ESCONDIDO, Calif., April 28 /PRNewswire/ -- Realty Income Corporation
(Realty Income) (NYSE: O) today announced operating results for the first
quarter ended March 31, 1998. Funds from Operations (FFO) increased 19.4% to
$14.8 million from $12.4 million for the same period one year ago. On a
diluted per share basis, FFO increased 5.6% to $0.57 per share compared to
$0.54 for the same period in 1997. Industry analysts generally consider FFO,
as defined by the National Association of Real Estate Investment Trusts
(NAREIT), to be an appropriate measure of performance for an equity REIT. Net
Income increased 20.7% to $9.9 million as compared to $8.2 million for the
same quarter in 1997. On a diluted per share basis this represented a 5.6%
increase to $0.38 per share as compared to $0.36 per share for the same period
one year ago.
FIRST QUARTER HIGHLIGHTS:
* Acquisition of 22 properties for $51.8 million with an initial cash-on-
cash return of 10.6%
* 189% increase in acquisition dollar volume as compared to first quarter
1997
* FFO increased by 19% to $14.8 million
* FFO per share increased by 5.6% to $0.57 per share
* Net income increased by 21% to $9.9 million
* Net income per share increased by 5.6% to $0.38 per share
* Monthly dividend increase to $0.1625 per share was announced on
March 12, the second consecutive quarterly increase
* $28.4 million in equity issued to two Unit Investment Trusts
Commenting on the Company's performance, Tom A. Lewis, Chief Executive
Officer, stated, "We are very pleased to have exceeded our goals for property
acquisitions during the first quarter. We are beginning to reap substantial
benefits from the investment we made during the second half of 1997 in our
retail research and property acquisition departments. The climate for
profitable property acquisitions within the net lease market remains strong
and we believe 1998 will be an excellent year for continued increases in the
size of our retail real estate portfolio."
During the first quarter, Realty Income acquired 22 additional properties
in 16 states for $51.8 million. The properties contain approximately 357,000
square feet and are 100% leased with an average lease term of 15.5 years and
an initial cash-on-cash return of 10.6%. The Company continued to diversify
its portfolio with the addition of two new industry segments, Private
Education and Fitness, as well as adding six new retail chains during the
quarter. Realty Income's portfolio of properties now consists of 855
properties leased to 50 separate retail chains doing business in 15 separate
retail segments.
Same store rents on 719 properties owned during both the three months
ended March 31, 1998 and 1997, increased 0.8% to $15.25 million compared to
$15.13 million in 1997.
Realty Income owns and actively manages a portfolio of 855 commercial
properties in 43 states. By purchasing the freestanding retail store
locations of regional and national chain store operators and then leasing the
locations back to them, Realty Income provides retailers with the opportunity
to free up financial resources for expansion. The Company's acquisition and
investment activities are concentrated in highly specific target markets and
focus primarily on middle and upper market retailers providing goods and
services which satisfy basic consumer needs.
CONSOLIDATED STATEMENTS OF INCOME
For the three months ended March 31, 1998 and 1997
(dollars in thousands, except per share data)
1998 1997
REVENUE
Rental $19,168 $15,449
Interest 16 22
Other 38 9
19,222 15,480
EXPENSES
Depreciation and amortization 5,084 4,464
General and administrative 1,465 1,253
Property 473 491
Interest 2,491 1,312
9,513 7,520
Income from operations 9,709 7,960
Gain on sales of properties 215 225
NET INCOME $9,924 $8,185
Funds From Operations $14,754 $12,413
Dividends Paid 12,462 10,861
Basic and Diluted
Per Share Information
Income from Operations $0.37 $0.35
Net Income 0.38 0.36
FFO 0.57 0.54
Cash Dividends Paid 0.480 0.473
Weighted average number
of shares used for basic
per share computations 26,028,589 22,986,690
Weighted average number
of shares used for diluted
per share computations 26,037,595 22,989,728
CONSOLIDATED BALANCE SHEETS
March 31, 1998 and December 31, 1997
(dollars in thousands, except per share data)
1998 1997
ASSETS
Real estate, at cost:
Land $232,496 $214,342
Buildings and improvements 516,582 485,455
749,078 699,797
Less - Accumulated depreciation
and amortization (156,182) (152,206)
Net real estate 592,896 547,591
Cash and cash equivalents 1,713 2,123
Accounts receivable 1,771 2,888
Due from affiliates 333 348
Other assets 3,259 3,170
Goodwill, net 20,669 20,901
TOTAL ASSETS $620,641 $577,021
LIABILITIES AND STOCKHOLDERS' EQUITY
Distributions payable $4,361 $4,112
Accounts payable and accrued expenses 4,133 2,180
Other liabilities 4,810 4,814
Lines of credit payable 38,000 22,600
Notes payable 110,000 110,000
TOTAL LIABILITIES 161,304 143,706
Stockholders' equity
Preferred stock, par value
$1.00 per share, 20,000,000 shares
authorized, no shares issued
or outstanding -- --
Common stock, par value
$1.00 per share, 100,000,000
shares authorized, 26,836,564
and 25,698,464 shares issued
and outstanding in 1998
and 1997, respectively 26,837 25,698
Paid in capital in excess of
par value 610,119 582,450
Accumulated distributions in
excess of net income (177,619) (174,833)
TOTAL STOCKHOLDERS' EQUITY 459,337 433,315
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $620,641 $577,021
The following table represents Realty Income's rental revenue by industry
(dollars in thousands):
Annualized (a)
Rent as of Quarter Ended Quarter Ended
April 1, 1998 March 31, 1998 March 31, 1997
Rental Percentage Rental Percentage RentalPercentage
Industry Revenue of Total Revenue of Total Revenueof Total
Apparel Stores $3,927 4.8% $515 2.7% $-- --%
Automotive Parts 6,717 8.1 1,436 7.5 1,560 10.1
Automotive Service 6,667 8.1 1,501 7.8 888 5.7
Book Stores 450 0.5 113 0.6 32 0.2
Child Care 24,509 29.6 5,947 31.0 5,889 38.1
Consumer Electronics4,432 5.4 1,172 6.1 1,044 6.8
Convenience Stores 4,470 5.4 1,110 5.8 786 5.1
Health and Fitness 408 0.5 -- -- -- --
Home Furnishings 5,704 6.9 1,295 6.8 642 4.2
Office Supplies 2,476 3.0 615 3.2 80 0.5
Pet Supplies 253 0.3 63 0.3 -- --
Private Education 923 1.1 40 0.2 -- --
Restaurant 13,576 16.4 3,369 17.6 3,303 21.4
Shoe Stores 529 0.6 115 0.6 -- --
Video Rental 2,813 3.4 641 3.3 -- --
Other 4,881 5.9 1,236 6.5 1,225 7.9
Total $82,735 100% $19,168 100% $15,449 100%
(a) Annualized rent is calculated by multiplying the monthly contracted
base rent as of April 1, 1998 by 12 and adding the previous twelve
month's historic percentage rent, which totaled $1.7 million
(i.e., additional rent calculated as a percentage of the tenant's
gross sales above a specific level). For properties under
construction, an estimated contractual base rent is used based upon
the estimated total costs of each property.
SOURCE Realty Income Corporation
 back to top
Related links:
http://www.realtyincome.com
CONTACT:
Gary Malino, Sr. Vice President and Chief
Financial Officer, 760-741-2111, ext. 142, or Tere Miller, Vice
President, Investor Relations, 760-741-2111, ext. 177, both of
Realty Income Corporation
NOTE TO EDITORS: Realty Income press releases are available at no
charge by calling our toll-free investor hotline number:
888-811-2001, or through the internet at
http://www.realtyincome.com
|
