Allied Properties Real Estate Investment Trust Announces Fourth-Quarter and Annual Results for 2012
March 05 2013 - 7:11PM
Marketwired Canada
Allied Properties REIT (TSX:AP.UN) today announced results for its fourth
quarter and fiscal year ended December 31, 2012. "We took advantage of a very
supportive environment in 2012 to make our business better and stronger in every
material respect," said Michael Emory, President and CEO. "Our performance
measures reached new heights, and our balance sheet continued to grow and
strengthen."
The results for the fourth quarter are summarized below and compared to the same
quarter in 2011:
(In thousands except for per
unit and % amounts) Q4 2012 Q4 2011 CHANGE % CHANGE
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Net income 25,524 19,073 6,451 33.8%
Same-asset NOI 32,560 30,688 1,872 6.1%
Funds from operations ("FFO") 28,020 20,706 7,314 35.3%
FFO per unit (diluted) $ 0.45 $ 0.40 $ 0.05 12.5%
FFO pay-out ratio 73.2% 81.9% (8.7%)
Adjusted FFO ("AFFO") 23,430 16,594 6,836 41.2%
AFFO per unit (diluted) $ 0.38 $ 0.33 $ 0.05 15.2%
AFFO pay-out ratio 87.5% 102.1% (14.6%)
Total debt as a % of fair value
of investment properties 36.4% 44.8% (8.4%)
Net debt as a multiple of
annualized Q4 EBITDA 6.3:1 6.3:1 -
Interest as a multiple of EBITDA 4.2:1 3.2:1 1:1
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The results for the fiscal year ended December 31, 2012, are summarized and
compared to the same period in 2011:
(In thousands except for per unit
and % amounts) 2012 2011 CHANGE % CHANGE
----------------------------------------------------------------------------
Net income 93,325 59,949 33,376 55.7%
Same-asset NOI 106,078 92,422 13,656 14.8%
Funds from operations ("FFO") 102,152 66,091 36,061 54.6%
FFO per unit (diluted) $ 1.79 $ 1.39 $ 0.40 28.8%
FFO pay-out ratio 73.8% 95.2% (21.4%)
Adjusted FFO ("AFFO") 81,707 51,083 30,624 59.9%
AFFO per unit (diluted) $ 1.43 $ 1.07 $ 0.36 33.6%
AFFO pay-out ratio 92.3% 123.2% (30.9%)
Total debt as a % of fair value
of investment properties 36.4% 44.8% (8.4%)
Net debt as a multiple of
annualized Q4 EBITDA 6.3:1 6.3:1 -
Interest as a multiple of EBITDA 3.6:1 2.9:1 0.7:1
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Allied's financial performance measures for the fourth quarter and fiscal year
were up significantly from the comparable periods in 2011, reflecting increased
occupancy, portfolio-wide rental growth and accretion from recent acquisitions.
Having leased over 1.7 million square feet of space in 2012, Allied finished the
year with its rental portfolio 92.2% leased, 94.2% leased if upgrade properties
are excluded. Allied renewed or replaced 81.3% of its leases maturing in 2012,
resulting in an overall increase of 8.3% in net rental income per square foot
from the affected space.
With over $400 million in acquisitions announced and completed in 2012, Allied
finished the year well ahead of its annual target. As expected, the acquisitions
were evenly spread over Allied's three operating regions and included a
significant number of value-creation opportunities. Allied also sold three
non-core properties, one in Toronto and two in Winnipeg, as well as an undivided
50% interest to joint-venture partners in three Toronto properties.
Allied's value-creation activity accelerated in 2012, with the acquisition of
redevelopment projects in Calgary and Montreal and the advancement of four urban
intensification opportunities in Toronto. Allied also established two new and
promising avenues of growth. One was the expansion of its telecom and IT
facilities through the long-term lease of space at 250 Front Street West in
Toronto. The other was the initiation of four urban intensification joint
ventures in Toronto.
Allied's balance sheet continued to grow and strengthen in 2012. At year-end,
the fair value of its assets was nearly $3 billion, up 41% from the beginning of
the year through a combination of acquisitions ($517 million) and value
appreciation ($369 million), offset somewhat by dispositions ($32 million). Its
weighted-average mortgage term was five years, its weighted-average interest
rate 5.0%, its total debt as a percentage of fair value 36.4% and its net debt
as a multiple of its annualized Q4 EBITDA 6.3:1 This was reflected in an
interest-coverage ratio of 4.2:1 in the fourth quarter.
"We expect our FFO and AFFO per unit to continue to grow, and we expect the
demand for space across our target markets to remain strong," said Mr. Emory,
summarizing Allied's outlook for 2013. "We intend to continue the consolidation
of ownership in our target markets, but with a more exclusive focus than last
year on the acquisition of stabilized properties. We also intend to focus on the
execution of our value-creation opportunities as part of our ongoing effort to
build a value-creation pipeline that in time will make a recurring, annual
contribution to the growth of our business."
FFO and AFFO are not financial measures defined by International Financial
Reporting Standards ("IFRS"). Please see Allied's MD&A for a description of
these measures and their reconciliation to net income and comprehensive income
under IFRS, as presented in Allied's consolidated financial statements for the
quarter and fiscal year ended December 31, 2012. These statements, together with
accompanying notes and MD&A, have been filed with SEDAR, www.sedar.com, and are
also available on Allied's web-site, www.alliedreit.com.
NOI is not a measure recognized under IFRS and does not have any standardized
meaning prescribed by IFRS. NOI is presented in this press release because
management of Allied believes that this non-IFRS measure is an important
financial performance indicator. NOI, as computed by Allied, may differ from
similar computations as reported by other similar organizations and,
accordingly, may not be comparable to NOI reported by such organizations.
This press release may contain forward-looking statements with respect to
Allied, its operations, strategy, financial performance and condition. These
statements generally can be identified by use of forward looking words such as
"may", "will", "expect", "estimate", "anticipate", intends", "believe" or
"continue" or the negative thereof or similar variations. Allied's actual
results and performance discussed herein could differ materially from those
expressed or implied by such statements. Such statements are qualified in their
entirety by the inherent risks and uncertainties surrounding future
expectations. Important factors that could cause actual results to differ
materially from expectations include, among other things, general economic and
market factors, competition, changes in government regulations and the factors
described under "Risk Factors" in the Allied's Annual Information Form which is
available at www. sedar.com. The cautionary statements qualify all
forward-looking statements attributable to Allied and persons acting on its
behalf. Unless otherwise stated, all forward-looking statements speak only as of
the date of this press release, and Allied has no obligation to update such
statements.
Allied Properties REIT is a leading owner, manager and developer of urban office
environments that enrich experience and enhance profitability for business
tenants operating in Canada's major cities. Its objectives are to provide stable
and growing cash distributions to unitholders and to maximize unitholder value
through effective management and accretive portfolio growth.
FOR FURTHER INFORMATION PLEASE CONTACT:
Allied Properties REIT
Michael R. Emory
President & Chief Executive Officer
416.977.9002
memory@alliedreit.com
www.alliedreit.com
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