Lakeview Hotel REIT Reports Year End Financial Results

/NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR DISTIBUTION TO U.S. NEWS WIRE SERVICES/

WINNIPEG, April 30, 2012 /CNW/ - Lakeview Hotel Real Estate Investment Trust ("Lakeview REIT") is pleased to report its financial results for the year ended December 31, 2011.  The following comments in regard to the financial results should be read in conjunction with the December 31, 2011 financial statements and Management Discussion and Analysis which are available on the SEDAR website www.sedar.com and the Lakeview REIT website www.lakeviewreit.com.

The uptrend in operating results that began in 2010 continued throughout 2011.  Lakeview REIT experienced a 14.7% increase in room revenues at its hotels in 2011.  Rebranding of Lakeview REIT's restaurant facilities to Roustabouts Restaurants and Bars, with accompanying renovations, led to a 21.1% increase in food and beverage revenues. Operating efficiencies that have been put in place at Lakeview REIT properties allowed the revenue increases to translate into significant improvements in Distributable Income, Funds from Operations, and Adjusted Funds from Operations.

The improvements in operating results that the REIT enjoyed in 2011 are expected to continue.  Economic activity in Alberta and Northern British Columbia continues to be very robust.  This activity has translated into increased occupancy levels in many of the markets that Lakeview REIT operates its hotels.  In some cases the improvement has been dramatic.  While natural gas prices are down, crude oil prices and prices for liquid rich gases are very strong and drilling for these commodities has been increasing in many markets where Lakeview REIT has its hotels.   Performance varies widely from market to market as demand in any given market may move up or down based on levels of drilling activity, pipeline construction and other drivers for hotel room demand.  However, the overall trend has been and continues to be very positive.

Lakeview REIT is now clearly cash flow positive.  It is anticipated that surplus cash flow will be used to reduce liabilities of the REIT and for capital improvements to its properties.

Following is a comparison of the operating results for the three months and year ended December 31, 2011 and the comparable periods in 2010:

		Three months ended December 31			Year ended December 31
		2011		2010	2011	2010
		$		$	$	$
Hospitality Revenue
	Room	9,065,600		7,706,385	35,392,992	30,863,747
	Food & Beverage	1,066,840		852,082	3,551,892	2,932,247
	Other	444,913		446,304	2,242,262	1,881,557
Total Revenue		10,577,353		9,004,771	41,187,146	35,677,551
Expenses		11,401,670		10,785,915	43,924,831	43,581,853
Net Income (Loss)		(824,317)		(1,781,144)	(2,737,685)	(7,904,302)
Basic and diluted income (loss) before income tax per unit		(0.042)		(0.091)	(0.140)	(0.404)
Reconciliation to funds from Operations
Add (deduct)
Amortization of income properties		1,281,333		1,569,584	5,498,366	6,354,176
Amortization of franchise fees and licenses		5,077		8,214	25,361	34,416
Provision for impairment of note receivable		-		-	-	1,396,062
Compensation Costs of Unit Options		-		-	-	124,000
Distributions from Lakeview Flag Licensing General Partnership		384,650		122,500	791,105	534,100
Distributions from Lakeview Flag Management General Partnership		107,500		105,000	370,750	235,000
Income from Lakeview Flag Licensing General Partnership		(110,757)		(134,437)	(576,876)	(532,124)
Income from Lakeview Flag Management General Partnership		(123,702)		(104,548)	(475,800)	(415,479)
Recovery of impaired amounts previously written off		-		-	(283,795)	-
Funds from Operations		719,784		(214,831)	2,611,426	(174,151)
Basic and diluted funds from Operations per unit		0.037		(0.011)	0.134	(0.009)
Contributions to reserve account		(291,637)		(199,177)	(1,048,345)	(770,056)
Adjusted funds from Operations		428,147		(414,008)	1,563,081	(944,207)
Basic and diluted adjusted funds from Operations per unit		0.022		(0.021)	0.080	(0.048)
Reconciliation to distributable income
Accretion on debt component of convertible debentures		342,417		302,182	1,324,396	1,170,714
Accretion of debentures		175,922		53,098	343,876	204,248
Accretion of mortgages payable		71,561		64,550	249,973	254,688
Gain on disposal of income properties		4,390		-	(2,593)	-
Distributable income		1,022,437		5,822	3,478,733	685,443
Basic and diluted distributable income per unit		0.052		0.000	0.178	0.035
Distributions		0		0	0	0

Lakeview REIT is a real estate investment trust, which is listed on the TSX Venture Exchange under the symbol "LHR.UN".  Lakeview REIT receives income from ownership, management and licensing of hotel properties.  For further information on Lakeview REIT please visit our website www.lakeviewreit.com.

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. 

 

 

 

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