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Scott';s REIT reports second quarter 2010 results

^{Published on 2010-08-11 15:55:29 - Market Wire}
 

 Second Quarter 2010 Financial Highlights Three months ended June 30, 2010 vs. Three months ended June 30, 2009 - Revenue increased by 14.2 per cent to $5.8 million - Net operating income* increased by 12.3 per cent to $4.8 million - Payout ratio* increased to 99.8 per cent from 77.6 per cent but decreased significantly from the first quarter of 2010. 

 RECONCILIATION OF DISTRIBUTABLE INCOME TO CASH PROVIDED BY OPERATING ACTIVITIES (UNAUDITED) (in thousands of dollars except per Unit amounts) The following table outlines the reconciliation of cash provided by operating activities to distributable income: ------------------------------------------------------------------------- Three months ended Six months ended June 30, June 30, ------------------------------------------------------------------------- 2010 2009 2010 2009 ------------------------------------------------------------------------- Cash provided by operating activities $1,154 $1,741 $2,691 $3,335 Net change in non-cash working capital 812 244 727 360 ------------------------------------------------------------------------- Distributable income 1,966 1,985 3,418 3,695 Distributions declared 1,962 1,540 3,780 3,081 ------------------------------------------------------------------------- Distributable income per Unit 0.213 0.274 0.396 0.509 Distributions per Unit 0.213 0.213 0.425 0.425 ------------------------------------------------------------------------- Distributable Income Payout Ratio 99.8% 77.6% 107.4% 83.5% ------------------------------------------------------------------------- Note (1) Distributable income payout ratio is calculated by taking distributable income divided by the weighted average number of Units outstanding assuming full conversion of the class B exchangeable Units during the relevant period end divided by the distributions per unit paid during the period. CONSOLIDATED BALANCE SHEETS (in thousands of dollars) June 30, December 31, 2010 2009 $ $ Assets Income-producing properties 206,388 167,525 Intangible assets 10,252 7,743 Cash and cash equivalents 7,137 16,004 Accounts receivable 685 247 Prepaid expenses and other assets 880 795 Due from related companies 58 101 Straight-line rent receivable 2,563 2,446 ----------------------- 227,963 194,861 ----------------------- ----------------------- Liabilities and Unitholders' Equity Mortgages payable 131,001 111,600 Convertible debentures 37,417 37,074 Accounts payable and accrued liabilities 1,880 1,284 Due to related companies 45 117 Distributions payable to Unitholders 654 513 Other liabilities 4,055 151 ----------------------- 175,052 150,739 ----------------------- Class B Exchangeable Units 12,960 14,334 ----------------------- Unitholders' Equity Contributed surplus 2,588 2,588 Class A Units of Scott's REIT 58,818 44,676 Convertible debentures 1,265 1,265 Cumulative losses (1,339) (183) Cumulative distributions declared on Class A Units (21,381) (18,558) ----------------------- 39,951 29,788 ----------------------- 227,963 194,861 ----------------------- ----------------------- CONSOLIDATED STATEMENTS OF OPERATIONS AND CUMULATIVE EARNINGS (in thousands of dollars, except per Unit amounts) Three months ended Six months ended June 30, June 30, 2010 2009 2010 2009 REVENUE Rental revenue $ 5,723 $ 5,049 $ 10,655 $ 9,784 Amortization of (above) below-market rentals 41 (23) 35 (4) Straight-line revenue accrual 68 79 117 127 -------------------------------------------- 5,832 5,105 10,807 9,907 -------------------------------------------- EXPENSES Amortization 2,400 1,985 4,449 4,051 Operating 1,042 841 1,884 1,647 Interest 2,703 1,990 5,183 3,967 General and administrative 452 575 864 955 -------------------------------------------- 6,597 5,391 12,380 10,620 -------------------------------------------- Loss before non -controlling interest (765) (286) (1,573) (713) Non-controlling interest of Class B Exchangeable Units 187 89 417 222 -------------------------------------------- Net loss for the period (578) (197) (1,156) (491) Cumulative earnings (loss) - Beginning of period (761) 983 (183) 1,277 -------------------------------------------- Cumulative earnings (loss) - End of period (1,339) 786 (1,339) 786 -------------------------------------------- -------------------------------------------- Basic and diluted loss per Unit (0.083) (0.039) (0.181) (0.098) -------------------------------------------- -------------------------------------------- Class A Units outstanding 6,982,036 4,993,964 6,982,036 4,993,964 -------------------------------------------- -------------------------------------------- Class B Exchangeable Units outstanding 2,254,909 2,254,909 2,254,909 2,254,909 -------------------------------------------- -------------------------------------------- CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (in thousands of dollars) For the years ended June 30, Three months ended Six months ended June 30, June 30, 2010 2009 2010 2009 Net loss for the period $ (578) $ (197) $ (1,156) $ (491) Other comprehensive income - - - - -------------------------------------------- Comprehensive loss for the period (578) (197) (1,156) (491) -------------------------------------------- -------------------------------------------- CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands of dollars) For the years ended June 30, 2010 and 2009 Three months ended Six months ended June 30, June 30, 2010 2009 2010 2009 CASH PROVIDED BY (USED IN) Operating activities Net loss for the period $(578) $(197) $(1,156) $(491) Add (deduct) Non-controlling interest of Class B Exchangeable Units (187) (89) (417) (222) Amortization of income- producing properties 2,115 1,728 3,918 3,456 Amortization of intangible assets 245 280 495 599 Amortization of deferred financing charges 269 118 453 236 Amortization of tenant inducements and leasing fees/commissions 12 4 23 10 Acquisition-in-progress cost written off - 206 - 206 Interest accretion 59 14 118 28 Straight-line revenue accrual (68) (79) (117) (127) Stock-based compensation 100 - 100 - -------------------------------------------- 1,966 1,985 3,418 3,695 Change in other non-cash operating items Accounts receivable (404) 184 (438) 338 Prepaid expenses and other assets (167) 3 (478) (245) Accounts payable and accrued liabilities (223) (389) 218 (509) Due to/from related companies (18) (42) (29) 56 -------------------------------------------- 1,154 1,741 2,691 3,335 -------------------------------------------- Investing activities Acquisition of income- producing properties (10,568) (9) (40,940) (7) Tenant inducements and leasing commissions (39) (17) (99) (17) Construction-in-progress (38) (14) (67) (14) Additions to income- producing properties (95) - (95) - Acquisitions-in-progress - - - 1 -------------------------------------------- (10,740) (40) (41,201) (37) -------------------------------------------- Financing activities Class A shares issued - - 15,002 - Buy back of Class A Units - - - (300) Demand loan - - - 1,300 Proceeds from mortgage payable - - 20,000 - Mortgage financing fees (125) - (339) (4) Principal repayments on mortgages payable (251) (215) (497) (399) Distributions paid (1,961) (1,540) (3,639) (3,086) Issuance costs 33 - (884) - -------------------------------------------- (2,304) (1,755) 29,643 (2,489) -------------------------------------------- Increase (decrease) in cash and short-term investments during the period (11,890) (54) (8,867) 809 Cash - Beginning of period 19,027 965 16,004 102 -------------------------------------------- Cash - End of period 7,137 911 7,137 911 -------------------------------------------- -------------------------------------------- Supplemental cash flow disclosure Interest paid 2,385 2,213 4,583 3,703 Accrued cost relating to acquisition of income- producing properties 430 - 430 - Accrued cost relating to issuance of Units 12 - 12 - Deposits made on income- producing properties in prior periods 100 - 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