Homburg Invest Inc. announces second quarter 2009 results
(Thomson Reuters ONE) - Property revenue and net operating income continue to grow strongly Shares issued: Class A - 16,618,819 Class B - 3,148,538Halifax, Nova Scotia, August 7, 2009 (TSX: HII.A & HII.B and AEX:HII) - Homburg Invest Inc. ("Homburg Invest" or the "Company") announcedtoday its financial results for the second quarter ending June 30,2009, prepared under both Canadian Generally Accepted AccountingPrinciples ("GAAP") and International Financial Reporting Standards("IFRS").IFRS Highlights:(Three and six months ended June 30, 2009) * Property revenue increased 9.6% to $84.7 million compared to $77.3 million for the same quarter last year. * Property net operating income note ("NOI") for the second quarter was $58.7 million, a 3.0% increase over $57.0 million net operating income in the same quarter last year. * Funds from operations note ("FFO"), a non-IFRS measure widely used to evaluate real estate performance, was $3.5 million for the second quarter, compared to $25.8 million for the same quarter last year. This $22.3 million reduction in FFO results from the $24.3 million reduction in profit from the development pipeline. Factoring this out, FFO increased by $2.0 million quarter over quarter. * The Company recorded a $50.1 million non-cash mark-to-market write-down of its investment properties for the three months ended June 30, 2009, as required under IFRS. Under IFRS, the investment properties must be carried at fair value. In the current economic environment, property values are decreasing despite stable cash flows as the result of increasing capitalization rates. GAAP, the standard which all Canadian public real estate entities report under, currently does not adjust to fair value, but rather does an impairment test based on non-discounted cash flows. The Company had no impairment under GAAP. * Shareholders' equity increased from $606.8 million at December 31, 2008 to $609.3 million at June 30, 2009. * Net asset value per share note at June 30, 2009, is $29.31.GAAP Highlights:(Three and six months ended June 30, 2009) * Property revenue increased 7% to $82.2 million compared to the second quarter ended June 30, 2008. For six months, property revenue increased 7.3% to $162.3 million. * Total revenues for the second quarter were $112.1 million compared to $125.6 million in the same quarter last year. The decrease in total revenues is mainly due to fewer sales of properties developed for resale in the Canadian market. * Property net operating income increased 0.5% in the second quarter to $56.9 million. * Funds from operations, a non-GAAP measure widely used by investors to evaluate real estate performance, were $4.8 million compared to $28.5 million in the second quarter last year. This $23.7 million reduction is the result of $23.9 less profit from the development pipeline in the second quarter of 2009. The basic underlying operations of the Company therefore generated stable FFO. * Shareholders' equity increased from $513.7 million at December 31, 2008, to $540.7 million at June 30, 2009."Homburg Invest's core investment properties in each of ourgeographical markets around the world continued to deliver solidreturns. Property revenues are up in all geographical markets. Netoperating income from our investment properties is also up in mostgeographical markets" said Richard Homburg, Chairman and ChiefExecutive Officer of Homburg Invest. "As should be expected indifficult economic times, our property development business hasslowed and sales of properties held for development were less robustthan this time last year. Fewer property sales is the principlesource of the decline in earnings and funds from operations, and doesnot reflect the underlying strength of our income-generatinginvestment property business."Table 1 - Property Revenues and Net Operating Income by GeographicalSegment(IFRS: thousands of CDN$, six months ended June 30) 2009 2008 % ChangeGermany Property Revenues 47.3 40.4 Net Operating income 44.3 39.8The Netherlands Property Revenues 23.0 22.2 Net Operating income 20.1 20.1The Baltics Property Revenues 11.4 9.0 Net Operating income 8.1 6.7Canada Property Revenues 74.0 72.4 Net Operating income 36.8 39.7United States Property Revenues 9.7 8.1 Net Operating income 6.7 5.9Total* Property Revenues 165.4 152.1 8.7% Net Operating income 116.0 112.2 3.3%"We have begun the process of reducing our debt and strengtheningHomburg Invest's balance sheet," Mr. Homburg continued. "As realestate and financial markets improve, we want to be in a strongposition to take advantage of new opportunities. Strengthening ourbalance sheet is an increasingly important element of our growthstrategy as we come out of the recession and liquidity crisis."Additional financial information is included at the bottom of thisnews release.About Homburg InvestHomburg Invest, with its head office in Halifax, Nova Scotia, ownsand develops a diversified portfolio of quality real estate includingoffice, retail, industrial and residential apartment and townhouseproperties throughout Canada, the United States and Europe. -30-For further information, please contact:Mr. Richard Homburg,Chairman and CEOHomburg Invest Inc.902-468-3395orJ. Richard StollePresident and COOHomburg Invest Inc.31-20-573-3855This news release may contain statements which by their nature areforward looking and express the Company's beliefs, expectations orintentions regarding future performance, future events or trends.Forward looking statements are made by the Company in good faith,given management's expectations or intentions however, they aresubject to market conditions, acquisitions, occupancy rates, capitalrequirements, sources of funds, expense levels, operating performanceand other matters. Therefore, forward looking statements containassumptions which are subject to various factors including: unknownrisks and uncertainties: general economic conditions; local marketfactors; performance of other third parties; environmental concerns;and interest rates, any of which may cause actual results to differfrom the Company's good faith beliefs, expectations or intentionswhich have been expressed in or may be implied from this newsrelease. Therefore, forward looking statements are not guarantees offuture performance and are subject to known and unknown risks.Information and statements in this document, other than historicalinformation, should be considered forward-looking and reflectmanagement's current views of future events and financial performancethat involve a number of risks and uncertainties. Factors that couldcause actual results to differ materially include, but are notlimited to, the following: general economic conditions anddevelopments within the real estate industry, competition and themanagement of growth. The Toronto Stock Exchange has neither approvednor disapproved of the information contained herein.Additional Financial InformationThe complete six-month period financial results and MD&A can beviewed and downloaded from the corporation's web site atwww.homburginvest.com. Additional highlights for the second quartercan be found below.The Company prepares it's quarterly and annual statements under bothGAAP and IFRS. This reflects the Board's view that the IFRSpresentation most accurately reflects the financial position of areal estate investment company, while at the same time the Companycontinues to comply with requirements to produce its results underGAAP. This also reflects the Company's desire to provide itsshareholders with as much information as possible in today'senvironment of continuing concerns with respect to financialdisclosure in the marketplace.The most significant differences between the IFRS and GAAP statementsare that while the IFRS statements reflect the investment propertiesat fair value and are without depreciation charges, the GAAPstatements record the fixed assets at historical cost lessaccumulated depreciation. In addition, deferred charges relating toleasing fees have been recorded as an asset in the GAAP financialstatements and will be charged to expense over the period of therelated lease. These charges are written off in the period incurredunder IFRS.Financial Highlights - IFRSSecond quarter ended June 30, 2009(000's) Six Months Six Months Ended Ended June 30 June 30 2009 2008 IncreaseProperty revenue $165,357 $152,103 8.7%Property net operating $115,958 $112,212 3.3%incomeUnrealized valuation ($51,986) ($4,011)changeNet earnings (loss) ($22,658) $34,563Funds from operations $14,445 $56,084Funds from operations pershare - $0.73/$0.73 $2.86/$2.79 basic anddiluted [note] Three Months Three Months Ended Ended June 30 June 30 2009 2008 IncreaseProperty revenue $84,717 $77,290 9.6%Net operating income $58,690 $56,972 3.0%Unrealized valuation changes $(50,137) $(3,389)Net earnings (loss) $(28,202) $16,709Funds from operations $3,465 $25,828Funds from operations per share - basic and diluted $0.17/$0.17 $1.29/$1.26Financial Highlights - GAAPSecond quarter ended June 30, 2009(000's) Six Months Six Months Ended Ended June 30 June 30 2009 2008 IncreaseProperty revenue $162,264 $151,241 7.3%Net operating income $114,046 $111,350 2.4%Net earnings (loss) $(5,041) $18,543Funds from operations $18,085 $62,166Funds from operations pershare - $0.91/$0.91 $3.16/$3.09 basic and diluted Three Months Three Months Ended Ended June 30 June 30 2009 2008 IncreaseProperty revenue $82,232 $76,879 7.0%Net operating income $56,851 $56,561 0.5%Net earnings $3,321 $9,325Funds from operations $4,882 $28,532Funds from operations per share - basic and diluted $0.25/$0.24 $1.43/$1.39NoteNon GAAP and Non IFRS Financial Measures This news release includes measures widely acceptedwithin the real estate industry which are not defined under GAAP orIFRS. These measures include Funds from Operations, Funds fromOperations per share, Property Net Operating Income, and Net AssetValue per share. As these are not defined measures under GAAP orIFRS, other issuers' may have different calculations from those usedby the Company. The Company considers these amounts to be measures ofoperating and financial performance. a) Funds from Operations ("FFO") and FFO per share are presented by the Company as net income (loss) from continuing operations adjusted for depreciation and amortization, non-recurring stock based compensation, deferred and capital income taxes, unrealized and realized valuation changes, gain (loss) on financial instruments and derivatives, and unrealized foreign exchange gains(losses); divided by the weighted average number of shares outstanding b) Property Net operating income ("N0I") is presented by the Company as Property Revenue less Property Operating Expenses c) Net Asset Value per share is presented by the Company as Shareholders' Equity less the priority claim for the equity component of Homburg Capital Securities A divided by the number of shares outstanding at period end.http://hugin.info/138798/R/1333543/316135.pdfThis announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.
Datum: 07.08.2009 - 19:15 Uhr
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