CALGARY, ALBERTA--(Marketwire - Nov. 21, 2012) -
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Alaris Royalty Corp (TSX:AD) ("Alaris" or the "Corporation") is pleased to announce that its board of directors (the "Board of Directors") approved an increase to the Corporation's monthly dividend by a half cent to $0.105 per share from $0.10. On an annualized basis, the dividend will increase by six cents to $1.26 per share from $1.20, a 5% increase. Based on the closing price on November 20, 2012, the yield on the annualized dividend is equal to 5.66%. This will be the fifth consecutive dividend increase by Alaris.
The decision to increase the dividend was based on the year over year performance of Alaris' current private company partners ("Partners") as well as the recently announced additional $19.0 million contribution to KMH Limited Partnership ("KMH"), which resulted in an increase of distributions from KMH equal to $2.8 million (on an annualized basis). Starting in January, Alaris is expecting net increases in distributions from our Partners, particularly from LMS Limited Partnership and Quetico, LLC.
"Alaris continues to strive for the optimal mix of stability and growth. The recent additions to our top and bottom lines from organic growth and accretive partnership contributions have allowed us to increase the dividend while also decreasing our payout ratio. We also currently have $30 million of capacity on our credit facility with which we expect to use to add more accretive partnerships in the future." said Steve King, President and Chief Executive Officer, Alaris.
The first dividend for which this increase will apply is the dividend expected to be paid on January 15, 2013 to shareholders of record on December 31, 2012. This dividend is expected to be declared by the Board of Directors in December 2012.
The Corporation provides alternative financing to a diversified group of private businesses ("Private Company Partners") in exchange for royalties or distributions from the Private Company Partners, with the principal objective of generating stable and predictable cash flows for dividend payments to its shareholders. Royalties or distributions to Alaris from the Private Company Partners are structured as a percentage of a "top line" financial performance measure such as gross margin, same clinic sales, gross revenues and same-store sales and rank in priority to the owners' common equity position.
The terms "distributable cash per share" and "payout ratio" (the "Non-IFRS Measures") are financial measures used in this news release that are not standard measures under International Financial Reporting Standards ("IFRS"). The Corporation's method of calculating the Non-IFRS Measures may differ from the methods used by other issuers. Therefore, the Corporation's Non-IFRS Measures may not be comparable to similar measures presented by other issuers. Payout ratio means Alaris' annualized dividend per share divided by its distributable cash per share. Distributable cash per share means Alaris' cash flow from operating activities divided by the weighted average number of common shares issued and outstanding in the share capital of the Corporation over such period. The Non-IFRS measures should only be used in conjunction with the Corporation's annual audited and quarterly reviewed financial statements, which are available on SEDAR at www.sedar.com.
This news release contains forward-looking statements as defined under applicable securities laws. Statements other than statements of historical fact contained in this news release may be forward-looking statements under applicable securities legislation, including, without limitation, management's expectations, intentions and beliefs concerning: the dividend increase and the timing and application thereof; expected increases in distributions to be received from the Partners; expected use of the credit facility; and the addition of new Partners. Many of these statements can be identified by looking for words such as "believe", "expects", "will", "intends", "projects", "anticipates", "estimates", "continues" or similar words or the negative thereof. To the extent any forward-looking statements herein constitute a financial outlook, they were approved by management as of the date hereof and have been included to provide an understanding with respect to Alaris' financial performance and are subject to the risks and assumptions disclosed herein. There can be no assurance that the plans, intentions or expectations upon which these forward looking statements are based will occur.
Statements containing forward-looking information by their nature involve numerous assumptions and significant known and unknown facts and uncertainties of both a general and a specific nature. Key assumptions include, but are not limited to assumptions that: the Private Company Partners will continue to grow and may require additional capital from Alaris in the future; the Canadian and U.S. economies will grow moderately over the balance of 2012; the businesses of the Private Company Partners will continue to grow; interest rates will not rise in a material nature over the next 12 months; and more private companies will require access to alternative sources of capital. In determining the Corporation's expectations for economic growth, management primarily considers historical economic data provided by the Canadian and U.S. governments and their agencies.
The forward-looking statements contained herein are subject to numerous known and unknown risks that may cause actual results to vary from those set forth in the forward-looking statements, including, but not limited to risks associated with: general economic conditions and changes in the financial markets; risks associated with the Private Company Partners and their respective businesses; and a change in the ability of the Private Company Partners to continue to pay Alaris' preferred distributions. In addition, the information set forth under the heading "Risk Factors" in the Corporation's Annual Information Form dated March 25, 2011 (a complete copy of which can be found on SEDAR at www.sedar.com) identifies additional factors that could affect the operating results and performance of the Corporation and may cause the actual results of the Corporation to differ materially from those anticipated in forward-looking statements.
As forward-looking statements are subject to risks, uncertainties and assumptions and should not be read as guarantees or assurances of future performance. Accordingly, readers are cautioned not to place undue reliance on any forward-looking information contained in this news release as a number of factors could cause actual future results, conditions, actions or events to differ materially from the targets, expectations, estimates or intentions expressed in the forward-looking statements. Statements containing forward-looking information reflect management's current beliefs and assumptions based on information in its possession on the date of this news release. Although management believes that the assumptions reflected in the forward-looking statements contained herein are reasonable, there can be no assurance that such expectations will prove to be correct.
The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement. The forward-looking statements included in this news release are made as of the date of this news release and Alaris does not undertake or assume any obligation to update or revise such statements to reflect new events or circumstances except as expressly required by applicable securities legislation.
Manager of Investor Relations and Analyst