Lakeview Hotel Investment Corp Announces Year End Results

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WINNIPEG, April 29, 2016 /CNW/ - Lakeview Hotel Investment Corp ("LHIC") is pleased to report its financial results for the Year ended December 31, 2015. The following comments in regard to the financial results should be read in conjunction with the December 31, 2015 financial statements and Management Discussion and Analysis which are available on the SEDAR website www.sedar.com.

The sharp decline in oil prices that occurred late in 2014 had an adverse impact on operating results throughout 2015. The important metrics of Funds from Operations, Adjusted Funds from Operations, and Distributable Income all turned negative in 2015. The duration of the downturn is still not clearly known. Although improvements may occur earlier, Management of Lakeview Hotel Investment Corp. is assuming that operating results will not show meaningful improvement until at least 2017 and is taking the measures it deems necessary to function through this downturn, without sacrificing the standard of operations at its hotels and restaurants.

Prior to the slowdown, Lakeview Hotel Investment Corp. had been focused on reducing its overall leverage in order to improve balance sheet ratios and to position the Corporation for future growth.  These efforts will continue. Total liabilities have been reduced by $32 million since the end of 2012, largely through the sale of assets and the refinancing of debt. The Corporation has also been focused on cost saving measures to improve bottom line performance. The Corporation benefits greatly from the support of related parties that own over 59% of the outstanding shares of Lakeview Hotel Investment Corp., and from the agreement of related parties to defer fees. This has allowed the Corporation to remain current on all payments to all unrelated parties. The Corporation is current on all debt service payments to mortgage holders, other long-term debt holders, on all payments to debenture holders, and on all property tax and tax payments to all government agencies. The related parties remain committed to the welfare of the Corporation and will continue to provide the support necessary to benefit the Corporation and its Shareholders.

Following is a comparison of the operating results for the three months and year ended December 31, 2015 and the comparable period in 2014:

		Three months ended December 31		Year ended December 31
		2015	2014	2015	2014
		$	$	$	$
Hospitality Revenue
	Room	5,069,763	8,317,561	25,005,838	32,915,994
	Food & Beverage	934,265	1,216,923	3,745,560	4,695,419
	Other	329,783	476,346	1,544,966	1,933,032
Total Revenue		6,333,811	10,010,830	30,296,364	39,544,445
Expenses		(8,535,197)	(9,682,067)	(35,276,757)	(38,359,661)
Gain on sale of income properties		-	-	-	1,007,514
Net Income (Loss)		(2,201,386)	328,763	(4,980,393)	2,192,298
Basic and diluted income (loss) per share		(0.1126)	0.017	(0.255)	0.112
Reconciliation to Funds from Operations
Add (deduct)
Provision for impairment of income property		400,000		400,000
Amortization of income properties		765,462	768,235	3,050,018	3,056,260
Amortization of franchise fees		1,192	1,192	4,768	4,768
Impairment of Income Property		-	-	-	-
Unrealized loss (gain) on change in fair value of interest rate			410,933	895,849	660,478
	swap	(121,667)
Compensation Costs of Stock Options		28,525	-	28,525	-
Distributions from Lakeview Flag Licensing General			164,150	234,710	759,010
	Partnership	53,900
Distributions from Lakeview Flag Management General			120,000	163,500	605,250
	Partnership	8,750
Income from Lakeview Flag Licensing General Partnership		(115,398)	(168,735)	(557,403)	(706,763)
Income from Lakeview Flag Management General			(109,165)	(345,463)	(445,130)
	Partnership	(72,053)
Gain on sale of income properties		-	-	-	(1,007,514)
Amortization of discount on bankers' acceptance		-	-	198,712	-
Funds from Operations		(1,252,675)	1,515,373	(907,177)	5,118,657
Basic and diluted funds from operations per share		(0.064)	0.077	(0.046)	0.262
Loss on derecognition of financial liability		-	-	-	580,732
Contributions to reserve account		(138,754)	(224,864)	(776,896)	(760,767)
Adjusted Funds from Operations		(1,391,429)	1,290,509	(1,684,073)	4,938,622
Basic and diluted adjusted funds from operations per share		(0.071)	0.066	(0.086)	0.253
Reconciliation to Distributable Income
Accretion of other long-term debt		39,635	40,662	178,857	53,397
Accretion of debentures		40,586	37,032	159,785	146,213
Accretion of mortgages payable		24,264	23,427	94,723	111,398
Loss on derecognition of income properties		44,144	14,244	151,627	25,834
Distributable income		(1,242,800)	1,405,874	(1,099,081)	5,275,464
Basic and diluted distributable income per share		(0.064)	0.072	(0.056)	0.270
Dividends		0	0	0	0

Lakeview Hotel Investment Corp is listed on the TSX Venture Exchange under the symbol "LHR".  Lakeview Hotel Investment Corp receives income from ownership, management and licensing of hotel properties. 

The TSX Venture Exchange nor its Regulation Service 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 Lakeview Hotel Investment Corp

Avrum Senensky, Executive Vice President, Tel: [phone], Fax: [phone], Email [email protected]