Real Estate — August 1, 2012Melcor Reports Second Quarter Earnings for 2012
EDMONTON, ALBERTA--(Marketwire - Aug. 1, 2012) - Melcor Developments Ltd. (TSX:MRD), an Alberta-based real estate development company, today reported net income of $24.72 million or $0.82 per share (basic) on revenue of $68.29 million for the six months ended June 30, 2012. These figures represent growth of 196% and 38% over 2011 results for the same period. Included in earnings are net fair value gains of $17.03 million which were realized across multiple divisions. Changes in capitalization rates on certain office properties and higher leasing activity in the Investment Properties division contributed $14.77 million to these fair value gains.
Second quarter net income was $18.87 million or $0.63 per share (basic) on revenue of $34.97 million compared to net income of $4.94 million or $0.15 per share (basic) on revenue of $24.62 million in the second quarter of 2011.
Funds from operations (FFO) per share was $0.24 per share in Q2-2012, an increase of $0.06 per share, or 33% from the same quarter last year. FFO per share adjusts for all non-cash earnings items included in income such as fair value adjustments on investment properties and stock based compensation expense.
Brian Baker, Melcor's President and COO reported on the quarter: "We are very pleased with the current level of sales and development activity, as well as the current quarter results. Development remains active this quarter despite the wet weather we have been experiencing in some regions. We remain well positioned to have a strong year."
Highlights for Q2-2012 include:
- The Community Development division had a strong quarter, recording revenue of $21.58 million which is 109% increase from Q2-2011. Lot sales year to date exceed sales in the prior year in the regions of Edmonton, Calgary and Lethbridge.
- The Investment Properties division purchased an industrial multi-tenant warehouse building in the city of Lethbridge, Alberta. The division also took over the management of three bank buildings constructed by the Property Development division. These three buildings have added 16,800 sq. ft. to the investment properties portfolio.
- The Property Development division has been active in planning and pre-leasing in the current quarter, with construction beginning on multiple projects to be completed by the end of this year.
- The Recreational Properties division is pleased to announce that the new clubhouse at the Links at Spruce Grove is complete, and has opened to the public.
About Melcor Developments Ltd.
Melcor is a diversified real estate development and management company with a rich heritage of integrity and innovation in real estate since 1923.
Through four integrated operating divisions, Melcor manages the full life cycle of real estate development: from acquiring raw land, to community planning, to construction and development, to managing leasable office, retail and residential sites. We develop and manage mixed-use residential communities, business and industrial parks, office buildings, retail commercial centres and golf courses.
Our headquarters are in Edmonton, Alberta, with regional offices throughout Alberta and British Columbia. Our developments span western Canada and the US. We have been trading on the Toronto Stock Exchange since 1968 (TSX:MRD).
FFO is a non-IFRS measure used in this Press Release that does not have any standardized meaning prescribed by International Financial Reporting Standards ("IFRS") and is therefore unlikely to be comparable to similar measures presented by other issuers. This non-IFRS measure is more fully defined and discussed in the management discussion and analysis of the Company for the six-months ended June 30, 2012.
Melcor Developments Ltd.
President & COO
Melcor Developments Ltd.
Jonathan Chia, CA
VP Finance & CFO
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