Alaris Equity Partners Income Trust (AD-UN) Q1 2025 earnings summary

Executive summary

• Net book value per unit rose by $0.12 to $24.34, driven by $0.50 per unit in earnings and offset by $0.34 per unit in distributions; NCIB activity added $0.02 per unit.

• Distributable cash flow increased 19.1% year-over-year to CAD 30.4 million, or CAD 0.67 per unit, with net distributable cash flow per unit up 19.6%.

• Partner distributions and transaction fee revenue reached CAD 43.7 million, 13% higher year-over-year and above guidance.

• Portfolio remains healthy with a weighted average ECR of 1.5x and low leverage among partners.

Financial highlights

• Net distributable cash flow for Q1 was CAD 30.4 million, up from CAD 25.5 million in Q1 2024.

• Actual payout ratio for the quarter was 59%, including share buybacks.

• Book value was impacted by a CAD 0.11 per unit FX loss, compared to a gain of CAD 1.35 per unit in Q4 2024.

• Approximately 219,000 units were repurchased and canceled at an average price of CAD 1,960.

• Earnings from operations per unit increased 19.2% year-over-year, but earnings and comprehensive income per unit fell 69.1% due to a non-recurring gain in Q1 2024 and a foreign exchange loss in Q1 2025.

Outlook and guidance

• Q2 revenue guidance is CAD 41.4 million; 12-month revenue outlook is CAD 178 million, including CAD 19.1 million in expected common distributions.

• Payout ratio is expected to rise slightly to 60-65% due to FMP distribution deferral.

• Management anticipates an active second half for new investments and sees a robust pipeline of opportunities, all current opportunities in the US.

• Anticipates continued portfolio performance and net book value growth, but expects FX volatility to impact reporting.