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Lakeview Hotel Investment Corp Announces Year End Results

Lakeview Hotel Investment Corp Announces Year End Results

/NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES./

WINNIPEG, April 29, 2016 /CNW/ - Lakeview Hotel Investment Corp (“LHIC”) is pleased to report its financial results for the Year ended December 31, 2015. The following comments in regard to the financial results should be read in conjunction with the December 31, 2015 financial statements and Management Discussion and Analysis which are available on the SEDAR website http://www.sedar.com.

The sharp decline in oil prices that occurred late in 2014 had an adverse impact on operating results throughout 2015. The important metrics of Funds from Operations, Adjusted Funds from Operations, and Distributable Income all turned negative in 2015. The duration of the downturn is still not clearly known. Although improvements may occur earlier, Management of Lakeview Hotel Investment Corp. is assuming that operating results will not show meaningful improvement until at least 2017 and is taking the measures it deems necessary to function through this downturn, without sacrificing the standard of operations at its hotels and restaurants.

Prior to the slowdown, Lakeview Hotel Investment Corp. had been focused on reducing its overall leverage in order to improve balance sheet ratios and to position the Corporation for future growth.  These efforts will continue.. Total liabilities have been reduced by $32 million since the end of 2012, largely through the sale of assets and the refinancing of debt. The Corporation has also been focused on cost saving measures to improve bottom line performance. The Corporation benefits greatly from the support of related parties that own over 59% of the outstanding shares of Lakeview Hotel Investment Corp., and from the agreement of related parties to defer fees. This has allowed the Corporation to remain current on all payments to all unrelated parties. The Corporation is current on all debt service payments to mortgage holders, other long-term debt holders, on all payments to debenture holders, and on all property tax and tax payments to all government agencies. The related parties remain committed to the welfare of the Corporation and will continue to provide the support necessary to benefit the Corporation and its Shareholders.

Following is a comparison of the operating results for the three months and year ended December 31, 2015 and the comparable period in 2014:


                                                                Three months ended             Year ended
                                                                  December 31               December 31

                                                                  2015         2014         2015         2014

                                                            $        $          $          $

  Hospitality Revenue

                                              Room                 5,069,763     8,317,561     25,005,838     32,915,994

                                              Food & Beverage           934,265     1,216,923     3,745,560       4,695,419

                                              Other                 329,783       476,346     1,544,966       1,933,032
                                                                ——-                  —

  Total Revenue                                                   6,333,811     10,010,830     30,296,364     39,544,445

  Expenses                                                     (8,535,197)    (9,682,067)  (35,276,757)    (38,359,661)

  Gain on sale of income properties                                   -        -          -    1,007,514

  Net Income (Loss)                                                (2,201,386)      328,763     (4,980,393)      2,192,298

  Basic and diluted income (loss) per share                                 (0.1126)        0.017       (0.255)        0.112
                                                                        ——-      ———        ——-

  Reconciliation to Funds from Operations

  Add (deduct)

  Provision for impairment of income property                         400,000                 400,000

  Amortization of income properties                                       765,462       768,235     3,050,018       3,056,260

  Amortization of franchise fees                                           1,192         1,192         4,768         4,768

  Impairment of Income Property                                       -        -          -          -

  Unrealized loss (gain) on change in fair value of interest rate

                                                                  410,933       895,849       660,478

                                              swap                 (121,667)

  Compensation Costs of Stock Options                               28,525         -      28,525           -

  Distributions from Lakeview Flag Licensing General

                                                                  164,150       234,710       759,010

                                              Partnership             53,900

  Distributions from Lakeview Flag Management General

                                                                  120,000       163,500       605,250

                                              Partnership               8,750

  Income from Lakeview Flag Licensing General Partnership                       (115,398)    (168,735)    (557,403)      (706,763)

  Income from Lakeview Flag Management General

                                                                (109,165)    (345,463)    (445,130)

                                              Partnership             (72,053)

  Gain on sale of income properties                                   -        -          -    (1,007,514)

  Amortization of discount on bankers’ acceptance                           -        -      198,712           -
                                                          —-      —-              —-

  Funds from Operations                                             (1,252,675)    1,515,373     (907,177)      5,118,657

  Basic and diluted funds from operations per share                             (0.064)        0.077       (0.046)        0.262

  Loss on derecognition of financial liability                             -        -          -      580,732

  Contributions to reserve account                                       (138,754)    (224,864)    (776,896)      (760,767)
                                                                -      -      -      -

  Adjusted Funds from Operations                                       (1,391,429)    1,290,509     (1,684,073)      4,938,622

  Basic and diluted adjusted funds from operations per share                       (0.071)        0.066       (0.086)        0.253

  Reconciliation to Distributable Income

  Accretion of other long-term debt                                         39,635       40,662       178,857         53,397

  Accretion of debentures                                               40,586       37,032       159,785       146,213

  Accretion of mortgages payable                                           24,264       23,427       94,723       111,398

  Loss on derecognition of income properties                                   44,144       14,244       151,627         25,834
                                                                ———      ———              ———

  Distributable income                                             (1,242,800)    1,405,874     (1,099,081)      5,275,464

  Basic and diluted distributable income per share                             (0.064)        0.072       (0.056)        0.270

  Dividends                                                           0           0           0           0
                                                                  —-        —-        —-          —-


Lakeview Hotel Investment Corp is listed on the TSX Venture Exchange under the symbol “LHR”.  Lakeview Hotel Investment Corp receives income from ownership, management and licensing of hotel properties. 

The TSX Venture Exchange nor its Regulation Service Provider (as the term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE Lakeview Hotel Investment Corp

Lakeview Hotel Investment Corp

CONTACT: Avrum Senensky, Executive Vice President, Tel: (204) 947-1161, Fax: (204) 957-1697, Email .(JavaScript must be enabled to view this email address)

Web Site: http://www.lakeviewhotels.com


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Posted on Apr 30, 2016 - 05:03 AM • Print