Third-Quarter Highlights:
-- 7.7% increase in third-quarter FFO per share
-- 13.9% increase in EBITDA
-- 3.2x debt service coverage
-- Portfolio occupancy at 93%
Financial Highlights (dollars in 000's, except per-share data)
Three Months Ended Nine Months Ended
September 30, September 30,
1999 1998 %Change 1999 1998 %Change
Revenues $38,415 $33,939 13.2% $115,326 $94,335 22.3%
EBITDA $24,948 $21,904 13.9% $74,638 $59,628 25.2%
Funds from
Operations $14,453 $13,186 9.6% $43,498 $38,300 13.6%
FFO Per Share
- Basic $0.57 $0.52 9.6% $1.71 $1.53 11.8%
FFO Per Share
- Diluted $0.56 $0.52 7.7% $1.69 $1.53 10.5%
Income before
gain and
minority
interest $10,970 $8,728 25.7% $32,750 $23,715 38.1%
Net Income $7,465 $36,092 -79.3% $23,107 $49,407 -53.2%
Net Income
Per Share -
Basic $0.31 $1.52 -79.6% $0.96 $2.09 -54.1%
Net Income Per
Share -
Diluted $0.31 $1.44 -78.5% $0.96 $2.07 -53.6%
At September 30, 1999 1998 %Change
Total Market
Capitalization $1,009,787 $1,061,228 -5%
Portfolio Occupancy 93% 93% 0%
Total Square Feet 15.3 M 15.3 M 0%
No. of Properties 96 95 1%
NORTHBROOK, Ill., Nov. 3 /PRNewswire/ -- Bradley Real Estate, Inc.
(NYSE: BTR) today reported a 7.7% increase in third-quarter funds from
operations per share to $0.56, or $14.5 million, from $0.52, or $13.2 million
a year earlier. For the nine months ended September 30, 1999, funds from
operations per share increased 10.5% to $1.69, or $43.5 million, compared to
$1.53, or $38.3 million, for the same nine month period in the prior year.
All per share amounts are reported on a diluted basis.
Commenting on the third quarter results, Thomas P. D'Arcy, chairman and
chief executive officer, stated, "The Company's solid third-quarter operating
performance is a result of our focus on maximizing cash flow from our core
portfolio. We have continued to experience increases in underlying rents
while sustaining high occupancy levels and are managing our cost structure in
response to the continued uncertainty in the capital markets."
Net income for the third quarter totaled $7.5 million, or $0.31 per share,
compared with $36.1 million, or $1.44 per share, for the prior-year quarter.
Net income for the third quarter of 1998 included a net gain of $30.6 million
on the sale of real estate investments. Excluding this gain and its effect on
minority interest, net income totaled $7.2 million, or $0.32 per share for the
third quarter of 1998. For the nine months ended September 30, 1999, net
income totaled $23.1 million, or $0.96 per share, compared to $49.4 million,
or $2.07 per share, in the prior year. Net income for the nine months ended
September 30, 1998 reflects a $29.7 million net gain on the sale of real
estate investments.
At September 30, 1999, total assets were $967.4 million, up from
$948.3 million a year earlier. The Company's debt-to-total market
capitalization was 39.5 percent and its debt service coverage ratio for the
quarter was 3.2 times. Total debt outstanding was $398.4 million at a
weighted average interest rate of 7.18 percent and a weighted average maturity
of 5.15 years.
During September, the Company completed a $25 million private placement of
8.875 percent Series C Cumulative Redeemable Perpetual Preferred Operating
Units in its operating partnership. Proceeds from the offering were used to
pay down floating-rate line debt. At September 30, 1999, the Company had
97.5 million outstanding under its $250 million unsecured line of credit.
Leasing Activity Review
Portfolio occupancy at quarter-end was 93 percent. Leasing activity was
strong during the quarter with 55 new leases signed, totaling 241,000 square
feet at an average base rent for comparable space of $10.68 per square foot,
an 8.3 percent increase over the prior average base rent. In addition, during
the quarter the Company renewed 65 leases totaling 293,000 square feet at an
average base rent of $8.87 per square foot, a 6.2 percent increase over the
prior average base rent.
Year-to-date, the Company signed 115 new leases, totaling 569,000 square
feet, at an average base rent for comparable space of $10.71 per square foot,
a 9.5 percent increase over the prior average base rent. In addition, the
Company renewed 214 leases, totaling 965,000 square feet, at an average base
rent of $9.40 per square foot, a 7.1 percent increase over the prior average
base rent.
During the quarter, the Company signed a 47,000-square-foot lease with
HomeLife to occupy the remaining former Montgomery Ward space at its Heritage
Square property, raising that property's percent-leased from 77 percent to
99 percent.
Acquisitions
On October 1st, the Company acquired two newly developed centers located
in Minnesota. Marketplace at 42, located in Savage, Minnesota, is a 109,000-
square-foot community shopping center, 92 percent occupied and anchored by a
56,000-square-foot Rainbow Foods. Austin Town Center, located in Austin,
Minnesota, is an 111,000-square-foot center, 91 percent occupied and anchored
by a 57,000-square-foot Rainbow Foods and a 24,000-square-foot Staples. The
centers were purchased for an aggregate price of $23 million and were acquired
under the Company's co-development program with Oppidan Center Development,
LLC. Following the closing, the Oppidan agreement was terminated as the
Company is pursuing its own development initiatives.
Commenting on the outlook for the balance of the year, Thomas P. D'Arcy,
stated "We remain on track to meet our financial targets for 1999. Entering
2000, our focus will be on maintaining our financial flexibility and liquidity
by generating growth from our existing assets, managing our cost structure and
making modest new investment. While we have experienced isolated tenant
bankruptcies, our occupancy levels remain high and we are optimistic in our
ability to retenant this space. Overall, our existing portfolio continues to
perform well and we are encouraged by the progress we have made on our
development and redevelopment initiatives. We believe these initiatives will
position the Company for sustained growth in the year 2000 and beyond."
Bradley Real Estate, Inc. is the nation's oldest real estate investment
trust 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 153 consecutive quarterly distributions to its share owners, one of the
longest records of distributions among publicly traded REITs. The Company
owns 98 properties located in 15 states aggregating 15.5 million square feet
of rentable space.
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 or may be obtained from
our website: http://www.bradleyrealestate.com .
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, a stable
interest rate climate and the continuing availability of retail center
acquisitions and development and redevelopment opportunities in the Midwest on
favorable terms and the Company's ability to sustain growth by capitalizing on
these opportunities. Reference is made to the discussions under the captions
"Risk Factors" in the Company's Form 10-K report for 1998 which includes a
discussion of certain other factors which could cause actual results to differ
materially from those in forward-looking statements.
To receive additional information on Bradley Real Estate free of charge
via fax, dial 1-800-PRO-INFO and enter "BTR" or visit the company's website at
http://www.bradleyrealestate.com
BRADLEY REAL ESTATE, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except share data)
(UNAUDITED)
September 30, December 31,
ASSETS 1999 1998 % Change
Real estate
investments-at cost $977,930 $936,465 4.4%
Accumulated depreciation
and amortization (75,395) (59,196) 27.4%
Net real estate investments 902,535 877,269 2.9%
Real estate investments
held for sale 30,138 46,492 -35.2%
Other assets:
Rents and other receivables,
net of allowance for doubtful
accounts of $4,648 for 1999
and $4,078 for 1998 17,672 14,994 17.9%
Investment in partnership -- 13,249 -100.0%
Deferred charges, net and
other assets 17,014 16,676 2.0%
Total assets $967,359 $968,680 -0.1%
LIABILITIES AND SHARE OWNERS' EQUITY
Mortgage loans $101,353 $103,333 -1.9%
Unsecured notes payable 199,589 199,542 0.0%
Line of credit 97,500 169,500 -42.5%
Accounts payable, accrued
expenses and other
liabilities 32,883 29,415 11.8%
Total liabilities 431,325 501,790 -14.0%
Exchangeable limited
partnership units 19,667 21,573 -8.8%
Series B preferred units 49,100 -- 100.0%
Series C preferred units 24,344 -- 100.0%
Total minority interest 93,111 21,573 331.6%
Share Owners' equity:
Shares of preferred stock
and paid-in capital, par
value $.01 per share;
liquidation preference
$25.00 per share:
Authorized 20,000,000 shares;
issued and outstanding 3,478,219
and 3,478,493 shares of Series A
Convertible Preferred Stock at
September 30, 1999 and
December 31, 1998,
respectively 86,802 86,809 0.0%
Shares of common stock
and paid-in capital, par
value $.01 per share:
Authorized 80,000,000
shares; issued and
outstanding 24,060,057
and 23,958,662 shares at
September 30, 1999 and
December 31, 1998,
respectively 350,464 349,254 0.3%
Shares of excess stock,
par value $.01 per share:
Authorized 50,000,000 shares;
0 shares issued
and outstanding -- -- --
Retained earnings 5,657 9,254 -38.9%
Total share owners' equity 442,923 445,317 -0.5%
Total liabilities and
share owners' equity $967,359 $968,680 -0.1%
BRADLEY REAL ESTATE, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
(UNAUDITED)
Three months ended September 30,
1999 1998 % Change
Income:
Rental income $37,833 $33,305 13.6%
Other income 582 634 -8.2%
38,415 33,939 13.2%
Expenses:
Operations, maintenance
and management 5,715 4,510 26.7%
Real estate taxes 5,567 5,665 -1.7%
Mortgage and other interest 7,129 7,424 -4.0%
General and administrative 2,185 2,107 3.7%
Depreciation and amortization 6,849 5,752 19.1%
27,445 25,458 7.8%
Income before equity in earnings
of partnership and net gain on
sale of properties 10,970 8,481 29.3%
Equity in earnings of partnership -- 247 -100.0%
Net gain on sale of properties -- 30,555 -100.0%
Income before allocation to
minority interest 10,970 39,283 -72.1%
Income allocated to exchangeable
limited partnership units (422) (2,095) -79.9%
Income allocated to Series B and
C preferred units (1,257) -- -100.0%
Net income 9,291 37,188 -75.0%
Preferred share distributions (1,826) (1,096) 66.6%
Net income attributable to
common share owners $7,465 $36,092 -79.3%
Basic net income per share $0.31 $1.52 -79.6%
Diluted net income per share $0.31 $1.44 -78.5%
BRADLEY REAL ESTATE, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
(UNAUDITED)
Nine months ended September 30,
1999 1998 % Change
Income:
Rental income $113,415 $92,642 22.4%
Other income 1,911 1,693 12.9%
115,326 94,335 22.3%
Expenses:
Operations, maintenance
and management 17,798 13,286 34.0%
Real estate taxes 17,238 16,441 4.8%
Mortgage and other interest 21,998 19,567 12.4%
General and administrative 6,252 5,227 19.6%
Depreciation and amortization 19,790 16,346 21.1%
83,076 70,867 17.2%
Income before equity in earnings
of partnership and net gain on
sale of properties 32,250 23,468 37.4%
Equity in earnings of partnership 500 247 102.4%
Net gain on sale of properties -- 29,680 -100.0%
Income before allocation to
minority interest 32,750 53,395 -38.7%
Income allocated to exchangeable
limited partnership units (1,343) (2,892) -53.6%
Income allocated to Series B and
C preferred units (2,822) -- -100.0%
Net income 28,585 50,503 -43.4%
Preferred share distributions (5,478) (1,096) 399.8%
Net income attributable to common
share owners $23,107 $49,407 -53.2%
Basic net income per share $0.96 $2.09 -54.1%
Diluted net income per share $0.96 $2.07 -53.6%
CALCULATION OF FUNDS FROM OPERATIONS
Three Months Ended September 30,
1999 1998 % Change
Income before allocation to
minority interest $10,970 $39,283 -72.1%
-Preferred share distributions (1,826) (1,096) 66.6%
-Income allocated to Series B
and C preferred units (1,257) -- -100.0%
+Depreciation of real estate
assets & amortization of
tenant improvements 5,683 4,939 15.1%
+Amortization of deferred
leasing commissions 684 290 135.9%
+Other amortization including
deferred finance & non-real
estate related costs 482 523 -7.8%
-Amortization of deferred
finance & non-real estate
related costs (283) (225) 25.8%
+Depreciation and amortization
included in equity in earnings
of partnership -- 27 -100.0%
-Net (gain) provision for loss on
real estate investments -- (30,555) 100.0%
Funds from Operations $14,453 $13,186 9.6%
Funds from Operations per
share - basic $0.57 $0.52 9.6%
Funds from Operations per
share - diluted $0.56 $0.52 7.7%
CALCULATION OF FUNDS FROM OPERATIONS
Nine Months Ended September 30,
1999 1998 % Change
Income before allocation to
minority interest $32,750 $53,395 -38.7%
-Preferred share
distributions (5,478) (1,096) 399.8%
-Income allocated to Series B
and C preferred units (2,822) -- -100.0%
+Depreciation of real estate
assets & amortization of
tenant improvements 16,685 13,185 26.5%
+Amortization of deferred
leasing commissions 1,468 1,574 -6.7%
+Other amortization including
deferred finance & non-real
estate related costs 1,637 1,587 3.2%
-Amortization of deferred
finance & non-real estate
related costs (842) (692) 21.7%
+Depreciation and amortization
included in equity in earnings
of partnership 100 27 270.4%
-Net (gain) provision for
loss on real estate
investments -- (29,680) 100.0%
Funds from Operations $43,498 $38,300 13.6%
Funds from Operations
per share - basic $1.71 $1.53 11.8%
Funds from Operations
per share - diluted $1.69 $1.53 10.5%
RECONCILIATION OF BASIC EARNINGS AND FUNDS FROM OPERATIONS PER SHARE
TO DILUTED EARNINGS AND FUNDS FROM OPERATIONS PER SHARE
Three Months Ended Nine Months Ended
September 30, September 30,
1999 1998 1999 1998
Net Income
NUMERATOR
Basic:
Net income
attributable to
common share
owners $7,465,000 $36,092,000 $23,107,000 $49,407,000
Diluted:
Net income
attributable
to common share
owners $7,465,000 $36,092,000 $23,107,000 $49,407,000
Income allocated
to exchangeable
limited partnership
units 422,000 2,095,000 1,343,000 2,892,000
Convertible preferred
stock distributions* -- 1,096,000 -- 1,096,000
Adjusted net
income $7,887,000 $39,283,000 $24,450,000 $53,395,000
DENOMINATOR
Basic:
Weighted average
common shares
outstanding 24,059,660 23,782,221 24,038,841 23,597,218
Diluted:
Weighted average
common shares
outstanding 24,059,660 23,782,221 24,038,841 23,597,218
Effect of dilutive
securities:
Stock options 32,599 46,466 34,111 48,338
Convertible
preferred stock* -- 2,162,504 -- 728,756
Exchangeable
limited
partnership
units 1,361,038 1,380,609 1,396,327 1,398,890
Weighted average
shares and assumed
conversions 25,453,297 27,371,800 25,469,279 25,773,202
Basic earnings per
share $0.31 $1.52 $0.96 $2.09
Diluted earnings per
share $0.31 $1.44 $0.96 $2.07
*Amounts are not included for the three and nine month periods ended
September 30, 1999 as the effects are anti-dilutive. Funds From
Operations
NUMERATOR
Basic:
Funds from
Operations $14,453,000 $13,186,000 $43,498,000 $38,300,000
Diluted:
Funds from
Operations $14,453,000 $13,186,000 $43,498,000 $38,300,000
Convertible
preferred stock
distributions 1,826,000 1,096,000 5,478,000 1,096,000
Diluted Funds from
Operations $16,279,000 $14,282,000 $48,976,000 $39,396,000
DENOMINATOR
Basic:
Weighted average
common shares and
partnership units
outstanding 25,420,698 25,162,830 25,435,168 24,996,108
Diluted:
Weighted average
common shares and
partnership units
outstanding 25,420,698 25,162,830 25,435,168 24,996,108
Effect of dilutive
securities:
Stock options 32,599 46,466 34,111 48,338
Convertibles
preferred
stock 3,550,860 2,162,504 3,550,894 728,756
Weighted average
shares and assumed
conversions 29,004,157 27,371,800 29,020,173 25,773,202
Basic Funds from
Operations per share $0.57 $0.52 $1.71 $1.53
Diluted Funds from
Operations per share $0.56 $0.52 $1.69 $1.53
SOURCE Bradley Real Estate, Inc.
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Related links:
http://www.bradleyrealestate.com
CONTACT:
Thomas P. D'Arcy, Chairman and CEO of Bradley
Real Estate, 847-272-9800; or Ellen McGinnis of The Financial
Relations Board, 312-274-2233, for Bradley Real Estate
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