THE BECKER MILK COMPANY LIMITED TORONTO, ONTARIO--(Marketwired - Sep 11, 2014) - The Becker Milk Company Limited (the "Company") (TSX:BEK.B) is pleased to report the results for the three months ended July 31, 2014.
HIGHLIGHTS
- Total revenues for the three months ended July 31, 2014 were $976,569 compared to $989,081 for the same period in 2013;
- Net operating income for Q1 fiscal 2015 was $874,851 compared to $845,812 in 2014;
- Net income for Q1 fiscal 2015 was $ 0.10 per share, compared to $0.15 per share in 2014.
FINANCIAL HIGHLIGHTS
| Three months ended | ||||||
| July 31 | ||||||
| 2014 | 2013 | |||||
| Property revenue | $ | 971,533 | $ | 971,842 | ||
| Finance income | 5,036 | 17,239 | ||||
| Total revenues | $ | 976,569 | $ | 989,081 | ||
| Property revenue | $ | 971,533 | $ | 971,842 | ||
| Property operating expenses | (96,682 | ) | (126,030 | ) | ||
| Net operating income | $ | 874,851 | $ | 845,812 | ||
| Adjusted funds from operations | $ | 386,441 | $ | 422,375 | ||
| Net income attributable to common and special shareholders | $ | 181,003 | $ | 274,351 | ||
| Average common and special shares outstanding | 1,808,360 | 1,808,360 | ||||
| Income per share | $ | 0.10 | $ | 0.15 | ||
Significant components of the $93,348 decrease in net income between the three months ended July 31, 2014 compared to the three months ended July 31, 2013 are:
Changes in net income - three months ended July 31, 2014 compared to three months ended July 31, 2013
| Change in fair value of investment properties | (94,690 | ) |
| Change in deferred taxes on investment properties | 28,586 | |
| Change in current taxes | (28,559 | ) |
| Change in net operating income | 29,039 | |
| Change in administrative expenses | (20,027 | ) |
| Change in expenses related to strategic review | 4,626 | |
| Other items | (12,203 | ) |
| Change in net income | ($93,348 | ) |
NET OPERATING INCOME
Net operating income for the three months ended July 31, 2014 was higher compared with the previous year, increasing $29,039 to $874,851 compared to $845,812 in 2013, principally as a result of reduced property operating expenses.
ADJUSTED FUNDS FROM OPERATIONS
| Three months ended | |||||||
| July 31 | |||||||
| 2014 | 2013 | ||||||
| Funds from operations | $ | 413,141 | $ | 440,265 | |||
| Items not affecting cash: | |||||||
| Straight line rent | 15,590 | (17,890 | ) | ||||
| Sustaining capital expenditures | (42,290 | ) | |||||
| Adjusted funds from operations | $ | 386,441 | $ | 422,375 | |||
| Adjusted funds from operations per share | $ | 0.21 | $ | 0.23 | |||
For the three months ended July 31, 2014 the Company recorded adjusted funds from operations of $386,441 ($0.22 per share) compared to $422,375 ($0.23 per share) in 2013. Lower funds from operations and higher sustaining capital expenditures were partially offset by a reversal of the non-cash adjustment for straight line rent.
STRATEGIC REVIEW
As reported in a press release dated August 6, 2013 the Company retained PricewaterhouseCoopers Real Estate Inc. to explore the possible sale of the Company. This process has not reached any conclusion and is ongoing. In support of this process an engineering firm has conducted property condition surveys and environmental assessments of all properties. Management believes none of these assessments have found any circumstances that require immediate remediation to meet currently legislated environmental obligations.
As at July 31, 2014 legal and engineering costs of $537,366 had been incurred in connection with the potential sale of the Company.
DIVIDEND
The Directors of the Company have declared the regular semi-annual dividend on Class B Special and Common Shares of 40 cents per share. This dividend of 40 cents will be paid to those shareholders of record as of September 24, 2014 and payable on October 7, 2014.
The dividends for Canadian tax purposes will be considered as an eligible dividend.
The Company's interim financial statements for the three months ended July 31, 2014, along with the Management's Discussion and Analysis will be filed with SEDAR at www.sedar.com.
Readers are cautioned that although the terms "Net Operating Income", and "Funds From Operations" are commonly used to measure, compare a nd explain the operating and financial performance of Canadian real estate companies and such terms are defined in the Management's Discussion and Analysis, such terms are not recognized terms under Canadian generally accepted accounting principles. Such terms do not necessarily have a standardized meaning and may not be comparable to similarly titled measures presented by the other publicly traded entities.
For the Board of Directors
G.W.J. Pottow, President
