Brookfield Real Estate Services Inc. Reports First Quarter 2013 Results and Monthly Dividend

Brookfield Real Estate Services Inc. Reports First Quarter 2013 Results and 
Monthly Dividend 
TORONTO, May 7, 2013 /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 months ended March 31, 2013 was $5.6 million or $0.436 
per restricted voting share ("Share"), compared to $5.6 million or $0.434 per 
Share for the same period in 2012. 
Royalties for the three months ended March 31, 2013 were $8.1 million, down 
slightly from $8.2 million for the same period in 2012. The net loss for the 
three months ended March 31, 2013 was $0.5 million, or $0.06 loss per Share, 
as compared to net loss of $3.2 million or $0.33 loss per Share, for the same 
period in 2012. 
OVERVIEW OF FIRST QUARTER OPERATING RESULTS
During the Quarter the Company generated CFFO of $5.6 million, which was up 
slightly from the same period of 2012. The tightening of mortgage-lending 
rules introduced in July 2012, contributed to a pull of market activity into 
the first half of 2012, resulting in an abnormally active comparative period. 
Royalties were down slightly this quarter as the industry returns to more 
normalized transactional patterns and cycle over the last year's period of 
heightened activity. Offsetting this decrease was a $0.2 million reduction in 
administration costs due primarily to a lower quarter-over-quarter bad debt 
provision resulting from the success of increased collection efforts as well 
as a reduction in professional fees as a result of the completion of 
activities in 2012 related IFRS requirements and the conversion of the Company 
from a Fund to a corporation. 
For the three months ended March 31, 2013, the Canadian market transactional 
dollar volume of $34.8 billion decreased by 12.2% from the same period in 
2012, driven solely by a decrease in units sold. The average sales price of a 
home remained largely unchanged due primarily to a balanced market supported 
by reduced listings and low interest rates. For the three months ended March 
31, 2013, the Toronto market transactional dollar volume was down 10.5% over 
the same period in 2012, also driven primarily by a decrease in home sale 
activity. 
"The first quarter of 2013 saw an unusual grouping of economic factors which 
brought stability to the Canadian housing market: consistently low interest 
rates, an expanding economy, with essentially flat home prices," said Phil 
Soper, President and Chief Executive Officer, Brookfield Real Estate Services 
Inc. "Together, these factors should mitigate the length and severity of the 
current cyclical correction." 
"We saw a year-over-year decline in sales volumes in the quarter, as the 
lingering impact of last summer's introduction of more restrictive mortgage 
rules affected entry-level buyers, and some sellers delayed listing their 
homes on speculation of a real estate price correction," continued Soper. 
"Buyers looking to make opportunistic purchases in a soft market, however, 
were largely disappointed as home prices held firm across almost all markets." 
The Company's revenue is primarily fixed in nature, based on the number of 
REALTORS® in the network. This structure provides revenue protection from the 
impact of revenue declines when the market cools, but also reduces the degree 
to which the Company participates in periods of rapid market expansion. 
The Company Network
As at March 31, 2013 the Company Network was comprised of 15,558 REALTORS®, 
operating under 440 franchise agreements providing services from 679 
locations, with an approximate 24% share of the Market based on 2012 
transactional dollar volume. 
Outlook
"As we previously forecasted, the Canadian residential real estate market is 
in the midst of a cyclical slowdown which has seen lower unit sales volumes 
and price appreciation reduced. We believe we are well through the 
correction, which began in the third quarter of 2012," said Soper. "In the 
first quarter of 2013 we saw fewer homes trade hands, but starting in the 
second half of 2013, Management expects volumes to adjust to normal levels." 
Monthly Cash Dividend
On May 6th the Company declared a dividend of $0.092 per share for the month 
of May 2013, payable on June 28th, 2013 to shareholders of record on May 31st, 
2013. 
CFFO
This news release and accompanying financial statements make reference to cash 
flow from operations ("CFFO") on a total and per restricted voting share 
basis. CFFO is defined as net income prior to fair value changes, 
amortization, interest on exchangeable units, income taxes, items related to 
other income and interests of exchangeable unitholders. CFFO is used by the 
Company to measure the amount of cash generated from operations which is 
available to the Company's shareholders on a diluted basis where such dilution 
represents the total number of shares of the Company that would be outstanding 
if exchangeable unitholders converted Class B LP units into shares of the 
Company. The Company uses CFFO to assess its operating results, the value of 
its business and believes that many of its shareholders and analysts also find 
this measure of value to them. CFFO does not have any standard meaning 
prescribed by IFRS and therefore may not be comparable to similar measures 
presented by other companies. 
Management Services Agreement
The Company is managed pursuant to a Management Services Agreement (the "MSA") 
between the Company and Brookfield Real Estate Services Manager Limited (the 
"Manager"), a subsidiary of Brookfield Asset Management Inc. The MSA has been 
in effect since 2003 and was originally designed for an income trust 
structure. The Company and the Manager have agreed to extend the termination 
date of the MSA to December 31, 2013 and the date for delivery of notice to 
terminate to on or before June 30, 2013. If such notice is not received, the 
MSA will automatically renew for a ten year period. The Board of Directors of 
the Company have convened a Special Committee to evaluate various alternatives 
associated with the renewal of the MSA and have engaged an external advisor. 
Forward-Looking Statements
This news release contains forward-looking information and other 
"forward-looking statements". The words such as "should", "will", "continue", 
"plan", "believe", "expect", "anticipate", "intend", "estimate", 
"approximate", "expected" and other expressions that are predictions of or 
indicate future events and trends and that do not relate to historical matters 
identify forward-looking statements. Reliance should not be placed on 
forward-looking statements because they involve known and unknown risks, 
uncertainties and other factors that may cause the actual results, performance 
or achievements of the Corporation to differ materially from anticipated 
future results, performance or achievement expressed or implied by such 
forward-looking statements. Factors that could cause actual results to differ 
materially from those set forward in the forward looking statements include a 
change in general economic conditions, interest rates, consumer confidence, 
the level of residential real estate resale transactions, the average rate of 
commissions charged, competition from other traditional real estate brokers or 
from discount and/or Internet-based real estate alternatives, the availability 
of acquisition opportunities and/or the closing of existing real estate 
brokerage offices, other developments in the residential real estate brokerage 
industry or the Corporation that reduce the number of and/or royalty revenue 
from the Company's network of 15,558 REALTORS®, our ability to maintain brand 
equity through the use of trademarks, the availability of equity and debt 
financing, a change in tax provisions, and other risks detailed in the 
Company's annual information form, which is filed with securities commissions 
and posted on SEDAR at www.sedar.com. The Corporation undertakes no obligation 
to publicly update or revise any forward-looking statements, whether as a 
result of new information, future events or otherwise, except as required by 
law. 
Conference Call
Brookfield Real Estate Services Inc. will host a conference call on Tuesday, 
May 7, 2013 at 2 p.m. ET to discuss its financial results for the first 
quarter of 2013. 
To access the call by telephone, please dial (888) 231-8191 or (647) 427-7450. 
Please connect approximately ten minutes prior to the beginning of the call to 
ensure participation. A recording of the conference call will be available on 
the Company's website by May 8, 2013 at 
http://www.brookfieldresinc.com/content/investor_centre-25063.html. 
Supplemental Information
The Company's Interim Condensed Consolidated Financial Statements, 
Supplemental Information and IFRS overview for the three months ended March 
31, 2013 contain further information on the company's strategy, operations and 
financial results and can be found on our website at www.brookfieldresinc.com. 
The Company's Management Discussion and Analysis, Financial Statements and 
associated regulatory filings will follow within prescribed timelines. 
Shareholders are encouraged to read these documents. 
Brookfield Real Estate Services Inc. Profile
The Company is a leading provider of services to residential real estate 
brokers and their REALTORS®¹. The Company generates cash flow from franchise 
royalties and service fees derived from a national network of real estate 
brokers and agents in Canada operating under the Royal LePage, Via Capitale 
Real Estate Network and Johnston & Daniel brand names. At March 31, 2013, the 
Company network consisted of 15,558 REALTORS®. The Company network has an 
approximate 24% share of the Canadian residential resale real estate market 
based on 2012 transactional dollar volume. The Company generates both fixed 
and variable fee components. Variable fees are primarily driven by the total 
transactional dollar volume from the sales commissions of REALTORS®, while 
fixed fees are based on the number of agents and sales representatives in the 
network. Approximately 73% of the Company's revenue is based on fees that are 
fixed in nature; this provides revenue stability and helps insulate the 
Company's cash flows from market fluctuations. The Company is listed on the 
TSX and trades under the symbol "BRE". For further information about the 
Company, please visit www.brookfieldresinc.com. 
(1)(REALTOR® is a trademark identifying real estate licensees 
inCanadawho are members of the Canadian Real Estate Association.) 
Tammy Gilmer Director, Public Relations & National Communications Brookfield 
Real Estate Services Inc. tgilmer@brookfieldres.com Tel: 416.510.5783 
SOURCE: Brookfield Real Estate Services Inc. 
To view this news release in HTML formatting, please use the following URL: 
http://www.newswire.ca/en/releases/archive/May2013/07/c4149.html 
CO: Brookfield Real Estate Services Inc.
ST: Ontario
NI: REL ERN CONF DIV  
-0- May/07/2013 11:00 GMT
 
 
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