Comparison to prior-year period
* 11% increase in FFO per share
* 25% increase in FFO
* 40% increase in EBITDA
* 52% growth in total assets
* 50% increase in total market capitalization
* Portfolio occupancy at 92%
Financial Highlights (Unaudited)
(Dollars in thousands, except per share data)
Three Months Ended June 30 %
1998 1997 Change
Revenues $31,041 $23,350 33%
EBITDA $19,586 $13,971 40%
Funds from Operations $12,775 $10,210 25%
FFO Per Share-Basic
and Diluted $0.51 $0.46 11%
Total Market
Capitalization $933,128 $621,940 50%
Portfolio Occupancy 92% 90% 2%
Total Square Feet 11.8 million 8.7 million 36%
No. of Properties 66 43 53%
Six Months Ended June 30 %
1998 1997 Change
Revenues $60,396 $46,531 30%
EBITDA $37,724 $27,646 36%
Funds from Operations $25,114 $20,030 25%
FFO Per Share-Basic
and Diluted $1.01 $0.90 12%
Total Market
Capitalization $933,128 $621,940 50%
Portfolio Occupancy 92% 90% 2%
Total Square Feet 11.8 million 8.7 million 36%
No. of Properties 66 43 53%
NORTHBROOK, Ill., Aug. 6 /PRNewswire/ -- Bradley Real Estate, Inc.
(NYSE: BTR) today reported an 11 percent increase in second-quarter funds from
operations per share to $0.51 per share compared with $0.46 per share in the
year-earlier period. Funds from operations climbed 25 percent to $12.8
million from $10.2 million in 1997's second quarter.
Net income for the quarter rose 40 percent to $7.0 million, or $0.29 per
share, from $5.0 million, or $0.23 per share, for the prior-year quarter.
Weighted average shares outstanding totaled 23,702,522 for the quarter
compared with 21,671,292 shares for the year-ago period. The computation of
diluted earnings per share resulted in no effect on the company's basic
earnings per share for either quarter ended June 30, 1998, and 1997.
For the six months ended June 30, 1998, funds from operations totaled
$25.1 million, or $1.01 per share, up 25 percent from $20.0 million, or $0.90
per share, a year earlier. Net income was $13.3 million, or $0.57 per share,
compared with $14.0 million, or $0.64 per share, a year earlier. Net income
for the six months ended June 30, 1998, reflected a $0.9 million loss on the
sale of property. Net income for the six months ended June 30, 1997,
reflected a net gain on the sale of properties of $1.8 million. Weighted
average shares for the six-month period were 23,503,183 compared with
21,668,458 in the prior-year period.
Bradley also reported the closing of two previously announced
transactions: the sale on July 31, 1998, of its One North State Street
property located in downtown Chicago for approximately $84.5 million, and the
approximately $157 million acquisition of Mid-America Realty Investments, Inc.
(MDI), which is expected to close today.
Review of Operations
Commenting on the results of operations during the first six months of
1998, Thomas P. D'Arcy, chairman and chief executive officer, stated, "The
increased funds from operations over the comparable periods of 1997 reflect
the solid fundamentals of our markets and of our grocery-anchored community
shopping center portfolio. Leasing activity remained strong during the most
recent quarter with 28 new leases signed totaling 99,000 square feet at an
average base rent of $13.02 per square foot. In addition, during the second
quarter the company renewed 32 leases totaling 148,000 square feet at an
average base rent of $9.82 per square foot. For the six months ended June 30,
the company achieved increases in average base rent of 9.1 percent on new
leases for comparable space and 7.8 percent on renewal leases."
Acquisition of Mid-America Realty Investments, Inc. Approved by
MDI Stockholders
Yesterday, August 5, 1998, holders of more than the required two-thirds of
the outstanding common stock of MDI approved the merger of MDI with and into
Bradley. Commenting on the acquisition, D'Arcy stated, " We are extremely
pleased with yesterday's positive vote and plan to complete the acquisition
today. There are no contingencies remaining and we are in the process of
completing the appropriate filings to make the merger effective. This
acquisition is being funded with $87 million of a new Bradley 8.4 percent
Series A Convertible Preferred Stock and the assumption of approximately $65
million of MDI debt, of which we expect to shortly prepay approximately $29
million. Following the closing, Bradley will have a total market
capitalization in excess of $1 billion and will own 90 properties, totaling
14.4 million square feet located in 15 states."
One North State Sale Completed
On July 31, 1998, the company closed on the sale of its One North State
Street building located in the "loop" area of downtown Chicago. The building
was sold to the Whitehall Street Real Estate Limited Partnership IX and the
Archon Group at a gross sales price of $84.5 million, representing a gain for
financial reporting purposes of approximately $30 million and a gain for
federal income tax purposes of approximately $12 million.
$112 Million in Other Acquisitions
Since the end of the first quarter Bradley has acquired nine shopping
centers totaling 1.1 million square feet for approximately $78 million. Year-
to-date, the company has closed on the acquisition of 14 shopping centers
totaling 1.7 million square feet at a cost of $112 million and having an
average yield of approximately 9.85 percent. Richard Heuer, executive vice
president of acquisitions, commented, "The quality of our acquisitions and the
opportunities which we see within our markets remain strong. We continue to
add solid grocery anchor tenants, further diversifying our tenant base and
reducing our overall geographic concentration in any one market. While the
acquisition market remains competitive, we continue to identify assets that
meet our return parameters and investment criteria and we have an active
pipeline of pending transactions."
June 30, 1998, Balance Sheet Review
At June 30, 1998, total assets increased to $781 million from $513 million
a year earlier. The company's debt-to-total market capitalization stood at
43 percent and its debt-service coverage ratio at quarter-end was 2.9 times.
Adjusting the balance sheet for the One North State sale and the MDI
acquisition, the company's debt-to-total market capitalization ratio would
have been approximately 38 percent. At June 30, 1998, total debt outstanding
was $402 million at a weighted average interest rate of 7.20 percent and a
weighted average maturity of 5.94 years. Total debt outstanding included
fixed rate debt of $255 million at a weighted average interest rate of
7.56 percent and a weighted average maturity of 7.91 years. At quarter end,
the floating rate portion of Bradley's total debt consisted of $146 million
outstanding under the company's $200 million unsecured line of credit facility
at a weighted average interest rate of 6.57 percent maturing December 2000.
Subsequent to the end of the quarter, the line of credit has been paid down
utilizing the proceeds from the One North State Street sale. Including the
repayment of approximately $29 million in prepayable MDI debt, the balance
outstanding is approximately $93 million.
On Target with 1998 Objectives
Commenting on Bradley's mid-year results, Thomas P. D'Arcy, continued, "We
remain optimistic about the company's prospects for the remainder of the year
and into 1999. The One North State Street sale and the MDI acquisition
coupled with the company's acquisition and development efforts, position the
company well for continued growth. We remain intently focused on increasing
share owner value by aggressively pursuing our business plan."
The preceding information contains forward-looking statements of the
company's plans, objectives and expectations, which are dependent upon a
number of factors including a stable retailing climate in the Midwestern
United States, the financial viability of the company's tenants and the
continuing availability of retail center acquisitions and development
opportunities in the Midwest on favorable terms. Reference is made to the
discussions under the captions "Risk Factors" in the company's 1997 Form 10-K
report which includes a discussion of certain other factors that could cause
actual results to differ materially from those in forward-looking statements.
Bradley Real Estate, Inc. is the nation's oldest real estate investment
trust (REIT) and a leading owner and operator of neighborhood and community
shopping centers located in the Midwest region of the United States. The
company has paid 148 consecutive quarterly distributions to its share owners,
one of the longest records of distributions among publicly traded REITs.
In addition to the regular quarterly earnings releases and quarterly
reports, the company also makes available on a quarterly basis supplemental
information which includes property- and corporate-level detail. This
information is available upon request from the company.
BRADLEY REAL ESTATE, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
(UNAUDITED)
June 30, June 30, %
ASSETS 1998 1997 Change
Real estate investments
- at cost $740,540 $510,558 45%
Accumulated depreciation and
amortization (48,813) (36,708) 33%
Net real estate investments 691,727 473,850 46%
Real estate investments held
for sale 52,702 10,000 427%
Other assets:
Cash and cash equivalents 1,695 3,579 (53)%
Rents and other receivables,
net of allowance for doubtful
accounts of $2,946 for 1998 and
$2,438 for 1997 14,361 10,587 36%
Deferred charges, net and
other assets 20,439 14,964 37%
Total assets $780,924 $512,980 52%
LIABILITIES AND SHARE OWNERS' EQUITY
Mortgage loans 55,866 128,868 (57)%
Unsecured notes payable 199,512 -- 100%
Line of credit 146,200 64,400 127%
Accounts payable, accrued expenses
and other liabilities 31,574 20,708 52%
Total liabilities 433,152 213,976 102%
Minority interest 19,090 7,952 140%
Share Owners' equity:
Shares of preferred stock,
par value $.01 per share:
Authorized 20,000,000 shares;
0 shares issued and outstanding -- -- --
Shares of common stock, par value
$.01 per share:
Authorized 80,000,000 shares;
issued and outstanding,
23,780,894 and 21,676,375
shares at June 30, 1998
and 1997, respectively 238 217 10%
Shares of excess stock, par value
$.01 per share:
Authorized 50,000,000 shares;
0 shares issued and outstanding -- -- --
Additional paid-in capital 345,327 300,551 15%
Distributions in excess of
accumulated earnings (16,883) (9,716) 74%
Total share owners' equity 328,682 291,052 13%
Total liabilities and share
owners' equity $780,924 $512,980 52%
BRADLEY REAL ESTATE, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
(UNAUDITED)
Three months ended
June 30,
%
1998 1997 Change
Income:
Rental income $30,601 $23,034 33%
Other income 440 316 39%
31,041 23,350 33%
Expenses:
Operations, maintenance and
management 4,443 3,666 21%
Real estate taxes 5,295 4,559 16%
Mortgage and other interest 6,585 3,581 84%
General and administrative 1,717 1,154 49%
Depreciation and amortization 5,631 3,925 43%
23,671 16,885 40%
Income before gain on sale and
provision for loss on real
estate investments 7,370 6,465 14%
Net gain on sale
(provision for loss) on
real estate investment -- (1,300) (100)%
Income before allocation to
minority interest 7,370 5,165 43%
Income allocated to minority
interest (406) (137) 196%
Net income $6,964 $5,028 39%
Earnings per share:
Basic $0.29 $0.23 26%
Diluted $0.29 $0.23 26%
Six months ended
June 30, %
1998 1997 Change
Income:
Rental income $59,337 $45,889 29%
Other income 1,059 642 65%
60,396 46,531 30%
Expenses:
Operations, maintenance and
management 8,776 6,999 25%
Real estate taxes 10,776 9,627 12%
Mortgage and other interest 12,143 7,231 68%
General and administrative 3,120 2,259 38%
Depreciation and amortization 10,594 7,855 35%
45,409 33,971 34%
Income before gain on sale and
provision for loss on real
estate investments 14,987 12,560 19%
Net gain on sale
(provision for loss) on
real estate investment (875) 1,773 (149)%
Income before allocation to 109%
minority interest 14,112 14,333 (2)%
Income allocated to minority
interest (797) (381) 109%
Net income $13,315 $13,952 (5)%
Earnings per share:
Basic $0.57 $0.64 (11)%
Diluted $0.57 $0.64 (11)%
BRADLEY REAL ESTATE, INC.
CALCULATION OF FUNDS FROM OPERATIONS
(Dollars in thousands, except per share data)
(Unaudited)
Three months ended
June 30, %
1998 1997 Change
Income before extraordinary items
and allocation to minority interest $7,370 $5,165 43%
Depreciation of real estate
assets & amortization of tenant
improvements 4,315 3,134 38%
Amortization of deferred leasing
commissions 791 313 153%
Other amortization including
deferred finance & non real
estate related costs 525 478 10%
Amortization of deferred
finance & non real estate
related costs (226) (180) 26%
Net (gain) provision for
loss on real estate investments -- 1,300 (100)%
FUNDS FROM OPERATIONS $12,775 $10,210 25%
Weighted average partnership
units outstanding 1,381,352 592,301 133%
Weighted average
shares outstanding 23,702,522 21,671,292 9%
Total weighted
average shares - basic 25,083,874 22,263,593 13%
Effect of dilutive
options exercised 50,014 31,258 60%
Total weighted
average shares - diluted 25,133,888 22,294,851 13%
Funds from Operations
per share - basic $0.51 $0.46 11%
Funds from Operations
per share - diluted $0.51 $0.46 11%
Six months ended
June 30, %
1998 1997 Change
Income before extraordinary items
and allocation to minority interest $14,112 $14,333 (2)%
Depreciation of real estate
assets & amortization of tenant
improvements 8,246 6,235 32%
Amortization of deferred leasing
commissions 1,284 638 101%
Other amortization including
deferred finance & non real
estate related costs 1,064 982 8%
Amortization of deferred
finance & non real estate
related costs (467) (385) 21%
Net (gain) provision for
loss on real estate investments 875 (1,773) (149)%
FUNDS FROM OPERATIONS
Weighted average partnership
units outstanding $25,114 $20,030 25%
Weighted average
shares outstanding 1,408,182 592,301 138%
Total weighted
average shares - basic 23,503,183 21,668,458 8%
24,911,365 22,260,759 12%
Effect of dilutive
options exercised 49,450 30,753 61%
Total weighted
average shares - diluted 24,960,815 22,291,512 12%
Funds from Operations
per share - basic $1.01 $0.90 12%
Funds from Operations
per share - diluted $1.01 $0.90 12%
In response to the recently issued Statement of Financial Accounting
Standards No. 128, Earnings Per Share ("Statement No. 128"), the company has
modified its presentation of the calculation of Funds From Operations ("FFO")
to reflect the potential dilution of the weighted average shares outstanding
that could occur if units of limited partnership interest in Bradley Operating
Limited Partnership ("LP Units") were converted into common stock. The effect
on the calculation of FFO assuming the conversion of LP Units into common
stock results in the addition to net income of the income allocated to
minority interest since, for the company, such allocation represents the
income allocated to the LP Unit holders. Applying Statement No. 128 to the
weighted average share computation assumes a conversion of the weighted
average LP Units outstanding during the period into common shares (since the
LP Units are convertible into common shares on a one-for-one basis), and
adding these newly converted shares to the weighted average shares outstanding
used in the basic EPS computation, resulting in no effect on FFO per share
from the previous method of presentation.
SOURCE Bradley Real Estate, Inc.
 back to top
CONTACT:
Thomas P. D'Arcy, Chairman and CEO of Bradley
Real Estate, 847-272-9800; or Dennis Waite, Senior Counselor of
The Financial Relations Board, 312-640-6674
NOTE TO EDITORS: To receive additional information on Bradley
Real Estate free of charge via fax, dial 1-800-PRO-INFO and enter
"BTR."
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