SmartCentres Real Estate Investment Trust (“SmartCentres”, the
“Trust” or the “REIT”) (TSX: SRU.UN) is pleased to report its
financial and operating results for the quarter ended
September 30, 2023.
“Building on a successful first half of the
year, we are pleased to report stronger performances in all areas
of the business for Q3,” said Mitchell Goldhar, CEO of
SmartCentres. “Our core retail portfolio has gone into a higher
gear and become more offensive, with even stronger numbers in our
centres anchored by Walmart, which drove an increase in net rental
income compared to the same quarter of last year. In-place and
committed occupancy has increased by 30 basis points from last
quarter to 98.5%, continuing our industry leadership. We expect to
continue delivering strong occupancy levels and solid rental income
for the balance of the year.”
“In addition to the strength of our core
recurring retail income, our mixed-use development program also
continues to grow and deliver strong results. We are delighted with
the progress we have made on our Transit City 4 & 5 condominium
projects at the Vaughan Metropolitan Centre,” said Mr. Goldhar.
“During the quarter, we closed on an additional 274 units in
Transit City 4 & 5, and the remaining 106 units at these two
towers are expected to close by the end of this year.”
“We also commenced construction or initial
siteworks on four new mixed-use development projects during the
quarter. These include the sold-out, 40-storey ArtWalk condominium
project at the Vaughan Metropolitan Centre, a new 200,000 square
foot flagship Canadian Tire store in the Leaside neighbourhood in
Toronto, and two additional multi-level self-storage projects. We
are confident that each of these projects will deliver strong
financial results to the Trust in the years to come.”
2023 Third Quarter
Highlights
Operational
- Shopping centre
leasing activity continued to strengthen from Q2 2023, with an
industry-leading in-place and committed occupancy rate of 98.5% as
at September 30, 2023 (June 30, 2023 – 98.2%).
- Executed new
leases of 182,682 square feet during the quarter.
- Renewed 84.2% of
the 5,083,274 square feet of current year expiries, with average
growth in renewed rents of 8.4% (excluding anchors).
Development
- Occupancy and
condo closings for Transit City 4 and 5 continued with an
additional 274 units closed during the third quarter generating
$6.9 million of FFO(1). The remaining 106 units are expected to
take place in Q4 2023.
- The Millway, a
458 rental unit apartments project is nearing completion. Leasing
continues to benefit from strong demand and is ahead of budget. As
of the end of the quarter, 67% of the 331 completed units were
leased. The remaining units are expected to be completed and ready
for lease by the end of 2023.
- Siteworks at
ArtWalk condominium Phase 1 commenced in September 2023, with all
320 released units sold out and the remaining units expected to be
released for sale in Q4 2023.
- The second phase
of the purpose-built residential rental project in Laval,
comprising 211 units, opened on July 1, 2023, and reached 82%
occupancy at the end of Q3 2023. Occupancy for the first phase has
reached 99%.
- The Trust,
together with its partner, Penguin, has also commenced preliminary
siteworks for the 224,000 square foot retail project on Laird Drive
in Toronto, that is expected to feature a flagship 200,000 square
foot Canadian Tire store together with 24,000 square feet of
additional retail space. Canadian Tire is expected to take
possession in early 2026.
- The Trust obtained municipal
approvals for two self-storage facilities in Stoney Creek and in
Toronto (Gilbert Ave), and commenced construction.
Financial
- Same Properties
NOI(1) increased by $2.6 million or 1.9% in Q3 2023 as compared to
the same period in 2022, which was attributable to lease-up
activity and higher rental renewal rates.
- Net rental
income for the three months ended September 30, 2023 increased
by $2.9 million or 2.3% as compared to the three months ended
September 30, 2022, primarily due to lease-up activity, higher
rental renewal rates and percentage rents.
- Net income and
comprehensive income per Unit was $1.19 (three months ended
September 30, 2022 – $0.02). The increase was primarily due to
a valuation adjustment in the prior year.
- FFO per Unit(1)
was $0.55 for the three months ended September 30, 2023
compared to $0.49 for the three months ended September 30,
2022. The increase was mainly attributable to higher profits from
condo closings at Transit City 4 & 5 and higher rental income,
partially offset by higher interest costs and a non-cash loss on
the total return swap.
- The Payout Ratio
to AFFO(1) for the three months ended September 30, 2023 was
96.1%, as compared to 101.6% for the same period ended
September 30, 2022, and 87.8% payout ratio to cash flows
provided by operating activities for the three months ended
September 30, 2023.
(1) |
Represents a non-GAAP measure. The Trust’s method of calculating
non-GAAP measures may differ from other reporting issuers’ methods
and, accordingly, may not be comparable. For additional
information, please see “Non-GAAP Measures” in this Press
Release. |
Selected Consolidated Operational,
Mixed-Use Development and Financial Information
(in thousands of
dollars, except per Unit and other non-financial data) |
|
|
|
As
at |
|
|
September 30, 2023 |
|
|
December 31, 2022 |
|
|
September 30, 2022 |
|
Portfolio Information (Number of properties) |
|
|
|
|
Retail properties |
|
|
155 |
|
|
155 |
|
|
155 |
|
Office properties |
|
|
4 |
|
|
4 |
|
|
4 |
|
Self-storage properties |
|
|
9 |
|
|
6 |
|
|
6 |
|
Residential properties |
|
|
2 |
|
|
2 |
|
|
2 |
|
Industrial properties |
|
|
1 |
|
|
0 |
|
|
0 |
|
Properties under development |
|
|
20 |
|
|
19 |
|
|
19 |
|
Total number of properties with an ownership interest |
|
|
191 |
|
|
186 |
|
|
186 |
|
Leasing and Operational
Information(1) |
|
|
|
|
Gross leasable
retail and office area (in thousands of sq. ft.) |
|
35,033 |
|
|
34,750 |
|
|
34,685 |
|
In-place and committed
occupancy rate |
|
|
98.5% |
|
|
98.0% |
|
|
98.1% |
|
Average lease term to maturity
(in years) |
|
|
4.3 |
|
|
4.2 |
|
|
4.3 |
|
Net
annualized retail rental rate excluding Anchors (per occupied sq.
ft.) |
$22.43 |
|
$22.20 |
|
$22.40 |
|
Mixed-Use Development
Information |
|
|
|
|
Trust’s
share of future development area (in thousands of sq. ft.) |
|
40,325 |
|
|
41,200 |
|
|
39,500 |
|
Financial
Information |
|
|
|
|
Investment properties(2) |
|
|
10,433,183 |
|
|
10,250,392 |
|
|
10,211,384 |
|
Total unencumbered
assets(3) |
|
|
9,067,121 |
|
|
8,415,900 |
|
|
8,383,900 |
|
Debt to Aggregate
Assets(3)(4)(5) |
|
|
43.0% |
|
|
43.6% |
|
|
43.7% |
|
Adjusted Debt to Adjusted
EBITDA(3)(4)(5) |
|
|
9.7X |
|
|
10.3X |
|
|
10.0X |
|
Weighted average interest
rate(3)(4) |
|
|
4.13% |
|
|
3.86% |
|
|
3.67% |
|
Weighted average term of debt
(in years) |
|
|
3.7 |
|
|
4.0 |
|
|
4.2 |
|
Interest coverage
ratio(3)(4) |
|
|
2.8X |
|
|
3.1X |
|
|
3.3X |
|
Weighted average number of units outstanding – diluted(7) |
|
|
180,069,508 |
|
|
179,696,944 |
|
|
179,678,009 |
|
|
Three Months Ended September 30 |
|
|
Nine Months Ended September 30 |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
Financial Information |
|
|
|
|
Rentals from investment
properties and other(2) |
206,016 |
|
|
196,962 |
|
|
623,560 |
|
|
598,375 |
|
Net income and comprehensive
income(2) |
215,175 |
|
|
3,548 |
|
|
495,938 |
|
|
535,655 |
|
FFO(3)(4)(6) |
98,405 |
|
|
88,403 |
|
|
294,072 |
|
|
269,102 |
|
AFFO(3)(4)(6) |
85,788 |
|
|
81,093 |
|
|
262,237 |
|
|
248,230 |
|
Cash flows provided by
operating activities(2) |
93,855 |
|
|
97,011 |
|
|
237,108 |
|
|
243,800 |
|
Net rental income and
other(2) |
130,402 |
|
|
127,481 |
|
|
385,110 |
|
|
373,453 |
|
NOI(3)(4) |
143,834 |
|
|
130,986 |
|
|
424,407 |
|
|
384,888 |
|
Change in net rental income
and other(3) |
2.3% |
|
|
2.9% |
|
|
3.1% |
|
|
3.8% |
|
Change in SPNOI(3) |
1.9% |
|
|
3.1% |
|
|
3.2% |
|
|
3.3% |
|
Net income and comprehensive
income per Unit(2) |
$1.21/$1.19 |
|
|
$0.02/$0.02 |
|
|
$2.78/$2.76 |
|
|
$3.01/$2.98 |
|
FFO per Unit(3)(4)(6) |
$0.55/$0.55 |
|
|
$0.50/$0.49 |
|
|
$1.65/$1.64 |
|
|
$1.51/$1.50 |
|
FFO with adjustments per
Unit(3)(4) |
$0.54/$0.54 |
|
|
$0.53/$0.52 |
|
|
$1.60/$1.59 |
|
|
$1.57/$1.56 |
|
AFFO per Unit(3)(4)(6) |
$0.48/$0.48 |
|
|
$0.46/$0.45 |
|
|
$1.47/$1.46 |
|
|
$1.39/$1.38 |
|
AFFO with adjustments per
Unit(3)(4) |
$0.47/$0.47 |
|
|
$0.48/$0.48 |
|
|
$1.42/$1.41 |
|
|
$1.45/$1.44 |
|
Payout Ratio to
AFFO(3)(4)(6) |
96.1% |
|
|
101.6% |
|
|
94.3% |
|
|
99.6% |
|
Payout Ratio to AFFO with
adjustments(3)(4) |
97.7% |
|
|
95.6% |
|
|
97.6% |
|
|
95.6% |
|
Payout
Ratio to cash flows provided by operating activities |
87.8% |
|
|
84.9% |
|
|
104.3% |
|
|
101.4% |
|
(1) |
Excluding residential and self-storage area. |
(2) |
Represents a Generally Accepted Accounting Principles (“GAAP”)
measure. |
(3) |
Represents a non-GAAP measure. The Trust’s method of calculating
non-GAAP measures may differ from other reporting issuers’ methods
and, accordingly, may not be comparable. For additional
information, please see “Non-GAAP Measures” in this Press
Release. |
(4) |
Includes the Trust’s proportionate share of equity accounted
investments. |
(5) |
As at September 30, 2023, cash-on-hand of $45.3 million was
excluded for the purposes of calculating the applicable ratios
(December 31, 2022 – $33.4 million, September 30,
2022 – $150.0 million). |
(6) |
The calculation of the Trust’s FFO and AFFO and related payout
ratios, including comparative amounts, are financial metrics that
were determined based on the REALpac White Paper on FFO and AFFO
issued in January 2022 (“REALpac White Paper”). Comparison with
other reporting issuers may not be appropriate. The payout ratio to
AFFO is calculated as declared distributions divided by AFFO. |
(7) |
The diluted weighted average includes the vested portion of the
deferred units issued pursuant to the deferred unit plan. |
Development and Intensification
SummaryThe following table provides additional details on
the Trust’s 13 development initiatives that are currently under
construction or where initial siteworks have began (in order of
estimated initial occupancy/closing date):
Projects under construction (Location/Project
Name) |
Type |
Trust’s Share (%) |
Actual / estimated initial occupancy / closing
date |
% of completion |
GFA(2) (sq.
ft.) |
No. of units |
|
|
|
|
|
|
|
Mixed-use
Developments |
|
|
|
|
|
|
Vaughan / The Millway |
Apartment |
50 |
Q1 2023 |
94 |
% |
— |
458 |
Vaughan / Transit City 4 |
Condo |
25 |
Q1 2023 |
96 |
% |
— |
498 |
Vaughan / Transit City 5 |
Q2 2023 |
96 |
% |
528 |
Pickering (Seaton Lands) |
Industrial |
100 |
Q2 2023 |
90 |
% |
229,000 |
— |
Markham East / Boxgrove |
Self-storage |
50 |
Q1 2024 |
63 |
% |
133,000 |
910 |
Whitby |
Self-storage |
50 |
Q1 2024 |
59 |
% |
126,000 |
811 |
Vaughan NW |
Townhouse |
50 |
Q3/Q4 2024 |
34 |
% |
— |
174 |
Toronto (Gilbert Ave.) |
Self-storage |
50 |
Q4 2024 |
41 |
% |
176,000 |
1,469 |
Stoney Creek |
Self-storage |
50 |
Q4 2024 |
16 |
% |
138,000 |
973 |
Ottawa SW (2) |
Retirement Residence |
50 |
Q2 2025 |
25 |
% |
— |
402 |
Ottawa SW (2) |
Seniors’ Apartments |
Vaughan / ArtWalk (40 Storeys) |
Condo |
50 |
Q2 2027 |
12 |
% |
— |
373 |
Retail Development |
|
|
|
|
|
|
Toronto (Laird) |
Retail |
50 |
Q1 2026 |
19 |
% |
224,000 |
— |
(1) |
GFA represents
Gross Floor Area. |
(2) |
Figure represents capital spend of both retirement residence
and seniors’ apartments projects. |
Reconciliations of Non-GAAP
MeasuresThe following tables reconcile the non-GAAP
measures to the most comparable GAAP measures for the three and
nine months ended September 30, 2023 and the comparable
periods in 2022. Such measures do not have a standardized meaning
prescribed by IFRS and may not be comparable to similar measures
disclosed by other issuers.
Net Operating Income (including the
Trust’s Interests in Equity Accounted
Investments)Quarterly Comparison to Prior
Year
(in
thousands of dollars) |
Three Months Ended September 30, 2023 |
Three Months Ended September 30, 2022 |
|
GAAP Basis |
Proportionate Share Reconciliation |
Total Proportionate Share(1) |
GAAP Basis |
Proportionate Share Reconciliation |
Total Proportionate Share(1) |
Net rental income and other |
|
|
|
|
|
|
Rentals from investment properties and other |
$206,016 |
|
$9,580 |
|
$215,596 |
|
$196,962 |
|
$7,286 |
|
$204,248 |
|
Property operating costs and other |
|
(74,551 |
) |
|
(4,397 |
) |
|
(78,948 |
) |
|
(69,451 |
) |
|
(3,567 |
) |
|
(73,018 |
) |
|
$131,465 |
|
$5,183 |
|
$136,648 |
|
$127,511 |
|
$3,719 |
|
$131,230 |
|
Residential sales revenue and other(2) |
|
— |
|
|
37,934 |
|
|
37,934 |
|
|
— |
|
|
7 |
|
|
7 |
|
Residential cost of sales and other |
|
(1,063 |
) |
|
(29,685 |
) |
|
(30,748 |
) |
|
(30 |
) |
|
(221 |
) |
|
(251 |
) |
|
$(1,063 |
) |
$8,249 |
|
$7,186 |
|
$(30 |
) |
$(214 |
) |
$(244 |
) |
NOI |
$130,402 |
|
$13,432 |
|
$143,834 |
|
$127,481 |
|
$3,505 |
|
$130,986 |
|
(1) |
This column contains non-GAAP measures because it includes figures
that are recorded in equity accounted investments. The Trust’s
method of calculating non-GAAP measures may differ from other
reporting issuers’ methods and, accordingly, may not be comparable.
For additional information, please see “Non-GAAP Measures” in this
Press Release. |
(2) |
Includes additional partnership profit and other revenues. |
Year-to-Date Comparison to Prior
Year
(in
thousands of dollars) |
Nine Months Ended September 30, 2023 |
Nine Months Ended September 30, 2022 |
|
GAAP Basis |
Proportionate Share Reconciliation |
Total Proportionate Share(1) |
GAAP Basis |
Proportionate Share Reconciliation |
Total Proportionate Share(1) |
Net rental income and other |
|
|
|
|
|
|
Rentals from investment properties and other |
$623,560 |
|
$26,105 |
|
$649,665 |
|
$598,375 |
|
$20,202 |
|
$618,577 |
|
Property operating costs and other |
|
(235,074 |
) |
|
(12,680 |
) |
|
(247,754 |
) |
|
(224,497 |
) |
|
(9,688 |
) |
|
(234,185 |
) |
|
$388,486 |
|
$13,425 |
|
$401,911 |
|
$373,878 |
|
$10,514 |
|
$384,392 |
|
Residential sales revenue and other(2) |
|
— |
|
|
125,401 |
|
|
125,401 |
|
|
— |
|
|
4,524 |
|
|
4,524 |
|
Residential cost of sales and other |
|
(3,376 |
) |
|
(99,529 |
) |
|
(102,905 |
) |
|
(425 |
) |
|
(3,603 |
) |
|
(4,028 |
) |
|
$(3,376 |
) |
$25,872 |
|
$22,496 |
|
$(425 |
) |
$921 |
|
$496 |
|
NOI |
$385,110 |
|
$39,297 |
|
$424,407 |
|
$373,453 |
|
$11,435 |
|
$384,888 |
|
(1) |
This column contains non-GAAP measures because it includes figures
that are recorded in equity accounted investments. The Trust’s
method of calculating non-GAAP measures may differ from other
reporting issuers’ methods and, accordingly, may not be comparable.
For additional information, please see “Non-GAAP Measures” in this
Press Release. |
(2) |
Includes additional partnership profit and other revenues. |
Same Properties NOI
|
Three Months Ended September 30 |
Nine Months Ended September 30 |
(in thousands of dollars) |
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
Net rental income and other |
$130,402 |
|
$127,481 |
|
$385,110 |
|
$373,453 |
|
NOI
from equity accounted investments(1) |
|
13,432 |
|
|
3,505 |
|
|
39,297 |
|
|
11,435 |
|
Total portfolio NOI before adjustments(1) |
$143,834 |
|
$130,986 |
|
$424,407 |
|
$384,888 |
|
|
|
|
|
|
Adjustments: |
|
|
|
|
Lease termination |
|
(230 |
) |
|
12 |
|
|
(691 |
) |
|
(133 |
) |
Net profit on condo and townhome closings |
|
(7,186 |
) |
|
244 |
|
|
(22,496 |
) |
|
(496 |
) |
Non-recurring items and other adjustments(2) |
|
1,814 |
|
|
3,073 |
|
|
5,324 |
|
|
6,143 |
|
Total portfolio NOI after adjustments(1) |
$138,232 |
|
$134,315 |
|
$406,544 |
|
$390,402 |
|
|
|
|
|
|
NOI
sourced from: |
|
|
|
|
Acquisitions |
|
(576 |
) |
|
27 |
|
|
(5,537 |
) |
|
(3,857 |
) |
Dispositions |
|
— |
|
|
1 |
|
|
2 |
|
|
(12 |
) |
Earnouts and Developments |
|
(970 |
) |
|
(226 |
) |
|
(3,017 |
) |
|
(818 |
) |
Same Properties NOI(1) |
$136,686 |
|
$134,117 |
|
$397,992 |
|
$385,715 |
|
(1) |
Represents a non-GAAP measure. The Trust’s method of calculating
non-GAAP measures may differ from other reporting issuers’ methods
and, accordingly, may not be comparable. For additional
information, please see “Non-GAAP Measures” in this Press
Release. |
(2) |
Includes non-recurring items such as one-time adjustments relating
to vaccination centre costs, royalties, straight-line rent and
amortization of tenant incentives. |
Reconciliation of FFO
|
Three Months Ended September 30 |
Nine Months Ended September 30 |
(in thousands of dollars) |
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
Net income and comprehensive income |
$215,175 |
|
$3,548 |
|
$495,938 |
|
$535,655 |
|
Add (deduct): |
|
|
|
|
Fair value adjustment on investment properties and financial
instruments(1) |
|
(67,063 |
) |
|
80,790 |
|
|
(157,989 |
) |
|
(279,703 |
) |
Loss on derivative – TRS |
|
(5,482 |
) |
|
(4,900 |
) |
|
(13,519 |
) |
|
(11,138 |
) |
Loss on sale of investment properties |
|
— |
|
|
112 |
|
|
23 |
|
|
216 |
|
Amortization of intangible assets and tenant improvement
allowance |
|
2,085 |
|
|
2,294 |
|
|
6,730 |
|
|
6,197 |
|
Distributions on Units classified as liabilities and vested
deferred units |
|
2,172 |
|
|
1,801 |
|
|
6,321 |
|
|
5,333 |
|
Adjustment on debt modification |
|
— |
|
|
— |
|
|
— |
|
|
(1,960 |
) |
Salaries and related costs attributed to leasing activities(2) |
|
1,776 |
|
|
2,216 |
|
|
5,810 |
|
|
5,994 |
|
Acquisition-related costs |
|
— |
|
|
(25 |
) |
|
— |
|
|
298 |
|
Adjustments relating to equity accounted investments(3) |
|
(50,258 |
) |
|
2,567 |
|
|
(49,242 |
) |
|
8,210 |
|
FFO(4) |
$98,405 |
|
$88,403 |
|
$294,072 |
|
$269,102 |
|
Add (deduct) non-recurring
adjustments: |
|
|
|
|
Loss on derivative – TRS |
|
5,482 |
|
|
4,900 |
|
|
13,519 |
|
|
11,138 |
|
FFO sourced from condominium and townhome closings |
|
(6,918 |
) |
|
216 |
|
|
(21,354 |
) |
|
(860 |
) |
Transactional FFO – loss on sale of land to co-owner |
|
— |
|
|
— |
|
|
(1,008 |
) |
|
— |
|
FFO with adjustments(4) |
$96,969 |
|
$93,519 |
|
$285,229 |
|
$279,380 |
|
(1) |
Includes fair value adjustments on investment properties and
financial instruments. Fair value adjustment on investment
properties is described in “Investment Properties” in the Trust’s
MD&A. Fair value adjustment on financial instruments comprises
the following financial instruments: units classified as
liabilities, Deferred Unit Plan (“DUP”), Equity Incentive Plan
(“EIP”), TRS, interest rate swap agreements, and LTIP recorded in
the same period in 2022. The significant assumptions made in
determining the fair value are more thoroughly described in the
Trust’s unaudited interim condensed consolidated financial
statements for the three and nine months ended September 30,
2023. For details, please see discussion in “Results of Operations”
in the Trust’s MD&A. |
(2) |
Salaries and related costs attributed to leasing activities of $5.8
million were incurred in the nine months ended September 30,
2023 (nine months ended September 30, 2022 – $6.0 million) and
were eligible to be added back to FFO based on the definition of
FFO, in the REALpac White Paper, which provided for an adjustment
to incremental leasing expenses for the cost of salaried staff.
This adjustment to FFO results in more comparability between
Canadian publicly traded real estate entities that expensed their
internal leasing departments and those that capitalized external
leasing expenses. |
(3) |
Includes tenant improvement amortization, indirect interest with
respect to the development portion, fair value adjustment on
investment properties, loss (gain) on sale of investment
properties, and adjustment for supplemental costs. |
(4) |
Represents a non-GAAP measure. The Trust’s method of calculating
non-GAAP measures may differ from other reporting issuers’ methods
and, accordingly, may not be comparable. For additional
information, please see “Non-GAAP Measures” in this Press
Release. |
Reconciliation of AFFO
|
Three Months Ended September 30 |
Nine Months Ended September 30 |
(in thousands of dollars) |
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
FFO(1) |
$98,405 |
|
$88,403 |
|
$294,072 |
|
$269,102 |
|
Add (Deduct): |
|
|
|
|
Straight-line of rents |
|
(410 |
) |
|
(24 |
) |
|
(211 |
) |
|
(403 |
) |
Adjusted salaries and related costs attributed to leasing |
|
(1,776 |
) |
|
(2,216 |
) |
|
(5,810 |
) |
|
(5,994 |
) |
Actual sustaining capital expenditures, leasing commissions, and
tenant improvements |
|
(10,431 |
) |
|
(5,070 |
) |
|
(25,814 |
) |
|
(14,475 |
) |
AFFO(1) |
$85,788 |
|
$81,093 |
|
$262,237 |
|
$248,230 |
|
Add (deduct) non-recurring
adjustments: |
|
|
|
|
Loss on derivative – TRS |
|
5,482 |
|
|
4,900 |
|
|
13,519 |
|
|
11,138 |
|
FFO sourced from condominium
and townhome closings |
|
(6,918 |
) |
|
216 |
|
|
(21,354 |
) |
|
(860 |
) |
Transactional FFO – loss on sale of land to co-owner |
|
— |
|
|
— |
|
|
(1,008 |
) |
|
— |
|
AFFO with adjustments(1) |
$84,352 |
|
$86,209 |
|
$253,394 |
|
$258,508 |
|
(1) |
Represents a non-GAAP measure. The Trust’s method of calculating
non-GAAP measures may differ from other reporting issuers’ methods
and, accordingly, may not be comparable. For additional
information, please see “Non-GAAP Measures” in this Press
Release. |
Adjusted EBITDAThe following
table presents a reconciliation of net income and comprehensive
income to Adjusted EBITDA:
|
Rolling 12 Months Ended |
(in
thousands of dollars) |
September 30, 2023 |
September 30, 2022 |
Net income and comprehensive income |
$596,309 |
|
$1,187,736 |
|
Add
(deduct) the following items: |
|
|
Net interest expense |
|
151,810 |
|
|
137,054 |
|
Amortization of equipment,
intangible assets and tenant improvements |
|
11,367 |
|
|
10,907 |
|
Fair value adjustments on
investment properties and financial instruments |
|
(228,795 |
) |
|
(840,441 |
) |
Fair value adjustment on
TRS |
|
(7,298 |
) |
|
(6,958 |
) |
Adjustment for supplemental
costs |
|
5,212 |
|
|
5,035 |
|
(Gain) loss on sale of
investment properties |
|
(509 |
) |
|
521 |
|
Gain on sale of land to
co-owners (Transactional FFO) |
|
— |
|
|
336 |
|
Acquisition-related costs |
|
— |
|
|
3,089 |
|
Adjusted EBITDA(1) |
$528,096 |
|
$497,279 |
|
(1) |
Represents a non-GAAP measure. The Trust’s method of calculating
non-GAAP measures may differ from other reporting issuers’ methods
and, accordingly, may not be comparable. For additional
information, please see “Non-GAAP Measures” in this Press
Release. |
Non-GAAP Measures
The non-GAAP measures used in this Press
Release, including but not limited to, AFFO, AFFO with adjustments,
AFFO per Unit, AFFO with adjustments per Unit, Payout Ratio to
AFFO, Payout Ratio to AFFO with adjustments, Unencumbered Assets,
NOI, Debt to Aggregate Assets, Interest Coverage Ratio, Adjusted
Debt to Adjusted EBITDA, Unsecured/Secured Debt Ratio, FFO, FFO
with adjustments, FFO per Unit, FFO with adjustments per Unit, Same
Properties NOI, Debt to Gross Book Value, Weighted Average Interest
Rate, Transactional FFO, and Total Proportionate Share, do not have
any standardized meaning prescribed by International Financial
Reporting Standards (“IFRS”) and are therefore unlikely to be
comparable to similar measures presented by other issuers.
Additional information regarding these non-GAAP measures is
available in the Management’s Discussion and Analysis of the Trust
for the three and nine months ended September 30, 2023, dated
November 8, 2023 (the “MD&A), and is incorporated by
reference. The information is found in the “Presentation of Certain
Terms Including Non-GAAP Measures” and “Non-GAAP Measures” sections
of the MD&A, which is available on SEDAR+ at www.sedarplus.ca.
Reconciliations of non-GAAP financial measures to the most directly
comparable IFRS measures are found in “Reconciliations of Non-GAAP
Measures” of this Press Release.
Full reports of the financial results of the
Trust for the three and nine months ended September 30, 2023
are outlined in the unaudited interim condensed consolidated
financial statements and the related MD&A of the Trust for the
three and nine months ended September 30, 2023, which are
available on SEDAR+ at www.sedarplus.ca.
Conference Call
Management will hold a conference call on
Thursday, November 9, 2023 at 8:00 a.m. (ET).
Interested parties are invited to access the
call by dialing 1-888-440-5675 and then keying in the participant
access code 2010586#.
A recording of this call will be made available
Thursday, November 9, 2023 through to Thursday,
November 16, 2023. To access the recording, please call
1-800-770-2030 and enter the conference access code 2010586#.
About SmartCentres
SmartCentres is one of Canada’s largest fully
integrated REITs, with a best-in-class and growing mixed-use
portfolio featuring 191 strategically located properties in
communities across the country. SmartCentres has approximately
$12.0 billion in assets and owns 35.0 million square feet of
income producing value-oriented retail and first-class office
properties with 98.5% in place and committed occupancy, on 3,500
acres of owned land across Canada.
Cautionary Statements Regarding
Forward-looking Statements
Certain statements in this Press Release are
"forward-looking statements" that reflect management's expectations
regarding the Trust's future growth, results of operations,
performance and business prospects and opportunities. More
specifically, certain statements including, but not limited to,
statements related to SmartCentres’ expectations relating to cash
collections, SmartCentres’ expected or planned development plans
and joint venture projects, including the described type, scope,
costs and other financial metrics and the expected timing of
construction and condominium closings and statements that contain
words such as "could", "should", "can", "anticipate", "expect",
"believe", "will", "may" and similar expressions and statements
relating to matters that are not historical facts, constitute
"forward-looking statements". These forward-looking statements are
presented for the purpose of assisting the Trust's Unitholders and
financial analysts in understanding the Trust's operating
environment and may not be appropriate for other purposes. Such
forward-looking statements reflect management's current beliefs and
are based on information currently available to management.
However, such forward-looking statements involve
significant risks and uncertainties. A number of factors could
cause actual results to differ materially from the results
discussed in the forward-looking statements, including risks
associated with potential acquisitions not being completed or not
being completed on the contemplated terms, public health crises,
real property ownership and development, debt and equity financing
for development, interest and financing costs, construction and
development risks, and the ability to obtain commercial and
municipal consents for development. These risks and others are more
fully discussed under the heading “Risks and Uncertainties” and
elsewhere in SmartCentres’ most recent Management’s Discussion and
Analysis, as well as under the heading “Risk Factors” in
SmartCentres’ most recent annual information form. Although the
forward-looking statements contained in this Press Release are
based on what management believes to be reasonable assumptions,
SmartCentres cannot assure investors that actual results will be
consistent with these forward-looking statements. The
forward-looking statements contained herein are expressly qualified
in their entirety by this cautionary statement. These
forward-looking statements are made as at the date of this Press
Release and SmartCentres assumes no obligation to update or revise
them to reflect new events or circumstances unless otherwise
required by applicable securities legislation.
Material factors or assumptions that were applied in drawing a
conclusion or making an estimate set out in the forward-looking
information may include, but are not limited to: a stable retail
environment; a continuing trend toward land use intensification,
including residential development in urban markets and continued
growth along transportation nodes; access to equity and debt
capital markets to fund, at acceptable costs, future capital
requirements and to enable our refinancing of debts as they mature;
that requisite consents for development will be obtained in the
ordinary course, construction and permitting costs consistent with
the past year and recent inflation trends.
Contact
For information, visit www.smartcentres.com or please
contact:
Mitchell
Goldhar |
Peter
Slan |
Executive Chairman and CEO |
Chief Financial Officer |
SmartCentres |
SmartCentres |
(905) 326-6400 ext. 7674 |
(905) 326-6400 ext. 7571 |
mgoldhar@smartcentres.com |
pslan@smartcentres.com |
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