MONTRÉAL, Nov. 8, 2021 /CNW/ - BTB Real Estate Investment Trust (TSX: BTB.UN) ("BTB" or the "REIT") releases today its financial results for the third quarter ended September 30th, 2021, compared to the third quarter of 2020, and announces the following highlights and information:
HIGHLIGHTS OF THE THIRD QUARTER ENDED SEPTEMBER 30TH, 2021
- BTB repeats a solid performance during the third quarter: Since the fourth quarter of 2020, BTB's portfolio continued to show significant improvement across all asset classes and geographic regions. During the third quarter, its financial performance was not impacted by the COVID-19 pandemic. With a solid foundation, BTB is ready to put its growth plan into action.
- Funds From Operations (FFO) & Adjusted Funds From Operations (AFFO): FFO was slightly impacted by the recent equity issuance and undeployed cash due to acquisitions that have been concluded on November 8th, 2021. For the third quarter 2021, BTB declared recurring FFO of 9.5 ¢ per unit, compared to 10.9 ¢ per unit for the same period in 2020 and declared recurring AFFO of
8,7 ¢ per unit, compared to 9.7 ¢ per unit for the same period in 2020:
- The recurring FFO payout ratio stands at 79.0 % for the quarter compared to 68.9 % in Q3 2020.
- The recurring AFFO payout ratio stands at 87.4 % for the quarter compared to 77.4 % in Q3 2020.
- Total Debt Ratio: At the end of the third quarter 2021, BTB maintained its objective of keeping its total debt ratio below 60% with a total debt ratio of 55.8%. This represents an improvement of 3.9% compared to Q3 2020. The improvement stems from the equity issued in April 2020 and by the conversion of Series H debentures, combined with the full repayment of the outstanding amount of the acquisition line of credit in Q2 2021.
- Net Income & Comprehensive Income: totalled $8.7 million compared to
$5.8 million for the same period in 2020.
- Rental Revenue and Net Operating Income (NOI): stood at $24.0million and at $13.6million which represents an increase of 1.7% and 2.0%, respectively, compared to Q3 2020.
- Rent Collection Rate: BTB collected 99.1% of rents during the third quarter and 99.2% of cumulative rents for 2021.
- Leasing Activity: resulted in a reasonably consistent occupancy rate of 92.0% by renting 17,181 sq. ft. to new tenants. Leases totalling 50,582 sq.ft. were renewed of which 46,600 sq.ft. were renewed before the end of their term and 3,982 sq. ft. renewed in anticipation of the end of their term ending in 2022 and after. For the cumulative period of nine-months, the REIT reached an average increase of 3.0% of its renewal rate. In particular, the industrial sector saw a cumulative increase of 14.6%.
- Same property NOI: increased by 0.1% compared to Q3 2020 due to additional recoveries and reduced pandemic expenses. Throughout Q4 2021, BTB is negotiating the leasing of approximately of 50% of the 81,000 sq.ft. that became vacant related to COVID-19 tenant departures.
- Acquisition of 6000 Kieran Street in Saint-Laurent, Montréal: on
June 29th, 2021, the REIT acquired an industrial property of 99,000 sq.ft. in
Saint-Laurent borough, in Montréal. This acquisition positively impacted the third quarter financial results.
- New acquisition facility: To enable the REIT to pursue its acquisition strategy, whilst improving its financial position through favorable terms and conditions, BTB successfully closed on September 29th, 2021, a new acquisition line of credit with the National Bank of Canada (as Administrative Agent and Sole Lender) consisting of $35 million of revolving credit facility with an option to increase the total amount to $60 million.
- Cash position: BTB concluded the third quarter with a cash position of
$19.2million. The $10.0 million increase in liquidity from year end 2020 is due to the undeployed proceeds of the April 2021 equity issuance to fund acquisitions announced post-closing of the third quarter.
A MESSAGE FROM MICHEL LÉONARD, PRESIDENT AND CHIEF EXECUTIVE OFFICER
For the third consecutive quarter, BTB is proud to announce strong results that support our growth and expansion strategies. Over the past few months, we could taste the return to normal life. Operations in our properties have resumed and our tenants are gradually returning to the office.
Our success is largely based on the efforts of our company and depends on the development and growth of our employees and clients. We continue to support our clients in their projects and decision-making by offering our ongoing support.
BTB's portfolio continues to be stable across all asset classes and geographic regions. In addition, we collected more than 99% of our rents, or 99.2% of the cumulative rents for the year 2021.
The acquisition of industrial property of more than 99,000 sq.ft. located at 6000 Kieran Street in Montréal, concluded in the second quarter of 2021, contributed to the improvement of our third quarter 2021 revenues. Rental revenue for the third quarter was $24.0 million and net operating income was $13.6 million, an increase of 1.7% and 2.0%, respectively, over the same quarter of 2020.
We remain committed to meeting our targets for 2021. We will soon cross the $1 billion mark in asset valuation, a major achievement in BTB's history, we aim to double the value of our total assets over the next five years. However, we remain focused on our core business values and on a strategic and intelligent growth, not accelerated or arbitrary.
SUBSEQUENT EVENTS
- Acquisition: On November 8th, 2021, BTB concluded the acquisition of two class A life-science and technology suburban office properties located at 2344 and 2600 boulevard Alfred-Nobel in the Saint-Laurent borough of Montréal, Québec. Acquired for the aggregate purchase price of $74 million, excluding transaction costs, this acquisition is funded from the proceeds received from the last equity raise and available funds. These two properties thus increase the total number of properties owned by the Trust to 66, representing an increase of respectively 108,724 sq. Ft. and 129,254 sq. ft., increasing the Trust's total square footage to approximately 5.6 million square feet.
OTHER SIGNIFICANT HIGHLIGHTS AS ATSEPTEMBER 30TH, 2021
- Total number of properties: 64
- Total leasable area: approximately 5.4 million sq. ft.
- Total asset value:$962 million
- Market capitalization:$297 million
FINANCIAL INFORMATION
The following two tables summarize our results for the quarters ended
September 30th, 2021, and 2020.
Quarterly Results Information
|
|
|
|
Periods ended September 30
|
Quarter
|
Cumulative (9 months)
|
|
(in thousands of dollars, except for ratios and per
unit data)
|
2021
|
2020
|
∆%
|
2021
|
2020
|
∆%
|
|
$
|
$
|
|
$
|
$
|
|
|
Financial information
|
|
|
|
|
|
|
|
Rental income
|
23,988
|
23,583
|
1.7
|
73,554
|
70,514
|
4.3
|
|
Net operating income (1)
|
13,572
|
13,308
|
2.0
|
41,560
|
38,493
|
8.0
|
|
Net income (net loss) and comprehensive income
|
8,678
|
5,757
|
50.7
|
18,349
|
(931)
|
(2,070.9)
|
|
Net property income from the same-property
portfolio (1)
|
8,496
|
8,471
|
0.3
|
24,323
|
23,946
|
1.6
|
|
Distributions
|
5,551
|
4,752
|
16.7
|
15,886
|
16,735
|
(5.1)
|
|
Recurring funds from operations (FFO) (1)
|
7,018
|
6,920
|
1.4
|
21,950
|
17,907
|
22.6
|
|
Recurring adjusted funds from operations (AFFO) (1)
|
6,453
|
6,139
|
5.1
|
20,606
|
15,893
|
29.7
|
|
Cash flow from operating activities
|
10,090
|
8,983
|
12.3
|
31,401
|
30,191
|
4.0
|
|
Total assets
|
|
|
|
962,207
|
945,592
|
1.8
|
|
Mortgage debt ratio
|
|
|
|
55.8%
|
59.7%
|
(6.5)
|
|
Weighted average interest rate on mortgage debt
|
|
|
|
3.78%
|
3.61%
|
4.7
|
|
Market capitalization
|
|
|
|
296,667
|
184,097
|
61.1
|
|
Financial information per unit
|
|
|
|
|
|
|
|
Net income and comprehensive income
|
11.7¢
|
9.1¢
|
28.8
|
26¢
|
-1.5¢
|
(1,832.6)
|
|
Distributions
|
7.5¢
|
7.5¢
|
(0.2)
|
22.5¢
|
26.5¢
|
(15.1)
|
|
Recurring FFO(1)
|
9.5¢
|
10.9¢
|
(13.0)
|
31.1¢
|
28.4¢
|
9.5
|
|
Recurring AFFO(1)
|
8.7¢
|
9.7¢
|
(10.1)
|
29.2¢
|
25.2¢
|
15.8
|
|
(1) Non IFRS financial measures
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|
|
|
|
|
|
|
|
|
|
Periods ended September 30
|
Quarter
|
Cumulative (9 months)
|
|
(in thousands of dollars, except per unit data)
|
2021
|
2020
|
2021
|
2020
|
|
$
|
$
|
$
|
$
|
|
Cash flows from operating activities (IFRS)
|
10,090
|
8,983
|
31,401
|
30,191
|
|
Leasing payroll expenses
|
173
|
176
|
576
|
470
|
|
Transaction costs on purchase and disposition of
investment properties and early repayment fees
|
-
|
-
|
(188)
|
(1,790)
|
|
Adjustments for changes in other working capital items
|
2,486
|
3,412
|
7,670
|
4,983
|
|
Financial income
|
185
|
127
|
581
|
356
|
|
Interest expenses
|
(5,538)
|
(5,712)
|
(16,753)
|
(17,572)
|
|
Provision for non-recoverable capital expenditures
|
(478)
|
(472)
|
(1,468)
|
(1,410)
|
|
Provision for non-recovered rental fees
|
(375)
|
(375)
|
(1,125)
|
(1,125)
|
|
Other items
|
(90)
|
-
|
(276)
|
-
|
|
AFFO(1)
|
6,453
|
6,139
|
20,418
|
14,103
|
|
Non-recurring item
|
|
|
|
|
|
Transaction costs on purchase and disposition of
investment properties and early repayment fees
|
-
|
-
|
188
|
1,790
|
|
Recurring AFFO(1)
|
6,453
|
6,139
|
20,606
|
15,893
|
|
(1) Non IFRS financial measures
|
|
|
|
|
NON-IFRS FINANCIAL MEASURES
Net operating income, net operating income of the same-property portfolio, funds from operations and adjusted funds from operations are not measures recognized by International Financial Reporting Standards ("IFRS") and do not have standardized meanings prescribed by IFRS. Such measures may differ from similar computations as reported by similar entities and, accordingly, may not be comparable to similar measures.
QUARTERLY CALL INFORMATION
Management will hold a conference call on Tuesday, November 9th, 2021, at 10 am, Eastern Standard Time, to present BTB's financial results and performance for the third quarter of 2021.
The media and all interested parties may attend the call-in listening mode only.
Conference call operators will coordinate the question-and-answer period (from analysts only) and will instruct participants regarding the procedures during the call.
The audio recording of the conference call will be available by via playback until
November 18th, 2021, by dialing: 1-416-764-8677 (local) or, 1-888-390-0541 (toll-free) and by entering the following access code: 861340 #.
FORWARD-LOOKING STATEMENTS
This press release may contain forward-looking statements with respect to BTB. These statements generally can be identified by use of forward-looking words such as "may", "will", "expect", "estimate", "anticipate", "intends", "believe" or "continue" or the negative thereof or similar variations. The actual results and performance of BTB could differ materially from those expressed or implied by such statements. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Some important factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors, competition, changes in government regulation and the factors described from time to time in the documents filed by BTB with the securities regulators in Canada. The cautionary statements qualify all forward-looking statements attributable to BTB and persons acting on their behalf. Unless otherwise stated or required by applicable law, all forward-looking statements speak only as of the date of this press release.
ABOUT BTB
BTB is a real estate investment trust listed on the Toronto Stock Exchange. BTB is an important owner of properties in eastern Canada. As of November 8th, 2021, BTB owns 64 retail, office, and industrial properties for a total leasable area of approximately
5.4 million sq. ft. and an approximate total asset value as of September 30th, 2021, of approximately of $962 million.
BTB'S OBJECTIVES
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(1)
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Generate stable monthly cash distributions that are reliable and fiscally beneficial to unitholders.
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(2)
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Grow the REIT's assets through internal growth and accretive acquisitions in order to increase distributable income and therefore fund distributions.
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(3)
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Optimize the value of its assets through the dynamic management of its properties in order to maximize the long-term value of its properties and therefore, its units.
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BTB offers a distribution reinvestment plan to unitholders whereby the participants may elect to have their monthly cash distribution reinvested in additional units of BTB at a price based on the weighted average price for BTB's units on the Toronto Stock Exchange for the five trading days immediately preceding the distribution date, discounted by 3%.
For more detailed information, visit BTB's website at www.btbreit.com.
SOURCE BTB Real Estate Investment Trust
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