Plazacorp announces 18.7% increase in FFO with its quarter end results - May 10, 2012

Plazacorp announces 18.7% increase in FFO with its quarter end results

May 10, 2012

FREDERICTON, May 10, 2012 /CNW/ - Plazacorp Retail Properties Ltd. (TSXV: PLZ) today announced its results for the quarter ended March 31, 2012.

For the quarter ended March 31, 2012, Plazacorp reported funds from operations ("FFO") of $3.8 million, an increase of 18.7% over the same period in the prior year. FFO per share was $0.064 for the three months ended March 31, 2012 ($0.064 per share diluted), consistent with the same period in the prior year. FFO was positively impacted by growth in net property operating income, savings in one-time administrative costs incurred in 2011 and a decrease in financing costs, partly offset by the net effects of the internalization of property and corporate management. FFO per share was impacted by an 18.9% increase in the weighted average shares outstanding.

Michael Zakuta, Plazacorp's President and CEO said, "We are very pleased with the financial results for the quarter. Plazacorp has strengthened its balance sheet as our ratio of debt to asset value has decreased to 44.6%. The strong growth in FFO is a confirmation of our business strategy that is based on creating value for our shareholders by developing high quality retail projects leased to national retailers and financing these projects with long term fixed rate financing for terms of ten years or more."

Profit for the quarter ended March 31, 2012 was $14.7 million compared to $6.9 million recorded for the same period in the prior year. Profit was mainly impacted by non-cash fair value adjustments on investment properties and convertible debentures, net of deferred taxes on those amounts, as well as the same factors described above affecting FFO.

Plazacorp's summary of FFO is presented below:      
(000s - except per share amounts and debt coverage
ratios)

3 Months
Ended
March 31,
2012
(unaudited)
3 Months
Ended
March 31,
2011
(unaudited)
 
Profit for the period attributable to shareholders   $  14,192 $   6,382
Add (deduct):      
Gain on disposal of land   (8) -
Deferred income tax expense   4,444 2,511
Fair value adjustment to investment properties   (13,361) (6,406)
Fair value adjustment to investments   (1,610) (982)
Fair value adjustment to convertible debentures   (79) 1,446
Net revaluation of interest rate swaps   (110) (62)
Non-controlling interest adjustment   340 320
Basic FFO   $   3,808 $   3,209
Interest on dilutive convertible debentures   - -
Diluted FFO   $   3,808 $   3,209
Basic Weighted Average Shares Outstanding   59,942 50,428
Diluted Weighted Average Shares Outstanding   59,942 50,428
Basic FFO per share   $   0.064 $   0.064
Diluted FFO per share   $   0.064 $   0.064
 
Debt coverage ratios      
Interest coverage ratio(1)   2.0 times 1.8 times
Debt service coverage ratio(2)   1.6 times 1.5 times

A copy of Plazacorp's quarterly report can be found on the Corporation's web site at www.plaza.ca or on SEDAR at www.sedar.com.

Plazacorp Retail Properties Ltd. is an owner of shopping malls and strip plazas throughout Atlantic Canada, Quebec and Ontario. Plazacorp owns interests in 116 properties comprising 5.1 million square feet of retail real estate.

CAUTIONARY STATEMENTS REGARDING FORWARD LOOKING INFORMATION

This news release contains forward looking statements relating to our operations and the environment in which we operate, which are based on our expectations, estimates, forecasts and projections. These statements are not future guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. Therefore, actual outcomes and results may differ materially from those expressed in these forward looking statements. Readers, therefore, should not place undue reliance on any such forward looking statements. Further, a forward looking statement speaks only as of the date on which such statement is made. We undertake no obligation to publicly update any such statement, to reflect new information or the occurrence of future events or circumstances, except for forward-looking information disclosed in prior disclosures which, in light of intervening events, requires further explanation to avoid being misleading.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.


 

For further information:

For more information on Plazacorp, visit our website at
www.plaza.ca
Or contact:
Floriana Cipollone, Chief Financial Officer (416) 848-4583 or Kim Sharpe, Director of Business Development at (506) 460-8261