Le Lézard
Classified in: Business, Covid-19 virus
Subject: EARNINGS

Skyline Announces Continued Improvement in Operational Results During Q2 2022


TORONTO, Aug. 12, 2022 (GLOBE NEWSWIRE) -- Skyline Investments Inc. (the "Company" or "Skyline") (TASE: SKLN), a Canadian company that specializes in hotel real estate investments in the United States and Canada, published its results for the three and six months ended June 30, 2022.

SUMMARY OF FINANCIAL RESULTS

C$000'sQ2 2022Q2 2021H1 2022H1 2021
NOI1 from Hotels & Resorts5,2856,49813,49614,752
NOI from Hotels & Resorts Margin17%26%21%28%
Same Asset Revenue30,79420,54262,81740,540
Same Asset NOI15,2547,17513,46511,666
Same Asset NOI Margin17%35%21%29%
Adjusted EBITDA23,4054,5469,59311,260
Adjusted EBITDA Margin10.7%17.3%14.9%19.6%
Net Income (loss)(5,767)2,206(5,087)2,051
FFO1(117)1,3505,1374,682
Shareholders' Equity278,933230,791 278,933 230,791

Q2 2022 Highlights

Blake Lyon, Skyline's Chief Executive Officer, commented, "Skyline's operational progress continued during the second quarter of 2022. Skyline's same asset NOI excluding Bear Valley remained constant compared to Q2 2021, as travel activity continues to rebound and Skyline continues to focus on efficiency initiatives. We have begun reinvesting the proceeds received during Q4 2021 from the sale of our Canadian resorts, with the acquisition of the Courtyard Ithaca, which is closed in Q3 2022. Our strong balance sheet will allow us to build on this success throughout the year as we continue to explore expansion opportunities in the hotel sector."

INCOME STATEMENT HIGHLIGHTS

All amounts in millions of Canadian dollars unless otherwise stated

BALANCE SHEET HIGHLIGHTS

About Skyline

Skyline is a Canadian company that specializes in hospitality real estate investments in the United States and Canada. The Company currently owns 16 income-producing assets with 2,749 hotel rooms and 85,238 square feet of commercial space.

The Company is traded on the Tel Aviv Stock Exchange (ticker: SKLN) and is a reporting issuer in Canada.

For more information:

Rob Waxman, CPA CA, CFA
Chief Financial Officer
robw@skylineinvestments.com
1 (647) 207-5312

Oded Ben Chorin
KM Investor Relations
+972-3-5167620
oded@km-ir.co.il 

Additional Information:

Non-IFRS Measures

The Company's interim condensed consolidated financial statements are prepared in accordance with International Financial Reporting Standards ("IFRS"). However, the following measures: NOI, FFO, FFO per share and Adjusted EBITDA are not measures recognized under IFRS and do not have standardized meanings prescribed by IFRS, and should not be compared to or construed as alternatives to profit/loss, cash flow from operating activities or other measures of financial performance determined in accordance with IFRS. NOI, FFO, FFO per share and Adjusted EBITDA as computed by the Company, may differ from similar measures as reported by other companies in similar or different industries. However, these non-IFRS measures are recognized supplemental measures of performance for real estate issuers widely used by the real estate industry, particularly by those publicly traded entities that own and operate income-producing properties, and the Company believes they provide useful supplemental information to both management and readers in measuring the financial performance of the Company. Skyline also uses certain supplementary financial measures as key performance indicators. Supplementary financial measures are financial measures that are intended to be disclosed on a periodic basis to depict the historical or expected future financial performance, financial position, or cash flow, that are not disclosed directly in the financial statements and are not non-IFRS measures. Same Asset NOI is a financial measure that is calculated using the same methodology as NOI, but only including NOI from properties owned for 2 full years prior to June 30, 2022.

Further details on non-IFRS measures and Supplementary Financial Measures are set out in the Company's Management's Discussion and Analysis for the period ended June 30, 2022 and available on the Company's profile on SEDAR at www.sedar.com or MAGNA at www.magna.isa.gov.il and are incorporated by reference in this news release.  

The reconciliations for each non-IFRS measure included in this news release are outlined as follows:

NOI
Skyline defines NOI as property revenues less property operating expenses. Management believes that NOI is a useful key indicator of performance on an unlevered basis as it represents a measure over which Management of property operations has control. NOI is also a key input used by management in determining the value of the Properties. NOI is used by industry analysts, investors and Management to measure operating performance of Canadian companies. NOI represents revenue from cash generating properties less property operating expenses excluding depreciation as presented in the consolidated statements of income and comprehensive income prepared in accordance with IFRS.

Given the seasonality of its hospitality operations, NOI for a fiscal year (or trailing four quarters) is considered by Management as a more accurate measure of the Company's performance.

Skyline calculates NOI as operating income before depreciation, valuation adjustments and other income, adjusted for:

i)      Segmented results from Development Segment

      ii)      Selling and Marketing expenses

iii)     Administrative and General expenses

Alternatively, the same result is arrived at by adding segmented results (per note 13 in the condensed interim consolidated financial statements) of the US and Canadian hotels and resorts segments.

NOI
 For the three months ended June 30
 20222021
Operating income before depreciation, valuation adjustments and other income        3,4054,546
Segmented results from Development Segment        43440
Selling and Marketing expenses        53143
Administrative and General Expenses        1,7841,369
NOI from hotels and resorts        5,2856,498
Income from hotels and resorts        30,82624,919
Operating expenses of hotels and resorts        (25,541)(18,421)
NOI from hotels and resorts        5,2856,498

FFO

FFO is a non-IFRS financial measure of operating performance widely used by the real estate industry, particularly by those publicly traded entities that own and operate income-producing properties. FFO should not be considered as an alternative to net income determined in accordance with IFRS. Skyline calculates its FFO in accordance with the Real Property Association of Canada White Paper on FFO for IFRS issued in January 2022, except for (i) changes in the fair value of financial instruments which are economically effective hedges but do not qualify for hedge accounting, (ii) non-controlling interest, and (iii) operational revenue and expenses from right-of-use assets. The use of FFO, combined with the required IFRS presentations, has been included for the purpose of improving the understanding of the operating results of Skyline.

Management believes that FFO provides an operating performance measure that, when compared period-over- period, reflects the impact on operations of trends in occupancy, room rates, operating costs and realty taxes and interest costs, and provides a perspective of the Company's financial performance that is not immediately apparent from net income determined in accordance with IFRS. FFO adds back to net income items that do not arise from operating activities, such as fair value adjustments, business combination transaction costs, and deferred income taxes, if any. FFO, however, still includes non-cash revenues related to accounting for straight-line rent and makes no deduction for recurring capital expenditures necessary to sustain the Company's existing earnings stream.

Funds from Operations (FFO)
 For the three months ended June 30,
 20222021
Net income attributable to shareholders of the Company(5,532)769
(Gain) loss from fair value adjustments1,283(3,129)
Depreciation3,0474,362
Deferred tax(1,387)(653)
Derecognition of investment costs and other capital (gains) losses394-
Tax on gain from disposal of a property1,822-
Revaluation component included in cost of sale, that was previously recognized in gain on fair value adjustments of investment property prior to its transfer to inventory256-
FFO        (117)1,350

Adjusted EBITDA

The Company's operations include income producing assets and revenue from the sale of developed real estate. As such, Management believes Adjusted EBITDA (as defined below) is a useful supplemental measure of its operating performance for investors and debt holders.

EBITDA is defined as Earnings Before Interest, Taxes, Depreciation, and Amortization. The Company calculates Adjusted EBITDA as follows:

Less:

Adjusted EBITDA does not include fair value gains, gains on sale or other expenses, and is presented in the Company's consolidated statement of income for the three months ended June 30, 2022 as operating income before depreciation, valuation adjustments and other income.

Adjusted EBITDA from Operations
Adjusted EBITDA from Operations combines
performance of income producing and development activities:
(In thousands CAD)
 For the three months ended June 30
 20222021
ADJUSTED EBITDA from operations3,4054,546

Forward-Looking Statements

This release may contain forward-looking statements (within the meaning of applicable securities laws) relating to the business of the Company. In some cases, forward-looking statements can be identified by terms such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "potential", "continue" or other similar expressions concerning matters that are not historical facts. Such statements involve a number of known and unknown risks and uncertainties, many of which are outside our control that could cause our future results, performance or achievements to differ significantly from the results, performance or achievements expressed or implied by such forward-looking statements as well as other risks detailed in our public filings with the Canadian and Israeli Securities Administrators. There can be no assurance that forward-looking statements will prove to be accurate as 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, these forward-looking statements are made as of the date of this news release and, except as expressly required by applicable law, we undertake no obligation to update any forward-looking or other statements herein whether as a result of new information, future events or otherwise.


1 A supplementary financial measure. Refer to the Non-IFRS Measures section of this news release.
2 A non-IFRS measure. For definitions, reconciliations and the basis of presentation of Skyline's non-IFRS measures, refer to the Non-IFRS Measures section in this news release.

 



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News published on 12 august 2022 at 12:50 and distributed by: