DREAM Unlimited Corp.

Good afternoon, ladies and gentlemen. Welcome to the Dream Unlimited Corp first quarter conference call for Wednesday, May the 15th, 2024. During this call, management of Dream Unlimited Corp may make statements containing forward-looking information within the meaning of applicable securities legislation. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties. many of which are beyond Dream Unlimited Corps control that could cause actual results to differ materially from those that are disclosed in or implied by such forward-looking information. Additional information about these assumptions and risks and uncertainties is contained in Dream Unlimited Corps filings with securities regulators, including its latest annual information form and MD&A, These filings are also available on Dream Unlimited Corp's website at www.dream.ca. Later in the presentation, we will have a question and answer session. To join the question queue, you may press star then one on your telephone keypad. Your host for today will be Michael Cooper, CRO of Dream Unlimited Corp. Mr. Cooper, please go ahead.

Thank you, operator, and good afternoon, everyone. Today I'm here with Megan Peloso, who is the CFO of Dream Unlimited. Megan took over the role 45 days ago. We've got a great start to getting our plans in effect. For the purpose of this call, Megan and I are very focused on how we can communicate what's happening in the business in a clear way, despite the requirements of the audit and financial statements. We're using the supplementary information package. I think we're going to make some changes to it going forward and make it even easier. But a lot has been changing in DREAM. And the way I think about it is there are three main businesses, the three main drivers are Western Canada activities, development activities, income properties, which is growing, and our asset management business, which is growing. Those three areas, they're effectively 90% of the whole business. I'm going to go into some detail on Western Canada and a little bit about our income properties, but for the most part, in a little bit, but I think we're seeing a surprising amount of strength in Western Canada. Not just for this year, but a lot of things that we're seeing happening is going to be great for future years to come. In income properties, we added a bunch of properties last year that were completed. We're adding a bunch of properties this year that will be completed. We also are in pre-development on some apartments and retail, and I think that's going to grow faster than people expect. And those income properties, a lot of them are in Western Canada, but also in Ottawa and Gatineau. So it's very exciting to see that. And I think there, the special thing with income properties, we're developing on some of our lands and we keep the properties. So we get a fair value gain for the work we do. Then we get income for that year. The next year it goes up, but often we have another building finished. So we keep adding buildings and the recurring income from our own developments is really adding up to a meaningful amount. On the asset management side, it's been going pretty good. We did a large transaction last year that was completed in the first quarter. But since then, we've added a fair amount of money under management, and we expect that while it may be a little bit unpredictable, our asset management business will continue to grow. With that, I'll go into some details later on about some other things, but I'm just going to hand it over to Megan to address you.

Thank you, Michael, and good afternoon, everyone. In the first quarter, we recognized pre-tax earnings on a standalone basis of $5.4 million, up from $4.6 million in the comparative period, which was largely driven by improved performance at 8 Basin and lower interest expense from reduced drawings on the operating line. FFO for the quarter was $0.98 per share, up significantly from prior year, largely due to Western Canada JV sales in the period, which I'll further describe in a minute. More specifically, on a segmented basis, In Q1, our recurring income segment generated revenue and NOI of $51 million and $25 million, respectively, up from $49 million and $21 million in 2023. The increase was primarily driven by our two highest income months at A-Basin in February and March, as well as higher income contribution from the distillery district. Now, included in revenue for the first quarter is $13 million relating to our asset management and development contracts. which is down slightly from 2023, mainly due to the volume of transactional activity in the prior year. As it relates to the development segment, revenue and net margins for the period was $43.9 million and negative $6.7 million, respectively, compared to $13.5 million and negative $4.3 million in the comparative period. Included in revenue figures in the first quarter was occupancy income of nearly $24 million from Ivy Condos, Brightwater, and Phase 2 of Riverside Square. Now, if you recall, IB Condo is a project that initially launched sales in 2017. Subsequent to launching, the market saw significant cost escalations. And while we anticipate a limited margin, we chose to continue the project to be fair to purchasers. We expect to close on the project and repay the construction debt this month. On the Western Canada front, including development earnings for the quarter, we're allotting acre sales of 23 and 11, respectively. The average selling price per lot increased relative to prior year largely driven by our sales mix, which included lots at Alpine Park. And while not included in consolidated earnings for the period, but included in our standalone FFO metric, with margin of $28.1 million from the sale of 146 acres in Edmonton to two development JVs. For accounting purposes, we expect to recognize the related revenue and margin in the second quarter of this year. As of today, and excluding the Edmonton JVs, we have commitments for an additional 370 lots and 106 acres through 2025, representing $162 million in revenue, $123 million of which will be recognized over the remainder of this year. This is the highest level of pre-sales volume which we've seen in Western Canada to date. We continue to maintain very strong liquidity over the quarter, ending the period with $320 million in total liquidity and a conservative leverage position of 38% on a standalone basis. And with that, I'll turn the call back over to Michael.