TORONTO, July 29, 2020 (GLOBE NEWSWIRE) -- RioCan Real Estate Investment Trust (“RioCan" or the "Trust”)(TSX: REI.UN) announced today its financial results for the three and six months ended June 30, 2020 ("Second Quarter").
"This second quarter was undoubtedly the most challenging quarter ever for many of our tenants as non-essential businesses were mandated to close in mid-March. After several months of shutdown, businesses have started to re-open under various restrictions with some tenants in the GTA just getting to reopen. Against this unprecedented reality, RioCan showed its resiliency and remained committed to supporting our tenants with a view to the long-term. We exercised patience, approved deferrals where appropriate, participated in CECRA for all eligible tenants, and where necessary, managed a stern recovery process," said Edward Sonshine, CEO of RioCan. "This has enabled us to collect 86.8% of our quarterly rents including expected government funding and short term deferrals with credit worthy tenants. The collections will continue to improve as evidenced in July. Meanwhile, we have maintained good relationships with our tenants, with special focus on those with continuing expansion programs. With our major market presence, strong liquidity and our remarkable experienced people, we are well positioned to take advantage of any opportunities that arise from the economic setbacks caused by this pandemic."
|Three months ended June 30||Six months ended June 30|
|(in millions except percentages, square feet and per unit values)||2020||2019||2020||2019|
|Net income (loss)||$||(350.8||)||$||253.0||$||(247.9||)||$||447.5|
|Weighted average Units outstanding - diluted (in thousands)||317,721||304,636||317,717||304,829|
|FFO per unit – diluted (i)||$||0.35||$||0.48||$||0.80||$||0.94|
|Same property NOI (decline) growth - overall portfolio (i)||(10.8||)%||2.2||%||(4.3||)%||1.9||%|
|Six major markets - % of total annualized revenue (ii)||90.1||%||87.8||%||90.1||%||87.8||%|
|Greater Toronto Area - % of total annualized revenue (ii)||52.1||%||48.6||%||52.1||%||48.6||%|
|Occupancy - committed six major markets (ii)||96.8||%||97.8||%||96.8||%||97.8||%|
|Occupancy - committed (ii)||96.4||%||97.1||%||96.4||%||97.1||%|
|Blended leasing spread||5.8||%||11.3||%||5.7||%||11.0||%|
|Renewal leasing spread||4.6||%||10.9||%||5.0||%||9.4||%|
|Development completions - sq ft in thousands||4.0||269.0||137.0||361.0|
|Development expenditures (iii)||$||114.6||$||102.5||$||217.5||$||195.0|
|Properties under development and residential inventory as a percentage of consolidated gross book value of assets (maximum permitted: 15%) (ii) (iii)||10.7||%||8.0||%||10.7||%||8.0||%|
|Balance Sheet Strength Highlights|
|Debt to Adjusted EBITDA (i) (iv)||8.80x||7.92x||8.80x||7.92x|
|Ratio of total debt to total assets (i) (ii) (iv)||44.4||%||42.9||%||44.4||%||42.9||%|
|Unencumbered assets (i) (ii) (iv)||$||8,697||$||8,104||$||8,697||$||8,104|
|Unencumbered assets to unsecured debt (i) (ii) (iv)||221||%||225||%||221||%||225||%|
|i.||A Non-GAAP measurement. For definitions and the basis of presentation of RioCan's Non-GAAP measures, refer to the Non-GAAP Measures section in RioCan's Management's Discussion and Analysis (MD&A) for the three and six months ended June 30, 2020.|
|ii.||Information presented as at June 30 for the years then ended.|
|iii.||Includes costs incurred for various properties under development and for residential inventory in respective reporting periods.|
|iv.||At RioCan's proportionate share.|
|Cash collection (i)||73.3||%|
|CECRA government funding (ii)||5.8||%|
|Deferred rents with definitive payment schedule||7.7||%|
|Provision for rent abatements and bad debts||6.8||%|
|Remaining to be collected||6.4||%|
|i. April, May and June cash collections were 73%, 71% and 76%, respectively.|
|ii. Net of $4.2 million CECRA tenant over-payments for the quarter.|
FFO and Net Income
Same Property NOI - Commercial
Operations - Commercial
Operations - Residential
Conference Call and Webcast
Interested parties are invited to participate in a conference call with management on Wednesday, July 29, 2020 at 10:00 a.m. (ET). Participants will be required to identify themselves and the organization on whose behalf they are participating.
In order to participate, please dial 647-427-3230 or 1-877-486-4304. For those unable to participate in the live mode, a replay will be available at 1-855-859-2056, passcode 5081147#.
For a copy of the slides to be used for the conference call or, to access the simultaneous webcast, visit RioCan’s website at http://investor.riocan.com/investor-relations/events-and-presentations/ and click on the link for the webcast.
RioCan is one of Canada’s largest real estate investment trusts. RioCan owns, manages and develops retail-focused, increasingly mixed-use properties located in prime, high-density transit-oriented areas where Canadians want to shop, live and work. As at June 30, 2020, our portfolio is comprised of 221 properties with an aggregate net leasable area of approximately 38.6 million square feet (at RioCan's interest) including office, residential rental and 15 development properties. To learn more about us, please visit www.riocan.com.
Basis of Presentation and Non-GAAP Measures
All figures included in this News Release are expressed in Canadian dollars unless otherwise noted. RioCan’s unaudited interim condensed consolidated financial statements ("Condensed Consolidated Financial Statements") are prepared in accordance with International Financial Reporting Standards (IFRS). Financial information included within this News Release does not contain all disclosures required by IFRS, and accordingly should be read in conjunction with the Trust's Condensed Consolidated Financial Statements and MD&A for the three and six months ended June 30, 2020, which is available on RioCan's website at www.riocan.com and on SEDAR at www.sedar.com.
Consistent with RioCan’s management framework, management uses certain financial measures to assess RioCan’s financial performance, which are not in accordance with generally accepted accounting principles (GAAP) under IFRS. Funds From Operations (“FFO”), Same Property NOI, Debt to Adjusted EBITDA, RioCan's Proportionate Share, Unencumbered Assets to Unsecured Debt and Total Enterprise Value, as well as other measures that may be discussed elsewhere in this News Release, do not have a standardized definition prescribed by IFRS and are, therefore, unlikely to be comparable to similar measures presented by other reporting issuers. RioCan supplements its IFRS measures with these Non-GAAP measures to aid in assessing the Trust’s underlying performance and reports these additional measures so that investors may do the same. Non-GAAP measures should not be considered as alternatives to net earnings or comparable metrics determined in accordance with IFRS as indicators of RioCan’s performance, liquidity, cash flow, and profitability. For full definitions of these measures, please refer to the "Non-GAAP Measures” section in RioCan’s MD&A for the three and six months ended June 30, 2020.
This News Release contains forward-looking information within the meaning of applicable Canadian securities laws. This information reflects RioCan’s objectives, our strategies to achieve those objectives, as well as statements with respect to management’s beliefs, estimates and intentions concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. Forward-looking information generally can be identified by the use of forward-looking terminology such as “outlook”, “objective”, “may”, “will”, “would”, “expect”, “intend”, “estimate”, “anticipate”, “believe”, “should”, “plan”, “continue”, or similar expressions suggesting future outcomes or events. Such forward-looking information reflects management’s current beliefs and is based on information currently available to management. All forward-looking information in this News Release is qualified by these cautionary statements.
Forward-looking information is not a guarantee of future events or performance and, by its nature, is based on RioCan’s current estimates and assumptions, which are subject to numerous risks and uncertainties, including those described in the “Risks and Uncertainties” section in RioCan's MD&A for the three and six months ended June 30, 2020 and in our most recent Annual Information Form, which could cause actual events or results to differ materially from the forward-looking information contained in this News Release. General economic conditions, including interest rate fluctuations, may also have an effect on RioCan’s results of operations. 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 gradual recovery and growth of the retail environment and the general economy over the remainder of 2020 and 2021; relatively historically low interest costs; a continuing trend toward land use intensification at reasonable costs and development yields, including residential development in urban markets; 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; the availability of investment opportunities for growth in Canada; the timing and ability for RioCan to sell certain properties; the valuations to be realized on property sales relative to current IFRS values; and the Trust's ability to utilize the capital gain refund mechanism. Although the forward-looking information contained in this News Release is based upon what management believes are reasonable assumptions, there can be no assurance that actual results will be consistent with this forward-looking information.
Given the current level of uncertainties arising from the COVID-19 pandemic, there can be no assurance regarding the impact of COVID-19 on the business, operations, and financial performance of RioCan and its tenants, as well as on consumer behaviors and the economy in general. General risks and uncertainties related to the COVID-19 pandemic also include, but are not limited to, the length, spread and severity of the pandemic; the nature and length of the restrictive measures, implemented or to be implemented by various levels of government in Canada; RioCan's tenants' ability to pay rents as required under their leases; the availability of various support programs that are or may be offered by the various levels of government in Canada; domestic and global supply chains; timelines and costs related to the Trust’s development projects; the pace of property lease-up and rents and yields achieved upon development completion; potential changes in leasing activities, market rents and property valuations; the capitalization rates that arm's length buyers and sellers are willing to transact on properties; the availability and extent of rent deferrals offered or to be offered by the Trust; domestic and global credit and capital markets, and the Trust's ability to access capital on favourable terms or at all and its ability to maintain its credit ratings; the total return and dividend yield of RioCan's Units; and the health and safety of our employees, tenants and people in the communities that our properties serve.
The forward-looking statements contained in this News Release are made as of the date hereof, and should not be relied upon as representing RioCan’s views as of any date subsequent to the date of this News Release. Management undertakes no obligation, except as required by applicable law, to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise.
RioCan Real Estate Investment Trust
Senior Vice President and Chief Financial Officer
416-866-3033 | www.riocan.com
Source: RioCan Real Estate Investment Trust