sold
|
|
97,450
|
|
|
217,003
|
|
|
(119,553)
|
|
(55)%
|
|
Impaired property
|
|
294,383
|
|
|
1,583,590
|
|
|
(1,289,207)
|
|
(81)%
|
|
Total
|
$
|
15,981,763
|
|
$
|
16,123,335
|
|
$
|
(141,572)
|
|
(1)%
|
During 2012, property operating costs for the portfolio of investment
properties, excluding properties sold and the impaired property,
increased by $1.3 million or 9%, compared to 2011. The increase is
comprised of a $0.6 million increase in the Fort McMurray portfolio and
an increase of $0.6 million in the operating costs of the other
investment properties portfolio.
The increase in operating costs for the Fort McMurray portfolio mainly
reflects an increase in maintenance costs associated with ongoing
renovations. The increase in operating costs for the Other investment
property portfolio reflects an increase in maintenance expense mostly
associated with repairs to building exterior.
|
Analysis of Net Operating Income and Operating Margin
|
|
|
|
Net Operating Income
|
|
|
|
|
Year Ended December 31
|
|
Increase (Decrease)
|
|
Percent of Total
|
|
Operating Margin
|
|
|
|
2012
|
|
2011
|
|
Amount
|
|
%
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fort McMurray
|
|
$
|
14,196,751
|
|
$
|
12,946,676
|
|
$
|
1,250,075
|
|
10%
|
|
63%
|
|
50%
|
|
62%
|
|
61%
|
|
Other investment properties
|
|
|
7,433,023
|
|
|
7,883,809
|
|
|
(450,786)
|
|
(6)%
|
|
33%
|
|
31%
|
|
52%
|
|
56%
|
|
Sub-total
|
|
|
21,629,774
|
|
|
20,830,485
|
|
|
799,289
|
|
4%
|
|
96%
|
|
81%
|
|
58%
|
|
59%
|
|
Properties sold
|
|
|
699,411
|
|
|
2,455,450
|
|
|
(1,756,039)
|
|
(72)%
|
|
3%
|
|
10%
|
|
n/a
|
|
n/a
|
|
Impaired property
|
|
|
100,044
|
|
|
2,443,456
|
|
|
(2,343,412)
|
|
(96)%
|
|
- %
|
|
9%
|
|
n/a
|
|
n/a
|
|
Total
|
|
$
|
22,429,229
|
|
$
|
25,729,391
|
|
$
|
(3,300,162)
|
|
(13)%
|
|
100%
|
|
100%
|
|
58%
|
|
61%
|
After considering the increase in rental revenue and the increase in
property operating costs, as analysed in the preceding sections of this
press release, the net operating income for the portfolio of investment
properties, excluding properties sold and the impaired property,
increased by $0.8 million or 4% during 2012, compared to 2011. The
increase is comprised of an increase in net operating income from the
Fort McMurray properties, partially offset by a decrease in net
operating income from the Other investment properties. As disclosed in
the chart above, the net operating income of the Fort McMurray
portfolio increased by $1.3 million during 2012, compared to 2011,
while the net operating income of the Other investment properties
portfolio decreased by $0.5 million.
Overall, the operating margin for the property portfolio, excluding
properties sold and the impaired property, decreased from 59% during
2011, to 58% during 2012. The decrease reflects a decrease in the
operating margin for the Other investment properties portfolio,
partially offset by an increase in the operating margin for the Fort
McMurray property portfolio.
After accounting for the decrease in net operating income related to
properties sold and the impaired property (Parsons Landing), net
operating income decreased by $3.3 million during 2012, compared to
2011. The decrease was almost entirely offset by the income recovery
for Parsons Landing.
The income recovery on Parsons Landing of $3.3 million exceeded the
decrease in net operating income of Parsons Landing by $0.9 million.
The income recovery consists of the amount recovered under the
insurance policy for revenue losses, less certain continuing operating
costs such as property taxes and insurance which are deducted from the
gross insurance recovery through an "occupancy fee".
COMPARISON TO PREVIOUS QUARTER
|
Analysis of Income (Loss)
|
|
|
2012
|
|
2011
|
|
|
Q4
|
|
Q3
|
|
Increase
(Decrease)
|
|
Q4
|
|
Increase
(Decrease)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rentals from investment properties
|
|
9,432,387
|
|
|
9,206,783
|
|
|
225,604
|
|
|
11,196,590
|
|
|
(1,764,203)
|
|
Property operating costs
|
|
4,137,920
|
|
|
3,851,511
|
|
|
286,409
|
|
|
4,013,791
|
|
|
(124,129)
|
|
Net operating income
|
|
5,294,467
|
|
|
5,355,272
|
|
|
(60,805)
|
|
|
7,182,799
|
|
|
(1,888,332)
|
|
Interest income
|
|
354,645
|
|
|
281,209
|
|
|
73,436
|
|
|
162,836
|
|
|
191,809
|
|
Interest expense
|
|
(8,532,653)
|
|
|
(10,196,949)
|
|
|
1,664,296
|
|
|
(7,709,989)
|
|
|
(822,664)
|
|
Trust expense
|
|
(751,957)
|
|
|
(407,263)
|
|
|
(344,694)
|
|
|
(560,688)
|
|
|
(191,269)
|
|
Income recovery on Parsons Landing
|
|
885,329
|
|
|
869,547
|
|
|
15,782
|
|
|
-
|
|
|
885,329
|
|
Insurance proceeds
|
|
525,355
|
|
|
400,000
|
|
|
125,355
|
|
|
-
|
|
|
525,355
|
|
Loss before the following
|
|
(2,224,814)
|
|
|
(3,698,184)
|
|
|
1,473,370
|
|
|
(925,042)
|
|
|
(1,299,772)
|
Profit (loss) on sale of investment
properties
|
|
16,967
|
|
|
-
|
|
|
16,967
|
|
|
487,095
|
|
|
(470,128)
|
|
Fair value gains
|
|
1,329,884
|
|
|
38,614
|
|
|
1,291,270
|
|
|
1,709,960
|
|
|
(380,076)
|
|
Fair value adjustment of Parsons Landing
|
|
500,000
|
|
|
500,000
|
|
|
-
|
|
|
-
|
|
|
500,000
|
Income (loss) for the period before
taxes and discontinued operations
|
|
(377,963)
|
|
|
(3,159,570)
|
|
|
2,781,607
|
|
|
1,272,013
|
|
|
(1,649,976)
|
|
Current income tax expense
|
|
49,763
|
|
|
-
|
|
|
49,763
|
|
|
-
|
|
|
49,763
|
|
Deferred income tax expense (recovery)
|
|
-
|
|
|
(181,339)
|
|
|
181,339
|
|
|
-
|
|
|
-
|
Income (loss) for the period before
discontinued operations
|
|
(427,726)
|
|
|
(2,978,231)
|
|
|
2,550,505
|
|
|
1,272,013
|
|
|
1,699,739)
|
|
Income from discontinued operations
|
|
17,014,084
|
|
|
598,502
|
|
|
16,415,582
|
|
|
333,267
|
|
|
16,680,817
|
|
Comprehensive income (loss)
|
$
|
16,586,358
|
|
$
|
(2,379,729)
|
|
$
|
18,966,087
|
|
$
|
1,605,280
|
|
$
|
14,981,078
|
Comparison to Q3-2012
During Q4-2012, loss before the profit on sale of investment properties,
fair value gains, fair value adjustment of Parsons Landing, income
taxes and discontinued operations, decreased by $1.5 million, compared
to Q3-2012. The decrease in the loss mainly reflects a decrease in
interest expense of $1.7 million, partially offset by an increase in
trust expense. The decrease in interest expense mainly reflects the
fact that interest expense was comparatively high in the third quarter
of 2012 due to the inclusion of $2.75 million in mortgage prepayment
charges, partially offset by a $0.2 million decrease in mortgage loan
interest.
During Q4-2012, fair value gains in regard to the carrying value of
investment properties amounted to $1.3 million, compared to $0.04
million during Q3-2012, representing an increase of $1.3 million.
Income from discontinued operations increased by $16.4 million during
Q4-2012, compared to Q3-2012, which mainly reflects the $13.0 million
profit on the sale and $3.6 million in net income tax recoveries
relating to Riverside Terrace.
After accounting for the variance in fair value gains/adjustments,
profit on sale, income from discontinued operations and income tax
expense, LREIT completed Q4-2012 with comprehensive income of $16.6
million, compared to a comprehensive loss of $2.4 million during
Q3-2012.
Comparison to Q4-2011
The loss before profit on sale of investment property, fair value gains,
income taxes and discontinued operations, increased by $1.3 million
during Q4-2012 compared to Q4-2011. The increase in the loss mainly
reflects a decrease in net operating income of $1.9 million, an
increase in interest expense of $0.8 million, partially offset by an
increase in insurance proceeds of $0.5 million and an increase in the
income recovery on Parsons Landing of $0.9 million. During Q4-2012, the
combined total of net operating income and the income recovery on
Parsons Landing decreased by $1.0 million, compared to Q4-2011.
The decrease in the combined total of net operating income and the
income recovery on Parsons Landing is comprised of a decrease in net
operating income of $1.9 million, partially offset by the income
recovery on Parsons Landing of $0.9 million. The decrease in net
operating income mainly reflects a decrease in net operating income at
Parsons Landing (due to the fire), Siena Apartments (due to the sale of
the property) and for the Fort McMurray property portfolio due to an
increase in operating costs.
After accounting for the variance in fair value gains/adjustments,
profit on sale, income from discontinued operations and income tax
expense, LREIT completed Q4-2012 with comprehensive income of $16.6
million, compared to $1.6 million during Q4-2011.
ABOUT LREIT
LREIT is a real estate investment trust, which is listed on the Toronto
Stock Exchange under the symbols LRT.UN (Trust Units), LRT.DB.G (Series
G Debentures), LRT.NT.A (Second Mortgage Bonds due December 24, 2015),
LRT.WT (Warrants expiring March 9, 2015) and LRT.WT.A (Warrants
expiring December 23, 2015). The objective of LREIT is to provide
Unitholders with stable cash distributions from investment in a
diversified portfolio of quality real estate properties. For further
information on LREIT, please visit our website at www.lreit.com.
This press release contains certain statements that could be considered
as forward-looking information. The forward-looking information is
subject to certain risks and uncertainties, which could result in
actual results differing materially from the forward-looking
statements.
The Toronto Stock Exchange has not reviewed or approved the contents of
this press release and does not accept responsibility for the adequacy
or accuracy of this press release.
SOURCE: Lanesborough Real Estate Investment Trust
Arni Thorsteinson, Chief Executive Officer, or Gino Romagnoli, Investor Relations
Tel: (204) 475-9090, Fax: (204) 452-5505, Email: info@lreit.com