Good morning, ladies and gentlemen, and welcome to Extendicare, Inc. 3rd Quarter Conference Call. Please be advised that this call is being recorded. I would now like to turn it over to Ms. Jillian Fountain.
Please go ahead, Ms. Fountain.
Thank you, Ruth. Good morning, everyone, and welcome to Extendicare's 2018 Q3 results conference call. With me today is Junius' President and Chief Executive Officer, Doctor. Michael Greer and Elaine Everson, your Vice President and Chief Financial Officer. Our 2018 Q3 results were disseminated yesterday and are available on our website along with the supplemental information package.
The audio webcast of today's call is also available on our website along with an accompanying slide presentation, which viewers may advance themselves. A replay of the call will be available from noon today until midnight on November 23. The replay numbers and passcode have been provided in our press release, and an archived recording of this call will also be available on our website. Before we get started, please be reminded that today's call may include forward looking statements regarding our future operations. Such statements involve known and unknown risks and uncertainties that may cause actual results to differ materially from those expressed or implied today.
We have identified such factors in our public filings with the Securities Commission and suggest that you refer to those filings. As we discuss our performance, please bear in mind that all figures are in Canadian dollars unless otherwise noted. With that, I'll turn the call over to Michael.
Thank you, Jillian, and good morning, everyone. As you know, Extendicare operates across the spectrum of seniors care in Canada to meet the needs of the growing seniors population. As you can see on Slide 3, our services are provided under various brands that together cover the continuum of seniors care. It is becoming increasingly clear that the growing needs of seniors are placing significant pressure on public sector health budgets. We won't be able to meet their needs by using the same approaches we always have.
We will need some innovative approaches that leverage new technology to help seniors thrive in their own homes longer before needing assisted living or long term care. I believe Extendicare is uniquely positioned to bring innovative solutions to the market that cover the full spectrum from home care to retirement to long term care. And given the steady expansion in this market given by demographic fundamentals, I believe there's a substantial opportunity to build shareholder value. On Slide 4, you can see that our results in the quarter were mixed across our various divisions. Growth from our retirement, management consulting and group purchasing divisions was strong, offset somewhat by declines in our long term care and home health care operations.
Net operating income from Canadian operations was up 2.5% from the same quarter last year. This kept pace with revenue growth, maintaining a margin of 12.7%. AFFO, however, was down 14.5% this quarter to 13,400,000 dollars This was negatively impacted by higher lump sum compensation costs, maintenance CapEx and current taxes. Let's look at the details in each of our divisions. Revenue in our Home Care division declined 2.4% from the year earlier quarter.
This was due to insufficient staff in some of our Ontario districts outside the GTA, where we found it very difficult to find enough care providers to meet all the demand coming from the Lynde. In order to address this, we've been beefing up our recruiting activity, adding training resources and investing in new IT infrastructure. Our new computer system went live in the quarter and is being used in 3 of our districts, which account for about 20% of our home care volumes. It will take most of fiscal 2019 to complete the implementation. During this time, we are still shouldering the costs of operating 3 legacy systems, which will be decommissioned by the end of 2019.
We are also investing in significant one time training and implementation resources. Implementation is disruptive, causing a transient slowdown in activity in each office that we implement. Taken together, these factors will result in profitability headwinds for the next 4 quarters. In Q3, NOI was down 19.8%
due to
the volume drop and one time costs related to the IT implementation and WSIB surcharges. As we continue with the system deployment, we expect performance will pick up in those districts that are already live on the system. We should start seeing volume increases that help to offset the one time costs as we enter the New Year. We are actively looking at ways to increase the speed of our implementation efforts. We are also working hard to improve engagement with our team in the field.
The level of staff turnover has improved by 50% in the quarter, a huge improvement on a chronic issue in our home care division. We are optimistic that the measures we are taking on the people front will put this division back on a path to significant annual growth. Let's turn to long term care on Slide 6. Although revenue growth was 3% over the prior year quarter, NOI was flat. Spending beyond our government funding envelopes, labor related accruals and a prior year revenue pickup were responsible for a drop in NOI margin from 13% to 12.7%.
Average occupancy continued to improve incrementally this quarter from the beginning of 2018, although it remained slightly below the same 2017 period. On the long term care redevelopment front, as previously announced, we received approval for 2 of our redevelopment applications, 1 in Stittsville, a growing suburb of Ottawa and the other in Sudbury. Both are 256 bed centers and we are optimistic that we will be breaking ground on them early in 2019. We were granted 158 new long term care beds in connection with the redevelopment of 3 of our other projects in Sault Ste. Marie, Sudbury and Peterborough, which are still in the government's review process.
We continue to be encouraged by the emphasis the new Ontario government has put on new long term care beds to reduce alternative level of care pressure in acute care hospitals. We will continue to apply for allocations of new beds to leverage the redevelopment of our older centers and to initiate new campus of care opportunities. In all, we have 21 long term care centers in Ontario to redevelop, and we continue to work collaboratively with the Ministry of Health to move all our projects through the approval process. Turning to our Esprit lifestyle division on Slide 7, revenue was up 78% over the prior year quarter and net operating income is up 2.94% due to higher occupancy in both our existing properties and our new communities. Our stabilized properties reached 94.8 percent occupancy by the end of the quarter.
And our lease up properties, of which there are 4 Yorkton Crossing and Westpark Crossing in Saskatchewan, Cedar Crossing and Douglas Crossing in Ontario reached 82.4% occupancy by the end of the quarter. We are very pleased with the continued growth of our retirement operations through acquisition and development. As previously mentioned, our new 103 Suite Douglas Crossing community has outperformed our expectations and is already at 93% occupancy after only a year of opening. And this week, we are welcoming our 1st residents to the 47 suite addition. Interest in the addition has been robust with 46 deposits on hand and 11 move ins already scheduled before the end of this year.
The total retirement community of 150 suites at Douglas Crossing has an expected NOI yield of 8.6%. The 2 development projects we have under construction in Bolton and Barrie are anticipated to deliver NOI yields of 7.6% and 8%, respectively. You can see these on Slide 8. These sites are on target to accept residents in early 2019 for Bolton and in Q3 2019 for the Berryview. We are using the Berryview retirement community to develop a smart retirement home concept, which we intend to be a prototype for future projects.
We are exploring technologies that will enable independence by helping connect our residents with the information they need to stay well longer as well as offering them technologies that will help them connect more effectively with their health care providers. We anticipate we will be able to use the same technology platform in our home care division to support seniors in their own homes as well. Following completion of these 2 communities, our Esprit platform, which we launched 2.5 years ago, will have 11 communities with 10 52 suites. We are working on additional projects, 2 of which are expansions of existing communities. We are doubling the size of Empire Crossing in Port Hope.
If all goes well, we will begin construction on the expansion in the summer of 2019. We are also pursuing expansion of Lynn Creek, which features 3.7 acres of surplus land ideal for an independent living development. On the next slide, you can see that revenue from our Extendicare Assist management and consulting services team and our SGP purchasing partner network increased 24.3% over the prior year quarter. Margins improved from 56.6 percent to 62.9%. The growth in these business units resulted in record high revenue and profit in Q3.
Assist added 3 new centers, bringing 416 beds to its managed facility portfolio for a total of 53 senior care centers with capacity for 6,632 residents. The new contracts thus far in 2018 for SGP represent over 5,800 residents, bringing 3rd party residents served by SGP to over 51,000. We continue to experience increased demand for our day to day management services and clients are contracting with us for assistance with their redevelopment efforts, where we provide analysis, application support and development services. In fact, Extendicare Assist recently secured a contract to provide consulting services in connection with Lakeside LTC Center, part of the University Health Network. So with that, I'll turn it over to Elaine to provide more details on the financial results.
Elaine?
Thank you, Michael, and good morning, everyone. I'll provide you with an overview of our consolidated results, beginning with the NOI contributions of each of our business segments. Turning to Slide 11. Our NOI generated from Canadian operations was up 2.5% to $35,500,000 this quarter with a margin of 12.7% unchanged from Q3 of 2017. As you can see on the slide, this was driven from growth of $2,000,000 from our retirement living operations, both organically and as a result of the acquisition completed earlier this year, as well as the increased contribution from our management consulting and group purchasing operations.
Conversely, our LTC operations were flat this quarter and our home health care NOI was lower by $2,200,000 experienced lower volume due to labor capacity challenges that Michael has spoken about. Similar factors impacted the NOI from Canadian operations for the 9 months, where we experienced a $3,700,000 or 3.8% increase over the prior year. As outlined on the slide, the Esprit operations contributed an additional $5,300,000 of which $2,200,000 was non same store and Extendicare Assist and SGP contributed an additional $2,500,000 On a year to date basis, the home health care contribution was lower by $2,800,000 and long term care was lower by $1,300,000 impacted by timing of spending under the flow through envelopes as well as higher cost of resident care and a favorable prior period revenue adjustment received last year. Turning to Slide 12, Our consolidated NOI, EBITDA and AFFO. The improvement in our consolidated NOI this quarter was partially offset by a slight increase in our admin and lease costs, bringing the increase in our adjusted EBITDA to $400,000 over the same period of 2017 with a margin of 8.7%.
For the 9 months, the consolidated NOI reflects the improvement I just discussed from our Canadian operations as well as lower investment income from our remaining U. S. Operations. The investment income relates to income earned on the investments in our captive that are held to settle self insured liabilities remaining from those former operations. The earnings of the captive do not impact our AFFO as any settled claims are funded by its cash and investment.
Lower administrative and lease cost of $800,000 in the 9 month period due primarily to share based compensation and professional fees brought the improvement in our adjusted EBITDA to $1,700,000 and a margin unchanged at 8.6%. AFFO this quarter was $13,400,000 or $0.151 per basic share and included a charge for our former CEO departure of $2,100,000 on an after tax basis or $0.025 per share. In comparison to Q3 of 2017, AFFO was down $2,200,000 reflecting the increase in adjusted EBITDA, the exclusion of the impact of lowered non cash share based compensation included therein and an increase in our current taxes and maintenance CapEx spending quarter over quarter. For the 9 months, AFFO improved by $2,400,000 reflecting the improvement in adjusted EBITDA and lower current income taxes, partially offset by an increase in the amount of maintenance CapEx spending over the same period last year. We anticipate our effective tax rate on FFO will be in the range of 13% to 15% for the 2018 year.
Our maintenance CapEx spend was $8,500,000 year to date, and we expect it to be in the range of $11,000,000 to $12,000,000 for the year. Our payout ratio for the 1st 9 months this year was 70% compared to 75% in 2017. Now turning to our financial position on Slide 13. Our total long term debt at September 30 was $540,000,000 and relatively unchanged from year end, with debt repayments offset by construction loan draws and a new mortgage on one of our retirement communities. At September 30, our weighted average interest rate was 4.8% and the weighted average term to maturity on our debt was 8 years.
Our debt to GBV was 46.6% and EBITDA interest coverage was relatively unchanged at 3.4x. We ended the quarter with cash on hand of $67,400,000 representing a decrease of $60,000,000 from the end of last year, primarily attributable to the acquisition of Linde Creek in the 2nd quarter, growth capital expenditures, purchases of common shares under our normal cash issuer bid and costs incurred in connection with the refinancing of our convertible debenture. As Michael mentioned, one of our priorities is the redevelopment of our long term care centers over the next few years, which will necessitate raising funds through debt financing and capital markets. We expect to be in a position to share more around our capital plans with you in the New Year. With respect to our captive, our provision for self insured liabilities was US35 $1,000,000 at September 30 with US62 $1,000,000 of investment held to service those liabilities.
And in October, we repatriated $7,500,000 of that cash from the captives, bringing the total repatriated since the sale in 2015 to $28,500,000 With that, I'd like to turn it back over to Michael for his concluding remarks.
Thanks, Elaine. In summary, we had strong results from ESPRIT, ASSIST and FGP, steady performance from LTC and a drop in volumes within the ParaMed division. Despite this, I'm very optimistic about where we are going with our home care operations. We have embarked on a modernization program focused on technology infrastructure that is approximately 20% complete. Improvements in our HR practices will increase the size of our team available for care delivery.
Given the success of efforts made to date, I will be looking for ways to speed adoption across the rest of our home care business. We are building momentum in the redevelopment of our Ontario seabeds and envision this to be the start of a multiyear long term care redevelopment and expansion phase for Extendicare across the province, involving 21 centers and over 3,000 300 beds, augmented by additional beds allocated by the government to Extendicare. Furthermore, our market leadership in redevelopment is providing opportunities to leverage our consulting and design services through Extendicare Assist and we anticipate more growth on this front in the future as well. We are delivering on our plans to enhance our non government revenue through the growth in the Esprit Lifestyles platform with additional organic development underway. In summary, our mission of helping people live better brings together a growing societal need and an enticing investment opportunity.
Providing seniors with services across the spectrum of care is a key element of our strategy. At Extendicare, we are unique in having the foundational building blocks in place to deliver that vision. With the investments we are making now in technology platforms and human resources, we will be well positioned to meet the growing needs of seniors whether or not they reside in one of our communities. In closing, I want to pay tribute to each one of our more than 23,000 people at Extendicare who work hard every day to make a difference for seniors. The passion they have for our mission is nothing short of inspiring.
The quality of care we provide and the quality of life that our residents and clients enjoy is our number one priority and gives purpose to everything we do. I feel fortunate to be part of a team that is pursuing a mission so vital for Canadian society. So that concludes our formal remarks. We'll now be happy to take any questions you may have.
Thank you. So we'll now take questions on the telephone lines. The first question is from Lauren Palmer from TD Securities. Please go ahead.
Hi, good morning.
Good morning, Lars.
And congratulations, Michael, on the new role. Thank you. Turning to Home Health, where do you guys see the margins going over the next couple of
years? Well, I mean, as we've talked about, we've got a significant investment next four quarters. So that's certainly going to be an impact from a margin perspective. But that will come to an end and we'll be able to decommission some of the legacy systems and take advantage of the new capabilities that those systems will give us from an analytics perspective, from a scheduling perspective. So we'll be able to speed up the growth of that particular business line.
So we don't expect the margins to change materially from what we've seen historically. What we expect to see change is our growth rate as a result of these investments. But there will be a transient period where we're facing these one time costs as well as the just the duplicated costs of supporting multiple computer systems until we've consolidated to 1.
All right. And how much are you guys expecting to spend on the new system in 2019?
Lauren, that's a great question. We are looking at that pretty carefully right now. I think we'll be able to give you more visibility to that in the next quarter. But at the moment, I think the way to look at it is that it won't be significantly different from what our investment pace has been to date.
Okay. So I guess kind of 8.5% would represent a good NOI
run rate for 2019? I think that I expect the performance of that division to be about the same in Q4. But then as we get into next year, the volume increases that we're anticipating will probably offset some of the one time costs. So it just depends on the rate of those two things and how they combine to set the margin.
All right. It sounds like you're off to a great start. I'll turn it back.
Thank you, Lynn.
Thank you. Our next question is from Chris Couprie from CIBC. Please go ahead.
Good morning. Good morning, Chris. Hi, there. I just wanted to follow-up on Lauren's comments there. So you mentioned that there's some one time expenses that you're seeing in home care right now.
Could you maybe just elaborate on what you mean by that and quantify it if possible?
Yes. The one time expenses are due to installing a new computer system across the home care division. So when we made the acquisitions in the past, we inherited different information systems with each acquisition. So we're running 3 different systems to operate that division. We're consolidating them all to actually a 4th system, a brand new system that we feel is state of the art in the industry.
So the costs associated with that are implementation costs to install a system as well as training for our entire team. We're also, of course, still shouldering the costs of the 3 legacy systems, which we'll be able to turn off when the new system is completely implemented. So that's the nature of the one time cost that we're facing.
And the magnitude?
Well, the I think just as we said in response to Lauren's question, we're looking at adding that up and being able to disclose more detail on that in the next quarter. So I don't have a number to share with you at the moment, but we will be able to give you more of a picture of what that investment looks like over the course of 2019. We'll also be letting you know how far along we are. So we've implemented 3 of our districts to date That represents about 20% of our home care volume. We'll report that on a quarterly basis, so you can track our progress.
And as we implement the system, those offices that are getting advantage of it are the ones that will start to see an improvement in operations. So we're just getting started. I mean, we just went live with new year.
Okay. In terms of where these costs are kind of currently allocated, you call out the 92% and change percent of OpEx tied to labor. So is it basically is the costs of these systems and the implementation, are they appearing in the ex labor costs or is some of it in the labor cost as well?
Chris, it's Elaine. There's a
combination. The vast majority of the costs that we've seen to date are really around the implementation team and resources. There'd be an impact within those labor costs as well as corporately through the infrastructure of our IT team. So we are aggregating and teasing them out, looking at opportunities as to how we can accelerate progress on that. And that's why we expect to be in a position to be able to share a little more on a granular level over the next quarter.
Okay, sure. And then just on the volume front. So the government last year said that they wanted to add 2,600,000 hours of various types of home care service in the province. So in terms of the kind of submissions or requests for service from the government that you're seeing, would you say that the level of requests that you're getting from the government is flat? Is it up?
And it's just that you're, for lack of a better word, your closing ratio is down?
Yes. It's definitely up. We've been turning down referrals unfortunately because of a lack staff to fulfill those services in a number of districts outside of the GTA. In the GTA, we've been able to keep up, but other parts of the province of Ontario, we've had real difficulty with recruiting staff to be able to meet the demand. And just roughly speaking, we've turned down over the past year close to $100,000,000 worth of referrals.
So it's very significant demand. It's a fulfillment issue as to why the volume has dropped, not a demand issue.
Okay. And just maybe big picture from a new change in government. Has there been any dialogue at all in terms of where the government stands with respect to how it's funding home care and so on?
This government has indicated that they're continuing to look for ways to take pressure off the acute care health care system. The reduction of hallway medicine, as they call it, has been a major focus for this government and that will involve home care, long term care, other community based solutions in order to address that demand function within the acute care system. I made reference in my comments to ALC or Alternate Level of Care, which is people who should be in long term care facilities that are in acute care beds, in the acute care hospital system. And clearly, if they're there, then they're not able to admit new patients. And that's why we have so many people on stretchers in the hallways of emergency departments.
So this is very high priority for this government. And so I expect to see continued support for expansion of long term care and home care services over the course of this government's mandate.
And where do you kind of sit on the private home care idea?
Well, we provide some private services. But as long as we're not fulfilling the referrals that we're getting from the public system, that will be our focus.
Okay. Thanks. I'll turn it back.
Thank you, Chris.
Thank you. Our next question is from Michael Smith from RBC Capital Markets. Please go ahead.
Thank you and good morning. Good morning. Michael, congratulations on your new position. I have a question just again on Home Health Care. And I know this was the major acquisition of the business was done before you were in management.
So you're going from 3 systems to a 4th system. And you've I guess the company has had a hired a consultant and you've been going through a process. Was that all part of the pro form a when the you double the size of the business, so to speak? Or was that or is that basically something that's come out after you've tried to integrate the 2 businesses?
Michael, it's Elaine. I was around at that time. And when we acquired the home care business and doubled our size, we absolutely understood that there would be efforts to integrate and benefits of the synergies that we would get. So we were well aware they were running on 2 different platforms at the time as well as some another internal platform that we had on the scheduling side. We were well aware that there would be initiatives in order to bring those together.
So considering it's in the pro form a, I can't answer that level of granularity here, but absolutely, it was a factor that we were well aware we would be undertaking after we acquired them.
Sure. And Michael, have you made any changes since? I know it's early days since joining on the sort of the plan for the
business? Sorry, for the home care business?
Yes, home care business, yes.
Well, no, I'm on day 15. So it's been pretty early. But I can tell you that I've spent a lot of those 15 days focused on the home care business and understanding it. Just to top up on what Elaine said earlier, the areas that are a bit of a surprise for us, if you look back over the last couple of years are 1, the difficulty in finding people to fulfill the service. And the fact that our economy is performing so well means that it's hard to find people with the unemployment rate so low.
And that by the way is not across the province. It's only in certain parts of the province where we're seeing that. As I said in GTA, we've had no difficulty. It's been in other parts of the province. And then Bill 148 was a challenge as well.
It caused significant compression in wage rates and that has created more competition within the market from other sectors for people. So I think those things are have been surprises. But I think our nimbleness and being able to respond to those issues has been challenged by the fact that we were behind the 8 ball on the integration of these of the various businesses. So it's made things more difficult. In the midst of all of this, we're combining pay scales and computer systems and integrating the analytics that we have on each of our districts.
So we'll get that sorted out in the next few quarters and I think we'll be able to get back to the growth pace that we anticipated.
Okay. Thank you. And just I'd like to try and get a sense, again, I realize it's early days, you're only 15 days on the job. Like from but you've been what do you like how do you what's the pecking order between LTC Retirement and Home Care in terms of like the businesses that you really want to grow over the next 5 years and where you see the most opportunity?
So, yes, it's a great between those three businesses that we can achieve to create a more continuous set of services for seniors. So if you think about it as a progression, seniors go from needing some help to stay in their own homes to then moving to seniors living and assisted living and then moving through to requiring more residential care and nursing care in our long term care facilities. Today, Extendicare is largely managing those three businesses as separate businesses, just because of the history of those businesses. So a big part of our growth strategy is to look at ways that we can create combinations and synergies between those businesses, 1, to get better operating results, but also to give our clients and residents a much better customer experience. And also bringing technology to bear allows us to deliver care in different ways.
So my focus is on getting growth out of all of our business lines, but finding ways that we can use each to provide synergy to the other in terms of improving our performance. I think the other thing that's important is the quality of our service and making sure that the customer experience is a positive one. And I'll be spending a lot of time on that aspect of it and creating a differentiated customer experience within the extended care community.
Great. Thank you. That's it for me.
Thank you. Thank
you. Our next question is from Wajrangpal from Laurentian Bank. Please go ahead.
Good afternoon. Yes. My first question is about your Douglas Crossing development. So you said the expected NOI is 8.6%. What is the market cap rate there right now?
If you were to sell the property right now, assuming it is fully stabilized, what kind of cap rate would you get?
I think that, that is a market area that I would think would demand a cap rate that is probably in the low 6s, but that's a speculative number, yes, but it's a great community. It's got a great community. It's got a high demand in the market. It's a 1st class building. So it's been a very big success story from our perspective.
Right. Okay. So roughly 40% upside just from the value creation perspective. Okay. The second question is on Home Care.
So when
you say you're going to fix the problem of fulfillment and you're going to get your staff ready for the demand. Does that mean essentially you're going to pay higher wages to your the people you're going to hire?
That's a good question. And I think it's going to involve a number of measures. One of the things that we're looking at very closely is the whole issue of scheduling services and how we fulfill the demand that we're getting for the market. Scheduling is a key part of it because it determines how many hours that we can give to every one of our care workers. And they're very focused on being able to get a sufficient number of hours in order to achieve a target total income.
And we've been looking at this very carefully because a lot of our employees are not working full time hours and many of them want to. So it's more about changing the relationship that we have with our team and we're exploring ways to do that and offer more of our team a full time status and being able to incorporate that into our scheduling systems to be able to optimize the way that we perform. So it's more a focus on that. It's also focused on training and being able to offer people a very compelling career trajectory. So that's another place where we think we can leverage our continuum.
We employ people in one of our 3 divisions, giving people opportunities for more mobility between those divisions, I think will create more career opportunities for some of our people. So there are a lot of things that we can do that will substantially improve our employees' experience without necessarily changing the average hourly rates that we're having to pay.
Right. Okay. And just for my understanding, what happens when you are not able to cater a particular patient or the government wants you to provide them care, but you don't have staff? So where does it go?
Those referrals would be offered to another company or another supplier.
And does the government give the same rate to those guys as you or there are different
Yes. No, those are standard. They're absolutely standard.
And so if you are not able to find enough people, say, outside the GTA, how are other guys able to do it? Just like on a broader scale,
What do you think is happening? The details of the referral acceptance rates are not shared. So we don't have the information about how much of the care that we are unable to fulfill isn't fulfilled by other people. Anecdotally, we know that shortages of of supply in certain parts of the province are a major problem and that governments and agencies and hospitals are struggling to pick up the slack where we're not able to provide the care in people's homes. We're also looking at different models in terms of how we do it.
So as you can imagine, in a home care situation, people are traveling quite a lot. Fair bit of their time is spent traveling from house to house. So we're exploring other models where when certain people are more mobile that they may be able to come to a central office to get some of the services that they would have been able to get from a home care perspective. So there's a lot of different things that we're doing to try to figure out how to be more efficient and provide that fill that gap in care that we're seeing.
Okay. So what I'm trying to understand is, if the situation persists, would the government step in at some point and say, you know what, maybe we should provide more funding to this particular area to make sure that everybody gets the care that they need?
Some of the Lynds are already exploring that, but we don't have any decisions on that front that we can share with you at this point. But we'll see how that evolves.
All right. And just one more question. You said that you're exploring various synergies that are possible between your divisions. Can you give us some examples?
At this point, I think it would be speculative for me to get ahead of the game on that front. So I think I'd rather defer the answer to that question until we have something definitive to announce.
All right. That's all for me. Thank you.
Thank you. Thank you, Yas.
Our next question is from Doug Loe from Epsilon Wealth Partners. Please go ahead.
Yes, my questions have been answered. Thanks very much.
Thank you, Doug.
Thank you. Our next question is from Chris Couprie from CIBC. Please go ahead.
Hi. Just one follow-up for me guys. How should we think about your cash position?
Our cash position ended the year, Chris, at about that $60,000,000 $64,000,000 I think that our cash position and our cash from operations are comfortable. But as we grow, as we look at our as we activate our redevelopment, as we look at development opportunities, we will be looking for raising capital either through a combination of debt and the capital markets. And I think that we'll be in a better position to maybe share a little more of that with you early in the New Year.
Okay. So is it safe to say then that the cash you currently have on hand is more earmarked for development and redevelopment versus making acquisitions?
No, it will be a transaction by transaction decision. I mean, there's a level of operating cash that needs to be there. The excess cash that is there can begin some of that. But with the amount of redevelopment that we have ahead of us and our growth plans, it will go beyond what's on the balance sheet right now.
Okay. Thanks, guys.
Thank you.
Thank you.
There are no further question registered at this time. I would like to turn it back over to you, Ms. Fountain.
Thank you, Ruth. That concludes our call for today. This presentation is available on our website as are the caller numbers for an archived recording.
Please don't hesitate to give us a
call if you have any further questions. Thank you again everyone for joining us. Goodbye and have a good weekend.
Thank you. The conference call has now ended. Please disconnect your lines at this time and we thank you for your participation.