CST: 27/09/2016 00:19:13   

Fronsac REIT Announces Very Strong Results for Fiscal 2015 and the March 31st, 2016 Regular Quarterly Distribution

200 Days ago

MONTREAL, QUEBEC--(Marketwired - Mar 10, 2016) - (TSX VENTURE:GAZ.UN) Fronsac Real Estate Investment Trust ("Fronsac REIT" or "Fronsac") today announced its results for fiscal 2015 and a distribution of 0.3875¢ per unit to unitholders of record as at March 18th, 2016 and payable on March 31st, 2016.

For the 12 months ended December 31 st , 2015, Fronsac reported funds from operations ("FFO") of $1,074,956 an increase of 55% ($693,768 in 2014). FFO per unit was 2.32¢ compared to 1.86¢ per unit, which equates to an increase of 25%. During 2015 the Trust's property rental income was $2,198,921 compared to $1,499,518 in 2014, an increase of 47%. NOI (Net operating Income) was $1,965,701 compared to $1,414,515 in 2014, an increase of 39%. Fronsac recorded a net income attributable to unitholders of $1,261,435 or 2.73¢ per unit compared to a net loss of ($730,872) or (1.95¢) per unit for 2014. The main reason for the fluctuation in reported net income is due to the stabilization capitalizations rates of the Trust's portfolio as well as solid results as demonstrated by the increases noted above.

For the quarter ended December 31 st , 2015, Fronsac reported funds from operations ("FFO") of $217,419, an increase of 106% ($105,347 in Q4 2014). A great deal of the increase is attributable to the increase in the Trust's portfolio by 8 properties during 2015. For the Q4 2015, FFO per unit was 0.47¢ compared to 0.23¢ per unit for the quarter ended December 31st, 2014, an increase of 101%. During Q4 2015 the Trust's property rental income was $615,452 compared to $400,520 in Q4 2014, an increase of 54%. NOI (Net operating Income) was $487,005 compared to $364,536 in Q4 2014, an increase of 34%. Fronsac recorded a net income attributable to unitholders of $45,020 or 0.10¢ per unit compared to a net loss of ($147,131) or (0.33)¢ per unit for Q4 2014.

Michel Lassonde President and CEO said: "2015 was a great year for the Trust. We nearly doubled our portfolio with the acquisition of real estate in Quebec and in Ontario. The increases in our FFO on both a nominal and per unit basis continue to demonstrate our discipline for acquiring investments which are accretive to our earnings and our commitment to building value for our shareholders. In addition our distributions represent a FFO payout ratio of only 66%."

The tables below represent other financial highlights as well as the reconciliation from net income to FFO for the periods ended December 31st, 2015 and its comparative period. This information should be read in conjunction with the Audited Consolidated Financials Statements and MD&A for the years ended December 31st, 2015 and December 31st, 2014.

SUMMARY OF SELECTED ANNUAL INFORMATION
Periods ended December 31 2015 2014 Change %
Financial info
Property rental income 2,198,921 1,499,518 699,403 47 %
Total revenue 2,291,631 1,499,518 792,113 53 %
NOI (1) 1,965,701 1,414,515 551,186 39 %
FFO (1) 1,074,956 693,768 381,188 55 %
AFFO (1) 1,066,031 573,607 492,424 86 %
EBITDA (1) 1,653,718 1,128,616 525,102 47 %
Investment properties (2) 33,360,523 18,694,326 14,666,197 78 %
Total assets 33,754,607 22,829,110 10,925,497 48 %
Total mortgage/loans/long term debt (3) 16,467,370 7,552,144 8,915,226 118 %
Total exchangeable preferred units 907,101 871,728 35,373 4 %
Total convertible debentures 247,808 246,552 1,256 1 %
Total equity 14,141,197 13,608,981 532,216 4 %
Weighted average units o/s - basic 46,290,395 37,397,809 8,892,586 24 %
Amounts on a per unit basis
FFO/unit 0.0232 0.0186 0.0047 25 %
AFFO/unit 0.0230 0.0153 0.0077 50 %
Distributions 0.0153 0.0148 0.0005 4 %
(1) Non-IFRS financial measures
(2) Includes value of investment properties owned through joint ventures (530 Barkoff)
(3) Excludes exchangeable debentures and exchangeable preferred units

RECONCILIATION OF NET INCOME TO FFO

3 months
Periods ended December 31 2015 2014 Change
Net income (loss) attributable to unitholders 45,020 (147,131 ) 192,151
Change in value of investment properties 147,487 98,195 49,292
Change in value of investment properties in joint ventures - - -
Unit based compensation - 13,225 (13,225 )
Change in liability component of exchangeable preferred units 5,707 (767 ) 6,474
Change in fair value of derivative financial instruments (4,985 ) 116,920 (121,905 )
Realized/unrealized gain on interest swaps - - -
Change in fair value of other financial components (810 ) 12,905 (13,715 )
Income taxes 25,000 12,000 13,000
FFO(1) - basic 217,419 105,347 106 %
FFO per unit - basic 0.0047 0.0023 101 %
Distributions paid on exchangeable units (if dilutive) 11,966 - 11,966
FFO - diluted 229,385 105,347 118 %
FFO per unit - diluted 0.0046 0.0023 99 %
Distributions 179,718 171,046 8,671
Distributions per unit 0.0039 0.0037 5 %
FFO - basic after distributions 0.0008 (0.0014 ) 0.0022
Distributions as a % of
FFO - basic 83 % 159 % (76 %)
Weighted avg. units o/s
Basic 46,378,751 45,220,576 1,158,175
Diluted 49,466,951 45,220,576 4,246,375
(1) FFO is a Non-IFRS financial measure
12 months Change
2015 2014
Net income (loss) attributable to unitholders 1,261,435 (730,872 ) 1,992,307
Change in value of investment properties (221,248 ) 1,655,115 (1,876,363 )
Change in value of investment properties in joint ventures - 58,300 (58,300 )
Unit based compensation (18,699 ) 8,649 (27,348 )
Change in liability component of exchangeable preferred units 36,629 35,666 963
Change in fair value of derivative financial instruments (8,055 ) 7,620 (15,675 )
Realized/unrealized gain on interest swaps - (4,700 ) 4,700
Change in fair value of other financial components (870 ) 2,405 (3,275 )
Income taxes 25,764 (338,415 ) 364,179
FFO(1) - basic 1,074,956 693,768 55 %
FFO per unit - basic 0.0232 0.0186 25 %
Distributions paid on exchangeable units (if dilutive) 45,343 56,928 (11,585 )
FFO - diluted 1,120,299 750,696 49 %
FFO per unit - diluted 0.0227 0.0182 25 %
Distributions 709,618 558,824 150,794
Distributions per unit 0.0153 0.0148 4 %
FFO - basic after distributions 0.0079 0.0038 0.0041
Distributions as a % of
FFO - basic 66 % 80 % (14 %)
Weighted avg. units o/s
Basic 46,290,395 37,397,809 8,892,586
Diluted 49,378,595 41,274,261 8,104,334
(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 commercial real estate properties situated along highways or frequently travelled routes, rented to strong tenants under long term, management free and net leases. These properties are occupied by tenants within the following sectors; (1) Fast food chains, (2) Major oil/gas companies and (3) Convenience store chains.

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 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 December 31st, 2015 financial statements and management discussion & analysis of Fronsac REIT may be viewed on SEDAR at www.sedar.com

Jason Parravano
(450) 536-5328