News Column

NorthWest International Healthcare Properties REIT releases first quarter 2014 results

May 27, 2014

TSX-V: MOB.UN

TORONTO, May 27, 2014 /CNW/ - NorthWest International Healthcare Properties REIT ("NWI" or the "REIT") announced today that it has released its results for the three month period ended March 31, 2014.

In the first quarter of 2014 the REIT realized the benefits of its significant acquisition in Brazil that closed in the fourth quarter of 2013, posting a 53% growth in Net Operating Income ("NOI") and an approximate 15% growth in Adjusted Funds From Operations ("AFFO") per Unit over the same quarter of last year.

Key highlights from the REIT's financial and operating results for the three month period ended March 31, 2014 include:

• NOI of $9,230,811 in Q1'14, representing a 53% increase over the same quarter last year; • AFFO / unit of $0.054 for Q1'14, or $0.22 per Unit on an annualized basis, representing a 15% increase over the same quarter last year; • AFFO to distribution payout ratio of 101%; • Leading portfolio occupancy at 96.3% (Canada = 91.8%; International = 99.4%), a sequential 30 bps increase from Q4'13; • Weighted average lease term of 12.5 years (Canada = 4.7 years; International = 17.9 years), slightly ahead of Q4'13 at 12.4 years; and • Announced the pending acquisition of 16 medical office buildings in Germany of nearly $100 million comprising approximately 500,000 square feet.

"The first quarter of 2014 represents the culmination of the REIT's significant acquisitions and investments in 2013 as we delivered meaningful AFFO growth to our unitholders in the quarter," said Paul Dalla Lana, Chief Executive Officer of the REIT.

Subsequent to the quarter, in May 2014, the REIT completed a successful $23 million bought-deal equity offering and announced two transformative plans for 2014. The REIT announced that it had entered into an agreement with NorthWest Value Partners Inc. ("NWVP") with respect to the internalization of its external management arrangements. This internalization will also result in the REIT acquiring from NWVP all of the rights and obligations relating to the management of Vital Healthcare Property Trust of which the REIT currently indirectly holds an approximate 24% interest. The REIT and NWVP are working towards the completion of the internalization by December 31st, 2014. Further, the REIT announced plans to initiate the process of graduating to the Toronto Stock Exchange (the "TSX"). Subject to TSX approval, the REIT intends to graduate on or before July 1, 2014.

FINANCIAL HIGHLIGHTS

                     
          As at

Mar. 31, 2014
        As at

Dec. 31, 2013
Operational Information (1)                    
  Number of Properties - 100% of associates         110         113
  Gross Leasable Area (sf) - 100% of associates         7,556,727         7,664,605
  Occupancy % - 100% of associates         94.7%         94.4%
                     
Summary of Financial Information                    
  Gross Book Value (2)       $  793,358,386       $ 756,258,230
  Debt - Declaration of Trust (3)       $ 463,946,840       $ 437,642,389
  Debt to Gross Book Value - Declaration of Trust         58.5%         57.9%
  Debt - Including convertible debentures (3)       $ 502,916,810       $ 473,065,389
  Debt to Gross Book Value - Including convertible debentures         63.4%         62.6%
                     
  Percentage of Mortgages and Loans Payable at Fixed Rates         61.9%         59.1%
  Weighted-Average Interest Rate on Fixed Rate Mortgages and Loans Payable         6.16%         6.11%
  Adjusted Units Outstanding - period end (4)                    
   Basic         147,327,109         146,046,705
   Diluted (7)        149,543,830         146,347,916
                     
          For the three

months ended

Mar. 31, 2014
        For the three

months ended

Dec. 31, 2013
                     
Operating Results                    
  Net Income / (Loss)        $ (27,019,676)       $ (26,809,534)
  NOI  (5)       $ 9,230,811       $ 4,855,484
  Funds From Operations ("FFO") (5)       $ 3,583,153       $ (815,635)
  Adjusted Funds From Operations ("AFFO") (5)       $ 7,983,166       $ 5,639,399
  Distributions (6)       $ 8,094,715       $ 5,590,562
                     
Per Unit Amounts (4)                    
  FFO per unit - Basic        $ 0.02       $ (0.01)
  FFO per unit - Adjusted fully diluted  (7)       $ 0.02       $ (0.01)
  AFFO per unit - Basic       $ 0.05       $ 0.04
  AFFO per unit - Adjusted fully diluted  (7)       $ 0.05       $ 0.04
  Distributions per unit        $ 0.06       $ 0.04
  AFFO Payout Ratio          101%         98%
  AFFO Payout Ratio - Adjusted fully diluted  (7)         101%         98%
                     
Adjusted Weighted Average Units Outstanding (4)                    
  Basic          147,043,933         138,120,778
  Diluted (7)         147,249,723         138,228,362


 





Full financial statements and MD&A will be available on SEDAR (www.sedar.com) as well as the Investors section of the REIT's website (www.nwireit.com).



Notes
  (1)   Operational information includes 100% of Vital Trust and NWHP REIT. The REIT has an exposure to an approximate 24% interest in Vital Trust and approximate 26% interest in NWHP REIT.
  (2)   Gross Book Value is defined as total assets.
  (3)   Indebtedness as defined in the Declaration of Trust includes the principal balance of mortgages, securities lending agreement, margin facilities, term loan, line of credit, and deferred consideration. The REIT's total debt also includes convertible debentures (at fair value).
  (4)   Under IFRS the REIT's Class B LP exchangeable units are treated as a financial liability rather than equity. As permitted under IFRS the REIT has chosen to present an adjusted basic and diluted per unit measure that includes the Class B LP exchangeable units in basic and diluted units outstanding/weighted average units outstanding. There were 91,068,320 Class B LP exchangeable units outstanding as at March 31, 2014 and 91,068,320 Class B LP exchangeable units outstanding at December 31, 2013.
  (5)   NOI, FFO and AFFO are not measures recognized under IFRS and do not have standardized meanings prescribed by IFRS. NOI, FFO and AFFO as computed by the REIT may differ from similar computations as reported by other real estate investment trusts and, accordingly, may not be comparable to NOI, FFO and AFFO as reported by other such issuers. These terms are defined in this MD&A and reconciled to IFRS-based amounts reported in the consolidated financial statements of the REIT.
  (6)   Represents distributions to Unitholders and Class B LP exchangeable unitholders on an accrual basis. Distributions are payable as at the end of the period in which they are declared by the Board of Trustees, and are paid on or around the 15th day of the following month.
  (7)   Diluted units include the conversion of the REIT's convertible debentures and warrants if the conversion price or exercise price is greater than the closing price of the Trust Unit as at the end of the reporting period. Otherwise the convertible debentures and warrants are considered anti-dilutive.



About NorthWest International Healthcare Properties Real Estate Investment Trust

The REIT is an unincorporated, open-ended real estate investment trust established under the laws of the Province of Ontario. The REIT's objectives are to: (i) provide its unitholders with stable and growing cash distributions from investments focused on international healthcare properties, on a tax efficient basis; (ii) enhance the value of the REIT's assets and maximize long-term unit value; and (iii) expand the asset base of the REIT.

Reader Advisory

This news release contains "forward-looking statements" within the meaning of applicable securities laws. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations, including the ability of the REIT to pay the distribution on the date specified. The statements in this news release are made as of the date of this release. Although the REIT believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and, accordingly, readers are cautioned not to place undue reliance on such statements due to the inherent uncertainty therein. A discussion of the risk factors applicable to the REIT is contained under the heading "Risk Factors" in the REIT's annual information form dated April 23, 2014, audited consolidated financial statements and management's discussion and analysis for the year ended December 31, 2013, and the REIT's short form prospectus dated May 13, 2014, copies of which each may be obtained on the SEDAR website at www.sedar.com.

Neither the TSX Venture Exchange Inc. nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) has approved or disapproved the contents of this press release.



SOURCE NorthWest International Healthcare Properties REIT


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