On May 12 Interent reported its' first quarter results.It is a REIT that owns and manages apartment buildings.This market is solid but not as strong as it was in 2010 or 2011.Interrent is typical of the apartment REIT sector.It's assets and revenues have grown considerably from 2010 but have slown down recently.Revenues have been basically flat in 2014 and the first quarter of 2015.Consequently the price has stalled recently.Nevertheless it has gradually improved most of it's financial statistics.In addition, it bought one new apartment building in Montreal- a new market for Interrent.We will look at the data in their quarterly report below.
The First Quarter Report
The Interrent report has a lot of operating statistics all of which show a small improvement.Monthly rents increased 3% and the net operating income was up by 16% while funds flow and adjusted funds flow was up about 15%.The interest coverage ratio improved from 2.62 to 2.38 times and the debt service ratio improved from 1.55 to 1.37 times. This means that earnings are adequate to cover interest payments and service the debt.Consequently the debt to gross book value ratio moved from 49% to 47%.Interrent is managing it's debt adequately. All of these statistics improved slightly.The quarterly report is optimistic but there has been no significant improvement in this quarter.Interrent's revenue and adjusted EBITDA have been almost flat since the first quarter of 2014.However it has improved slightly every quarter.This has caused the stock price to remain in a very tight range since the end of 2013.And it will likely remain flat unless their operational statistics improve more in 2015.
No comments:
Post a Comment