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Press release from CNW Group

Morguard Real Estate Investment Trust announces fourth quarter and 2011 annual results and increase in distributions

Monday, February 27, 2012

Morguard Real Estate Investment Trust announces fourth quarter and 2011 annual results and increase in distributions17:59 EST Monday, February 27, 2012TSX: MRT.UNMISSISSAUGA, ON, Feb. 27, 2012 /CNW/ - Morguard Real Estate Investment Trust ("the Trust") (TSX: MRT.UN) today announced that net income for the year ended December 31, 2011 was $158.3 million or $2.77 per unit, compared with $174.4 million or $3.07 per unit in 2010.  Net income for the three months ended December 31, 2011 was $48.4 million or $0.84 per unit, compared to $56.7 million or $1.00 per unit for the same period in 2010.Funds from operations ("FFO") for the year ended December 31, 2011 was $79.5 million or $1.39 per unit ($1.35 per unit fully diluted), compared to $71.8 million or $1.26 per unit ($1.22 per unit fully diluted) in 2010.  FFO for the three months ended December 31, 2011 was $21.4 million or $0.36 per unit ($0.36 per unit fully diluted) compared to $20.5 million or $0.36 per unit ($0.35 per unit fully diluted) for the same period in 2010.Net operating income for the year ended December 31, 2011 was $133.8 million, compared to $123.6 million in 2010.  Net operating income for the three months ended December 31, 2011 was $35.0 million, compared with $34.4 million during the same period in 2010.DISTRIBUTION INCREASEThe board of Trustees of Morguard REIT announced an increase in the distribution paid to unitholders.  The increase to $0.96 per unit per annum (from $0.90 currently) will be effective for unitholders of record at the close of business on March 30, 2012.NET OPERATING INCOME, FFOThis press release and accompanying financial information make reference to net operating income and funds from operations ("FFO") on a total and per unit basis.  Net operating income is defined as income from property operations after operating expenses have been deducted, but prior to deducting interest expense, general and administrative expenses and fair value gains (losses).  FFO is defined as net income prior to extraordinary items, valuation adjustments, and certain other non-cash items, if any.Readers are cautioned that although the terms "Net Operating Income" and "Funds from Operations" are commonly used to measure, compare and explain the operating and financial performance of Canadian real estate investment trusts and such terms are defined in the Management's discussion and Analysis, such terms are not recognized terms under IFRS.  Such terms do not necessarily have a standardized meaning and may not be comparable to similarly titled measures presented by the other publicly traded entities.FINANCIAL STATEMENTS AND MORGUARD'S DISCUSSION AND ANALYSISMorguard REIT's 2011 Consolidated Financial Statement and Management's Discussion and Analysis along with its 2010 Annual Report are available on Morguard REIT's website at www.morguardreit.com and have been filed with SEDAR at www.sedar.comABOUT MORGUARD REAL ESTATE INVESTMENT TRUSTMorguard REIT is a closed-end real estate investment trust, which owns a diversified portfolio of 53 retail, office and mixed-use properties in Canada with a book value of $2.1 billion and approximately 8.5 million square feet of leaseable space.Consolidated Balance Sheet(In thousands of dollars, except per-unit amounts)  2011   2010        Assets     Real estate properties$    2,119,084 $   1,935,901Amounts receivable 8,851  7,756Other assets 1,321  981Cash and cash equivalents 8,134  7,441 $    2,137,390 $  1,952,079      Liabilities      Mortgages and bonds payable$      799,672 $     760,219Convertible debentures payable 86,457  94,974Accounts payable and other liabilities 34,496  34,300Bank indebtedness  43,852  8,620      Unitholders' Equity 1,172,913  1,053,966 $2,137,390 $1,952,079Consolidated Statements of Income and Comprehensive IncomeThree months ended December 31, Year ended December 31,(In thousands of dollars, except per-unit amounts) 2011 2010 2011 2010         Revenue from real estate properties$      60,673$      60,052$   235,693 $  220,301Property operating expenses 23,679 23,764 94,238 89,479Property management fees 2,036 1,925 7,676 7,237Net operating income 34,958 34,363 133,779 123,585         Interest expense 12,692 12,929 50,833 48,571General and administrative 954 1,240 4,538 4,472Amortization expense 11 19 48 79Other expenses / (income) 14 (3) 5 (40)Income before fair value changes on real estate properties       and loss on sale of real estate properties 21,287 20,178 78,355 70,503         Fair value gains on real estate properties 27,086 36,514 79,947 104,137Loss on sale of real estate properties — (1) — (276) Net income for the year$      48,373$     56,691$158,302$  174,364         Other comprehensive income        Amortization - cash flow hedge 240 234 951 930Comprehensive income$     48,613$    56,925$  159,253$  175,294         Net income per-unit              Basic$          0.84$       1.00$       2.77 $        3.07      Diluted$         0.80$        0.92$       2.62$         2.85Reconciliation of Net Income to Funds from OperationsThree months ended December 31, Year ended December 31,(In thousands of dollars, except per-unit amounts) 2011 2010 2011 2010         Net income for the year$      48,373$   56,691$   158,302$   174,364         Add / (deduct):        Accretion of convertible debentures 80 357 1,121 1,250Fair value gains on real estate properties (27,086) (36,514) (79,947) (104,137)Loss on sale of real estate properties — 1 — 276Funds from operations$      21,367$   20,535$   79,476$71,753         Funds from operations per-unit               Basic$          0.36$      0.36$     1.39$1.26      Diluted$          0.36$     0.35$          1.35$  1.22 For further information: K. (Rai) Sahi, President and Chief Executive Officer, Tel: 905.281.4800, or; Tim Walker, Vice President and Chief Financial Officer, Tel: 905.281.4800