TORONTO, ONTARIO -- (Marketwired) -- 02/16/16 -- Canadian Apartment Properties Real Estate Investment Trust ("CAPREIT") (TSX: CAR.UN) announced today record portfolio growth and strong operating and financial results for the year ended December 31, 2015.
Three Months Ended Year Ended
December 31 December 31
2015 2014 2015 2014
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Operating Revenues (000s) $ 142,776 $ 128,111 $ 533,798 $ 506,411
Net Operating Income
("NOI") (000s) (1) $ 86,427 $ 76,806 $ 324,614 $ 303,885
NOI Margin (1) 60.5% 60.0% 60.8% 60.0%
Normalized Funds From
Operations ("NFFO") (000s)
(1) $ 52,813 $ 46,620 $ 200,027 $ 183,353
NFFO Per Unit - Basic (1) $ 0.417 $ 0.423 $ 1.692 $ 1.675
Weighted Average Number of
Units - Basic (000s) 126,515 110,193 118,220 109,456
NFFO Payout Ratio (1) 74.7% 71.5% 73.1% 71.5%
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(1) NOI, NFFO and NFFO per Unit are measures used by Management in
evaluating operating performance. Please refer to the cautionary
statements under the heading "Non-IFRS Financial Measures" and the
reconciliations provided in this press release.
2015 Highlights
-- Acquired 5,362 residential suites and sites (excluding the IRES
transaction) in key geographic markets for total acquisition costs of
$823.9 million, further strengthening and diversifying the portfolio
-- Subsequent to year-end, CAPREIT purchased 670 residential suites in
London, Ontario for $52.0 million (excluding transaction costs)
-- Portfolio growth and strong operating performance generates 5.4%
increase in revenues
-- Average monthly rents for same residential properties up 1.7% as at
December 31, 2015 compared to last year
-- Portfolio occupancy remains strong at 97.5% at year-end
-- NOI rises 6.8% to $324.6 million with strong NOI margin increasing to
60.8% for the year ended December 31, 2015
-- NFFO up 9.1% to $200.0 million for the year ended December 31, 2015
-- Continued accretive growth as NFFO per Unit for the year ended December
31, 2015 up 1.0% despite reduced leverage and 8% increase in the
weighted average number of Units outstanding due to two successful
bought-deal equity offerings during the year
-- Continuing strong organic growth as same property NOI up 3.3% for the
year ended December 31, 2015 due to proven successful property
management programs
-- NFFO payout ratio remains conservative at 73.1% for the year ended
December 31, 2015
-- Closed mortgage refinancings for $667.0 million to December 31, 2015,
including $143.3 million for renewals of existing mortgages and $523.7
million for additional top up financing and new acquisition financing
with a weighted average term to maturity of 8.8 years, and a weighted
average interest rate of 2.44%.
"2015 was another year of record portfolio growth as we further strengthened and diversified our asset base and increased our critical mass and operating synergies in rental markets from coast-to-coast. Our proven and successful property management programs also generated very strong operating performance, driven by industry-leading organic growth in all our key geographic markets," commented Thomas Schwartz, President and CEO. "Since our Initial Public Offering in 1997 we have demonstrated our ability to generate solid accretive growth for our Unitholders through both good and bad economic times, and we look for this track record of strong sustainable and accretive growth to continue in the years ahead."
Three Months Ended Year Ended
December 31 December 31
2015 2014 2015 2014
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Overall Portfolio Occupancy
(1) 97.5% 97.9%
Overall Portfolio Average
Monthly Rents (1),(2) $ 963 $ 964
Operating Revenues (000s) $ 142,776 $ 128,111 $ 533,798 $ 506,411
Annualized Net Rental
Revenue Run-Rate (000s)
(1),(3),(4) $ 544,727 $ 486,503
Operating Expenses (000s) $ 56,349 $ 51,305 $ 209,184 $ 202,526
NOI (000s) (4) $ 86,427 $ 76,806 $ 324,614 $ 303,885
NOI Margin (4) 60.5% 60.0% 60.8% 60.0%
Number of Suites and Sites
Acquired 173 133 5,632 474
Number of Suites Disposed - - 530 338
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(1) As at December 31.
(2) Average monthly rents are defined as actual rents, net of vacancies,
divided by the total number of suites and sites in the portfolio and
do not include revenues from parking, laundry or other sources.
(3) For a description of net rental revenue run-rate, see the Results of
Operations section in the MD&A for the year ended December 31, 2015.
(4) Net rental revenue run-rate and NOI are measures used by Management in
evaluating operating performance. Please refer to the cautionary
statements under the heading "Non-IFRS Financial Measures" and the
reconciliations provided in this press release.
Operating Revenues
For the three months and year ended December 31, 2015, total operating revenues increased by 11.4% and 5.4%, respectively, compared to the same periods last year primarily due to the contribution from acquisitions, higher same property average monthly rents, and continuing strong occupancies. For the three months and year ended December 31, 2015, ancillary revenues, including parking, laundry and antenna income, rose by 5.3% and 7%, respectively, compared to the same periods last year, due to contributions from acquisitions and Management's continued focus on maximizing the revenue potential of its property portfolio.
CAPREIT's annualized net rental revenue run-rate as at December 31, 2015 increased to $544.7 million, up 12.0% from $486.5 million as at December 31, 2014 primarily due to acquisitions completed within the last twelve months and strong increases in average monthly rents on properties owned prior to December 31, 2014. Net rental revenue run-rate net of dispositions for the twelve months ended December 31, 2015 was $503.7 million (2014 - $478.1 million).
Portfolio Average Monthly Rents ("AMR")
As at Properties Owned Prior to
December 31, Total Portfolio December 31, 2014
2015 2014 2015 2014 (1)
AMR Occ. % AMR Occ. % AMR Occ. % AMR Occ. %
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Average
Residential
Suites $1,059 97.4 $1,076 97.9 $1,094 97.3 $1,076 97.9
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Average MHC Land
Lease Sites $ 366 98.2 $ 356 97.5 $ 365 98.2 $ 356 97.5
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Overall
Portfolio
Average $ 963 97.5 $ 964 97.9 $ 980 97.4 $ 964 97.8
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(1) Prior year's comparable AMR and occupancy have been restated for
properties disposed of since December 31, 2014.
Average monthly rents and occupancy for residential suites decreased slightly as at December 31, 2015 due to recent acquisitions in lower rent demographic sectors offset by ongoing successful sales and marketing strategies and continued strength in the residential rental sector in the majority of CAPREIT's regional markets. For the Manufactured Housing Community ("MHC") land lease portfolio, average monthly rents increased to $366 as at December 31, 2015, compared to $356 as at December 31, 2014. Occupancy for the MHC portfolio rose to 98.2% at December 31, 2015 from 97.5% at the same time last year.
Average monthly rents for residential suites owned prior to December 31, 2014 also increased as at December 31, 2015 to $1,094 from $1,076 as at December 31, 2014, an increase of 1.7% from last year with occupancies remaining strong at 97.3%.
Suite Turnovers and Lease Renewals
For the Three
Months Ended
December 31, 2015 2014
Change in AMR % Turnovers Change in AMR % Turnovers
$ % & Renewals (1) $ % & Renewals (1)
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Suite Turnovers 28.3 2.6 5.5 32.5 3.0 6.2
Lease Renewals 20.5 1.9 16.3 17.5 1.6 16.6
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Weighted Average
of Turnovers
and Renewals 22.5 2.1 21.5 2.0
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For the Year
Ended December
31, 2015 2014
Change in AMR % Turnovers Change in AMR % Turnovers
$ % & Renewals (1) $ % & Renewals (1)
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Suite Turnovers 20.7 1.9 24.8 32.6 3.0 28.1
Lease Renewals 21.6 2.0 71.6 17.4 1.6 79.7
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Weighted Average
of Turnovers
and Renewals 21.4 1.9 21.4 2.0
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(1) Percentage of suites turned over or renewed during the period based on
the total number of residential suites (excluding co-ownerships) held
at the end of the period.
The higher rate of growth in average monthly rents on lease renewals during 2015 compared to the prior year is primarily due to the higher mandated guideline increases for 2015 (Ontario - 1.6%, British Columbia - 2.5%), compared to the lower guideline increases in 2014 (Ontario - 0.8%, British Columbia - 2.2%) and by increases due to above guideline increases ("AGI") achieved in Ontario in 2015. Management continues to pursue AGI applications where it believes increases are supported by market conditions above the annual guideline to raise average monthly rents on lease renewals. For 2016, the permitted guideline increase in Ontario and British Columbia have been increased to 2.0% and 2.9%, respectively.
Operating Expenses
Three Months Ended Year Ended
December 31 December 31
($ Thousands) 2015 %(1) 2014 %(1) 2015 %(1) 2014 %(1)
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Operating Expenses
Realty Taxes $15,536 10.9 $14,324 11.2 $ 59,337 11.1 $ 56,591 11.2
Utilities 14,815 10.4 13,512 10.5 54,241 10.2 52,210 10.3
Other (2) 25,998 18.2 23,469 18.3 95,606 17.9 93,725 18.5
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Total Operating
Expenses $56,349 39.5 $51,305 40.0 $209,184 39.2 $202,526 40.0
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(1) As a percentage of total operating revenues.
(2) Comprises R&M, wages, general and administrative, insurance,
advertising, and legal costs.
Operating Expenses
Overall operating expenses as a percentage of operating revenues improved to 39.5% and 39.2%, respectively, for the three months and year ended December 31, 2015 compared to 40.0% and 40.0%, respectively, for the same periods last year, due to lower realty taxes, repairs and maintenance ("R&M") and wages costs as a percentage of operating revenues.
Net Operating Income
For the three months ended December 31, 2015, NOI increased by $9.6 million or 12.5%, and the NOI margin strengthened to 60.5% from 60.0% for last year. For the year ended December 31, 2015, NOI increased by $20.7 million or 6.8%, and the NOI margin rose to 60.8% compared to 60.0% last year. The increase in NOI margin for the three months and year ended December 31, 2015 was primarily the result of higher operating revenues and lower realty taxes, R&M, and wages cost as a percentage of operating revenues.
For the three months and year ended December 31, 2015, operating revenues for stabilized suites and sites increased 1.3% and 1.8% respectively, while operating expenses decreased 0.3% and 0.3%, respectively, compared to the same periods last year. As a result, for the three months and year ended December 31, 2015, stabilized NOI increased by a strong 2.3% and 3.3%, respectively, compared to the same periods last year, showing the positive effects of CAPREIT's geographic diversification across Canada and proven property management programs.
NON-IFRS FINANCIAL MEASURES
Three Months Ended Year Ended
December 31, December 31,
2015 2014 2015 2014
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NFFO (000s) $ 52,813 46,620 $ 200,027 $ 183,353
NFFO Per Unit - Basic $ 0.417 $ 0.423 $ 1.692 $ 1.675
Cash Distributions Per Unit $ 0.305 $ 0.295 $ 1.207 $ 1.168
NFFO Payout Ratio 74.7% 71.5% 73.1% 71.5%
NFFO Effective Payout Ratio 51.4% 46.0% 49.4% 47.5%
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For the year ended December 31, 2015, basic NFFO per Unit increased by 1.0% compared to the same period last year despite decreased leverage and the approximate 8% increase in the weighted average number of Units outstanding due to the two successful equity offerings completed in March 2015 and October 2015. For the three months ended December 31, 2015, basic NFFO per Unit decreased slightly by 1.4% compared to the same period last year due to the approximate 15% increase in the weighted average number of Units outstanding.
LIQUIDITY AND LEVERAGE
As at December 31, 2015 2014
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Total Debt to Gross Book Value 45.71% 46.49%
Total Debt to Gross Historical Cost (1) 55.41% 56.73%
Total Debt to Total Capitalization 48.46% 49.35%
Debt Service Coverage Ratio (times) (2) 1.63 1.61
Interest Coverage Ratio (times) (2) 2.96 2.82
Weighted Average Mortgage Interest Rate (3) 3.39% 3.66%
Weighted Average Mortgage Term to Maturity (years) 6.3 6.3
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(1) Based on historical cost of investment properties.
(2) Based on the trailing four quarters ended December 31, 2015.
(3) Weighted average mortgage interest rate includes deferred financing
costs and fair value adjustments on an effective interest basis.
Including the amortization of the realized component of the loss on
interest rate hedge settlement of $32.5 million included in
Accumulated Other Comprehensive Loss ('AOCL'), the effective
portfolio weighted average interest rate at December 31, 2015 would be
3.52% (December 31, 2014 - 3.81%).
Financial Strength
Management believes CAPREIT's strong balance sheet and liquidity position will enable it to continue to take advantage of acquisition and property capital investment opportunities over the long term.
CAPREIT is achieving its financing goals as demonstrated by the following key indicators:
-- Total debt to gross book value ratio strengthened to 45.71% as at
December 31, 2015 compared to 46.49% for the same period last year, both
well below our target debt ratio;
-- Debt service and interest coverage ratios for the year ended December
31, 2015 improved to 1.63 times and 2.96 times, respectively, compared
to 1.61 times and 2.82 times last year;
-- As at December 31, 2015, 96.5% (December 31, 2014 - 95.7%) of CAPREIT's
mortgage portfolio was insured by the Canada Mortgage and Housing
Corporation ("CMHC"), excluding the mortgages on CAPREIT's MHC land
lease sites and Euro LIBOR borrowings, resulting in improved spreads on
mortgages and lower overall interest costs than conventional mortgages.
-- The effective portfolio weighted average interest rate on mortgages has
steadily declined to 3.39% as at December 31, 2015 from 3.66% as at
December 31, 2014, resulting in significant potential interest rate
savings in future years;
-- Management expects to raise between $275 million and $325 million in
total mortgage renewals and refinancings in 2016;
-- The weighted average term to maturity of the mortgage portfolio remained
stable at 6.30 years as at December 31, 2015 compared to 6.3 years at
December 31, 2014;
-- As at December 31, 2015, CAPREIT has investment properties with a fair
value of $289.1 million not encumbered by mortgages and secure only the
Acquisition and Operating Facility. CAPREIT intends to maintain
unencumbered investment properties with an aggregate fair value in the
range of $150 and $180 million over the long term.
Property Capital Investments
During the year ended December 31, 2015, CAPREIT made property capital investments (excluding disposed properties, head office assets, tenant improvements and signage) of $161.7 million as compared to $143.6 million in last year. For the full 2016 year, CAPREIT expects to complete property capital investments of approximately $170 million to $180 million, including approximately $87 million targeted at acquisitions completed since January 1, 2011, and approximately $20 million in high-efficiency boilers and other energy-saving initiatives.
Property capital investments include suite improvements, common areas and equipment, which generally tend to increase NOI more quickly. CAPREIT also continues to invest in energy-saving initiatives, including boilers, energy-efficient lighting systems, and water-saving programs, which permit CAPREIT to mitigate potentially higher increases in utility and R&M costs and significantly improve overall portfolio NOI.
Subsequent Event
On January 20, 2016, CAPREIT completed the acquisition of a portfolio of six apartment and townhome properties well located in London, Ontario totaling 670 rental suites. The purchase price (excluding transaction costs) of approximately $52.0 million was funded with cash from CAPREIT's Acquisition and Operating credit facility.
Additional Information
More detailed information and analysis is included in CAPREIT's audited consolidated annual financial statements and MD&A for the year ended December 31, 2015, which have been filed on SEDAR and can be viewed at www.sedar.com under CAPREIT's profile or on CAPREIT's website on the investor relations page at www.caprent.com or www.capreit.net.
Conference Call
A conference call hosted by Thomas Schwartz, President and CEO and the CAPREIT Management Team, will be held Wednesday, February 17, 2016 at 10:00 am EST. The telephone numbers for the conference call are: Local/International: (416) 340-2216, North American Toll Free: (866) 225-0198.
A slide presentation to accompany Management's comments during the conference call will be available one hour and a half prior to the conference call. To view the slides, access the CAPREIT website at www.caprent.com or www.capreit.net, click on "Investor Relations" and follow the link at the top of the page. Please log on at least 15 minutes before the call commences.
The telephone numbers to listen to the call after it is completed (Instant Replay) are local/international (905) 694-9451 or North American toll free (800) 408-3053. The Passcode for the Instant Replay is 1628046#. The Instant Replay will be available until midnight, February 24, 2016. The call and accompanying slides will also be archived on the CAPREIT website at www.caprent.com or www.capreit.net. For more information about CAPREIT, its business and its investment highlights, please refer to our website at www.caprent.com or www.capreit.net.
About CAPREIT
CAPREIT owns interests in multi-unit residential rental properties, including apartments, townhomes and manufactured home communities primarily located in and near major urban centres across Canada. As at December 31, 2015, CAPREIT had owning interests in 46,790 residential units, comprised of 40,501 residential suites and 30 manufactured home communities ("MHC") comprising 6,289 land lease sites. For more information about CAPREIT, its business and its investment highlights, please refer to our website at www.caprent.com or www.capreit.net and our public disclosure which can be found under our profile at www.sedar.com.
Non-IFRS Financial Measures
CAPREIT prepares and releases unaudited quarterly and audited consolidated annual financial statements prepared in accordance with IFRS. In this and other earnings releases and investor conference calls, as a complement to results provided in accordance with IFRS, CAPREIT also discloses and discusses certain non-IFRS financial measures, including Net Rental Revenue Run-Rate, NOI, FFO, NFFO and applicable per Unit amounts and payout ratios. These non-IFRS measures are further defined and discussed in the MD&A released on February 16, 2016, which should be read in conjunction with this press release. Since Net Rental Revenue Run-Rate, NOI, FFO and NFFO are not determined by IFRS, they may not be comparable to similar measures reported by other issuers. CAPREIT has presented such non-IFRS measures as Management believes these non-IFRS measures are relevant measures of the ability of CAPREIT to earn and distribute cash returns to Unitholders and to evaluate CAPREIT's performance. A reconciliation of Net Income and such non-IFRS measures including Adjusted Funds From Operations ("AFFO") is included in this press release. These non-IFRS measures should not be construed as alternatives to net income (loss) or cash flow from operating activities determined in accordance with IFRS as an indicator of CAPREIT's performance.
Cautionary Statements Regarding Forward-Looking Statements
Certain statements contained, or contained in documents incorporated by reference, in this press release constitute forward-looking information within the meaning of securities laws. Forward-looking information may relate to CAPREIT's future outlook and anticipated events or results and may include statements regarding the future financial position, business strategy, budgets, litigation, projected costs, capital investments, financial results, taxes, plans and objectives of or involving CAPREIT. Particularly, statements regarding CAPREIT's future results, performance, achievements, prospects, costs, opportunities and financial outlook, including those relating to acquisition and capital investment strategy and the real estate industry generally, are forward-looking statements. In some cases, forward-looking information can be identified by terms such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "potential", "continue" or the negative thereof or other similar expressions concerning matters that are not historical facts. Forward-looking statements are based on certain factors and assumptions regarding expected growth, results of operations, performance and business prospects and opportunities. In addition, certain specific assumptions were made in preparing forward-looking information, including: that the Canadian and Irish economies will generally experience growth, however, may be adversely impacted by the global economy; that inflation will remain low; that interest rates will remain low in the medium term; that Canada Mortgage and Housing Corporation ("CMHC") mortgage insurance will continue to be available and that a sufficient number of lenders will participate in the CMHC-insured mortgage program to ensure competitive rates; that the Canadian capital markets will continue to provide CAPREIT with access to equity and/or debt at reasonable rates; that vacancy rates for CAPREIT properties will be consistent with historical norms; that rental rates will grow at levels similar to the rate of inflation on renewal; that rental rates on turnovers will remain stable; that CAPREIT will effectively manage price pressures relating to its energy usage; and, with respect to CAPREIT's financial outlook regarding capital investments, assumptions respecting projected costs of construction and materials, availability of trades, the cost and availability of financing, CAPREIT's investment priorities, the properties in which investments will be made, the composition of the property portfolio and the projected return on investment in respect of specific capital investments.
Although the forward-looking statements contained in this press release are based on assumptions, Management believes they are reasonable as of the date hereof, there can be no assurance actual results will be consistent with these forward-looking statements; they may prove to be incorrect. Forward-looking statements necessarily involve known and unknown risks and uncertainties, many of which are beyond CAPREIT's control, that may cause CAPREIT or the industry's actual results, performance, achievements, prospects and opportunities in future periods to differ materially from those expressed or implied by such forward-looking statements. These risks and uncertainties include, among other things, risks related to: reporting investment properties at fair value, real property ownership, leasehold interests, co-ownerships, investment restrictions, operating risk, energy costs and hedging, environmental matters, insurance, capital investments, indebtedness, interest rate hedging, foreign operation and currency risks, taxation, harmonization of federal goods and services tax and provincial sales tax, government regulations, controls over financial accounting, legal and regulatory concerns, the nature of units of CAPREIT ("Trust Units") and of CAPREIT's subsidiary, CAPREIT Limited Partnership ("Exchangeable Units") (collectively, the "Units"), unitholder liability, liquidity and price fluctuation of Units, dilution, distributions, participation in CAPREIT's distribution reinvestment plan, potential conflicts of interest, dependence on key personnel, general economic conditions, competition for residents, competition for real property investments, continued growth and risks related to acquisitions. There can be no assurance the expectations of CAPREIT's Management will prove to be correct. These risks and uncertainties are more fully described in regulatory filings, including CAPREIT's Annual Information Form, which can be obtained on SEDAR at www.sedar.com, under CAPREIT's profile, as well as under Risks and Uncertainties section of the MD&A released on February 16, 2016. The information in this press release is based on information available to Management as of February 16, 2016. Subject to applicable law, CAPREIT does not undertake any obligation to publicly update or revise any forward-looking information.
SELECTED FINANCIAL INFORMATION
Condensed Balance Sheets
As at December 31, December 31,
2015 2014
($ Thousands)
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Investment Properties $ 6,863,140 $ 5,749,640
Total Assets 7,102,828 5,926,161
Mortgages Payable 3,097,773 2,658,454
Bank Indebtedness 168,211 113,167
Total Liabilities 3,442,875 2,943,056
Unitholders' Equity 3,659,953 2,983,105
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Condensed Income Statements
Three Months Ended Year Ended
December 31, December 31,
($ Thousands) 2015 2014 2015 2014
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Net Operating Income 86,427 76,806 324,614 303,885
Trust Expenses (5,369) (4,973) (22,707) (20,944)
Unrealized Gain on
Remeasurement of
Investment Properties 81,030 42,023 173,242 150,897
Realized Loss on
Disposition of Investment
Properties - - (639) -
Remeasurement of
Exchangeable Units (4) (249) (276) (626)
Unit-based Compensation
Expenses 2,075 (5,618) (13,417) (16,478)
Interest on Mortgages
Payable and Other
Financing Costs (27,026) (25,333) (103,795) (99,931)
Interest on Bank
Indebtedness (1,991) (976) (3,988) (5,326)
Interest on Exchangeable
Units (49) (49) (194) (188)
Other Income 4,122 1,355 12,340 6,942
Amortization (763) (612) (2,799) (2,400)
Severance and Other
Employee Costs (395) - (5,237) -
Unrealized and Realized
(Loss) Gain on Derivative
Financial Instruments (155) (47) 282 (2,810)
Dilution Loss on Equity
Accounted Investments - - (4,346) -
(Loss) Gain on Foreign
Currency Translation (527) 432 (7,447) 4,954
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Net Income 137,375 82,759 345,633 317,975
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Other Comprehensive Income
(Loss) $ 2,724 $ (1,846) $ 12,754 $ (6,090)
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Comprehensive Income $ 140,099 $ 80,913 $ 358,387 $ 311,885
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Condensed Statements of Cash Flows
Three Months Ended Year Ended
December 31, December 31,
2015 2014 2015 2014
($ Thousands)
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Cash Provided By Operating
Activities:
Net Income $ 137,375 $ 82,759 $ 345,633 $ 317,975
Items in Net Income Not
Affecting Cash:
Changes in Non-cash
Operating Assets and
Liabilities (9,403) (1,161) (12,921) (19)
Realized and Unrealized
Gain on
Remeasurements (80,871) (41,727) (172,609) (147,461)
Gain on Sale of
Investments - - - (717)
Unit-based Compensation
Expenses (2,075) 5,618 13,417 16,478
Items Related to Financing
and Investing
Activities 26,007 23,891 97,667 94,338
Other 3,484 1,636 21,637 3,388
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Cash Provided By Operating
Activities 74,517 71,016 292,824 283,982
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Cash Used In Investing
Activities
Acquisitions (26,442) (9,303) (933,386) (34,964)
Capital Investments (58,652) (46,826) (174,027) (164,898)
Acquisition of investments - - (32,305) -
Disposition of Investments - - - 7,599
Dispositions - - 24,004 -
Other (32) 914 1,018 3,102
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Cash Used In Investing (1,114,69
Activities (85,126) (55,215) 6) (189,161)
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Cash Provided (Used) By
Financing Activities
Mortgages, Net of
Financing Costs 325,844 (3,002) 563,280 165,904
Bank Indebtedness (502,611) 32,830 54,644 (76,712)
Interest Paid (26,334) (24,828) (100,467) (98,124)
Proceeds on Issuance of
Units 239,973 336 401,154 1,031
Distributions, Net of DRIP
and Other (26,263) (21,137) (96,739) (86,920)
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Cash Provided (Used) By
Financing Activities 10,609 (15,801) 821,872 (94,821)
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Changes in Cash and Cash
Equivalents During the
Period - - - -
Cash and Cash Equivalents,
Beginning of Period - - - -
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Cash and Cash Equivalents,
End of Period $ - $ - $ - $ -
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SELECTED NON-IFRS FINANCIAL MEASURES
Reconciliation of Net Income to FFO and to NFFO
Three Months Ended Year Ended
December 31, December 31,
2015 2014 2015 2014
($ Thousands, except per
Unit amounts)
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Net (Loss) Income $ 137,375 $ 82,759 $ 345,633 $ 317,975
Adjustments:
Unrealized Gain on
Remeasurement of
Investment Properties (81,030) (42,023) (173,242) (150,897)
Realized Loss on
Disposition of Investment
Properties - - 639 -
Remeasurement of
Exchangeable Units 4 249 276 626
Remeasurement of Unit-
based Compensation
Liabilities (4,309) 4,650 7,511 12,131
Interest on Exchangeable
Units 49 49 194 188
Corporate taxes expense 31 - 59 1,405
Loss (Gain) on Foreign
Currency Translation 527 (432) 7,447 (4,954)
FFO Adjustment for Income
from Equity Accounted
Investments (1,925) (137) (4,024) (1,710)
Unrealized and Realized
(Gain) Loss on Derivative
Financial Instruments 155 47 (282) 2,810
Dilution Loss on Equity
Accounted Investments - - 4,346 -
Amortization of Property,
Plant and Equipment 763 612 2,799 2,400
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FFO $ 51,640 $ 45,774 $ 191,356 $ 179,974
Adjustments:
Amortization of Loss from
AOCL to Interest and
Other Financing Costs 778 846 3,311 3,333
Net Mortgage Prepayment
Cost - - 123 763
Realized Gain on Sale of
Investments - - - (717)
Severance and Other
Employee Costs 395 - 5,237 -
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NFFO $ 52,813 $ 46,620 $ 200,027 $ 183,353
NFFO per Unit - Basic $ 0.417 $ 0.423 $ 1.692 $ 1.675
NFFO per Unit - Diluted $ 0.412 $ 0.416 $ 1.668 $ 1.651
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Total Distributions
Declared (1) $ 39,469 33,338 $ 146,198 $ 131,044
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NFFO Payout Ratio (2) 74.7% 71.5% 73.1% 71.5%
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Net Distributions Paid (1) $ 27,133 $ 21,464 $ 98,795 $ 87,051
Excess NFFO Over Net
Distributions Paid $ 25,680 $ 25,156 $ 101,232 $ 96,302
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Effective NFFO Payout
Ratio (3) 51.4% 46.0% 49.4% 47.5%
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(1) For a description of distributions declared and net distributions
paid, see the Non-IFRS Financial Measures section in the MD&A for the
year ended December 31, 2015.
(2) The payout ratio compares distributions declared to NFFO.
(3) The effective payout ratio compares net distributions paid to NFFO.
Reconciliation of NFFO to AFFO
Three Months Ended Year Ended
December 31 December 31
2015 2014 2015 2014
($ Thousands, except per
Unit amounts)
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NFFO $ 52,813 $ 46,620 $ 200,027 $ 183,353
Adjustments:
Provision for Maintenance
Property Capital
Investments (1) (4,417) (3,889) (16,343) (15,466)
Amortization of Fair Value
on Grant Date of Unit-
based Compensation 2,234 968 5,906 4,347
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AFFO $ 50,630 $ 43,699 $ 189,590 $ 172,234
AFFO per Unit - Basic $ 0.400 $ 0.397 $ 1.604 $ 1.574
AFFO per Unit - Diluted $ 0.395 $ 0.390 $ 1.581 $ 1.551
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Distributions Declared (2) $ 39,469 $ 33,338 $ 146,198 $ 131,044
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AFFO Payout Ratio (3) 78.0% 76.3% 77.1% 76.1%
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Net Distributions Paid (2) $ 27,133 $ 21,464 $ 98,795 $ 87,051
Excess AFFO over Net
Distributions Paid $ 23,497 $ 22,235 $ 90,795 $ 85,183
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Effective AFFO Payout
Ratio (4) 53.6% 49.1% 52.1% 50.5%
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(1) An industry based estimate (see the Non-IFRS Measures section in the
MD&A for the year ended December 31, 2015).
For a description of distributions declared and net distributions
paid, see the Non-IFRS Financial Measures section in the MD&A for the
(2) year ended December 31, 2015.
(3) The payout ratio compares distributions declared to AFFO.
(4) The effective payout ratio compares net distributions paid to AFFO.
Contacts:
CAPREIT
Mr. Michael Stein
Chairman
(416) 861-5788
CAPREIT
Mr. Thomas Schwartz
President & CEO
(416) 861-9404
CAPREIT
Mr. Scott Cryer
Chief Financial Officer
(416) 861-5771
