UPDATE – The Becker Milk Company Limited: 2022 Annual Financial Results
TORONTO, July 22, 2022 (GLOBE NEWSWIRE) — The Becker Milk Company Limited (the “Company”) (TSX-BEK.B) is pleased to report the results for the year ended April 30, 2022.
HIGHLIGHTS
- Total revenues for the year ended April 30, 2022 were $2,670,042 compared to $3,097,155 for the same period in 2021;
- Net operating income for the year was $2,121,894 compared to $2,367,836 in 2021;
- Net income for the year was $3.13 per share, compared to $1.96 per share in 2021.
FINANCIAL HIGHLIGHTS
Net operating income for the year ended April 30, 2022 decreased $245,942 to $2,121,894 as compared with the previous year, primarily as a result of non-recurring adjustments to property revenue resulting from completion of negotiations with Mac’s Convenience Stores Inc. regarding base rents for most of its locations. In determining net operating income the revenue reduction was partially offset by lower property operating expenses.
| Year ended | ||||
| April 30 | ||||
| 2022 | 2021 | |||
| Property revenue | $2,630,175 | $3,024,970 | ||
| Finance income | 39,867 | 72,185 | ||
| Total revenues | $2,670,042 | $3,097,155 | ||
| Net income attributable to common and special shareholders | $5,665,984 | $3,536,378 | ||
| Average common and special shares outstanding | 1,808,360 | 1,808,360 | ||
| Income per share | $3.13 | $1.96 | ||
| Year ended | ||||
| April 30 | ||||
| 2022 | 2021 | |||
| Property revenue | $2,630,175 | $3,024,970 | ||
| Property operating expenses | (508,281 | ) | (657,134 | ) |
| Net operating income | $2,121,894 | $2,367,836 | ||
Components of the $2,129,606 decrease in net income for the year ended April 30, 2022 compared to the year ended April 30, 2021 are:
| Changes in net income – Year ended April 30, 2022 | ||
| compared to year ended April 30, 2021 | ||
| Provision for environmental liability | ||
| Increase in fair value adjustment | $2,748,000 | |
| Decrease in current taxes | 76,581 | |
| Decrease in administrative expenses | 43,752 | |
| Decrease loss on disposal | 18,038 | |
| Decrease in finance income | (32,318 | ) |
| Increase strategic review expenses | (99,014 | ) |
| Decrease in net operating income | (245,942 | ) |
| Increase in deferred tax charges | (379,491 | ) |
| Decrease in gain on expropriation settlement | 0 | |
| Increase in net income | $2,129,606 | |
The large increase in the fair value adjustment to investment properties resulted from revised assumptions with respect to capitalization rates and market rents reflecting market conditions as at April 30, 2022.
ADJUSTED FUNDS FROM OPERATIONS
For the year ended April 30, 2022 the Company recorded adjusted funds from operations of $348,427 ($0.19 per share) compared to $757,017 ($0.42 per share) in 2021.
| Year ended | |||||
| April 30 | |||||
| 2022 | 2021 | ||||
| Net income | $5,665,984 | $3,536,378 | |||
| Add (deduct) items not affecting cash: | |||||
| Fair value adjustment to investment properties | (5,993,000 | ) | (3,245,000 | ) | |
| Loss (gain) on sale of investment properties | 4,583 | 22,621 | |||
| Tax on gains from sale of property | 9,065 | 27,700 | |||
| Deferred income taxes | 798,546 | 419,055 | |||
| Expenses related to strategic review | (102,751 | ) | (3,737 | ) | |
| Sustaining capital expenditures | (34,000 | ) | 0 | ||
| Adjusted funds from operations | $348,427 | $757,017 | |||
| Adjusted funds from operations per share | $0.19 | $0.42 | |||
STRATEGIC REVIEW
Since 2014 the Board of Directors has been evaluating strategic directions for the Company and has engaged in discussions with potential acquirors. While the Company has engaged in some discussions during the last quarter, none of those discussions are active at this time. During this period a programme of divesting less desirable sites has resulted in the sale of 26 investment properties. The Company continues to review its strategic alternatives and will update the market as appropriate, and as required.
The Company’s annual financial statements for the year ended April 30, 2022, 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 and 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
Tel: 416-698-2591
