Fronsac Real Estate Investment Trust Announces the Increase of its Annual Distribution and Releases Interim Financial Statements

Marketwired

MONTREAL, QUEBEC--(Marketwired - May 29, 2013) - Fronsac real estate investment trust (TSX VENTURE:GAZ.UN) ("Fronsac REIT") today released its unaudited consolidated financial statements for its first quarter ended March 31, 2013 of which the highlights are presented in the following tables:

On the same date, the Board of Directors of Fronsac REIT adopted a distribution policy for the year 2013: a semi-annual distribution for the first half of 2013 and a quarterly distribution from the second half of 2013 and future years.

The Board of Directors of Fronsac REIT also approved the increase of the annual distribution to $ 0.0135 per unit, which represents an increase of 8.00% ($ 0.0125 in 2012). The Board thereby declared a semi-annual distribution of $ 0.00675 per unit to unitholders registered on June 14th, 2013, which will be payable on June 30th, 2013.

Results March 31, 2013 March 31, 2012
AFFO/FFO - basic $ 128,946 $ 76,986
AFFO/FFO - diluted $ 133,869 $ 76,986
AFFO/FFO per unit - basic 0.40 ¢/u 0.38¢/u
AFFO/FFO per unit - diluted 0.38 ¢/u 0.38¢/u
Weighted average number of units outstanding
- basic 32,616,083 20,514,000
- diluted 35,030,530 20,514,000
Interest coverage ratio 3.9 3.2
Debt service ratio 2.5 2.3
Financial position March 31, 2013 Dec 31, 2012
Investment properties (at fair value) $ 13,744,144 $ 11,521,954
Investments in joint ventures (at fair value) $ 707,079 -
Total assets $ 15,602,117 $ 14,333,024
Total liabilities $ 5,928,454 $ 4,832,944
Leverage Ratio 38.0 % 33.7 %
Weighted Average Cost of Debt 4.87 % 4.91 %

The Trust uses the "funds from operations" (FFO) measurement to assess the performance of its operations. This measurement, which is a non-IFRS measurement, provides a better evaluation of the performance of the operations of the Trust and is largely used in the commercial real estate industry. The reconciliation of net income to FFO is presented below. For the quarters ending March 31, 2013 and March 31, 2012, FFO and AFFO were equal.

March 31, 2013 March 31, 2012
Net income and comprehensive income attributable to unitholders 184,709 94,514
(Increase) decrease of fair value of investment properties (68,158 ) -
(Increase) decrease of fair value of investments in joint ventures (39,580 ) -
Unit-based compensation 4,450 (10,394 )
Increase of liability component of the convertible preferred units 2,683 421
Variation of fair value of derivative financial instrument 10,000 (20,000 )
Unrealized (gains) losses on interest rates swaps (1,500 ) (7,300 )
Variation of fair value of warrants 1,440 (906 )
Amortization intangible assets 1,851 1,851
Deferred income taxes 33,051 18,800
FFO - basic 128,946 76,986
Interests expenses on dilutive convertible preferred units 4,923 -
FFO - diluted 133,869 76,986
Weighted average number of units outstanding - basic 32,616,083 20,514,000
Weighted average number of units outstanding - diluted 35,030,530 20,514,000
FFO per unit - basic 0.0040 0.0038
FFO per unit - diluted 0.0038 0.0038

The March 31, 2013 financial statements of Fronsac REIT may be viewed on SEDAR at www.sedar.com

Contact:
Michel Lassonde
President
(450) 536-5328

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