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In addition, the Trust amended the terms of nine mortgages receivable by extending the maturity by a weighted average of 2.9 years and by committing to provide an additional $111.6 million. Two mortgages with commitments totalling $37.1 million and an outstanding balance of $16.2 million were repaid to the Trust.
The Trust disposed of seven non-core properties for gross proceeds of $86.0 million.
Under the proposed amendments to SIFT legislation announced on December 16, 2010, which were substantively enacted on November 21, 2012, the Trust qualifies for the REIT Exemption under the SIFT rules for accounting purposes. As a result, $659.2 million of previously recorded current and deferred tax were reversed through net income and comprehensive income.
The following table summarizes the Trust's key financial highlights for the quarters ended December 31 (3):
(in millions of dollars, Three Months Three Months except per Unit Ended December Ended December Increase/ information) 31, 2012 31, 2011 (decrease)--------------------------------------------------------------------------------------------------------------------------------------------------------Net income excluding income tax recovery/expense 101.4 38.5 62.9Rental revenue 142.1 132.5 9.6Net operating income 91.9 87.1 4.8Cash flow as measured by FFO (1) 60.4 54.8 5.6Per Unit InformationFFO excluding current income tax recovery/expense (fully diluted) 0.469 0.449 0.020AFFO per Unit (fully diluted) 0.451 0.425 0.026Quarterly distribution 0.387 0.387 -Payout ratio (to AFFO) 85.8% 91.1% (5.3)%
Net income for the quarter (excluding income tax recovery/expense) was $101.4 million compared to $38.5 million in the same quarter of 2011. Excluding the impact of fair value adjustments and loss on dispositions, net income increased by $5.5 million in the current quarter compared to the same period last year mainly due to an increase in net operating income of $4.8 million and an increase in interest income of $1.6 million offset by an increase in interest expense of $0.4 million.
Annual Results
During the year, the Trust issued $150.0 million in unsecured debentures with an eight-year term and 4.05% interest rate. The funds were used for the acquisition of investment properties and repayment of maturing debt. The Trust also obtained $189.5 million in new mortgages with an average term of 10.5 years and weighted average interest rate of 3.79%.
The Trust completed the acquisitions of two income properties totalling 400,358 square feet for $102.7 million, which consisted of 152,633 square feet in Dartmouth, Nova Scotia for a purchase price of $26.5 million and 247,725 square feet in Duncan, British Columbia for a purchase price of $76.2 million.
The Trust maintained its debt to gross book value at 48.7% at December 31, 2012, which is below the Trust's target range. The Trust also improved its debt to total assets ratio to 40.9% (2011 - 45.4%), net interest coverage ratio (excluding capitalized interest) to 2.6X (2011 - 2.5X) and interest coverage ratio to 2.3X (2011 - 2.2X). In addition, properties with an aggregate appraised value of $1,139.8 million are unencumbered or debt-free. This will provide flexibility to the Trust to address its committed obligations and to grow its portfolio.
Excluding Including convertible convertible debentures debentures--------------------------------------------------------------------------------------------------------------------------------------------------------Debt to gross book value 48.7% 49.7%Target range 55.0%-60.0% 60.0%-65.0%--------------------------------------------------------------------------------------------------------------------------------------------------------The following table summarizes the Trust's key financial highlights for theyears ended December 31 (3):(in millions of dollars, except per Unit Increase/ information) 2012 2011 (decrease)--------------------------------------------------------------------------------------------------------------------------------------------------------Net income excluding income tax recovery/expense 603.3 348.8 254.5Rental revenue 546.1 511.9 34.2Net operating income 358.7 338.9 19.8Cash flow as measured by FFO (1) 226.9 203.4 23.5Per Unit InformationFFO excluding current income tax recovery/expense (fully diluted) 1.787 1.703 0.084AFFO per Unit (fully diluted) 1.714 1.646 0.068Annual distribution 1.548 1.548 -Payout ratio (to AFFO) 90.3% 94.0% (3.7)%
