CALGARY, Aug. 10 /CNW/ - Northern Property R.E.I.T. (NPR.UN - TSX)
announced its financial results for the three and six months ended
June 30, 2005.
Highlights:
- quarterly distributable income exceeds the $6 million threshold
- Q1 Newfoundland and Alberta purchases absorbed; NWT commercial
properties acquired
- 28.7% increase in revenues
- portfolio interest rates continue to decline
Rental properties revenue increased from $12.2 million in Q2-2004 to
$15.7 million in Q2-2005 primarily due to the acquisition of rental properties
and same door growth within the portfolio of 0.7%. Revenue year-to-date 2005
is 28.7% higher than the same period in 2004 ($29.9 million versus
$23.3 million).
Distributable income for the quarter reached $6.02 million, up from
$4.98 million for the corresponding quarter a year earlier. DIPU for the
quarter held steady at $0.38, compared to a year ago. Weighted average units
outstanding for the quarter were 16,016,912 compared to 13,167,881 for Q2
2004.
Net income for the second quarter of 2005 was $2.82 million compared to
$2.44 million for the same period in the prior year, an increase of 15.6%. For
the six months ended June 30, 2005 net income was $5.51 million compared to
$4.62 million in the prior year.
Capital assets increased from $326.84 million at December 31, 2004 to
$380.55 million at June 30, 2005 reflecting the significant acquisition
activity during the first six months of the year. At June 30, 2005, NPREIT's
debt to Gross Book Value was 53.1%. The weighted average interest rate of
NPREIT's debt declined from 6.13% at year end to 5.87% at the end of June,
2005.
Vacancy loss in the portfolio totalled 3.4% for the second quarter of
2005, plus 1.3% for units off the market due to renovations. NPREIT has
embarked on a program to improve the marketing and sales skills of front line
and managerial staff. Third party consultants are supporting the initiative
which also includes measures such as adoption of a tenant retention program,
enhanced signage and increased internet based marketing.
NPREIT President and CEO, Jim Britton said the first six months of 2005
were "both challenging and productive. We acquired 1110 residential units plus
a 50% interest in a commercial portfolio, concluded a public offering and
completely revamped our marketing program to deal with more competitive rental
market conditions. The improvements we are beginning to see in lower vacancy
and continued declines in mortgage interest rates will significantly offset
utility cost pressures. We expect improvements in DIPU as acquisition efforts
continues to employ the capital we have raised."
"Our markets generally are enjoying impressive economic growth"
Mr. Britton said. "Northern Alberta is exceptionally strong, the NWT is
prospering and there is evidence of another surge of economic growth in
Newfoundland. Our rental properties are a proxy for this growth."
NPREIT's payout ratio is one of the healthiest in the business at 83% of
FFO. "This helps to ensure strong and stable returns for our Unitholders",
Mr. Britton concluded.
<<
-------------------------------------------------------------------------
Three Months Ended Six Months Ended
June 30 June 30
-------------------------------------------------------------------------
($000) except per
Unit amounts 2005 2004 2005 2004
-------------------------------------------------------------------------
Rental properties revenue 15,727 12,245 29,857 23,282
-------------------------------------------------------------------------
Laundry and vending income 122 73 224 118
-------------------------------------------------------------------------
Rental properties operating
expenses (6,089) (3,977) (11,314) (7,529)
-------------------------------------------------------------------------
Net operating income 9,760 8,341 18,767 15,871
-------------------------------------------------------------------------
Interest on mortgages (2,601) (2,389) (5,097) (4,577)
-------------------------------------------------------------------------
Interest on operating facility (414) (309) (676) (539)
-------------------------------------------------------------------------
Amortization (3,179) (2,488) (6,027) (4,714)
-------------------------------------------------------------------------
Interest and other income 202 169 369 304
-------------------------------------------------------------------------
Trust administration costs (917) (847) (1,824) (1,637)
-------------------------------------------------------------------------
Loss on sale of assets (45) - (17) -
-------------------------------------------------------------------------
Current income taxes (99) (111) (195) (214)
-------------------------------------------------------------------------
Future income tax recovery
(expense) 111 75 214 129
-------------------------------------------------------------------------
Net earnings 2,818 2,441 5,514 4,623
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Earnings per unit - basic 0.18 0.18 0.35 0.35
-------------------------------------------------------------------------
Earnings per unit - diluted 0.17 0.18 0.34 0.35
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Net earnings 2,818 2,441 5,514 4,623
-------------------------------------------------------------------------
Addback:
-------------------------------------------------------------------------
Amortization 3,159 2,488 6,007 4,714
-------------------------------------------------------------------------
Amortization of lease
origination costs 20 - 20
-------------------------------------------------------------------------
Amortization of above and below
market leases (24) - (24) -
-------------------------------------------------------------------------
Loss on sale of capital assets 45 - 17 -
-------------------------------------------------------------------------
Future income tax (recovery)
expense (111) (75) (214) (129)
-------------------------------------------------------------------------
Long-term incentive plan 116 125 241 250
-------------------------------------------------------------------------
Distributable Income (DI) 6,023 4,979 11,561 9,458
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Distributable Income per unit
(DIPU) - basic 0.38 0.38 0.73 0.72
-------------------------------------------------------------------------
Distributable Income per unit
(DIPU) - diluted 0.38 0.38 0.73 0.72
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Cash distributions paid 5,016 3,911 9,757 7,759
-------------------------------------------------------------------------
Payout ratio 83.3% 78.5% 84.2% 82.0%
-------------------------------------------------------------------------
For a full copy of the Management Discussion & Analysis and Financial
Statements please log on to www.sedar.com
NORTHERN PROPERTY REAL ESTATE INVESTMENT TRUST
Consolidated Balance Sheets
(Thousands of dollars)
-------------------------------------------------------------------------
June 30, December 31,
2005 2004
$ $
--------------------------
Unaudited Audited
ASSETS
Rental properties and other capital
assets (Note 3) 380,552 326,837
Prepaid expenses and other assets 5,276 4,827
Capital assets under development 5,041 3,529
Accounts receivable 3,047 5,036
Loans receivable 2,499 2,535
Tenant security deposits 1,802 1,565
Intangible assets (Note 4) 429 -
--------------------------
398,646 344,329
--------------------------
--------------------------
LIABILITIES
Mortgages payable (Note 5) 173,653 156,947
Bank indebtedness (Note 6) 37,249 36,713
Future income tax liability 11,760 11,974
Accounts payable and accrued liabilities 6,876 6,499
Loan payable (Note 7) 1,750 -
Distributions payable 1,672 1,407
Long-term incentive plan obligation (Note 8) 1,119 1,065
Intangible liabilities (Note 4) 250 -
Income taxes payable (8) 20
--------------------------
234,321 214,625
UNITHOLDERS' EQUITY 164,325 129,704
--------------------------
398,646 344,329
--------------------------
--------------------------
NORTHERN PROPERTY REAL ESTATE INVESTMENT TRUST
Consolidated Statements of Earnings
Three Months and Six Months Ended June 30
(Columnar amounts expressed in thousands of dollars, except for per unit
amounts)
-------------------------------------------------------------------------
Three Months Ended Six Months Ended
------------------------- -------------------------
June 30, June 30, June 30, June 30,
2005 2004 2005 2004
Unaudited Unaudited Unaudited Unaudited
$ $ $ $
------------------------- -------------------------
REVENUE
Rental properties
revenue 15,727 12,245 29,857 23,282
Laundry and vending
income 122 73 224 118
Rental properties
operating expenses (6,089) (3,977) (11,314) (7,529)
------------------------- -------------------------
Net operating
income 9,760 8,341 18,767 15,871
------------------------- -------------------------
EXPENSES
Interest on
mortgages 2,601 2,389 5,097 4,577
Interest on
operating facility 414 309 676 539
Amortization (Note 3) 3,179 2,488 6,027 4,714
------------------------- -------------------------
6,194 5,186 11,800 9,830
------------------------- -------------------------
INCOME FROM OPERATIONS
BEFORE OTHER ITEMS 3,566 3,155 6,967 6,041
------------------------- -------------------------
OTHER ITEMS
Interest and other
income 202 169 369 304
Trust administration
costs (917) (847) (1,824) (1,637)
Loss on sale of
assets (45) - (17) -
------------------------- -------------------------
(760) (678) (1,472) (1,333)
------------------------- -------------------------
EARNINGS BEFORE
INCOME TAXES 2,806 2,477 5,495 4,708
------------------------- -------------------------
INCOME TAXES
Current (99) (111) (195) (214)
Future recovery 111 75 214 129
------------------------- -------------------------
12 (36) 19 (85)
------------------------- -------------------------
NET EARNINGS 2,818 2,441 5,514 4,623
------------------------- -------------------------
------------------------- -------------------------
Earnings per unit
(Note 11)
Basic 0.18 0.18 0.35 0.35
------------------------- -------------------------
------------------------- -------------------------
Diluted 0.17 0.18 0.34 0.35
------------------------- -------------------------
------------------------- -------------------------
NORTHERN PROPERTY REAL ESTATE INVESTMENT TRUST
Consolidated Statements of Unitholders' Equity (Unaudited)
At June 30
(Thousands of dollars)
Cumulative Cumulative Cumulative Total
Capital Net Income Distributions
(Note 10)
-------------------------------------------------------------------------
Unitholders' Equity -
December 31, 2004 137,803 27,773 (35,872) 129,704
Net income - 5,514 - 5,514
Distributions to
unitholders - - (10,022) (10,022)
New units issued 40,879 - - 40,879
Issuance costs (1,937) - - (1,937)
Long term incentive
plan units issued 187 - - 187
-------------------------------------------------------------------------
Unitholders' Equity -
June 30, 2005 176,932 33,287 (45,894) 164,325
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Cumulative Cumulative Cumulative Total
Capital Net Income Distributions
(Note 10)
-------------------------------------------------------------------------
Unitholders' Equity -
December 31, 2003 130,734 17,924 (20,035) 128,623
Net income - 4,623 - 4,623
Distributions to
unitholders - - (7,797) (7,797)
New units issued 5,244 - - 5,244
Issuance costs (21) - - (21)
Long term incentive
plan units issued 130 - - 130
-------------------------------------------------------------------------
Unitholders' Equity -
June 30, 2004 136,087 22,547 (27,832) 130,802
-------------------------------------------------------------------------
-------------------------------------------------------------------------
NORTHERN PROPERTY REAL ESTATE INVESTMENT TRUST
Consolidated Statements of Cash Flows
Three Months and Six Months Ended June 30
(Columnar amounts expressed in thousands of dollars, except for per unit
amounts)
-------------------------------------------------------------------------
Three Months Ended Six Months Ended
------------------------- -------------------------
June 30, June 30, June 30, June 30,
2005 2004 2005 2004
Unaudited Unaudited Unaudited Unaudited
$ $ $ $
------------------------- -------------------------
CASH FLOWS RELATED TO
THE FOLLOWING
ACTIVITIES:
OPERATING
Net earnings 2,818 2,441 5,514 4,623
Adjustments for:
Amortization 3,159 2,488 6,007 4,714
Amortization of
lease origination
costs 20 - 20 -
Amortization of
above and below
market leases (24) - (24) -
Loss on sale of
capital assets 45 - 17
Future income tax
recovery (111) (75) (214) (129)
Long-term incentive
plan 116 125 241 250
------------------------- -------------------------
Funds from operations 6,023 4,979 11,561 9,458
Changes in non-cash
working capital 1,540 6,258 1,516 (6,443)
------------------------- -------------------------
7,563 11,237 13,077 3,015
------------------------- -------------------------
FINANCING
Proceeds of mortgages 4,279 20,443 17,397 21,789
Proceeds of loan 1,750 - 1,750 -
Repayment of
mortgages (3,038) (1,662) (4,797) (3,194)
Proceeds from sale
of assets 38 264
Proceeds of public
offering (net of
issue costs) (3) (6) 38,149 (21)
Distributions to
unitholders
(Note 11) (5,016) (3,911) (9,757) (7,759)
------------------------- -------------------------
(1,990) 14,864 43,006 10,815
------------------------- -------------------------
INVESTING
Acquisition of
properties and other
capital assets (3,400) (26,950) (52,874) (28,554)
Capital assets
under development (1,961) (314) (2,991) (2,150)
Building
improvements (565) (464) (754) (757)
------------------------- -------------------------
(5,926) (27,728) (56,619) (31,461)
------------------------- -------------------------
NET INCREASE IN BANK
INDEBTEDNESS (353) (1,627) (536) (17,631)
BANK INDEBTEDNESS,
BEGINNING OF PERIOD (36,896) (32,949) (36,713) (16,945)
------------------------- -------------------------
BANK INDEBTEDNESS,
END OF PERIOD (37,249) (34,576) (37,249) (34,576)
------------------------- -------------------------
------------------------- -------------------------
SUPPLEMENTARY
INFORMATION
Interest paid 2,995 2,698 5,684 5,116
------------------------- -------------------------
------------------------- -------------------------
Interest received 18 165 187 170
------------------------- -------------------------
------------------------- -------------------------
Income taxes paid 234 57 234 57
------------------------- -------------------------
------------------------- -------------------------
NORTHERN PROPERTY REAL ESTATE INVESTMENT TRUST
Notes to the Consolidated Financial Statements (Unaudited)
Six Months Ended June 30, 2005 and June 30, 2004
(Columnar amounts expressed in thousands of dollars except where
indicated)
-------------------------------------------------------------------------
1. ORGANIZATION OF TRUST
Northern Property Real Estate Investment Trust ("NPREIT") is an
unincorporated "open-end" real estate investment trust created for
the benefit of the unitholders pursuant to the Declaration of Trust
dated January 2, 2002 under the laws of the Province of Alberta.
NPREIT was created to invest in a portfolio of income-producing
residential and commercial rental properties located primarily in the
Northwest Territories, Nunavut and the Province of Alberta.
2. BASIS OF PRESENTATION
These unaudited interim consolidated financial statements of NPREIT
have been prepared in accordance with the recommendations of the
handbook of the Canadian Institute of Chartered Accountants ("CICA")
and are consistent with those used in the audited consolidated
financial statements as at and for the period ended
December 31, 2004. These unaudited interim consolidated financial
statements do not include all of the disclosures required by Canadian
generally accepted accounting principles ("Canadian GAAP") applicable
to annual financial statements; therefore, they should be read in
conjunction with the December 31, 2004 audited consolidated financial
statements.
The preparation of financial statements in accordance with Canadian
GAAP requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities, and to make
disclosure of contingent assets and liabilities at the date of the
financial statements, and the reported amounts of revenues and
expenses during the reported period. Actual results may differ from
those estimates.
The Trust adopted the new CICA requirements for accounting for income
property acquisitions initiated on or after September 12, 2003. In
accordance with EIC-137 "Recognition of Customer Relationship
Intangible Assets Acquired in a Business Combination" and EIC-140
"Accounting for Operating Leases Acquired in Either an Asset
Acquisition or a Business Combination", the Trust allocates the
purchase price of real property to land, building, and intangibles,
such as the value of above-market and below-market leases, and lease
origination costs, if any.
The above-market and below-market in-place lease values for acquired
properties are determined based on the present value of the
difference between the contractual base rentals under the lease and
fair market lease rates for similar in-place leases, measured from
the date of acquisition to the end of the remaining lease term.
The value of above and below market leases are recorded and amortized
over the remaining term of the associated lease. The value associated
with lease origination costs is amortized over the lease term.
3. RENTAL PROPERTIES AND OTHER CAPITAL ASSETS
-------------------------------------------------------
June 30, 2005 December 31, 2004
-------------------------------------------------------
Accumulated Accumulated
Amort- Net Book Amort- Net Book
Cost ization Value Cost ization Value
$ $ $ $ $ $
-------------------------------------------------------
Land 27,569 - 27,569 18,951 - 18,951
Buildings 364,618 18,319 346,299 316,082 13,066 303,016
Furniture,
fixtures and
equipment 3,137 785 2,352 1,473 620 853
Vehicles 633 187 446 469 140 329
Capital and
leasehold
improvements 5,625 1,739 3,886 4,915 1,227 3,688
-------------------------------------------------------
401,582 21,030 380,552 341,890 15,053 326,837
-------------------------------------------------------
-------------------------------------------------------
NPREIT acquired buildings in 2005 for a total purchase price of
$55.81 million (2004 - $33.12 million). The acquisitions were
financed as follows:
---------------------------------------
Three Months Ended Six Months Ended
June 30 June 30
---------------------------------------
2005 2004 2005 2004
$ $ $ $
---------------------------------------
Building acquisitions -
(included in above totals):
Mortgages, debt assumed and
mezzanine repaid 1,750 7,699 5,856 9,045
Units issued - 3,292 790 5,245
Cash paid 1,346 18,648 49,012 18,829
---------------------------------------
3,096 29,639 55,658 33,119
Fair value adjustment to debt - - 155 -
---------------------------------------
Total purchase price of
building acquisitions 3,096 29,639 55,813 33,119
---------------------------------------
---------------------------------------
Residential units acquired 4 486 1,110 581
Commercial square feet
acquired 63,549 5,964 63,549 7,030
---------------------------------------
---------------------------------------
4. INTANGIBLE ASSETS AND LIABILITIES
Intangible assets are composed of the value of above-market leases
for real property acquisitions initiated after September 12, 2003,
and are net of accumulated amortization of $11,637 (December 31, 2004
- nil). Also included are the values of lease origination costs net
of accumulated amortization of $20,208 (December 31, 2004 - nil).
Intangible liabilities are composed of the value of below-market
leases for income property acquisitions initiated after
September 12, 2003, and are net of accumulated amortization of
$35,782 (December 31, 2004 - nil).
5. MORTGAGES PAYABLE
Mortgages payable bear interest at rates ranging from 4.00% to 13.5%
(weighted average rate of 5.87% as at June 30, 2005 (6.13% -
December 31, 2004)) per annum, payable in principal and interest
instalments of $1.6 million monthly during 2005, and maturing between
2005 and 2017. All mortgages are secured by specific charges against
specific properties.
6. BANK INDEBTEDNESS
NPREIT has a revolving line of credit in the amount of $40 million
for acquisition and operating purposes, bearing interest at prime
plus 0.25% or bankers acceptance rate with a maturity of May 31, 2006
(prime plus 0.5% with a maturity of May 31, 2005). Specific
properties have been pledged as collateral security for the line of
credit.
At June 30, 2005, NPREIT has utilized $37,249,000 (December 31, 2004
- $36,713,000).
7. LOAN PAYABLE
During the period, Gwichin Development Corporation provided loans to
Inuvik Commercial Properties Zheh Gwizhu Limited Partnership
totalling $3.5 million. The demand loan is secured by promissory
notes and bears interest at 5.84% per annum. NPREIT owns a 50%
interest in the Commercial Properties Zheh Gwizhu Limited
Partnership.
8. LONG TERM INCENTIVE PLAN
The Board of Trustees approved a long-term incentive plan ("LTIP")
for the executives of NPREIT, based on the results of the each fiscal
year. Units were granted under the long-term incentive plan (LTIP) as
follows:
---------------------------------------------------------------------
Grant Total Cost
Grant Date Units Price ($000's)
---------------------------------------------------------------------
TOTAL - December 31, 2004 64,979 - 1,065
Accrual for 2005 LTIP grants - - 250
Units vested and issued -
January, 2005 (11,360) - (187)
Units forfeited - June, 2005 (525) - (9)
---------------------------------------------------------------------
TOTAL - June 30, 2005 53,094 - 1,119
---------------------------------------------------------------------
---------------------------------------------------------------------
The actual amount of the LTIP award is determined at the end of the
year by the Board of Trustees based on an assessment of the
performance of the Trust and the individual performance of the
executives. The number of units issued is based on the trading price
on December 31st of each year. One third of the units vest over each
12, 24 and 36 month period following their initial grant. Units are
forfeited if an individual resigns prior to the period in which the
units vest. For the period ended June 30, 2005, a total of 11,360
LTIP units have vested and been issued (June 30, 2004 - 8,518).
9. EMPLOYEE UNIT PURCHASE PLAN
The Board of Trustees approved an Employee Unit Purchase Plan (the
"EUPP") for the employees of NPREIT, effective June 16, 2005. Under
the terms of the EUPP, employees may invest a maximum of 5% of their
salary in NPREIT units and the Trust will contribute one unit for
every three units acquired by an employee. The units are purchased on
the TSX at market prices. For the period ending June 30, 2005,
employees invested a total of $3,000 and the trust contributed
$1,000. Units were purchased on July 4 at $18.60 per unit.
10. UNITHOLDERS' CAPITAL
Total NPREIT Trust units and Class B units issued, outstanding and
eligible for distributions at March 31, 2005 is 16,045,117
(December 31, 2004 - 13,498,757), representing net proceeds of
$176,932,863 (net of issue costs of $11,270,370) (December 31, 2004 -
$137,803,259 net of issue costs of $9,333,332). The number of units
issued and outstanding is as follows:
---------------------------------------------------------------------
Trust Issue Class B
Date Description Units Price LP Units
---------------------------------------------------------------------
December 31, 2004 TOTAL 10,399,120 - 3,099,637
January 6, 2005 Offering 2,490,000 16.10 -
January 6, 2005 Issue costs -
January 10, 2005 LTIP units issued 10,634 16.45 -
January 14, 2005 LTIP units issued 726 17.25 -
March 1, 2005 Property acquisition - - 45,000
LP units exchanged 541,135 - (541,135)
---------------------------------------------------------------------
June 30, 2005 TOTAL 13,441,615 - 2,603,502
---------------------------------------------------------------------
---------------------------------------------------------------------
---------------------------------------------------------------------
Issue TOTAL
Date Description Price Units $(000's)
---------------------------------------------------------------------
December 31, 2004 TOTAL - 13,498,757 137,803
January 6, 2005 Offering - 2,490,000 40,089
January 6, 2005 Issue costs - (1,937)
January 10, 2005 LTIP units issued - 10,634 175
January 14, 2005 LTIP units issued - 726 12
March 1, 2005 Property acquisition 17.56 45,000 790
LP units exchanged - - -
---------------------------------------------------------------------
June 30, 2005 TOTAL - 16,045,117 176,932
---------------------------------------------------------------------
---------------------------------------------------------------------
Trust units
Total number of units outstanding at June 30, 2005 is 13,441,615
(December 31, 2004 - 10,399,120) representing a net book value of
$148,158,198 (December 31, 2004 - $103,804,854), net of issue costs.
Class B Exchangeable Limited Partnership Units and Special Voting
Units
As at June 30, 2005, NPREIT has 2,603,502 Class B Units
(December 31, 2004 - 3,099,637) of a controlled limited partnership
outstanding representing a value of $28,774,517 (December 31, 2004 -
$33,998,405).
11. INCOME AVAILABLE FOR DISTRIBUTION AND PER UNIT INFORMATION
The terms of the Trust Indenture state that Distributable Income is
defined as net income determined in accordance with Canadian
generally accepted accounting principles, subject to certain
adjustments. Other adjustments may be made to Distributable Income as
determined by the majority of the Trustees at their discretion.
Distributable income paid per unit
Three Months Ended Six Months Ended
------------------------- -------------------------
June 30, June 30, June 30, June 30,
2005 2004 2005 2004
Unaudited Unaudited Unaudited Unaudited
$ $ $ $
------------------------- -------------------------
Net earnings 2,818 2,441 5,514 4,623
Add back:
Amortization
expense 3,159 2,488 6,007 4,714
Loss on sale of
assets 45 - 17 -
Amortization of
lease
origination costs 20 - 20 -
Amortization of
above and below
market leases (24) - (24) -
Future income
tax recovery (111) (75) (214) (129)
Long-term
incentive plan 116 125 241 250
------------------------- -------------------------
Distributable
income 6,023 4,979 11,561 9,458
Less: income not
distributed 1,007 1,068 1,804 1,699
------------------------- -------------------------
Distributions
paid to unitholders 5,016 3,911 9,757 7,759
------------------------- -------------------------
------------------------- -------------------------
Distributions per unit
For the period ended June 30, NPREIT made distributions to
unitholders as follows:
2005 2004
---------------------------------------------------------------------
Month Record date Payment date Distribution per unit
---------------------------------------------------------------------
January January 31 February 15 0.1042 0.0987
February February 28 March 15 0.1042 0.0987
March March 31 April 15 0.1042 0.0987
April April 30 May 15 0.1042 0.0987
May May 31 June 15 0.1042 0.0987
June June 30 July 15 0.1042 0.0987
-------------------------
Total
distributions 0.6252 0.5922
-------------------------
-------------------------
Earnings per unit
Three Months Ended Six Months Ended
June 30, June 30,
------------------------- -------------------------
2005 2004 2005 2004
Unaudited Unaudited Unaudited Unaudited
$ $ $ $
------------------------- -------------------------
Net earnings 2,818 2,441 5,514 4,623
------------------------- -------------------------
Weighted average
units for basic
earnings per
unit 15,963,818 13,230,180 15,963,818 13,135,654
Effect of
dilutive units
to be issued in
respect of the
long-term
incentive plan 53,094 32,227 53,094 32,227
------------------------- -------------------------
Weighted average
units for
diluted earnings
per unit 16,016,912 13,262,407 16,016,912 13,167,881
------------------------- -------------------------
------------------------- -------------------------
Basic earnings
per unit 0.18 0.18 0.35 0.35
Diluted earnings
per unit 0.17 0.18 0.34 0.35
------------------------- -------------------------
------------------------- -------------------------
12. GUARANTEES
Guarantees for equity accounted investments and proportionately
consolidated joint ventures total $0.9 million at June 30, 2005
(December 31, 2004 - $0.9 million). Of this amount $160,000 has been
included in the mortgage balance payable. The mortgages bear interest
at rates ranging from 6.41% to 7.50% and mature August, 2005. The
mortgages are secured by specific charges against the properties
owned by the corporations and joint ventures. NPREIT would be liable
in the event of a default of the corporation or joint venture.
13. RELATED PARTY TRANSACTIONS
A trustee leases space from NPREIT under normal commercial terms. The
amounts paid during the period for the space were $101,568 for the
three months ended March 31, 2005 (2004 - $101,813) and $226,159 for
the six months ended June 30, 2005 (2004 - $203,626). Amounts
outstanding in accounts receivable pertaining to this lease were nil
at March 31, 2005 (2004 - $Nil) and $8,280 at June 30, 2005
(2004 - $Nil).
A trustee of NPREIT is a senior partner of a law firm that provides
and continues to provide legal services to NPREIT in the ordinary
course of business. Fees paid during the three month period ended
March 31, 2005 were $119,521 (2004 - $11,529) and $126,485
(2004 - $29,836) for the six month period ended June 30, 2005.
14. SUBSEQUENT EVENTS
NPREIT has signed an offer to acquire a 50% interest in 24,959 square
feet of commercial space in three properties in Inuvik, Northwest
Territories for a total purchase price of $4.05 million. The
properties will be acquired by the Inuvik Commercial Properties Zheh
Gwizuh Limited Partnership. The acquisitions will be financed by CPLP
through cash of $2.55 million and a vendor take-back mortgage in the
amount of $1.50 million bearing interest at 5.25% per annum. The
Closing Date is at the discretion of the Vendor but in any event not
later than November 1, 2005
In addition to the above acquisition, NPREIT has signed agreements to
purchase $6.72 million of residential properties. The offers are for
cash and are subject to the completion of due diligence and Board
approval. The acquisitions are anticipated to close on or before
November 1, 2005.
15. COMPARATIVE FIGURES
Certain of the prior year's figures have been reclassified to confirm
with the current presentation.
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Northern Property R.E.I.T. Announces Second Quarter 2005 Results
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