INVESTOR PRESENTATION NOVEMBER 2019 INVESTOR PRESENTATION NOVEMBER 2019
Disclaimer About this Presentation This presentation is dated November 11, 2019 and is strictly intended to provide general information about PRO Real Estate Investment Trust (“PROREIT”) and its business. This presentation does not constitute an offer to sell or the solicitation of an offer to buy any securities of PROREIT. The information in this presentation is stated as at September 30, 2019, unless otherwise indicated. Non-IFRS Measures PROREIT’s consolidated financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS”). In this presentation, as a complement to results provided in accordance with IFRS, PROREIT discloses and discusses certain non ‐ IFRS financial measures, including Adjusted Funds From Operations (“AFFO”), Funds From Operations (“FFO”), Gross Book Value (“GBV”), debt ‐ to ‐ GBV, Net Operating Income (“NOI”), interest coverage ratio and payout ratios as well as other measures discussed elsewhere in this presentation. These non ‐ IFRS measures are not defined by IFRS, do not have a standardized meaning and may not be comparable with similar measures presented by other issuers. PROREIT has presented such non ‐ IFRS measures as Management believes they are relevant measures of PROREIT’s underlying operating performance and debt management. Non ‐ IFRS measures should not be considered as alternatives to net income, cash generated from (utilized in) operating activities or comparable metrics determined in accordance with IFRS as indicators of PROREIT’s performance, liquidity, cash flow, and profitability. For a full description of these measures and, where applicable, a reconciliation to the most directly comparable measure calculated in accordance with IFRS, please refer to the “Non ‐ IFRS and Operational Key Performance Indicators” section in PROREIT’s Management’s Discussion and Analysis for the period ended September 30, 2019 and for the year ended December 31, 2018 available on SEDAR at www.sedar.com. Forward-Looking Information Certain statements contained in this presentation constitute forward ‐ looking information within the meaning of applicable securities laws. In some cases, forward ‐ looking information can be identified by such terms such as “may”, “might”, “will”, “could”, “should”, “would”, “occur”, “expect”, “plan”, “anticipate”, “believe”, “intend”, “estimate”, “predict”, “potential”, “continue”, “likely”, “schedule”, or the negative thereof or other similar expressions concerning matters that are not historical facts. Some of the specific forward ‐ looking statements in this presentation include, but are not limited to, statements with respect to PROREIT’s future financial performance; the ability of PROREIT to execute its growth strategies; and PROREIT’s ability to continue paying monthly distributions and PROREIT’s ability to raise capital. Forward ‐ looking statements are based on a number of assumptions and are subject to a number of risks and uncertainties, many of which are beyond PROREIT’s control, that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward ‐ looking statements. PROREIT’s objectives and forward ‐ looking statements are based on certain assumptions, including that (i) PROREIT will receive financing on favourable terms; (ii) the future level of indebtedness of PROREIT and its future growth potential will remain consistent with PROREIT’s current expectations; (iii) there will be no changes to tax laws adversely affecting PROREIT’s financing capacity or operations; (iv) the impact of the current economic climate and the current global financial conditions on PROREIT’s operations, including its financing capacity and asset value, will remain consistent with PROREIT’s current expectations; (v) the performance of PROREIT’s investments in Canada will proceed on a basis consistent with PROREIT’s current expectations; and (vi) capital markets will provide PROREIT with readily available access to equity and/or debt. Additional information about these assumptions and risks and uncertainties is contained under “Risk Factors” in PROREIT’s latest annual information form, and in other filings that PROREIT has made and may make with applicable securities authorities in the future, all of which are or will be available on SEDAR at www.sedar.com. The forward ‐ looking statements contained in this presentation are expressly qualified in their entirety by this cautionary statement. Investors are cautioned not to put undue reliance on forward ‐ looking statements. All forward ‐ looking statements in this presentation are made as of the date of this presentation. PROREIT does not undertake to update any such forward ‐ looking information whether as a result of new information, future events or otherwise, except as required by law. Additional Information Information appearing in this presentation is a select summary of PROREIT’s business, operations and results. The latest annual information form of PROREIT and its consolidated financial statements and management’s discussion and analysis thereon for the year ended December 31, 2018 and for the period ended September 30, 2019 are available on SEDAR at www.sedar.com. INVESTOR PRESENTATION 2 NOVEMBER 2019
BUILDING A MID-CAP DIVERSIFIED COMMERCIAL REIT IN CANADA INVESTOR INVESTOR PRESENTATION PRESENTATION 3 NOVEMBER 2019 NOVEMBER 2019
Section 1. PROREIT AT A GLANCE Section 2. PROVEN EXECUTION Section 3. ROBUST 2019 THIRD QUARTER Section 4. POSITIONED FOR GROWTH Section 5. APPENDICES INVESTOR INVESTOR PRESENTATION PRESENTATION 4 NOVEMBER 2019 NOVEMBER 2019
SECTION 1. PROREIT AT A GLANCE INVESTOR INVESTOR PRESENTATION PRESENTATION 5 NOVEMBER 2019 NOVEMBER 2019
About PROREIT Quick Facts Established in 2013, PROREIT owns $629 million of diversified commercial real estate properties in Canada, representing (As at November 11, 2019) over 4.4 million square feet of gross leasable area. PROREIT is Ticker Symbol (TSX) Total Units mainly focused on strong secondary markets in Québec, Atlantic PRV.UN 39,824,556 Canada and Ontario, with selective exposure in Western Canada. Tax Deferred Market Distribution Capitalization 100% (estimated) $290 million Yield (1) DRIP Eligible 91 3% bonus units 8.7% Annual Distribution Average Daily Volume PROPERTIES $0.63 (post-consolidation) 103,000 IN 9 PROVINCES Revenue by Asset Class (3 months ended September 30, 2019) Retail 40.5% BC: 5 Industrial 21.3% AB: 11 MB: 6 PEI: 1 SK: 4 Office 12.1% ON: 12 QC: 16 Commercial NB: 22 NS: 14 Mixed-use 26.2% (1) Based on Nov. 11, 2019, $7.26 closing price. INVESTOR PRESENTATION 6 6 NOVEMBER 2019
Our Vision To become a mid-cap diversified Canadian REIT with high-quality commercial real estate in specific segments of the industrial, retail, commercial mixed-use and office sectors, recognized for its ability to: PRODUCE GROW STABLE AND GROWING UNITHOLDER VALUE RETURNS PER UNIT WITH A CLEAR STRATEGY TO GROW FFO AND NAV INVESTOR PRESENTATION 7 NOVEMBER 2019
SECTION 2. PROVEN EXECUTION INVESTOR INVESTOR PRESENTATION PRESENTATION 8 NOVEMBER 2019 NOVEMBER 2019
Our Growth History PROREIT CREATION A BREAKOUT BY FORMER CANMARC YEAR MANAGEMENT ► Achieved ► Internalization of ► One $6 million $500M asset management property, asset target 397K sq. ft. GLA ► Graduation to TSX ► 84 properties, ► 32 properties, ► 66 properties, ► Consolidation ► TSX-V listing 3.7M sq. ft. GLA 1.7M sq. ft. GLA 2.7M sq. ft. GLA of Units 3:1 (PRV.UN) 2013 2014 2015 2016 2017 2018 2019 ► 23 properties, ► 39 properties, ► 91 properties, ► $69.1 million 1.0M sq. ft. GLA 2.0M sq. ft. GLA 4.4 M sq. ft. GLA in new equity ► Acquisitions capital raised of 7 properties ► Acquisition for $97.8M PROREIT has of property ► $57.6M equity management consistently paid offering platform attractive distributions every month, since January 2014 INVESTOR PRESENTATION 9 NOVEMBER 2019
A Solid Track Record – Five Years Of Growth Total Assets Gross Leasable Area Property Revenues ($ Millions) (‘000 sq. ft.) ($ Millions) 600 4,000 45 3,703 40.889 509.7 3,500 40 500 CAGR CAGR 35 3,000 CAGR 2,690 91% 29.639 56% 365.9 400 30 49% 2,500 22.963 2,005 25 300 2,000 258.0 1,670 18.190 20 203.2 1,500 200 15 1,044 141.5 9.189 1,000 10 100 70.2 397 500 5 1.628 0 0 0 (1) (1) (1) 2013 2014 2015 2016 2017 2018 2013 2014 2015 2016 2017 2018 2013 2014 2015 2016 2017 2018 Net Cash Flows Provided Net Operating Income (2) Adjusted funds from operations (2) from Operating Activities ($ Millions) ($ Millions) ($ Millions) 13.885 45 14 45 40 40 12 35 35 CAGR CAGR 10 9.053 30 30 26.049 87% 58% CAGR 8 25 25 59% 18.266 20 20 6 14.105 4.465 14.340 15 3.568 15 11.207 10.325 4 7.619 10 10 6.258 5.758 1.404 2 2.944 5 5 1.410 1.126 0.155 0 0 0 (1) (1) (1) 2013 2014 2015 2016 2017 2018 2013 2014 2015 2016 2017 2018 2013 2014 2015 2016 2017 2018 (1) 2013 was for 13 months ended (2) Non-IFRS measure. See “Disclaimer – Non-IFRS measure”. INVESTOR PRESENTATION 10 NOVEMBER 2019
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