The Becker Milk Company Limited: Six Month Financial Results

The Becker Milk Company Limited (the “Company”) (TSX-BEK.B) is pleased to report the results for the six months ended October 31, 2023.

HIGHLIGHTS

• Total revenues for the six months ended October 31, 2023 were $1,488,135 compared to $1,360,032 for the same period in 2022;
• The non-GAAP financial measure Net Operating Income for the first half fiscal 2024 was $1,181,810 compared to $1,153,009 for the first half fiscal 2023;
• Net loss for the first half fiscal 2024 was $0.30 per share, compared to $1.19 net loss per share for the first half fiscal 2023.

FINANCIAL HIGHLIGHTS

Total revenue for the six months ended October 31, 2023 improved $128,103 compared to the six months ended October 31, 2022, largely a result of higher finance income.

					Six months ended
					October 31
						2023				2022
Property revenue					$1,345,934				$1,303,395
Finance income						142,201				56,637
Total revenues					$1,488,135				$1,360,032
Net income (loss) attributable to common and special shareholders						($546,853)				($2,153,525)
Average common and special shares outstanding						1,808,360				1,808,360
Income (loss) per share						($0.30)				($1.19)

Components of the $1,606,672 decrease in the net loss for the six months ended October 31, 2023 compared to the six months ended October 31, 2022 are:

Changes in Net Income - Six months ended October 31, 2023
compared to six months ended October 31, 2022
Favourable change in fair value adjustment					$1,753,573
Increase in finance income						85,564
Decrease in expenses related to strategic review						40,456
Increase in net operating income						28,801
Increase in gain on disposal						12,376
Increase in administrative expenses						(22,210)
Increase in current taxes						(33,791)
Decrease in recovery of deferred income taxes						(258,097)
Decrease in net loss					$1,606,672

The decrease in the unfavourable change in the fair value adjustment to investment properties was the result of an upward adjustment in investment property capitalization rates during six months ended October 31, 2023, as compared to the six months ended October 31, 2022.

Non-GAAP financial measures

Net operating income

The non-GAAP financial measure Net Operating Income for the six months ended October 31, 2023 was $1,181,810, a $28,801 increase compared with the previous year. Improved revenue was partially offset by an increase in property operating expenses.

					Six months ended
					October 31
						2023				2022
Property revenue					$1,345,934				$1,303,395
Property operating expenses						(164,124)				(150,386)
Net operating income					$1,181,810				$1,153,009

Funds from operations and Adjusted funds from operations

For the six months ended October 31, 2023 the Company recorded Adjusted funds from operations of $482,063 ($0.27 per share) compared to $387,413 ($0.21 per share) in 2022.

					Six months ended
					October 31
						2023				2022
Net income (loss)						($546,853)				($2,153,525)
Add (deduct) items not affecting cash:
	Adjustment to fair value of investment properties					1,203,385				2,956,958
	Loss (gain) on sale of investment properties					(2,122)				10,254
	Tax on gains from sale of property					54,736				9,065
	Deferred income taxes					(183,698)				(441,795)
Funds from operations						525,448				380,957
Add (deduct) non-operating items:
	Expenses related to strategic review					-				40,456
	Sustaining capital expenditures					(43,385)				(34,000)
Adjusted funds from operations					$482,063				$387,413
Adjusted funds from operations per share					$0.27				$0.21

STRATEGIC REVIEW

The Board of Directors continually evaluates strategic directions for the Company and has engaged in discussions with potential acquirers. While the Company has engaged in some discussions within the last year, none of those discussions are active at this time. The Company continues to review its strategic alternatives and will update the market as appropriate, and as required.

The Company’s interim financial statements for the six months ended October 31, 2023, along with the Management’s Discussion and Analysis will be filed with SEDAR at www.sedar.com.

Readers are cautioned that although the terms “Net Operating Income”, and “Funds From Operations” are commonly used to measure, compare and explain the operating and financial performance of Canadian real estate companies and such terms are defined in the Management’s Discussion and Analysis, such terms are not recognized terms under Canadian generally accepted accounting principles. Such terms do not necessarily have a standardized meaning and may not be comparable to similarly titled measures presented by the other publicly traded entities.

For the Board of Directors G.W.J. Pottow, President Tel: [phone]