Plazacorp announces FFO growth with its year end results

FREDERICTON, March 5, 2013 /CNW/ - Plazacorp Retail Properties Ltd. (TSXV: PLZ) today announced its results for the year ended December 31, 2012.

Plazacorp reported funds from operations ("FFO") of $16.2 million for the year ended December 31, 2012, an increase of 15.6% over the same period in the prior year. FFO per share was $0.264 for the year ended December 31, 2012 ($0.264 per share diluted) compared to $0.263 per share for the year ended December 31, 2011 ($0.263 per share diluted).  FFO was positively impacted by growth in net property operating income and a decrease in financing costs, partly offset by the net effects of the internalization of property and corporate management that occurred effective July 1, 2011.

For the quarter ended December 31, 2012, Plazacorp reported FFO of $4.1 million, an increase of 12.7% over the same period in the prior year.  FFO per share was $0.064 for the quarter ended December 31, 2012 ($0.064 per share diluted) compared to $0.061 per share for the quarter ended December 31, 2011 ($0.061 per share diluted). Again, FFO was positively impacted by growth in net property operating income and a decrease in financing costs.  These were partly offset by an increase in current income taxes mainly from subsidiary entities.

Michael Zakuta, Plazacorp's President and CEO said, "We are pleased with the financial results for the year.  The company has continued to execute on its strategy of creating value for our shareholders by developing or acquiring high quality retail real estate in our geographies, leased to national tenants.  The growth in FFO and our ability to continue increasing dividends to shareholders is a reflection of the success of our strategy."

Profit for the year ended December 31, 2012 was $47.1 million compared to $28.9 million recorded for the prior year.  Profit was mainly impacted by non-cash fair value adjustments on investment properties and investments as a result of decreases in capitalization rates, net of deferred taxes on those amounts, as well as the same factors described above affecting FFO.

Plazacorp's summary of FFO is presented below:

(000s - except per share amounts and debt coverage ratios)	3 Months Ended December 31, 2012 (unaudited)		3 Months Ended December 31, 2011 (unaudited)		12 Months Ended December 31, 2012		12 Months Ended December 31, 2011
Profit for the period attributable to shareholders	$	1,058	$	7,911	$	43,598	$	28,114
Add (deduct):
Loss on disposal of surplus land		51		3		43		3
Deferred income tax expense		(72)		2,829		13,176		10,349
Fair value adjustment to investment properties		3,633		(8,385)		(37,091)		(23,864)
Fair value adjustment to investments		(2,701)		(1,762)		(7,485)		(3,759)
Fair value adjustment to convertible debentures		547		3,088		673		2,744
Tax on disposals of investment properties and investment properties included in investments		835		-		835		-
Net revaluation of interest rate swaps		(27)		165		(48)		363
Non-controlling interest adjustment		789		(198)		2,542		103
Basic FFO	$	4,113	$	3,651	$	16,243	$	14,053
Interest on dilutive convertible debentures		-		-		-		-
Diluted FFO	$	4,113	$	3,651	$	16,243	$	14,053
Basic Weighted Average Shares Outstanding		63,833		59,716		61,447		53,394
Diluted Weighted Average Shares Outstanding		63,833		59,716		61,447		53,394
Basic and diluted FFO per share	$	0.064	$	0.061	$	0.264	$	0.263
Debt coverage ratios
Interest coverage ratio		2.1 times		1.9 times		2.1 times		1.9 times
Debt service coverage ratio		1.7 times		1.5 times		1.7 times		1.5 times

A copy of Plazacorp's annual report can be found on the Company's web site at www.plaza.ca or on SEDAR at www.sedar.com.

Plazacorp Retail Properties Ltd. is an owner of shopping malls and strip plazas throughout Atlantic Canada, Quebec and Ontario.  Plazacorp owns interests in 118 properties comprising 5.2 million square feet of retail real estate.

CAUTIONARY STATEMENTS REGARDING FORWARD LOOKING INFORMATION

This news release contains forward looking statements relating to our operations and the environment in which we operate, which are based on our expectations, estimates, forecasts and projections.  These statements are not future guarantees of future performance and involve risks and uncertainties that are difficult to control or predict.  Therefore, actual outcomes and results may differ materially from those expressed in these forward looking statements.  Readers, therefore, should not place undue reliance on any such forward looking statements.  Further, a forward looking statement speaks only as of the date on which such statement is made.  We undertake no obligation to publicly update any such statement, to reflect new information or the occurrence of future events or circumstances, except for forward-looking information disclosed in prior disclosures which, in light of intervening events, requires further explanation to avoid being misleading.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE: PLAZACORP RETAIL PROPERTIES LTD.