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Crombie REIT Announces Second Quarter 2019 Results

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Second Quarter Summary
(In thousands of CAD dollars, except per unit amounts and as otherwise noted)

  • Operating income of $39,449
  • Property revenue of $99,332
  • Same-asset property cash NOI growth of 3.2%
  • Debt to gross book value - fair value basis improved to 49.2%; lowest level over past four quarters
  • Solid renewal growth over expiring rates of 6.7%
  • Strong committed occupancy at 95.9%
  • Quarter to date dispositions of $186,400

NEW GLASGOW, NS, Aug. 7, 2019 /CNW/ - Crombie Real Estate Investment Trust ("Crombie") (TSX:CRR) today announced results for its second quarter ended June 30, 2019. Management will host a conference call to discuss the results at 12:00pm (ET), August 8, 2019.

"Strong fundamentals and innovative capital recycling have led us to solid Q2 financial results and an improvement of our already strengthened balance sheet," said Don Clow, President & CEO. "Our strategic partnership with Sobeys continues to provide us a sustainable competitive advantage and enables unique opportunities to create short, medium and long-term value for our unitholders. We are thrilled to expand our development pipeline to include 33 properties in Canada's fastest growing markets."

Full details on our results can be found at www.crombiereit.com and www.sedar.com.

 

FINANCIAL RESULTS



Crombie's key financial metrics for the three and six months ended June 30, 2019 are as follows:




Three months ended June 30,

(In thousands of CAD dollars, except per unit amounts and as otherwise noted)

2019

2018

Change  

Change (%)

Property revenue

$

99,332

$

104,143

$

(4,811)

(4.6)%

Property operating expenses


28,222


29,925


1,703

5.7%

Property net operating income ("NOI")

$

71,110

$

74,218

$

(3,108)

(4.2)%

Operating income attributable to unitholders

$

39,449

$

49,033

$

(9,584)

(19.5)%

Same-asset property cash NOI (1)

$

62,154

$

60,204

$

1,950

3.2%

Funds from operations ("FFO") (1)




Basic

$

44,567

$

46,325

$

(1,758)

(3.8)%

Per unit - Basic

$

0.29

$

0.31

$

(0.02)

(6.5)%

Payout ratio (%)


75.7%


72.7%


(3.0)%


Adjusted funds from operations ("AFFO") (1)




Basic

$

37,549

$

39,492

$

(1,943)

(4.9)%

Per unit - Basic

$

0.25

$

0.26

$

(0.01)

(3.8)%

Payout ratio (%)


89.9%


85.3%


(4.6)%



(1) Same-asset property cash NOI, FFO and AFFO are non-GAAP financial measures used by management to evaluate Crombie's business performance. See "Cautionary Statements" below and refer to Crombie's June 30, 2019 MD&A for a reconciliation of same-asset property cash NOI, FFO and AFFO.

 

Same-asset property cash NOI increased by $1,950 or 3.2% compared to the second quarter of 2018 primarily due to rate increases on existing tenant leases, new leasing activity and revenues from land use intensifications at certain properties, comprising $1,648 (or 2.7%) of the increase, with the remaining $302 (or 0.5%) due to the favourable impact from the adoption of IFRS 16 'Leases' on January 1, 2019.

Operating income attributable to Unitholders decreased by $9,584 or 19.5% primarily impacted by Gain on disposal of investment properties of $16,661 in Q2 2019 versus $33,502 in Q2 2018.

FFO and AFFO for the quarter were negatively impacted primarily by reduced Property NOI from the disposition of properties in the current and prior quarters as well as increases in general and administrative costs, primarily related to the impact of increased unit prices on unit-based compensation.

 


Six months ended June 30,

(In thousands of CAD dollars, except per unit amounts and as otherwise noted)

2019

2018

Change

Change (%)

Property revenue

$

204,572

$

209,848

$

(5,276)

(2.5)%

Property operating expenses

60,588

62,829

2,241

3.6%

Property NOI

$

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