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Press release from Filing Services Canada

Proventure Income Fund Announces Results for Third Quarter of 2010

Wednesday, March 09, 2011

Proventure Income Fund Announces Results for Third Quarter of 201016:42 EST Wednesday, March 09, 2011FSC / Press ReleaseProventure Income Fund Announces Results for Third Quarter of 2010Calgary, Alberta CANADA, March 09, 2011 /FSC/ - Proventure Income Fund (PVT.UN - TSX Venture), is pleased to report its financial results for the year ended December 31, 2010.Overview of ProventureProventure is an "open ended" mutual trust established under the laws of the Province of Alberta. The objectives of Proventure are to provide Unitholders with cash distributions from the acquisition and operation of a portfolio of real estate properties. Proventure owns directly and indirectly, a 100% interest in its subsidiaries, Proventure Income Trust, Proventure Holding Limited Partnership and Proventure Operating Limited Partnership (with the exception of 225 thousand Class C preferred units held by an unrelated party and 2.1 million Class D preferred units held by a related party). On November 16, 2010, the Unitholders of the Fund approved certain amendments to the declaration of trust constituting the Fund and have approved the sale of certain assets and liabilities of the Fund to a separate and distinct private income trust, Prodev Trust ("Prodev"). Prodev is a considered a related party as the trustees and officers of Prodev are the same as those of Proventure. The sale of assets, as more particularly described in this MD&A and in the Information Circular of the Fund dated October 1, 2010 (the "Information Circular"), a copy which can be obtained on SEDAR, and was completed on December 31, 2010.The purpose of the amendments to the declaration of trust was to ensure the Fund conformed to new International Financial Reporting Standards ("IFRS") in respect to the preparation of its financial statements by removing the obligation of the Fund to make distributions to the Unitholders to ensure the Fund to maintain its equity classification for the Fund units under IFRS. Proventure may qualify for the REIT Exemption (as defined below) and for an exemption to certain rules ("SIFT Rules") under the Income Tax Act (Canada) (the "Tax Act") applicable to certain publicly listed trusts or partnerships ("SIFTS") and their investors commencing January, 2011. The SIFT Rules are not applicable to a real estate investment trust that meets certain specified criteria relating to the nature of its revenue and investments (the "REIT Exemption"). The estimate of income tax consequences of the above transactions for Unitholders is described in the income tax section of the annual MD&A.Overall PerformanceDuring 2010, we reported net earnings of $1.9 million or $0.25 per basic unit for the year ended December 31, 2010 when compared to net earnings of $1.1 million or $0.15 per unit in 2009. Gross revenues increased by $2.8 million to $6.2 million compared to $3.4 million for the same period of 2009. Our gross revenues from real estate leases increased by $347 thousand or 12%. In addition, our EBITDA (see "Non-GAAP Financial Measures") increased by 31% to $4.0 million from $3.1 million in 2009 due primarily to a gain on disposal of assets of $2.3 million and revenue from the sale of land held for development of $329 thousand and a loss on write-down of assets of $1.7 million.We also declared a $0.53 distribution in-kind on December 15, 2010, payable January 14, 2011. Net cash provided by operating activities increased to $2.1 million for the year ended December 31, 2010 compared to $1.8 million for the year ended December 31, 2009 due primarily to receiving full benefit of the increase in rental activity due to acquisitions in the latter part of 2009.-***- ------------------------------------------------------------------------- Selected Annual Information ------------------------------------------------------------------------- $ thousands, except per December December December December unit amounts 31, 2010 31, 2009 31, 2008 31, 2007 ------------------------------------------------------------------------- Revenues 6,225 3,413 5,686 1,900 Net earnings (loss) 1,924 1,061 1,588 724 Per unit - Basic and diluted 0.25 0.15 0.22 0.14 ------------------------------------------------------------------------- Cash provided by (used in) operating activities 2,061 1,822 1,179 1,108 Per unit - basic 0.27 0.26 0.17 0.22 Distributions declared 4,048 1,352 3,555 813 Per unit 0.53 0.19 0.50 0.12 ------------------------------------------------------------------------- EBITDA1 4,013 3,058 3,267 1,989 EBITDA margin1 64.5% 89.6% 57.4% 104.7% Per Unit - basic 0.53 0.43 0.46 0.39 ------------------------------------------------------------------------- Weighted average units outstanding Basic 7,617 7,116 7,102 5,089 Diluted 9,721 7,125 7,160 5,089 Actual units outstanding 7,638 7,116 7,116 6,773 ------------------------------------------------------------------------- Total assets 45,353 38,240 33,451 24,702 Total long-term liabilities 27,142 21,643 19,822 12,978 Unitholders' equity 10,912 12,945 10,721 10,523 Net book value per unit - diluted 1.12 1.82 1.50 2.07 ------------------------------------------------------------------------- -****-The Non-GAAP measures indentified in this Press Release do not have any standardized meaning prescribed by Canadian generally accepted accounting principles ("GAAP") and are therefore unlikely to be comparable to similar measures presented by other issuers. These non-GAAP measures are more fully defined and discussed, together with reconciliation to the most directly related GAAP measure in the MD&A of the Fund on the results of operations for the year ended December 31, 2010.Copies of Proventure Income Fund's unaudited financial statements and related MD&A are available on the SEDAR at For further information, please contact:Peter Lacey - President & CEO Telephone: (403) 567-2098 Fax: (403) 567-2151 Email: placey@cervuscorp.comRandy Muth - Chief Financial Officer Telephone: (403) 567-2097 Fax: (403) 567-2152 Email: rmuth@cervuscorp.comNeither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.Source: Proventure Income Fund (TSX-V: PVT.UN) Maximum News Dissemination by Filing Services Canada Inc.