Fronsac Announces Its Results for the Quarter Ended March 31, 2019 and Monthly Distributions for the Months of July, August and September 2019 – Wire Real Estate

Fronsac Announces Its Results for the Quarter Ended March 31, 2019 and Monthly Distributions for the Months of July, August and September 2019




Jun 4, 2019

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MONTREAL, — (TSX-V: FRO.UN) Fronsac Real Estate Investment Trust (“Fronsac REIT” or “Fronsac”) announces its results for the quarter ended March 31, 2019 and that it will make monthly cash distributions of 0.185¢ per unit, representing 2.220¢ per unit on an annualized basis, on July 31th, August 30st and September 30th, 2019 to unitholders of record on July 15th, August 15th and September 16th, 2019, respectively.

For the quarter ended March 31st, 2019, Fronsac reported recurring funds from operations (“Recurring FFO”) per unit of 0.98¢ compared to 0.91¢ per unit for the quarter ended March 31, 2018, an increase of 8%. Recurring FFO was $1,000,484, an increase of 29% ($777,049 in Q1 2018). During Q1 2019, the Trust’s property rental income was $1,999,095 compared to $1,361,751 in Q1 2018, an increase of 47%. NOI (Net operating Income) was $1,556,756 compared to $1,088,893 in Q1 2018, an increase of 43%. Fronsac recorded a net income attributable to unitholders of $50,870, or 0.05¢ per unit, compared to a net income of $1,373,354, or 1.60¢ per unit, in Q1 2018.

Jason Parravano President and CEO said: “We are pleased to share with you our results for the 1st quarter of 2019 which demonstrate a per unit growth of 8% in recurring FFO due to our ability to continue to achieve accretive returns from our acquisitions. The focus in the 1st quarter was to secure funds with respect to our private placement, which was successfully completed on May 16th, 2019. We announced yesterday our largest acquisition to date, which was comprised of a Walmart and Tim Hortons property in Lachute, QC. We are happy to have put this new equity to use quickly, as we have in the past. In addition, I would like to announce that Michel Lassonde, the Chairman of the board of trustees, has informed the board that this year will be his last one as trustee and Chairman.” Mr. Lassonde commented: “After 12 years as a trustee and Chairman of the board, I have achieved my objectives alongside the co-founders of Fronsac.”

The tables below represent other financial highlights as well as the reconciliation from net income to FFO for the periods ended March 31st, 2019 and its comparative period. This information should be read in conjunction with the Consolidated Financials Statements and MD&A for the quarters ended March 31st, 2019 and March 31st, 2018.

SUMMARY OF SELECTED ANNUAL INFORMATION
  3 months        
Periods ended March 31 2019 2018     Δ %
Financial info            
Property rental income 1,999,095 1,361,751     637,344 47%
Total revenue 1,999,095 1,376,751     622,344 45%
NOI (1) 1,556,756 1,088,893     467,863 43%
FFO (1) 1,000,484 792,049     208,435 26%
Recurring FFO (1) 1,000,484 777,049     223,435 29%
AFFO (1) 970,747 790,780     179,967 23%
EBITDA (1) 1,474,163 1,014,097     460,066 45%
Investment properties (2) 107,597,405 77,974,669     29,622,736 38%
Total assets 100,749,003 77,151,567     23,597,436 31%
Total mortgage/loans/long term debt (3) 54,979,310 38,529,315     16,449,995 43%
Total convertible debentures 1,580,732 254,714     1,326,018 521%
Total equity 41,842,156 37,690,821     4,151,335 11%
Weighted average units o/s – basic 101,606,238 85,659,099     15,947,139 19%
Amounts on a per unit basis            
FFO 0.0098 0.0092     0.0006 7%
Recurring FFO 0.0098 0.0091     0.0007 8%
AFFO 0.0096 0.0092     0.0004 4%
Distributions 0.0056 0.0050     0.0006 12%
(1) Non-IFRS financial measures
(2) Includes value of investment properties owned through joint ventures
(3) Excludes convertible debentures

 

RECONCILIATION OF NET INCOME TO FFO
  3 months      
Periods ended March 31 2018 2017     Δ
Net income (loss) attributable          
to unitholders 50,870 1,373,354     (1,322,484)
Debenture issuance costs    
Δ in value of investment properties 842,237 (674,827)     1,517,064
Δ in value of investment          
properties in joint ventures 76,151 60,489     15,662
Unit based compensation 63,180 41,080     22,100
Δ in liability component of          
convertible debentures (12,749) 4,133     (16,882)
Δ in fair value of derivative          
financial instruments (19,205) (12,180)     (7,025)
Income taxes    
FFO(1) – basic 1,000,484 792,049     26%
FFO per unit – basic 0.0098 0.0092     7%
Interest paid on convertible          
debentures (if dilutive)    
FFO – diluted 1,000,484 792,049     26%
FFO per unit – diluted 0.0098 0.0092     7%
Recurring FFO – basic 1,000,484 777,049     29%
Recurring FFO per unit – basic 0.0098 0.0091     8%
Distributions 563,825 431,785     132,040
Distributions per unit 0.0056 0.0050     12%
FFO – basic after distributions 0.0043 0.0042     0.0001
Recurring FFO – basic after distributions 0.0043 0.0040     0.0003
Distributions as a % of          
FFO – basic 56% 55%     1%
Distributions as a % of          
Recurring FFO – basic 56% 56%    
Weighted avg. units o/s          
Basic 101,606,238 85,659,099     15,947,139
Diluted 101,606,238 86,240,494     15,365,744
(1) FFO is a Non-IFRS financial measure

About Fronsac – Fronsac Real Estate Investment Trust is an open-ended trust that acquires and owns high quality triple net and management-free commercial real estate properties.

Forward-Looking Statements – This press release contains forward-looking statements and information as defined by applicable securities laws. Fronsac warns the reader that actual events may differ materially from current expectations due to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from the results anticipated in such statements. Among these include the risks related to economic conditions, the risks associated with the local real estate market, the dependence to the financial condition of tenants, the uncertainties related to real estate activities, the changes in interest rates, the availability of financing in the form of debt or equity, the effects related to the adoption of new IFRS standards, as well as other risks and factors described from time to time in the documents filed by Fronsac with securities regulators, including the management report. Fronsac does not update or modify its forward-looking statements even if future events occur or for any other reason, unless required by law or any regulatory authority.

Neither the TSX Venture Exchange Inc., nor its Regulatory Services Provider (as that term is defined in the Policy of the TSX Venture Exchange and its Regulatory Services Provide) accepts any responsibility for the adequacy or accuracy of this release.

The March 31st, 2019 financial statements and management discussion & analysis of Fronsac REIT may be viewed on SEDAR at www.sedar.com

For further information please contact Jason Parravano at (450) 536-5328.

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See Campaign: http://www.sedar.com
Contact Information:
Jason Parravano at (450) 536-5328

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