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Genesis Reports 2023 Third Quarter Results and Declares a Special Dividend of $0.085

CALGARY, AB, Nov. 8, 2023 /CNW/ - Genesis Land Development Corp. (TSX: GDC) (the "Corporation" or "Genesis") reported its financial and operating results for the three months ("Q3") and nine months ended September 30, 2023 ("YTD"). Genesis is an integrated land developer and residential home builder with a strategy to grow its portfolio of well-located, entitled and unentitled primarily residential lands and serviced lots throughout the Calgary Metropolitan Area ("CMA").

The following are highlights of Genesis financial results for the third quarter of 2023:

2023 Highlights (Q3 2023 and YTD 2023)

  • Progress on Business Plan: During 2023, Genesis has continued to execute its growth business plan. Genesis achieved some significant milestones in 2022, with the removal of Growth Management Overlays ("GMOs") and in 2023, with receiving final development approvals enabling Genesis to proceed with development of its Lewiston, Logan Landing and Huxley communities in 2023. More growth is coming through expansion of its home building division. Genesis has contracted to purchase 554 lots through third party developers. In all, Genesis is now building homes in 9 communities in the CMA.

  • $131.7 Million of Revenues in YTD 2023: Genesis generated revenue of $131.7 million in YTD 2023 up from $86.2 million achieved in YTD 2022. Q3 2023 revenues of $41.2 million were lower when compared to $43.6 million generated in Q3 2022.

  • Net Earnings in YTD 2023 were $6.5 Million: Net earnings attributable to equity shareholders in YTD 2023 were $6.5 million ($0.11 net earnings per share - basic and diluted), compared to net earnings attributable to equity shareholders of $1.5 million ($0.03 earnings per share - basic and diluted) in YTD 2022. Net earnings attributable to equity shareholders in Q3 2023 were $2.2 million ($0.04 net earnings per share - basic and diluted), compared to net earnings attributable to equity shareholders of $1.9 million ($0.04 earnings per share - basic and diluted) in Q3 2022.

  • 210 Lots Sold: In YTD 2023, Genesis sold 210 residential lots (76 to third-party builders and 134 through its home building division, GBG), an increase of 62% from 130 lots in YTD 2022 (60 to third-party builders and 70 through GBG). In Q3 2023, Genesis sold 44 residential lots (1 to third-party builders and 43 through GBG), a decrease of 41% from 74 lots in Q3 2022 (54 to third-party builders and 20 through GBG).

  • 200 Homes Sold: In YTD 2023, Genesis sold 200 homes, an increase of 79% from the 112 sold in YTD 2022. In Q3 2023, Genesis sold 71 homes, an increase of 58% from the 45 sold in Q3 2022.

  • 278 New Home Orders in YTD 2023: New home orders for the nine months ended September 30, 2023 were 278 units compared to 202 units for the same period in 2022. During Q3 2023, Genesis had 122 new home orders compared to 4 for Q3 2022. As of September 30, 2023, Genesis had 283 outstanding new home orders, compared to 231 as at September 30, 2022.

  • Cash on Hand of $35.0 Million: On September 30, 2023, Genesis had $35.0 million in cash and cash equivalents and loan and credit facilities of $66.4 million which is 16% of the total book value of assets.

  • Dividend Declared: The Corporation declared an unconditional special cash dividend of $0.085 per common share for a total of $4.8 million on November 8, 2023, payable on December 8, 2023 to shareholders of record on November 21, 2023. Pursuant to subsection 89(14) of the Income Tax Act (Canada) the dividend qualifies as an eligible dividend for Canadian federal income tax purposes.

  • Land Acquisitions: In Q3 2023, Genesis entered into an agreement to acquire approximately 460 acres of future residential development land in the southeast sector of the City of Calgary for a total purchase price of $25.8 million.

Selected Financial Results and Operating Data:




Three months ended
September 30,

Nine months ended
September 30,

($000s, except for per share items or unless otherwise noted)

2023

2022

2023

2022

Key Financial Data






Total revenues

41,173

43,610

131,710

86,200

Net earnings attributable to equity shareholders

2,203

1,857

6,456

1,458

Net earnings per share - basic and diluted

0.04

0.04

0.11

0.03

Cash flows (used in) from operating activities

(9,922)

(2,737)

5,702

(42,070)

Cash flows (used in) from operating activities per share -

basic and diluted

(0.17)

(0.05)

0.10

(0.74)

Key Operating Data





Land Development





Total residential lots sold (units)

44

74

210

130

Residential lot revenues (1)

5,838

12,170

31,188

22,624

Development land revenues

-

7,453

4,242

9,653






Home Building





Homes sold (units)

71

45

200

112

Revenues (2)

40,928

28,091

114,896

66,881

Outstanding new home orders at period end (units)



283

231

 (1) Includes residential lot sales to third parties, residential lot sales to GBG and other revenues

(2) Includes other revenues and revenues of $5,593,000 for 43 lots in Q3 2023 and $18,616,000 for 134 lots in YTD 2023 purchased by the Home Building division from the Land Development division ($4,104,000 and 20 in Q3 2022; $12,958,000 and 70 in YTD 2022) and sold with the home. These amounts are eliminated on consolidation.

 

($000s, except for per share items or unless otherwise noted)



As at Sept. 30, 2023

As at Dec. 31, 2022

Key Balance Sheet Data





Cash and cash equivalents



34,961

36,598

Total assets



407,304

364,140

Loan and credit facilities



66,422

65,057

Shareholders' equity



227,985

224,632

Loan and credit facilities to total assets



16 %

18 %

Outlook

Supported by a solid financial position, a backlog of new-home orders, and the strength of Calgary's economy, Genesis continues to add growth opportunities in both its land and housing divisions. Housing price increases in recent years, rapidly increasing interest rates, inflationary pressures, tight labour markets and continuing supply chain constraints are impacting new home orders, and home affordability. These factors are being offset by continued strong housing demand from newcomers to Alberta, historic low supply of homes for sale in the tight Calgary market and the growing economy.

According to the Calgary Real Estate Board total residential home sales for the first 9 months of 2023 is 22,110 units with only 25,921 units forecast for all of 2023 in Calgary, down from a record high of 29,672 units in 2022. The Royal Bank of Canada forecasts Alberta GDP to grow by 2.2% in 2023, which is the strongest in Canada but a marked deceleration from the 5.1% growth in 2022. Immigration to both Alberta and the CMA continues to be strong into 2023 as evidenced by the 4.5% growth in the working age population in the CMA to the end of September 2023 as compared to September 2022. In addition to strong international immigration, people are moving to the CMA from across Canada, with the biggest net inflows coming from the two provinces with the most unaffordable housing markets: Ontario and British Columbia. Nonetheless, continued mixed economic indicators and general economic uncertainty, lead Genesis to remain cautious in planning and executing its strategic and business plans.

Additional Information

The information contained in this press release should be read in conjunction with the unaudited condensed consolidated interim financial statements for the three and nine months ended September 30, 2023 and 2022 and the related Management's Discussion and Analysis ("MD&A") dated November 8, 2023 which have been filed with Canadian securities regulatory authorities. Copies of these documents may be obtained via www.sedarplus.com or our website at www.genesisland.com.

ADVISORIES

Cautionary Note Regarding Forward-Looking Statements

This news release contains certain statements which constitute forward-looking statements or information ("forward-looking statements") within the meaning of applicable securities legislation, including Canadian Securities Administrators' National Instrument 51-102 - Continuous Disclosure Obligations, concerning the business, operations and financial performance and condition of Genesis. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "proposed", "scheduled", "future", "likely", "seeks", "estimates", "plans", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved".

Although Genesis believes that the anticipated future results, performance or achievements expressed or implied by forward-looking statements are based upon reasonable assumptions and expectations, the reader should not place undue reliance on forward-looking statements because they involve assumptions, known and unknown risks, uncertainties and other factors many of which are beyond the Corporation's control, which may cause the actual results, performance or achievements of Genesis to differ materially from anticipated future results, performance or achievement expressed or implied by such forward-looking statements. Accordingly, Genesis cannot give any assurance that its expectations will in fact occur and cautions that actual results may differ materially from those in the forward-looking statements.

Forward-looking statements are based on factors or assumptions made by us with respect to, among other things, opportunities that may or may not be pursued by us; changes in the real estate industry; fluctuations in the Canadian and Alberta economy; changes in the number of lots sold and homes delivered per year; and changes in laws or regulations or the interpretation or application of those laws and regulations. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control.

Forward-looking statements in this news release include, but are not limited to, Genesis' strategy; the ability to take advantage of growth opportunities; anticipated general economic and business conditions (including prospects for the local economy); and areas of continued operational focus.

Factors that could cause actual results to differ materially from those set forth in the forward-looking statements include, but are not limited to: the impact of contractual arrangements and incurred obligations on future operations and liquidity; local real estate conditions, including the development of properties in close proximity to Genesis' properties and the strength and growth of the Calgary economy; the uncertainties of real estate development and acquisition activity; fluctuations in interest and inflation rates; ability to access and raise capital on favorable terms; not realizing on the anticipated benefits from transactions or not realizing on such anticipated benefits within the expected time frame; the cyclicality of the oil and gas industry; changes in the Canadian / U.S. dollar exchange rate; labor matters; governmental regulations; general economic and financial conditions; stock market volatility; and other risks and factors described from time to time in the documents filed by Genesis with the securities regulators in Canada available at www.sedarplus.com, including in the Corporation's MD&A under the heading "Risks and Uncertainties" and the Corporation's annual information form under the heading "Risk Factors".

Furthermore, the forward-looking statements contained in this news release are made as of the date of this news release and, except as required by applicable law, Genesis does not undertake any obligation to publicly update or to revise any of the forward-looking statements, whether as a result of new information, future events or otherwise.

SOURCE Genesis Land Development Corp.

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View original content: http://www.newswire.ca/en/releases/archive/November2023/08/c4666.html