June 30, 2000 Quarter Performance Highlights
- Funds From Operations (FFO) increased 13 percent over the corresponding
quarter one year ago
- Company completed industrial facility leases totaling 1.1 million square
feet, and generating 15 percent increase in effective rents over ending
rates on expired leases
- Industrial same-store net operating income increased 9 percent over one
year ago
- Multifamily same-store net operating income increased 10 percent over
one year ago
- June 30 industrial occupancy rate: 95 percent
- June 30 multifamily occupancy rate: 96 percent
- 669 'active senior' apartment units under development in California
NEWPORT BEACH, Calif., Aug. 3 /PRNewswire/ -- Pacific Gulf Properties Inc.
(NYSE: PAG), an equity real estate investment trust (REIT) that owns, develops
and manages industrial and multifamily properties, including rental housing
for 'active seniors,' today reported the Company's operating results for
June 30, 2000. For the second quarter ended June 30 pro forma Funds From
Operations (assuming the conversion of all preferred shares) totaled
$16,465,000, or $0.70 per share. That number reflects an increase of 13% per
share over the $14,664,000, or $0.62 per share, generated one year ago, which
is due primarily to strong increases in same-store rents. The $0.70 per share
exceeds First Call Corp. consensus estimates by $0.02 per share.
For the six months ended June 30, pro forma Funds From Operations
increased 12% to $32,151,000, or $1.37 per share, over $28,666,000, or
$1.22 per share, for the one-year-ago period. That increase was due to strong
growth in same-store rents.
Net operating income, or gross rental income less rental operating
expenses, for the second quarter of 2000 was $26,043,000 on revenues of
$34,067,000, versus $23,234,000 on revenues of $30,864,000 for the year-ago
period. This represents a 12% increase for the Company. Income available to
common shareholders was $10,418,000, or $0.49 per diluted share, compared with
$8,102,000, or $0.40 per diluted share, as reported in the second quarter of
1999.
Net operating income for the first six months of 2000 was $50,929,000 on
revenues of $67,997,000, versus $45,364,000 on revenues of $60,554,000 one
year ago, representing a 12% increase. Income available to common
shareholders increased to $18,470,000, or $0.88 per diluted share, from
$17,873,000, or $0.88 per diluted share, one year ago.
INDUSTRIAL PORTFOLIO
Within the Company's industrial portfolio, Pacific Gulf Properties
completed leases for 1.1 million square feet at its stabilized properties
during the second quarter of 2000. This activity generated a 15% increase in
effective rental rates over ending rates on expired leases. Industrial
properties generated 83% of the Company's total net operating income during
the second quarter of 2000 and 82% in the first six months of the year. For
the first six months of 2000, 2.3 million square feet were re-leased at the
Company's stabilized properties, reflecting a 12% increase in effective rental
rates over ending rates on expired leases.
Same-store results for the 12.4 million square feet of industrial
properties owned during both the second quarter of 2000 and the second quarter
of 1999 reflect an increase in net operating income of 9%, due primarily to a
8% increase in rental revenues. For the first six months of 2000, same-store
net operating income also increased 10%, due to a 9% increase in rental
revenues.
As of June 30, the occupancy rate in the Company's industrial portfolio
was 95% in 2000, compared to 96% in 1999.
MULTIFAMILY PORTFOLIO
Same-store net operating income in the multifamily operations increased
10% during the second quarter, versus the same period one year ago, resulting
primarily from a 7% increase in rental revenues. For the first six months of
2000, same-store net operating income increased 10% over the one-year-ago
first half, due to an 8% increase in revenues. Overall occupancy for the
multifamily portfolio at June 30 was 96% in 2000, compared with 95% in 1999.
At June 30, 2000, Pacific Gulf's multifamily portfolio included
3,069 units, of which 1,438 are rental communities designed for active seniors
age 55 and older.
Pacific Gulf Properties is a real estate investment trust (REIT) that
owns, develops and manages a portfolio of industrial properties targeting
small to mid-size tenants in selected high-growth U.S. western markets. The
Company's industrial portfolio includes 74 properties encompassing more than
15.3 million square feet of space. Pacific Gulf also maintains a multifamily
portfolio that includes eight rental communities comprising almost 1,500 units
designed for the burgeoning population of active seniors age 55 and older.
The company is headquartered in Newport Beach, California. For more
information please visit the Company's web site, http://www.pacificgulf.com.
Forward-looking statements and comments in this press release are made
pursuant to the safe harbor provisions of Section 21E of the Securities
Exchange Act of 1934. Such statements relating to, among other things,
events, conditions, prospects and financial trends that may affect the
company's future plans of operations, business strategy, growth of operations
and financial position are not guarantees of future performance and are
necessarily subject to risks and uncertainties, some of which are significant
in scope and nature, including without limitation, increased competition,
adverse economic trends, increasing interest rates and other factors.
PACIFIC GULF PROPERTIES INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
June 30, December 31,
2000 1999
(Unaudited) (Audited)
ASSETS
Real estate assets
Operating properties
Land $235,307 $232,665
Buildings 675,458 657,347
910,765 890,012
Accumulated depreciation (86,800) (72,715)
823,965 817,297
Properties under development, including land 48,360 52,815
872,325 870,112
Cash and cash equivalents 8,598 2,177
Accounts receivable 8,358 4,005
Other assets 16,506 15,627
$905,787 $891,921
LIABILITIES AND SHAREHOLDERS' EQUITY
Loans payable $430,157 $418,343
Accounts payable and accrued liabilities 18,481 17,244
Dividends payable 10,561 10,366
459,199 445,953
Minority interests in consolidated partnerships 18,126 18,077
Commitments and contingencies -- --
Shareholders' equity
Preferred shares, $.01 par value; 10,000,000
shares authorized; 2,763,116 Senior
Cumulative Convertible Class A shares
outstanding at June 30, 2000, and
Dec. 31, 1999, respectively 28 28
Preferred shares, $.01 par value; 300,000
shares authorized; Class C Junior
Participating Cumulative Preferred Stock;
no shares outstanding -- --
Common shares, $.01 par value; 100,000,000
shares authorized; 21,157,878 and 20,685,402
shares outstanding at June 30, 2000 and
December 31,1999, respectively 212 207
Less: Restricted stock and notes receivable
issued for common stock (9,708) (1,011)
Additional paid-in capital 434,248 424,450
Retained Earnings 3,682 4,217
428,462 427,891
$905,787 $891,921
PACIFIC GULF PROPERTIES INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share data)
(Unaudited)
Six Months Ended June 30
2000 1999
REVENUES
Rental income
Industrial properties $53,480 $47,826
Multifamily properties 13,517 12,728
66,997 60,554
EXPENSES
Rental property expenses
Industrial properties 11,566 10,691
Multifamily properties 4,502 4,499
16,068 15,190
Depreciation 14,567 12,379
Interest (including amortization of debenture
discount and financing costs of $357 and
$423 respectively) 14,524 13,553
General and administrative expenses 3,650 3,119
Minority partners' interest in earnings of
consolidated partnerships 604 593
49,413 44,834
INCOME BEFORE GAIN ON SALE OF REAL ESTATE 17,584 15,720
Gain on sale of real estate 3,415 4,624
NET INCOME 20,999 20,344
Less preferred dividend requirements 2,529 2,471
INCOME AVAILABLE TO COMMON SHAREHOLDERS $18,470 $17,873
EARNINGS PER SHARE
Basic $0.89 $0.90
Diluted $0.88 $0.88
DIVIDENDS DECLARED PER COMMON SHARE $0.88 $0.86
PACIFIC GULF PROPERTIES INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(Unaudited)
Three Months Ended June 30,
2000 1999
REVENUES
Rental income
Industrial properties $27,254 $24,496
Multifamily properties 6,813 6,368
34,067 30,864
EXPENSES
Rental property expenses
Industrial properties 5,752 5,408
Multifamily properties 2,272 2,222
8,024 7,630
Depreciation 7,306 6,319
Interest (including amortization of debenture
discount and financing costs of $185 and
$210, respectively) 7,453 6,816
General and administrative expenses 1,823 1,739
Minority interest in earnings of
consolidated partnerships 302 296
24,908 22,800
INCOME BEFORE GAINS ON SALE OF REAL ESTATE 9,159 8,064
Gains on sale of real estate 2,524 1,273
NET INCOME 11,683 9,337
Less preferred dividend requirements 1,265 1,235
INCOME AVAILABLE TO COMMON SHAREHOLDERS $10,418 $8,102
Earnings per share
Basic $0.50 $0.41
Diluted $0.49 $0.40
FUNDS FROM OPERATIONS (a)
SUPPLEMENTAL TABLE
(In thousands except share data)
For the Three For the Six
Months Ended Months Ended
June 30, June 30, June 30, June 30,
2000 1999 2000 1999
Income Available to
Common Shareholders $10,418 $8,102 $18,470 $17,873
Gain on sale of real estate (2,524) (1,273) (3,415) (4,624)
Depreciation 7,306 6,319 14,567 12,379
Funds from Operations $15,200 $13,148 $29,622 $25,628
Weighted Average Common
Shares Outstanding 20,756 19,972 20,694 19,967
Funds from Operations
per Common Share $0.73 $0.66 $1.43 $1.28
(a) Industry analysts generally consider funds from operations ("FFO") an
appropriate measure of performance of a real estate investment trust
("REIT"). Funds from operations represent amounts available to common
shareholders and is defined as net income (computed in accordance with
generally accepted accounting principles), excluding gains (or losses)
from debt restructuring and sales of property, plus depreciation and
amortization (excluding amortization of deferred financing costs and
depreciation of non real estate assets), and after adjustments for
unconsolidated partnerships and joint ventures and preferred dividend
requirements.
PRO FORMA FUNDS FROM OPERATIONS (b)
Funds from Operations $15,200 $13,148 $29,622 $25,628
Preferred Dividend Requirements 1,265 1,235 2,529 2,471
Interest Expense on Debentures -- 249 -- 505
Amortization of Debenture
Discount and Costs -- 32 -- 62
Pro Forma Funds
from Operations $16,465 $14,664 $32,151 $28,666
Weighted Average Common
Shares Outstanding 20,756 19,972 20,694 19,967
Additional Shares
Assuming Conversion
Other (c) 130 135 96 131
Preferred Stock 2,763 2,763 2,763 2,763
Debentures -- 643 -- 643
Pro Forma Weighted Average
Outstanding Shares 23,649 23,513 23,553 23,504
Pro Forma Funds from
Operations per Common Share $0.70 $0.62 $1.37 $1.22
(b) Pro Forma Funds from Operations Calculations - Assumes the conversion
of Convertible Subordinated Debentures and Preferred Stock and excludes
the conversion of limited partnership units (consistent with the Company's
previous calculation methodology).
(c) Represents non-vested restricted stock and options as converted.
SOURCE Pacific Gulf Properties Inc.
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Related links:
http://www.pacificgulf.com
Company News On-Call:
http://www.prnewswire.com/comp/671475.html or fax,
800-758-5804, ext. 671475
CONTACT:
Donald G. Herrman, Chief Financial Officer,
949-223-5000, or Victoria J. Baker, General Information,
703-370-8652, both of Pacific Gulf Properties Inc.
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