High Asset

Dream Unlimited Corp. Reports Fourth Quarter Results and Continued Diversification of

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TORONTO–(BUSINESS WIRE)–Feb 22, 2022–

Dream Unlimited Corp. (TSX: DRM) (“Dream”, “the Company” or “we”) today announced its financial results for the three and twelve months ended December 31, 2021 (“fourth quarter”).

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20220222006088/en/

Breakdown of Assets Under Management by Asset Class and Geography (Graphic: Business Wire)

“2021 has been an exceptional year for Dream across all lines of business,” said Michael Cooper, Chief Responsible Officer. “Our western Canada land and housing business had a very profitable year and 2022 has significant pre-sales leading to the expectation of another good year, our development team is making great progress on our developments and anticipated profits are as planned, and with our innovative impact focus, we are accessing more opportunities and working closely with the government on some of their highest priorities. Our asset management business also had an outstanding year with the introduction of our private asset management business, which now manages about $1.4 billion of equity from institutions and high net worth individuals. We have also seen significant growth across our public vehicles, with Dream Industrial REIT’s robust acquisition and development pipelines and Dream Impact Trust’s acquisitions of impact investments. With various developments nearing completion over the next two years, including portions of our impact investments at Zibi and the West Don Lands, we enter 2022 well-positioned to continue developing and acquiring best in class assets in great markets.”

As of December 31, 2021, assets under management (1) were $15 billion, up $5 billion since 2020, with fee earning assets under management (1) of $9 billion as of year end, up from $5 billion at the end of 2020. We have significantly expanded our assets under management in the past two years, increasing our geographic diversification outside of Canada from 7% in 2019 to 29% in 2021 while expanding our investments in the industrial and residential rental asset classes from 31% to 59% over the same period. A breakdown of assets under management by asset class and geography as of December 31, 2021, 2020 and 2019 is included above.

As at December 31, 2021 our debt to total assets ratio (1) was 37% and we ended the year with $275.6 million in available liquidity (2).

A summary of our consolidated results for the three and twelve months ended December 31, 2021 is included in the table below.

 

 

For the three months ended December 31,

For the twelve months ended December 31,

(in thousands of Canadian dollars, except per share

amounts)

2021

 

2020

 

2021

 

2020

Revenue

 

$

150,122

$

48,639

$

325,922

$

347,623

Net margin

 

$

34,685

$

5,245

$

60,566

$

72,320

Net margin (%) (1)

 

 

23.1%

$

10.8%

 

18.6%

 

20.8%

Earnings (loss) before income taxes

 

$

95,349

$

(31,181)

$

125,875

$

197,620

Earnings (loss) for the period (3)

 

$

80,317

$

(32,315)

$

110,661

$

159,638

 

 

 

 

 

 

 

 

 

 

Basic earnings (loss) per share (3)

 

$

1.87

$

(0.70)

$

2.52

$

3.37

Diluted earnings (loss) per share

 

$

1.81

$

(0.70)

$

2.46

$

3.31

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2021

December 31, 2020

Total assets

 

 

 

 

 

$

3,488,674

$

2,844,373

Total liabilities

 

 

 

 

 

$

2,066,461

$

1,437,761

Shareholders’ equity (excluding non-controlling interest) (4)

$

1,422,213

$

1,391,646

Total issued and outstanding shares

 

 

 

 

 

 

42,836,031

 

45,011,928

Earnings before income taxes after adjusting for fair value adjustments taken on Dream Impact Trust units held by other unitholders (1) for the three months ended December 31, 2021 was $99.1 million, an increase of $70.2 million relative to the prior year. The change is primarily due to higher lot sales in Western Canada, fair value gains on the Company’s investment properties portfolio and increased fees earned from our growing asset management platform. Higher earnings were also driven by the growth of our GTA multi-family rental portfolio, with 1,140 units (at 100%) acquired in the second half of 2021.

Earnings before income taxes after adjusting for fair value adjustments taken on Dream Impact Trust units held by other unitholders (1) for the twelve months ended December 31, 2021 was $150.9 million, up from $119.9 million in the prior year. Current year pre-tax earnings were primarily driven by the gains across our multi-family rental portfolio, higher earnings from the Company’s equity accounted investments, including Dream Office REIT, increased earnings from our asset management platform and improved results from Arapahoe Basin. The comparative year results include the gain on sale of our renewable power portfolio, the sale of 480 acres at Glacier Ridge and occupancies at our Canary Block, Riverside Square, BT Towns and Zibi developments, with limited comparable activity in 2021.

Earnings before income taxes for the three and twelve months ended December 31, 2021 was $95.3 million and $125.9 million, respectively due to the aforementioned operational results in addition to the fair value changes in Dream Impact Trust units held by other unitholders.

Highlights: Recurring Income

  • In the fourth quarter, revenue and net operating income (1) derived from recurring income sources increased to $35.9 million and $10.0 million, respectively, due to higher earnings from our asset management platform, Toronto investment properties and our recreational properties portfolio. Included in results for the quarter is $2.4 million in net operating income (1) from seven multi-family rental properties in the GTA acquired in 2021.
  • In the year ended December 31, 2021, our recurring income segment generated revenue and net operating income (1) of $116.8 million and $40.4 million, respectively, up by $24.5 million and $13.2 million over the prior year, primarily due to increased earnings from our asset management platform and Toronto investment properties, in addition to increased visitors and a full year of operations at Arapahoe Basin.
  • Included in revenue for the year ended December 31, 2021 was $22.7 million in fees earned from Dream Industrial REIT, up from $11.3 million in the prior year, largely driven by $2.4 billion in acquisitions in 2021, which generated acquisition fees and higher base fees for the Company. Dream Industrial REIT has an additional $400 million in acquisitions closed, under contract or in exclusive negotiations in 2022. In 2021, Dream Industrial REIT raised over $2.2 billion in capital through equity issues and unsecured debentures. We have also raised nearly $1.4 billion in capital to date for our private asset management business, inclusive of Dream Impact Fund, a U.S. apartment portfolio with a buy/fix/sell strategy, and our U.S. industrial fund. Our asset management team remains focused on sourcing, managing and growing both our public and private platform through 2022 and our target is to raise an additional $1 billion in private equity this year.
  • In the year ended December 31, 2021, Arapahoe Basin generated Adjusted EBITDA (1) of $10.7 million, up from $2.3 million in the prior year, largely due to reduced social distancing measures and our investment in summer activities including the Aerial Adventure Park, the Via Ferrata climbing course, various hiking and biking trails, disc golf, events and specialty dining. Similarly, in the year ended December 31, 2021, Arapahoe Basin generated net earnings of $6.5 million, an increase of $8.3 million over 2020.
  • Results for 2021 include $62.1 million in equity earnings on our 33% interest in Dream Office REIT, up from $36.2 million over the comparative period. Improved results were driven by fair value gains at Dream Office REIT and through the REIT’s 10.5% interest in Dream Industrial REIT, in addition to increased operating income at Dream Industrial REIT from recent…

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