TORONTO, ONTARIO–(Marketwired – April 30, 2015) – Mitchell Cohen, President and Chief Executive Officer of Urbanfund Corp. (TSX VENTURE:UFC) (the “Company”), confirmed today that the Company has filed financial statements for the year ended December 31, 2014 (the “Consolidated Financial Statements”).
For the year ended December 31, 2014 the Company reported earnings before income taxes of $2,875,821 on revenue of $4,739,344 compared to earnings before income taxes of $2,991,739 on revenue of $4,405,761 for the corresponding year in 2013. The decrease in earnings is due to an increase in respect of the Company’s interest in 10 residential projects consisting of 1,870 residential suites located in Quebec City and Montreal (the “Quebec Properties”), which reported a full year of operation in 2014.
Rental income increased to $4,739,344 for the period ended December 31, 2014 from $4,405,761 for the corresponding period ended 2013. This is a result of the Quebec Properties reporting a full year of operations and increased rentals on expanded premises at the Company’s North Front Street, Belleville property. Rental expenses for the year ended December 31, 2014 increased to $2,374,641 compared with $2,094,991 for the corresponding period in 2013.
FUNDS FROM OPERATIONS
Funds from Operations (“FFO”) is a non-IFRS measure and should not be construed as an alternative to net income determined in accordance with IFRS. However, FFO is an operating performance measure which is widely used by the real estate industry and the Company has calculated FFO in accordance with the recommendations of the Real Property Association of Canada (“REALpac”).
FFO, or any other non-IFRS performance measure, is not intended to represent operating profits for the period or from a property. Furthermore, it should not be viewed as an alternative to net income, cash flow from operating activities or similar measures of financial performance calculated in accordance with IFRS.
FFO is a widely accepted supplemental measure of financial performance for real estate entities; however, it does not represent amounts available for capital programs, debt service obligations, commitments or uncertainties. FFO should not be interpreted as an indicator of cash generated from operating activities and is not indicative of cash available to fund operating expenditures, or for the payment of cash distributions. FFO is simply one measure of operating performance.
FFO for the years ended December 31, 2014 and 2013 are as follows:
| Year Ended December 31, 2014 |
Year Ended December 31, 2013 |
|||
| Net Earnings Before Income Taxes | $2,875,821 | $2,991,739 | ||
| Adjusted for: | ||||
| Interest Income | ($31,310 | ) | ($34,587 | ) |
| Dividend Income | – | ($9,769 | ) | |
| Realized Gain on Marketable Securities | ($17,244 | ) | ($110,533 | ) |
| Unrealized Loss on Marketable Securities | – | $72,424 | ||
| Fair value Adjustment – Investment Properties | ($1,545,326 | ) | ($1,746,366 | ) |
| Funds From Operations (FFO) | $1,281,941 | $1,162,908 |
LIQUIDITY AND CAPITAL STRUCTURE
As at December 31, 2014, the Company had mortgages payable in the amount of $19,637,737 which was comprised of: (i) $7,830,136 representing a mortgage payable for the Don Mills property; (ii) $5,526,442 representing a mortgage payable for the Belleville property and London property; and (iii) $6,281,159 representing mortgages payable on the Quebec Properties.
As of December 31, 2014, the Company had cash on hand in the amount of $2,049,967 (2013 – $1,838,261), marketable securities of $320,518 (2013 – $314,908) and short term investments in the amount of $2,691,563 (2013 – $2,659,648). As at the date hereof, liquidity has improved since December 31, 2014 as a result of the refinancing of the Company’s Don Mills property in April 2015, as more particularly described in “Subsequent Events” in the Company’s management’s discussion and analysis dated April 30, 2015 and in the Company’s press release dated April 2, 2015.
ASSETS / LIABILITIES
As of December 31, 2014, total assets were $47,211,558 as compared to $45,091,043 as of December 31, 2013. The increase of $2,120,515 in total assets as at December 31, 2014 is mainly due to fair value adjustments to investment properties.
SUMMARY OF QUARTERLY RESULTS
The following selected financial data is derived from the unaudited quarterly financial statements of the Company:
| Quarter ended | Revenue | Net Income (Loss) |
Net Income Per Share (Basic)1 |
| December 31, 2014 | $1,192,556 | $2,462,190 | 0.057 |
| September 30, 2014 | $1,203,021 | $315,922 | 0.007 |
| June 30, 2014 | $1,185,504 | $119,301 | 0.003 |
| March 31, 2014 | $1,158,263 | $165,087 | 0.004 |
| December 31, 2013 | $1,330,217 | $1,418,536 | 0.033 |
| September 31, 2013 | $686,670 | $441,974 | 0.010 |
| June 30, 2013 | $1,684,854 | $342,741 | 0.010 |
| March 31, 2013 | $704,020 | $182,202 | 0.004 |
SELECTED CONSOLIDATED FINANCIAL INFORMATION
The following table highlights selected financial information for the Company’s past two years:
| Year ended December 31, 2014 |
Year ended December 31, 2013 |
|
| Revenue | $4,739,344 | $4,405,761 |
| Net Income (Loss) | $3,062,500 | $2,385,453 |
| Net Income (Loss) per Share | ||
| – basic1 | $0.07 | $0.05 |
| – diluted | $0.06 | $0.05 |
| Total Assets | $47,211,558 | $45,091,043 |
| Mortgages Payable | $19,637,737 | $20,377,807 |
| Cash Dividends Declared per Share | Nil | Nil |
| Notes: | |
| 1 | Basic net income or loss per common share is calculated by dividing the net income or loss by the weighted average number of common shares outstanding during the period. Diluted net income or loss per common share is calculated by dividing the applicable net income or loss by the sum of the weighted average number of common shares outstanding and all additional shares that would have been outstanding if potentially dilutive common shares had been issued during the period. The dilutive effect of outstanding stock options on net income per share is calculated by determining the proceeds for the exercise of such securities which are then assumed to be used to purchase common shares of the Company. |
FOURTH QUARTER RESULTS
For the quarter ended December 31, 2014, the Company reported net income of $2,462,190 ($0.057 per common share) compared with a net income of $1,418,536 ($0.033 per common share) for the corresponding quarter in 2013. The Company’s revenues decreased in the quarter ended December 31, 2014 to $1,192,556 compared with revenues of $1,330,217 for the corresponding period in 2013. Revenues decreased due to the final determination in the estimate of the amount of net operating activity recorded prior to the effective closing date of the purchase of the company’s 10% interest in the Quebec Properties. The increase in net income for the three month period ended December 31, 2014 compared with the corresponding period ended December 31, 2013 is principally due to the fair value adjustment to the investment properties.
For comprehensive disclosure of the Company’s performance for the period ended December 31, 2014 and its financial position as at such date, reference should be made to: (i) the Consolidated Financial Statements as at the period ended September 30, 2014 and the notes thereto; and (ii) management’s discussion and analysis of financial condition at, and results of operations for the period ended September 30, 2014, which have been filed with applicable securities regulators on SEDAR at www.sedar.com.
ABOUT URBANFUND CORP.
Urbanfund Corp. (TSX VENTURE:UFC) is a Toronto-based real estate development and operating company. Urbanfund’s focus is to identify, evaluate and invest in real estate or real estate related projects. The Company’s assets are located in Belleville, London and Toronto, Ontario, Quebec City and Montreal, Quebec. The Company’s strategy going forward remains committed to seek accretive real estate or real estate-related opportunities.
FORWARD LOOKING STATEMENTS
This press release contains certain forward-looking statements, which reflect Management’s expectations regarding the Company’s growth, results of operations, performance and business prospects and opportunities. Statements about the Company’s future plans and intentions, results, levels of activity, cash flow from operations, performance, goals or achievements or other future events constitute forward-looking statements. Wherever possible, words such as “may”, “will”, “should”, “could”, “expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict” or “potential” or the negative or other variations of these words, or similar words or phrases, have been used to identify these forward-looking statements. These statements reflect Management’s current beliefs and are based on information currently available to management as at the date hereof.
Forward-looking statements involve significant risk, uncertainties and assumptions. Many factors could cause actual results, performance or achievements to differ materially from the results discussed or implied in the forward-looking statements. These factors should be considered carefully and readers should not place undue reliance on the forward-looking statements. Although the forward-looking statements contained in this press release are based upon what management believes to be reasonable assumptions, the Company cannot assure readers that actual results will be consistent with these forward-looking statements. These forward-looking statements are made as of the date of this press release, and the Company assumes no obligation to update or revise them to reflect new events or circumstances, except as required by law. Many factors could cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including: general economic and market segment conditions, interest rates, costs outside of the Company’s control such as real estate taxes and utilities, the ability of tenants to satisfy their contractual rent obligations and any unforeseen repair, maintenance or replacement of the Company’s assets. More detailed assessment of the risks that could cause actual results to materially differ than current expectations is contained in the “Risks and Uncertainties” section of the Company’s most recent Management’s Discussion and Analysis dated April 30, 2015.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the Policies of the TSX Venture Exchange) accepts responsibility for the adequacy or the accuracy of this release.
Mitchell Cohen
President & CEO
(416) 703-1877