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Brookfield Real Estate Services Inc. reports fourth quarter and annual 2011 results and monthly dividend

Monday, March 12, 2012 7:00 AM




TORONTO, March 12, 2012 /CNW/ - Brookfield Real Estate Services Inc. (the Company) (TSX: BRE), a leading provider of services to residential real estate brokers and their REALTORS®¹, today announced that cash flow from operations ("CFFO") for the three and twelve months ended December 31, 2011 was $5.4 million and $25.3 million, respectively, as compared to $5.0 million and $25.2 million, respectively, for the same period in 2010.

CFFO per Restricted Voting Share ("Share") for the three and twelve months ended December 31, 2011 was $0.42 and $1.97 per Share, respectively, as compared to $0.39 and $1.97 per Share, respectively, in the same period of 2010.

Royalties for the three and twelve months ended December 31, 2011 were $8.4 million and $36.7 million, respectively, compared to $8.2 million and $36.6 million, respectively for the same period in 2010.

Net earnings (loss) for the three and twelve months ended December 31, 2011 was $3.2 million loss and $8.0 million income, or $0.34 loss per share and $0.85 basic earnings per Share, respectively, as compared to a net loss of $29.2 million and $50.7 million.

OVERVIEW OF FOURTH QUARTER OPERATING RESULTS
During the quarter, the Company generated cash flow from operations ("CFFO") of $5.4 million as compared to $5.0 million for the same period in 2010.

To understand what has transpired in the Market for the 2011 and how it impacts our outlook for 2012, a review of year-to-date 2011 and 2010 Market activity is required.

On a rolling twelve-month basis, the fourth quarter of 2011 closed out at a Market transactional dollar volume of $166.1 billion, up 10% from December 31, 2010, driven by a 7% increase in selling price and a modest increase in home sale activity of 3%. For the three months ended December 31, 2011, transactional dollar volume was up 11% over the same period in 2010, driven by an 4% and a 7% increase in selling price and home sale activity, respectively. The steady increase in selling price on a twelve-month rolling and quarterly basis is largely driven by consistent shortage of listings, resulting in competition among home buyers, and low interest rates continue to draw homebuyers to the Market.

While the sales activity for the twelve months ended December 31, 2011 as compared to December 31, 2010 increased moderately by 3%, home sale activity on a quarter-over-same-quarter basis increased by 7% due to an active 2011 summer Market, the carry-through of second-quarter 2011 home sales and the fall-off of Market activity in 2010.

In 2010, the Market was up significantly for the first two quarters as consumers sought to complete their home purchases ahead of the Harmonized Sales Tax ("HST") and tighter mortgage-lending rules, which reduced home sale activity in the third and fourth quarters.  The fourth of 2011, which is typically the slower season of the home-purchase cycle, saw a normalization of Market activity to a ten year National average.

"Brookfield Real Estate Services Inc. is pleased to report with the fourth quarter financial performance for 2011," said Phil Soper, President and Chief Executive Officer, Brookfield Real Estate Services, Inc.

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