CALGARY, Aug. 13 /CNW/ - Genesis Land Development Corp. ("Genesis" or the "Company") is pleased to report financial results for the six months ended June 30, 2008. Over the first two quarters of the year, Genesis recorded total revenues of $51,343,117 as compared to $46,581,559 over the same period in 2007. This has produced after-tax earnings in 2008 of $13,487,999 or $0.29 basic and fully diluted earnings per share vs. $10,140,106 and $0.22 basic and fully diluted earnings per share during the first six months of 2007.
As at June 30, 2008, Genesis' cash balance increased to $12,452,183 from $11,007,142 at December 31, 2007. Amounts receivable at June 30, 2008 were $60,954,835 compared to $47,587,450 at December 31, 2007. The balance of debt/financings at June 30, 2008 was $110,945,997 vs. $85,159,905 at December 31, 2007. At June 30, 2008 Genesis maintained a debt-to-equity ratio of 0.83 exclusive of non-controlling interest and 1.34 inclusive of non-controlling interest.
Land Development
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During the six months ended June 30, 2008, Genesis sold a total of 148 lots to external builders resulting in revenues of $26,242,504. Gross margins from lot sales during this period were $16,274,991 (62%) as compared to gross margins of $14,177,005 (62%) over the first six months of 2007. For the first two quarters of 2008, the average price per lot was $177,314, down from an average price per lot in the same period last year of $197,278. The reduced price per lot is primarily a result of a different sales mix whereby fewer amenity lots have been sold in 2008. With the summer development season in full swing, Genesis expects to develop nearly 400 lots in the last half of 2008. This includes development in the Airdrie community of Bayside and Calgary communities of Sage Meadows (NW Calgary) and Taralake (NE Calgary).
Single-Family Home Building
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Genesis Builders Group closed the sale of a total of 58 single-family homes in the six months ended June 30, 2008. Total revenues from single-family home sales for the first two quarters were $24,367,095 (2007 - $23,107,993). The average price of a single-family home sold in the first six months of 2008 was $420,122, up from the average price of $316,548 for the first two quarters of 2007. This rise is a reflection of the increases in pre-sold house prices that were experienced during 2007 in the Calgary real estate market. On the strength of currently pre-sold homes and ample inventory of spec product Genesis expects to increase quarterly single-family home sales in the second half of 2008.
Multi-Family Home Building
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During the second quarter, Generations Group of Companies further advanced construction and pre-sales on The Breeze, a 125 unit condo/town home development in Airdrie, Alberta. Completion of the project is now scheduled for early 2009. Pre-sales for this project continue with a showhome scheduled for opening in September 2008.
Five other multi-family projects have commenced planning and approvals while the company carefully monitors the Calgary and surrounding area multi-family marketplace before proceeding with construction.
Commercial
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Genesis' commercial division has not recorded any revenues to date in 2008, but is scheduled to close the sale of a large anchor store parcel in 2008 at the Sage Hill Crossing site in NW Calgary for total revenues exceeding $22 million. The Company has also signed a letter of intent for the sale of a second anchor store site. Conditional leases have been signed with national retailers in the pharmaceutical, hardware, restaurant, grocery, coffee and banking sectors for Sage Hill Crossing, the Company's largest retail development with approximately 1.2 million square feet of retail. Genesis has also received approval for approximately 1 million square feet of office space at the Sage Hill Crossing site. Current suburban office vacancy rates in Calgary are at 3.61% while the Northwest quadrant, where Sage Hill Crossing is located, is at 1.81% with very little future office space expected to come on-stream in the near term in the Northwest.
The Calgary and surrounding area residential real estate market appears to be in a transition year after two strong years in 2006 and 2007. The excess inventory of single-family and multi-family homes that was created is gradually being absorbed by housing demand that remains buoyed by a strong economic environment. The strong economy in Alberta, which is producing the lowest unemployment rate and highest per capita incomes in Canada, is keeping the retail, office and industrial markets robust through 2008. Behind the strength of a well positioned and largely approved land base, Genesis expects 2008 to be another strong year for earnings despite the rebalancing residential real estate marketplace in its operating region.
UNAUDITED FINANCIAL SUMMARY
Six Months Ended 30th of June, 2008 and 2007 (in $CAN)
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2008 2007
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Assets 356,521,910 197,843,047
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Liabilities 223,273,908 92,115,154
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Shareholders Equity 133,248,002 105,727,893
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Revenue 51,343,117 46,581,559
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Expenses 33,286,690 31,679,779
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Earnings before taxes and
non-controlling interest 18,056,427 14,901,780
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Net earnings 13,487,999 10,140,106
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Earnings per share (basic
& fully diluted) 0.29 0.22
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Common Shares Outstanding 46,035,690 46,112,690
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Genesis Land Development Corp. is a Calgary based land development company with an inventory of more than 24,000 future residential building sites (single-family and multi-family) and over 300 acres of commercial/industrial lands in Western Canada, of which more than 14,000 residential lots and over 300 acres of commercial/industrial lands are located in the Calgary metropolitan area.
Certain statements in this news release could constitute forward-looking statements. The Corporation's line of business involves risk, uncertainties and other factors which may cause actual results, performance or achievements of Genesis to be materially different from any future results, performance or achievements expressed or implied by such forward looking statements. Such factors include the number of dwelling sites that Genesis will actually develop and sell.