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Walton Westphalia Development Corporation Reports First Quarter 2020 Fiscal ResultsWalton Westphalia Development Corporation (the "Corporation") announced today its results for the first quarter of 2020. Launched in March 2012, the Corporation was formed to provide investors with the opportunity to participate in the acquisition and development of the 310-acre Westphalia Property (the "Property or the "Project") located in Prince George's County, Maryland, United States of America. Novel Coronavirus ("COVID-19") Since early 2020, the spread of COVID-19 has severely impacted many local economies around the globe. In many countries, including Canada and the United States, businesses have been forced to cease or limit operations for long or indefinite periods of time. Measures taken to contain the spread of the virus, including travel bans, quarantines, social distancing, and closures of nonessential services have triggered significant disruptions to businesses worldwide, resulting in an economic shutdown. The short and long-term impact to the real estate market is unknown at this time and therefore the impact to the Corporation's land and development costs is unknown as of the date of these unaudited condensed interim consolidated financial statements. 2020 Highlights During the period ended March 31, 2020, the Corporation closed on the sale of Phase 1A to Galaxy NC, LLC ("Galaxy"). The Corporation also signed a letter of intent ("LOI") with a regional retail developer to develop 30 acres of Phase 1 retail with the goal of executing a sale agreement in Q2 of 2020, but due to the impacts of COVID-19, the scope of the retail is being re-evaluated by the regional retail developer and the timing of executing the sale agreement is expected to be moved out a year. The Corporation is actively seeking purchasers and developers for the lands associated with Phases 2 and 3 and considering whether to renegotiate or refinance its senior debt with its related party, WWMN, LLC. The key activities undertaken by the Corporation were as follows: Construction Activities
Financing Activities
Sales Activities
Management continues to focus on strategies to maximize the returns of the project, which include, but are not limited to: First Quarter Financial Results During the three months ended March 31, 2020 and March 31, 2019, the Corporation recognized revenue on contracts of $17,133,027 and $3,909,747, respectively. The cost of sales relating to the lot sales was $17,242,797 and $3,958,927, respectively, with $257,924 and $49,180, respectively, relating to selling costs and commissions. The revenue and cost of sales recognized for the three months ended March 31, 2020, was in respect to the sale of 6 Phase 1 single family lots to home builders, and the Phase 1A bulk land sale to Galaxy. The revenue and cost of sales recognized for the three months ended March 31, 2019, was in respect to the sale of 36 Phase 1 single family lots to home builders. For the three months ended March 31, 2020, the total comprehensive loss generated was $683,953. When compared to the three months ended March 31, 2019 total comprehensive loss of $290,198, there is a variance of $393,755 between the respective period ends. The variance is due to the items discussed in detail in the Management Discussion & Analysis. Additional Information The Corporation is managed by Walton Global Investments Ltd. and the development of the project is managed by Walton Development & Management (USA), Inc., both of which are members of Walton. Walton is a privately owned, leading global real estate investment, land asset management and administration group that has focused on strategically located land in major growth corridors for more than 40 years. Walton manages and administers US$3.8 billion of real estate assets in North America, on behalf of its investors and business partners. Walton has more than 106,000 acres of land under ownership, management and administration in the United States and Canada. Key entities in Walton include Walton Global Holdings, Walton International Group and Walton Development and Management. For more information visit Walton.com. This news release, required by Canadian laws, does not constitute an offer of securities, and is not for distribution or dissemination outside Canada. This news release contains forward looking information, and actual future results may differ from what is disclosed in this news release. Forward-looking information is based on the current expectations, estimates and projections of the Corporation at the time the statements are made. They involve a number of known and unknown risks and uncertainties which would cause actual results or events to differ materially from those presently anticipated. The risks, uncertainties and other factors that could cause the Corporation's actual results and performance in future periods to differ materially from the forward looking information contained in this news release include, among other things, the development of Westphalia Town Center, general economic and market factors, including interest rates, a decline in the real estate market, changes in government policies and regulations or in tax laws, changes in municipal planning strategies and whether certain development approvals are obtained and changes in the Canadian/U.S. dollar exchange rate, in addition to those factors discussed or referenced in documents filed with Canadian securities regulatory authorities and available online at www.sedar.com. Except as otherwise noted, all amounts are in Canadian dollars, and are based on unaudited condensed interim consolidated financial statements for the three months ended March 31, 2020 and related notes, prepared in accordance with International Financial Reporting Standards. View source version on businesswire.com: https://www.businesswire.com/news/home/20200528005843/en/ |