Business
Melcor Developments Ltd., (TSX:MRD) Releases Third Quarter Results
EDMONTON, Nov. 5 /CNW/ - Melcor Developments Ltd., an Alberta based real estate development compa...
About this update from Melcor Developments Ltd.
[{"type":"text","content":"\n\n\n\nEDMONTON, Nov. 5 /CNW/ - Melcor Developments Ltd., an Alberta based real\nestate development company achieved net earnings of $26,617,000 or $0.85 per\nshare ($0.84 per share diluted) on revenue of $66,678,000 for the nine months\nended September 30, 2008 compared to net earnings of $38,407,000 or $1.23 per\nshare ($1.21 per share diluted) on revenue of $139,331,000 for the same period\nin 2007.\n\n\nEarnings for the three months ending September 30, 2008 were $18,542,000\nor $0.59 per share ($0.58 per share diluted) on revenue of $25,967,000\ncompared to earnings of $16,013,000 or $0.51 per share ($0.50 per share\ndiluted) on revenue of $55,954,000 during the same period in 2007.\n\n\nThe comparatively lower levels of company revenues and operating earnings\nto date in 2008 is due to the continued slowdown that has occurred in the\nAlberta residential real estate sector for new homes. Earnings are behind the\nCompany's 2008 business plan. While the Company expected lower single family\nlot sales for 2008, the drop in activity is steeper than expected. Earnings\nfor the quarter were buoyed up by the sale of the Crowfoot West Business\nCentre, a recently completed 113,500 sq. ft. office building in northwest\nCalgary, Alberta. This sale generated a material gain of approximately $0.60\nper share, enhanced the Company's cash position and has allowed for the\nredeployment of capital to other strategic opportunities.\n\n\nThe Board of Directors declared a semi-annual dividend of $0.17 per share\npayable on December 30, 2008 to Shareholders of record on December 16, 2008.\nDividends for 2008 will total $0.42 per share compared to $0.40 in 2007 and\n$0.30 in 2006.\n\n\nThe company was active with its normal course issuer bid purchasing\n133,000 common shares from early August to mid October. Further purchases will\nbe made based on the Company's need for preserving cash, exploring expansion\nopportunities and paying down debt.\n\n\nPreviously, the Company has reported that the rebalancing of the\noverheated real estate markets will take some time (12 months or so) to absorb\nthe excess housing inventory. The Company believes that the real estate\nmarkets will take longer to normalize than previously expected. This is also\nthe current view of CMHC who predict housing starts for 2009 will be down\nmodestly from 2008 with improv...