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Homburg (AMS:HII) Shares issued: Class A - 155,578,911 Class B - 31,514,782
Halifax, Nova Scotia, August 8, 2008 (TSX: HII.A & HII.B and NYSE Euronext Amsterdam: HII) - Richard Homburg, Chairman and CEO of Homburg Invest Inc. ("Homburg Invest" or "the Company") is pleased to announce Homburg Invest has released the June 30, 2008 financial results prepared under both Canadian Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS). The complete June 30, 2008 financial results and MD&A will be available for viewing and downloading from the corporation's web site at www.homburginvest.com.
The Company is pleased to announce a substantial increase in the results both under IFRS and Canadian GAAP for the six months ended June 30, 2008.
Increase in IFRS results:
* Property revenue increased 60.2% to $152.1 million compared to June 30, 2007. * Property net operating income (note) increased 42.4% to $112.2 million compared to June 30, 2007 * Funds from operations per share (note) increased 72.2% to $0.31 compared to June 30, 2007 * Funds from operations (note) increased 137.0% to $56.1 million compared to June 30, 2007
Increase in Canadian GAAP results: * Property revenue increased 59.3% to $151.2 million compared to June 30, 2007 * Property net operating income (note) increased 41.3% to $111.4 million compared to June 30, 2007 * Funds from operations per share (note) increased 70.0% to $0.34 compared to June 30, 2007 * Funds from operations (note) increased 138.8% to $62.2 million compared to June 30, 2007
The Company prepares it's quarterly and annual statements under both GAAP and IFRS. This reflects the Board's view that the IFRS presentation most accurately reflects the financial position of a real estate investment company, while at the same time the Company continues to comply with requirements to produce its results under GAAP. This also reflects the Company's desire to provide its shareholders with as much information as possible in today's environment of continuing concerns with respect to financial disclosure in the market place.
The most significant differences between IFRS and GAAP statements are that while the IFRS statements reflect the investment properties at fair value and are without depreciation charges, the GAAP statements record the fixed assets at historical cost less accumulated depreciation. In addition, deferred charges relating to leasing fees have been recorded as an asset in the GAAP financial statements and will be charged to expense over the period of the related lease. These charges are written off in the period incurred under IFRS.
Financial Highlights - IFRS Second Quarter ended June 30, 2008
Six Months Six Months Ended Ended June 30 June 30 (000's) 2008 2007 Increase
Property revenue $152,103 $94,961 60.2% Property net operating income $112,212 $78,796 42.4% Other revenue $134,615 $47,384 Unrealized valuation changes ($4,011) $25,093 Net earnings $34,563 $48,578 Earnings per share - basic and diluted $0.19/$0.18 $0.38/$0.35 Funds from operations $56,084 $23,665 137.0% Funds from operations per share - basic and diluted $0.31/$0.30 $0.18/$0.17 72.2%
Financial Highlights - IFRS Second Quarter ended June 30, 2008
Three Months Three Months Ended Ended June 30 June 30 (000's) 2008 2007 Increase
Property revenue $77,290 $54,925 40.7% Property net operating income $56,972 $42,976 32.6% Other revenue $49,672 $27,076 Unrealized valuation changes ($3,389) $16,538 Net earnings $16,709 $29,598 Earnings per share - basic and diluted $0.09/$0.09 $0.22/$0.20 Funds from operations $25,828 $9,114 183.4% Funds from operations per share - basic and diluted $0.14/$0.13 $0.07/$0.06 100.0%
Property revenue for the second quarter is up 40.7% over the same quarter in 2007 to $77.3 million. At the same time property net operating income (NOI) increased to $57.0 million from $43.0 million, an increase of 32.6%. The positive aspects of the growth in our portfolio also manifest themselves in our funds from operations ("FFO") which improved to $25.8 million in the second quarter of 2008, up 183.4% from 2007's quarter two. On an annualized basis this is a FFO of $0.62 per share, which is a FFO payout ratio (note) of 77.4%. When the 50% participation in our dividend reinvestment program is factored in, the cash outflow on our annual $0.48 dividend is $0.24, a FFO cash payout ratio of 38.7%.
Shareholders' equity increased from $886.3 million at December 31, 2007 to $886.7 million at June 30, 2008.
Financial Highlights - GAAP Second Quarter ended June 30, 2008
Six Months Six Months Ended Ended June 30 June 30 (000's) 2008 2007 Increase
Property revenue $151,241 $94,961 59.3% Property net operating income $111,350 $78,795 41.3% Other income $141,054 $50,047 Realized gains on sale of property $Nil $2,179 Net earnings $18,543 $18,092 Earnings per share - basic and diluted $0.10/$0.10 $0.14/$0.13 Funds from operations $62,166 $26,036 138.8% Funds from operations per share - basic and diluted $0.34/$0.33 $0.20/$0.19 70.0%
Financial Highlights - GAAP Second Quarter ended June 30, 2008
Three Months Three Months Ended Ended June 30 June 30 (000's) 2008 2007 Increase
Property revenue $76,879 $54,925 40.0% Property net operating income $56,561 $42,976 31.6% Other income $48,731 $29,666 Net earnings $9,325 $9,490 Earnings per share - basic and diluted $0.05/$0.05 $0.07/$0.07 Funds from operations $28,532 $11,485 148.4% Funds from operations per share - basic and diluted $0.15/$0.15 $0.09/$0.08 66.7%
Homburg Invest, with its head office in Halifax, Nova Scotia, owns and develops a diversified portfolio of quality real estate including office, retail, industrial and residential apartment and townhouse properties throughout Canada, the United States and Western Europe.
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For further information, please contact:
Mr. Richard Homburg, Chairman and CEO Homburg Invest Inc. 902-468-3395
or
J. Richard Stolle President and COO Homburg Invest Inc. 31-20-573-3855
This news release may contain statements which by their nature are forward looking and express the Company's beliefs, expectations or intentions regarding future performance, future events or trends. Forward looking statements are made by the Company in good faith, given management's expectations or intentions however, they are subject to market conditions, acquisitions, occupancy rates, capital requirements, sources of funds, expense levels, operating performance and other matters. Therefore, forward looking statements contain assumptions which are subject to various factors including: unknown risks and uncertainties: general economic conditions; local market factors; performance of other third parties; environmental concerns; and interest rates, any of which may cause actual results to differ from the Company's good faith beliefs, expectations or intentions which have been expressed in or may be implied from this news release. Therefore, forward looking statements are not guarantees of future performance and are subject to known and unknown risks. Information and statements in this document, other than historical information, should be considered forward-looking and reflect management's current views of future events and financial performance that involve a number of risks and uncertainties. Factors that could cause actual results to differ materially include, but are not limited to, the following: general economic conditions and developments within the real estate industry, competition and the management of growth. The Toronto Stock Exchange has neither approved nor disapproved of the information contained herein.
Note
Non GAAP and Non IFRS Financial Measures
This news release includes measures widely accepted within the real estate industry which are not defined under CDN GAAP or IFRS. These measures include Funds from Operations, Funds from Operations per share, Property Net Operating Income, and Payout Ratio. As these are not defined measures under CDN GAAP or IFRS, other issuers' may have different calculations from those used by the Company.
The Company considers these amounts to be measures of operating and financial performance.
a) Funds from Operations ("FFO") and FFO per share are presented by the Company as net income (loss) from continuing operations adjusted for amortization, stock based compensation, deferred and capital income taxes, unrealized and realized valuation changes, and unrealized foreign exchange gains; divided by the weighted average number of shares outstanding b) FFO payout ratio are presented by the Company as dividends per share divided by funds from operations per share c) FFO Cash payout ratio are presented by the Company as cash dividends per share divided by fund from operations per share d) Property Net operating income ("N0I") are presented by the Company as Property Revenue less Property Operating Expenses
