TORONTO, Aug. 14, 2024 (GLOBE NEWSWIRE) -- Nexus Industrial REIT (the "REIT") (TSX:NXR) announced today its results for the second quarter ended June 30, 2024. "We have entered a new phase as we begin to benefit from our recent investments. We have high-graded our portfolio, and invested in our development projects" said Kelly Hanczyk, CEO of Nexus Industrial REIT. "Our Q2 results clearly demonstrate this shift in our trajectory, and I expect that our momentum will accelerate from here, as we now have resolved key vacancy headwinds, have three remaining development projects coming online, and will also benefit from contractual rent lift and renewals," continued Kelly. "I am thrilled with the progress that we have made, and I am confident that our strategy to be a Canada-focused pure-play industrial REIT will continue to be meaningful and rewarding for our stakeholders." Second Quarter 2024 Highlights: Net income was $43.5 million driven by net operating income ("NOI")(1) of $31.6 million, gains on fair value adjustments of Class B LP Units of $21.1 million and of investment properties of $13.6 million. NOI increased 14.2% year over year to $31.6 million from the acquisition of high-quality, tenanted income-producing industrial properties, and growth in industrial Same Property NOI which totaled $0.8 million or 3.5% compared to a year ago (1). Advanced the construction of a new 96,000 sq. ft. intensification industrial project in London, ON, which is expected to earn an 8% return. The building was completed and tenanted in July. Completed the sale of an office property for $5 million and have contracted for the disposition of 28 non-core properties for a total of $107 million. Normalized FFO(1) per unit was $0.178 and Normalized AFFO(1) per unit was $0.148, a reduction of $0.018 and $0.017 versus a year ago. NAV(1) per unit of $13.2 grew $0.71 or 5.7% versus a year ago. Subsequent events: Acquired a 62,000 sq. ft. new industrial building in Sherbrooke, QC on July 2, 2024 valued at $16.6 million. The purchase price was satisfied through the issuance of 456,700 Class B LP Units at a deemed value of $10 per unit and cash. (1) Non-IFRS Financial Measure Summary of Results (In thousands of Canadian dollars, except per unit amounts) Three months ended June 30,   Six months ended June 30,   2024 2023   2024 2023   $ $   $ $ FINANCIAL INFORMATION           Operating Results           Property revenues 43,910   38,419     85,507   75,895   Net operating income (NOI) 31,617   27,689     61,154   53,417   Net Income 43,525   77,222     87,196   80,939               Funds from operations (FFO) (1) 16,576   16,775     30,931   33,223   Normalized FFO (1) (2) 16,642   17,266     31,885   33,717   Adjusted funds from operations (AFFO) (1) 13,770   14,100     25,358   28,048   Normalized AFFO (1) (2) 13,836   14,591     26,312   28,542   Distributions declared (3) 14,970   14,192     29,910   28,234   Same Property NOI (1) 24,867   24,063     48,452   47,766               Weighted average units outstanding (000s):           Basic (4) 93,541   88,310     93,441   88,027   Diluted (4) 93,717   88,412     93,617   88,129               Per unit amounts:           Distributions per unit – basic (3) (4) 0.160   0.160     0.320   0.320   Distributions per unit – diluted (3) (4) 0.160   0.160     0.320   0.320               Normalized FFO per unit – basic (1) (2) (4) 0.178   0.196     0.341   0.383   Normalized FFO per unit – diluted (1) (2) (4) 0.178   0.195     0.341   0.383               Normalized AFFO per unit – basic (1) (2) (4) 0.148   0.165     0.282   0.324   Normalized AFFO per unit – diluted (1) (2) (4) 0.148   0.165     0.281   0.324               AFFO payout ratio – basic (1) (3) 108.7 % 100.7 %   118.0 % 100.7 % Normalized AFFO payout ratio – basic (1) (2) (3) 108.2 % 97.3 %   113.7 % 98.9 %                         As at June 30, 2024 and December 31, 2023 2024 2023         $ $       PORTFOLIO INFORMATION           Total Portfolio           Number of Investment Properties(5) 118   116         Number of Properties Under Development 3   4         Investment Property Fair Value (excludes assets held for sale) 2,408,859   2,364,027         Gross leasable area ("GLA") (in millions of sq. ft.) (at the REIT's ownership interest) 12.9   12.5         Industrial occupancy rate – in-place and committed (period-end)(6) 98 % 97 %       Weighted average lease term ("WALT") (years) 6.9   6.9         Estimated spread between industrial portfolio market and in-place rents 25.1 % 29.0 %                   FINANCING AND CAPITAL INFORMATION           Financing           Net debt 1,296,226   1,203,432         Net Indebtedness Ratio 49.97 % 48.90 %       Interest coverage ration (times) 1.61   1.72         Secured Indebtedness Ratio 28.1 % 30.4 %       Unencumbered investment properties as a percentage of investment properties 41.8 % 35.6 %       Total assets 2,593,924   2,463,067         Cash and cash equivalents 7,868   5,918         Capital           Total equity (per condensed consolidated financial statements) 1,080,195   1,000,329         Total equity (including Class B LP Units) 1,235,819   1,199,434         Total number of Units (in thousands) 93,628   93,201         NAV per Unit 13.20   12.87         (1) See Non-IFRS Financial Measures.(2) See Appendix A – Non-IFRS Financial Measures (3) Includes distributions payable to holders of Class B LP Units which are accounted for as finance expense in the consolidated financial statements. (4) Weighted average number of units includes Class B LP Units.(5) Includes 26 properties classified as assets held for sale.(6) Includes committed new leases for future occupancy. Non-IFRS Measures Included in the tables above and elsewhere in this news release are non-IFRS financial measures that should not be construed as an alternative to net income / loss, cash from operating activities or other measures of financial performance calculated in accordance with IFRS and may not be comparable to similar measures as reported by other issuers. Certain additional disclosures for these non-IFRS financial measures have been incorporated by reference and can be found on page 3 in the REIT's Management's Discussion and Analysis for the three and six months ended June 30, 2024, available on SEDAR at www.sedarplus.ca and on the REIT's website under Investor Relations. See Appendix A of this earnings release for a reconciliation of the non-IFRS financial measures to the primary financial statement measures. NOI Net Operating Income for the three months ended June 30, 2024 was $31.6 million or $3.9 million higher than Q2 2023, which was primarily due to $3.9 million from acquisitions of industrial income producing property completed subsequent to Q2 2023 and an increase in Same Property NOI of $0.8 million principally due to the completed lease up of 1751-1771 Savage Rd, Richmond, BC, partially offset by $0.4 million relating to redevelopment of an investment property that was reclassified to properties under development during the quarter, $0.2 million relating to dispositions completed since Q2 2023, and a lower termination fee ...