WesternOne Equity Income Fund Reports Significant Growth in 2012 Q1 Results

May 09, 2012, 08:30 ET from WesternOne Equity Income Fund

VANCOUVER, May 9, 2012 /PRNewswire/ - WesternOne Equity Income Fund ("WesternOne Equity") (Toronto Stock Exchange: WEQ.UN, WEQ.DB.B and WEQ.DB.C) today announced the release of its financial results for the three months ended March 31, 2012.

The results, consisting of WesternOne Equity's interim financial statements for the three months ended March 31, 2012 and Management's Discussion and Analysis ("MD&A") dated May 9, 2012, are available on SEDAR (www.sedar.com).

2012 Q1 Financial highlights and recent events:

  • Significant growth in consolidated revenue (206%), gross profit (175%) and adjusted EBITDA(1) (123%) compared to Q1 2011 due to organic growth in the WesternOne Rentals & Sales ("WRS") aerial and general construction rentals division and additional earnings from Britco.

  • Growth translated to solid operating cash flow, up 128% year over year (before working capital changes).

  • Consolidated payout percentage(2) of 30.6% compared to 48.7% in Q1 2011.

  • Britco contributed incremental revenue of $35.4 million and adjusted EBITDA of $7.3 million due to strong manufacturing activity in the workforce accommodations sector.

  • Britco increased production output as a result of full production mode at its Waco, Texas facility and acquisition of Alberta Modular Inc. in Edmonton, Alberta in February 2012.

  • WRS's aerial and general construction rentals branch achieved organic growth of 14% in revenue and 19% in adjusted EBITDA. The growth was driven by strong demand for equipment rentals and related services in Western Canada's construction and infrastructure sectors, in spite of an unseasonably warm winter.

  • WRS's newly launched construction heat and climate control division in Southern British Columbia was successful in gaining entry into the niche climate control markets in construction and film production.

  • WesternOne Equity completed new financing with its senior lender, which included increase in capital loan revolver limit from $14.5 million to $41.5 million and reduction in interest rates.

"We are off to a great start in 2012 with outstanding Q1 operating results driven by our investments in growth initiatives," said Mr. Darren Latoski, Chief Executive Officer. "As capital investments in the construction and infrastructure and resource sectors continue to grow, our WRS and Britco operating platforms are well positioned to benefit from this positive economic trend through executing disciplined capital expenditures and external business acquisitions."

Summary Financial Overview     Three months ended
(unaudited)     March 31,
($ millions except per unit amounts)     2012     2011
Revenue     $     51.9     $     17.0
Gross Profit       17.6       6.4
Adjusted EBITDA (1)     $     12.9     $       5.8
Distributable Cash Generated (1)     $       9.4     $       4.5
Distributions Declared       2.9       2.2
Distributable Cash per Unit (3)       0.4956       0.3071
Distributions Declared per Unit       0.1500       0.1500
Payout Percentage (2)       30.6%       48.7%



  1. "Adjusted EBITDA" and "Distributable Cash" are not recognized measures under IFRS and do not have a standardized meaning prescribed by IFRS. "Adjusted EBITDA" refers to earnings before interest, income taxes, depreciation, amortization, gain/loss on financial derivatives relating to changes in the fair market value of the fixed interest rate swap, business acquisition costs, debenture issuance costs, gain/loss on debentures relating to changes in their fair values, gain/loss on Unit issuances relating to conversion of debentures, gain/loss on WesternOne Equity's exchangeable units relating to changes in their fair values, unit based compensation, distribution to unitholders, foreign exchange gains/losses, and write-down of fleet assets, intangible assets and goodwill. "Distributable Cash" refers to cash available for distribution to the unitholders by WesternOne Equity. For further description of Adjusted EBITDA and Distributable Cash refer to "Non-IFRS Measures" in the MD&A dated May 9, 2012.
  2. Amounts calculated using distributable cash and distributions declared for the related period, not on per Unit amounts. Calculated as distribution declared divided by distributable cash generated.
  3. Calculated based on basic weighted average number of units.

Conference Call

Darren Latoski, CEO, Carlos Yam, CFO and Geoff Shorten, COO, of WesternOne Equity GP Inc. will host a conference call at 4:30pm (Eastern time) or 1:30pm (Pacific time), on Wednesday, May 9, 2012, to review the financial results and corporate developments for the three months ended March 31, 2012.

To participate in this conference call, please dial one of the following numbers approximately 10 minutes prior to the commencement of the call, and ask to join the WesternOne Equity conference call.

Dial in numbers:          Toll Free          1-888-231-8191
          International or Local Toronto          1-647-427-7450

Conference Call Replay

If you cannot participate on May 9, 2012, a replay of the conference call will be available by dialing one of the following replay numbers. You will be able to dial in and listen to the conference two hours after the meeting end time, and the replay will be available until May 16, 2012. Please enter the Replay ID number 78862914 followed by the # key.

Replay Dial-In:          Toll Free         1-855-859-2056
          International or Local Toronto          1-416-849-0833

Forward-looking Information

Certain statements in this press release may constitute "forward-looking" information that involves known and unknown risks, uncertainties and other factors, and it may cause actual results, performance or achievements or industry results, to be materially different from any future results, performance or achievements or industry results expressed or implied by such forward-looking information. Forward-looking information is identified by the use of terms and phrases such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "predict", "project", "will", "would", and similar terms and phrases, including references to assumptions. Such information includes, without limitation, statements with respect to: the enhancement of WesternOne Equity's product and service offering and customer base derived from acquisitions completed by WesternOne Equity or its subsidiaries, the growth prospects in sectors where WesternOne Equity's businesses are conducted, market expansions under WesternOne Equity's current and future strategies, and the benefits that may accrue to WesternOne Equity and its unitholders as a result of such market expansions. Actual events or results may differ materially.

Forward-looking information contained in this press release is based on certain key expectations and assumptions made by WesternOne Equity, including, without limitation, expectations and assumptions respecting: the outlook of WesternOne Equity's business and the economy in Western Canada and the US, the supply and demand for WesternOne Equity's products and services, and management's assessment of future plans and operations. Although the forward-looking information contained in this press release is based upon what the WesternOne Equity's management believes to be reasonable assumptions, WesternOne Equity cannot assure investors that actual results will be consistent with such information. Forward-looking information reflects current expectations of management regarding future events and operating performance as of the date of this press release. Such information involves significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking information, and a description of these factors can be found under "Risk Factors" in WesternOne Equity's Annual Information Form dated March 29, 2012 and Management's Discussion and Analysis dated May 9, 2012, which are available on SEDAR (www.sedar.com).

The forward-looking information contained herein is expressly qualified in its entirety by this cautionary statement. Forward-looking information reflects management's current beliefs and is based on information currently available to WesternOne Equity. The forward-looking information is made as of the date of this press release and WesternOne Equity assumes no obligation to update or revise such information to reflect new events or circumstances, except as may be required by applicable law.

About WesternOne Equity

WesternOne Equity seeks to acquire and grow businesses in the construction and infrastructure sectors in order to generate stable and growing distributions to its unitholders as well as to achieve overall capital appreciation.

Additional Information

Additional information relating to WesternOne Equity, including WesternOne Equity's Annual Information Form and other public filings, is available on SEDAR at www.sedar.com or on WesternOne Equity's website at www.weq.ca.

Trading Symbols

Toronto Stock Exchange: WEQ.UN, WEQ.DB.B and WEQ.DB.C



SOURCE WesternOne Equity Income Fund