WINNIPEG, MB, Nov. 23, 2023 /CNW/ – Lanesborough Real Estate Investment Trust (“LREIT”) (TSXV: LRT.UN) today reported its operating results for the quarter ended September 30, 2023. The following comments in regard to the financial position and operating results of LREIT should be read in conjunction with the interim management’s discussion & analysis – quarterly highlights and the interim financial statements for the quarter ended September 30, 2023, which may be obtained from the SEDAR+ website at www.sedarplus.ca.
ANALYSIS OF OPERATING RESULTS
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Analysis of Income (Loss) and Comprehensive Income (Loss) |
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|
Three Months Ended September 30 |
Nine Months Ended September 30 |
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|
Increase (Decrease) in Income |
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|
2023 |
2022 |
Amount |
% |
2023 |
2022 |
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|
Rentals from investment properties |
$ 3,249,696 |
$ 4,417,868 |
$ (1,168,172) |
(26) % |
$ 9,948,127 |
$ 13,438,795 |
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|
Rental loss insurance proceeds (reversal of proceeds) |
1,071 |
– |
1,071 |
– % |
(105,745) |
– |
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|
Property operating costs |
(2,154,903) |
(3,110,373) |
955,470 |
31 % |
(7,065,663) |
(9,609,990) |
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|
Net operating income (NOI) |
1,095,864 |
1,307,495 |
(211,631) |
(16) % |
2,776,719 |
3,828,805 |
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|
Interest income |
22,846 |
19,464 |
3,382 |
17 % |
65,979 |
73,145 |
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|
Interest expense |
(2,511,932) |
(2,713,225) |
201,293 |
7 % |
(7,605,778) |
(8,212,072) |
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|
Trust expense |
(216,294) |
(291,396) |
75,102 |
26 % |
(882,918) |
(1,170,877) |
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|
Loss before the following |
(1,609,516) |
(1,677,662) |
68,146 |
4 % |
(5,645,998) |
(5,480,999) |
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|
Loss on sale of investments and investment property |
– |
– |
– |
‑ % |
(41,835) |
– |
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|
Fair value adjustments |
359,825 |
11,162,152 |
(10,802,327) |
(97) % |
5,607,079 |
9,707,894 |
||||||
|
Gain on extinguishment of Series G Debentures |
– |
– |
– |
– |
– |
19,797,489 |
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|
Income (loss) before discontinued operations |
(1,249,691) |
9,484,490 |
(10,734,181) |
(113) % |
(80,754) |
24,024,384 |
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|
Loss from discontinued operations |
(632,016) |
(525,089) |
(106,927) |
(20) % |
(1,747,184) |
(1,674,720) |
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|
Income (loss) and comprehensive income (loss) |
$ (1,881,707) |
$ 8,959,401 |
$ (10,841,108) |
(121) % |
$ (1,827,938) |
$ 22,349,664 |
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Overall Results
LREIT completed Q3-2023 with a loss and comprehensive loss of $1.9 million, compared to an income and comprehensive income of $9.0 million during Q3-2022, representing a decrease in income and comprehensive income of $10.8 million. The decrease in income and comprehensive income mainly reflects a decrease from fair value adjustments of $10.8 million and a $1.2 million decrease in rental revenues, partially offset by a $1.0 million decrease in property operating costs.
The decrease from fair value adjustments reflects a $0.4 million gain from fair value adjustments during Q3-2023, compared to a $11.2 million gain from fair value adjustments during Q3-2022. The gain from fair value adjustments during Q3-2023 reflects an increase in the carrying value of the Fort McMurray properties segment, which is mainly due to an increase in the normalized revenue considered to be achievable in the Fort McMurray rental market as a result of the favourable occupancy and rental rate trends; partially offset by an unfavourable variance from fair value adjustments of the Other investment properties segment, which is mainly due to an increase in normalized property operating costs. The gain from fair value adjustments recognized during Q3-2022 mainly reflected an increase in the carrying value of the Fort McMurray properties segment, primarily as a result of changes made to key valuation assumptions to incorporate information obtained from external appraisals received during the quarter and in recognition of the favourable occupancy trend.
The decreases in both rental revenues and property operating costs are primarily attributable to the sales of Laird’s Landing, Lakewood Apartments and Westhaven Manor during Q1-2023.
ABOUT LREIT
LREIT is a real estate investment trust, which is listed on the TSX Venture Exchange under the symbol LRT.UN (Trust Units). For further information on LREIT, please visit our website at www.lreit.com.
This press release contains certain statements that could be considered as forward-looking information. The forward-looking information is subject to certain risks and uncertainties, which could result in actual results differing materially from the forward-looking statements.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as the term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Lanesborough Real Estate Investment Trust
Featured image: Megapixl © Photographerlondon
