New Plan Excel Realty Trust Reports Second Quarter 2004 Results NEW
YORK, July 29 /PRNewswire-FirstCall/ -- New Plan Excel Realty
Trust, Inc. (NYSE:NXL) today announced financial results for the
three and six months ended June 30, 2004. Total rental revenues for
the second quarter of 2004 increased to $122.9 million from $120.0
million in the second quarter of 2003. Net income available to
common stockholders was $27.9 million, or $0.27 per diluted share,
in the second quarter of 2004 compared with $26.5 million, or $0.27
per diluted share, in the second quarter of 2003. Funds from
operations (FFO) for the second quarter of 2004 was $55.0 million,
or $0.54 on a diluted per share basis, compared with $45.0 million,
or $0.45 on a diluted per share basis, in the second quarter of
2003 (as restated downward by $0.05 per diluted share to reflect
the revised FFO methodology described below). A reconciliation of
net income to FFO is presented in the attached table. Total rental
revenues for the six months ended June 30, 2004 were $248.1 million
as compared with $239.8 million in the first six months of 2003.
Net income available to common stockholders was $60.3 million, or
$0.59 per diluted share, in the first six months of 2004 compared
with $57.3 million, or $0.57 per diluted share, in the first six
months of 2003. FFO for the first six months of 2004 was $107.2
million, or $1.05 on a diluted per share basis, compared with $94.1
million, or $0.94 on a diluted per share basis, in the first six
months of 2003 (as restated downward by $0.09 per diluted share to
reflect the revised FFO methodology described below). On October 1,
2003, the National Association of Real Estate Investment Trusts
(NAREIT), based on discussions with the SEC, provided revised
guidance regarding the calculation of FFO. This revised guidance
provides that impairments should not be added back to net income in
calculating FFO and that original issuance costs associated with
preferred stock that has been redeemed should be factored into the
calculation of FFO. Prior to this pronouncement, the Company had
added back impairments in calculating FFO, in accordance with prior
NAREIT guidance, and had not factored in original issuance costs of
preferred stock that had been redeemed in the calculation of FFO.
The Company has restated its historical calculations of FFO made
prior to this pronouncement in accordance with NAREIT's revised
guidance and its application to the Company's financial performance
is as stated above. Property Portfolio At the end of the second
quarter, the gross leasable area (GLA) for the Company's total
stabilized community and neighborhood shopping centers, including
its pro rata share of joint venture projects, was approximately
92.7 percent leased. The GLA for the Company's total portfolio,
including its pro rata share of joint venture projects (Total
Portfolio), was approximately 90.9 percent leased at June 30, 2004.
The average annual base rent (ABR) at June 30, 2004 for the total
portfolio was $8.03 per leased square foot. During the quarter, 159
new leases, aggregating approximately 953,000 square feet, were
signed at an average ABR of $10.49 per square foot. Also during the
quarter, 208 renewal leases, aggregating approximately 917,000
square feet, were signed at an average ABR of $10.20 per square
foot, an increase of approximately 6.9 percent over the expiring
leases. In total, 323 new leases, aggregating approximately 1.9
million square feet, were signed during the first six months of
2004 at an average ABR of $9.36 per square foot and 381 renewal
leases, aggregating approximately 1.5 million square feet, were
signed at an average ABR of $10.40 per square foot, an increase of
approximately 6.3 percent over the expiring leases. During the
second quarter, the Company completed the redevelopment of nine
shopping centers and added ten projects to its redevelopment
pipeline, increasing the pipeline to 36 projects (including joint
venture redevelopment projects), with an aggregate expected cost of
$165.3 million (including costs incurred in prior years on these
projects). The Company also commenced one new development project
as discussed below, with an expected cost of $14.0 million.
Acquisitions and Dispositions During the second quarter of 2004,
the Company acquired, including through co-investments with its
joint venture partners, three shopping centers and two land parcels
for an aggregate of approximately $60.5 million. The shopping
centers totaled approximately 386,129 square feet and the land
parcels totaled approximately 24 acres. During the first six months
of 2004, the Company acquired, including through co-investments
with its joint venture partners, an aggregate of eight shopping
centers, two land parcels and the remaining 50 percent interest in
a shopping center in which the Company owned the other 50 percent
interest for an aggregate of approximately $227.5 million. The
shopping centers totaled approximately 1.8 million square feet and
the land parcels totaled approximately 24 acres. Acquisitions
completed during the second quarter are summarized below: * On
April 12, 2004, CA New Plan Venture Fund, the Company's joint
venture with a major U.S. pension fund, acquired Marrero Shopping
Center, a 69,259 square foot shopping center located in Marrero,
Louisiana (a suburb of New Orleans), for approximately $3.7
million. The property is currently under redevelopment with the
expansion of its Winn-Dixie anchor. * On April 22, 2004, BPR West,
a joint venture in which the Company has a 50 percent interest,
acquired 12.8 acres of land in Frisco, Texas, for approximately
$3.2 million. The parcel is adjacent to a 280,000 square foot IKEA
currently under construction and will be developed for
approximately 105,000 square feet of retail use. The site is within
one-half mile of The Centre at Preston Ridge, a community shopping
center owned by a joint venture in which the Company has a 25
percent interest. * On April 28, 2004, the Company acquired Unity
Plaza, 11 acres of unimproved land in East Fishkill, New York, for
$6.0 million. The Company will develop an approximately 70,000
square foot shopping center anchored by a 47,500 square foot
A&P Food Market, which has received all required permits and
approvals to commence development. * On April 29, 2004, the Company
acquired Stockbridge Village, a 188,203 square foot shopping center
located in Stockbridge, GA (a suburb of Atlanta) and anchored by
Kroger, for approximately $23.8 million. * On May 20, 2004,
NP/I&G Institutional Retail Company, LLC, the Company's joint
venture with JPMorgan Fleming Asset Management, acquired Village
Shoppes of East Cherokee, a 128,667 square foot shopping center
located in Woodstock, Georgia (a suburb of Atlanta) and anchored by
Publix, for approximately $23.9 million. During the second quarter
of 2004, the Company generated an aggregate of approximately $21.1
million of proceeds through the sale of five properties and one
outparcel, as well as the sale of one property held through a joint
venture and the transfer of one property to a joint venture.
Properties sold during the quarter include Eastgate Shopping
Center, a 102,161 square foot shopping center located in Lake
Wales, Florida and anchored by a vacant Kmart; Sun Valley Plaza, a
107,405 square foot shopping center located in Mesa, Arizona;
Whitestown Plaza, a 80,612 square foot shopping center located in
Whitesboro, New York; a 4,000 square foot single tenant Northern
Automotive located in Hastings, Nebraska; Genzyme Corp., a 21,560
square foot miscellaneous office property located in Scottsdale,
Arizona; a one- acre outparcel at Superior Marketplace in Superior,
Colorado; and Raymond Road, a 62,345 square foot shopping center
located in Jackson, Mississippi and owned by CA New Plan Venture
Fund. In addition, on June 1, 2004, the Company transferred Villa
Monaco, a 122,213 square foot shopping center located in Denver,
Colorado, to CA New Plan Venture Fund. In the first six months of
2004, the Company generated an aggregate of approximately $34.4
million of proceeds through the culling of non-core and
non-strategic properties, the disposition of certain properties
held through joint ventures and the transfer of one property to a
joint venture. Balance Sheet Position The Company completed the
second quarter with total book assets of approximately $3.7 billion
and a total debt / undepreciated book value ratio of 46.6 percent.
The Company's debt for the three months ended June 30, 2004 had an
overall weighted average current interest rate of 5.9 percent and a
weighted average maturity of 7.0 years. Approximately 78 percent of
the Company's total debt is fixed rate debt, including the impact
of the Company's interest rate swap agreements that effectively
convert $115 million of outstanding notes from a fixed rate to a
blended floating rate. On June 30, 2004, the Company amended its
existing $350 million revolving credit facility. The amended
facility bears interest at LIBOR plus 65 basis points (a reduction
of 20 basis points) and matures on June 30, 2007, with a one-year
extension option. On June 30, 2004, the Company also amended its
existing $100 million secured term loan facility. The amended term
loan facility, which was increased to $150 million, bears interest
at LIBOR plus 85 basis points (a net reduction of 20 basis points)
and matures on June 30, 2007. Bank of America, N.A. and The Bank of
New York acted as administrative agent and syndication agent,
respectively, for both facilities. On July 12, 2004, Fitch Ratings
initiated coverage of the Company by assigning a BBB+ rating to its
outstanding senior unsecured notes and a BBB rating to the
Company's preferred stock. The rating outlook is stable. Dividend
For the third quarter of 2004, the Company's Board of Directors
declared a cash dividend of $0.4125 per common share. On an
annualized basis, this is the equivalent of $1.65 per share. The
dividend is payable on October 15, 2004 to common stockholders of
record on October 1, 2004. New Plan Excel Realty Trust, Inc. shares
go ex-dividend on September 29, 2004. The Board of Directors also
declared a dividend of $0.975 per depositary share on its 7.8
percent Series D Cumulative Voting Step-Up Premium Rate Preferred
Stock to stockholders of record on October 1, 2004, payable on
October 15, 2004. In addition, the Board of Directors declared a
dividend of $0.47656 per depositary share on its 7.625 percent
Series E Cumulative Redeemable Preferred Stock to stockholders of
record on October 1, 2004, payable on October 15, 2004. Management
Comment "We continue to improve both the quality and performance of
our shopping center portfolio. This is the result of several
initiatives including aggressive leasing and property management,
an accelerating redevelopment program, the disposition of non-core
and non-strategic properties and the acquisition of competitively
positioned shopping centers. The results of these highly focused
efforts are apparent in our operating results and detailed in our
annual Portfolio Assessment," commented Glenn J. Rufrano, Chief
Executive Officer. The Company's 2004 Portfolio Assessment will be
available on the Company's website at http://www.newplan.com/ under
Investor Information; Presentations. Conference Call The Company
will be hosting a teleconference on Thursday, July 29, 2004 at 2:00
PM ET. The teleconference can be accessed by dialing 1-800-884-5695
(International: 1-617-786-2960) or via the web at
http://www.newplan.com/ under Investor Information; Audio Archives.
Please refer to passcode #37137307. A replay of the teleconference
will be available through midnight ET August 5, 2004 by dialing
1-888-286-8010 (International: 1-617-801-6888) or via the web at
http://www.newplan.com/ under Investor Information; Audio Archives.
Please refer to passcode #88536605. The Company's Supplemental
Disclosure package will be furnished today on a Current Report on
Form 8-K and will also be available on the Company's website at
http://www.newplan.com/ under Investor Information; Financial
Reports. These materials are also available in e-mail or hard copy
formats by contacting New Plan Corporate Communications at or
1-800-468-7526. New Plan Excel Realty Trust, Inc. is one of the
nation's largest real estate companies, focusing on the ownership
and management of community and neighborhood shopping centers. The
Company operates as a self-administered and self-managed REIT, with
a national portfolio of 401 properties, including 23 properties
held through joint ventures, and total assets of approximately $3.7
billion. Its properties are strategically located across 34 states
and include 375 community and neighborhood shopping centers,
primarily grocery or name-brand discount chain anchored, with
approximately 54.6 million square feet of gross leasable area, and
26 related retail real estate assets, with approximately 2.2
million square feet of gross leasable area. For additional
information, please visit http://www.newplan.com/. Certain
statements in this release that are not historical fact may
constitute forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Such
forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results
of the Company to differ materially from historical results or from
any results expressed or implied by such forward-looking
statements, including without limitation: national and local
economic, business, real estate and other market conditions; the
competitive environment in which the Company operates; financing
risks; possible future downgrades in our credit ratings; property
management risks; the level and volatility of interest rates;
financial stability of tenants; the Company's ability to maintain
its status as a REIT for federal income tax purposes; acquisition,
disposition, development and joint venture risks, including risks
that developments and redevelopments are not completed on time or
on budget and strategies, actions and performance of affiliates
that the Company may not control; potential environmental and other
liabilities; and other factors affecting the real estate industry
generally. The Company refers you to the documents filed by the
Company from time to time with the Securities and Exchange
Commission, specifically the section titled "Business-Risk Factors"
in the Company's Annual Report on Form 10-K for the year ended
December 31, 2003, which discuss these and other factors that could
adversely affect the Company's results. NEW PLAN EXCEL REALTY
TRUST, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (In
thousands, except per share amounts) Three Months Six Months Ended
Ended June 30, June 30, June 30, June 30, 2004 2003 2004 2003
Rental Revenues: Rental income $96,624 $92,067 $192,839 $184,188
Percentage rents 1,495 1,956 4,235 3,717 Expense reimbursements
24,780 26,025 51,002 51,909 TOTAL RENTAL REVENUES 122,899 120,048
248,076 239,814 Rental Operating Expenses: Operating costs 19,881
23,016 43,890 45,791 Real estate and other taxes 15,181 14,609
30,161 30,095 Provision for doubtful accounts 2,405 1,960 4,168
3,686 TOTAL RENTAL OPERATING EXPENSES 37,467 39,585 78,219 79,572
NET OPERATING INCOME 85,432 80,463 169,857 160,242 Other Income:
Interest, dividend and other income 1,850 1,932 4,388 5,292 Equity
in income of unconsolidated ventures 559 1,188 789 1,661 TOTAL
OTHER INCOME 2,409 3,120 5,177 6,953 Other Expenses: Interest
expense 26,536 24,849 52,937 50,850 Depreciation and amortization
21,823 18,615 42,989 37,307 General and administrative 5,173 4,204
10,166 8,434 TOTAL OTHER EXPENSES 53,532 47,668 106,092 96,591
Income before real estate sales, impairment of real estate and
minority interest 34,309 35,915 68,942 70,604 Gain on sale of real
estate (1) -- -- 1,217 -- Impairment of real estate -- (1,124) --
(1,124) Minority interest in income of consolidated partnership and
joint ventures (476) (375) (736) (776) INCOME FROM CONTINUING
OPERATIONS 33,833 34,416 69,423 68,704 Discontinued Operations:
Results of discontinued operations 96 1,481 489 2,353 (Loss) gain
on sale of discontinued operations (2) (970) 83 444 3,566
Impairment of real estate held for sale (43) (3,451) (43) (6,905)
INCOME FROM DISCONTINUED OPERATIONS (917) (1,887) 890 (986) NET
INCOME $32,916 $32,529 $70,313 $67,718 Preferred dividends (5,275)
(5,753) (10,550)(10,612) Premium on redemption of preferred stock
-- (630) -- (630) NET INCOME AVAILABLE TO COMMON STOCKHOLDERS -
BASIC 27,641 26,146 59,763 56,476 Minority interest in income of
consolidated partnership 286 375 546 776 NET INCOME AVAILABLE TO
COMMON STOCKHOLDERS - DILUTED $27,927 $26,521 $60,309 $57,252 Net
income per common share - basic $ 0.28 $ 0.27 $ 0.60 $ 0.58 Net
income per common share - diluted 0.27 0.27 0.59 0.57 Funds from
operations: (3) Net income available to common stockholders -
diluted $27,927 $26,521 $60,309 $57,252 Deduct: Minority interest
in income of consolidated partnership (286) (375) (546) (776) Net
income available to common stockholders - basic 27,641 26,146
59,763 56,476 Add: Depreciation and amortization: Continuing
operations real estate assets 21,823 18,615 42,989 37,307
Discontinued operations real estate assets 70 326 168 752 Pro rata
share of joint venture real estate assets 268 209 641 463 NEW PLAN
EXCEL REALTY TRUST, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS
OF INCOME (In thousands, except per share amounts) Three Months Six
Months Ended Ended June 30, June 30, June 30, June 30, 2004 2003
2004 2003 Deduct: Gain on sale of real estate (1) (4) -- -- (1,217)
-- Loss (gain) on sale of discontinued operations (4) 4,909 (83)
3,963 (1,083) Pro rata share of joint venture (gain) loss on sale
of real estate (4) (4) (604) 390 (604) FUNDS FROM OPERATIONS -
Basic 54,708 44,609 106,697 93,311 Add: Minority interest in income
of consolidated partnership 286 375 546 776 FUNDS FROM OPERATIONS -
DILUTED $54,994 $44,984 $107,243 $94,087 Funds from operations per
share - basic $0.55 $0.46 $1.07 $0.96 Funds from operations per
share - diluted 0.54 0.45 1.05 0.94 Funds from operations - diluted
$54,994 $44,984 $107,243 $94,087 Add: Impairment of real estate --
1,124 -- 1,124 Impairment of real estate held for sale 43 3,451 43
6,905 Premium on redemption of preferred stock -- 630 -- 630 FUNDS
FROM OPERATIONS - DILUTED (prior calculation) $55,037 $50,189
$107,286 $102,746 Funds from operations per share - diluted (prior
calculation) $0.54 $0.50 $1.05 $1.03 Weighted average common shares
outstanding - basic 100,159 97,112 99,789 97,025 ERP partnership
units 1,239 2,178 1,301 2,178 Options 874 663 1,052 547 Weighted
average common shares outstanding - diluted 102,272 99,953 102,142
99,750 (1) For the six months ended June 30, 2004, balance includes
$1.217 million of previously deferred gain incurred in connection
with the Company's sale of 70 percent of its interest in Arapahoe
Crossings, LP in 2003. (2) For the three and six months ended June
30, 2004, balance includes approximately $3.876 million of
previously deferred gain incurred in connection with the Company's
sale of 21.5 acres of land at The Mall at 163rd Street in 2003. (3)
Funds from Operations ("FFO") is a widely used performance measure
for real estate companies and is provided here as a supplemental
measure of operating performance. The Company calculates FFO in
accordance with the best practices described in the April 2002
National Policy Bulletin of the National Association of Real Estate
Investment Trusts (the "White Paper"). The White Paper defines FFO
as net income (computed in accordance with generally accepted
accounting principles ("GAAP")), excluding gains (or losses) from
sales of property, plus depreciation and amortization, and after
adjustments for unconsolidated partnerships and joint ventures. On
October 1, 2003, NAREIT, based on discussions with the SEC,
provided revised guidance regarding the calculation of FFO. This
revised guidance provides that impairments should not be added back
to net income in calculating FFO and that original issuance costs
associated with preferred stock that has been redeemed should be
factored into the calculation of FFO. Prior to this pronouncement,
the Company had added back impairments in calculating FFO, in
accordance with prior NAREIT guidance, and had not factored in
original issuance costs of preferred stock that had been redeemed
in the calculation of FFO. The Company has revised its calculations
of FFO made prior to this pronouncement in accordance with NAREIT's
revised guidance. To assist investors in understanding the impact
of these changes, the Company also is presenting FFO in accordance
with the methodology historically used by the Company ("prior
calculation"). Given the nature of the Company's business as a real
estate owner and operator, the Company believes that FFO is helpful
to investors as a starting point in measuring its operational
performance because it excludes various items included in net
income that do not relate to or are not indicative of its operating
performance such as gains (or losses) from sales of property and
depreciation and amortization, which can make periodic and peer
analyses of operating performance more difficult to compare. The
Company also believes that the presentation of FFO consistent with
the guidance that was in effect until October 1, 2003 is further
helpful to investors because it assists investors in evaluating the
Company's historical operational performance and because it
excludes other items included in the revised calculation of FFO
such as impairments which also do not relate to and are not
indicative of the Company's operating performance. FFO should not,
however, be considered as an alternative to net income (determined
in accordance with GAAP) as an indicator of the Company's financial
performance, is not an alternative to cash flow from operating
activities (determined in accordance with GAAP) as a measure of the
Company's liquidity, and is not indicative of funds available to
fund the Company's cash needs, including its ability to make
distributions. In addition, the Company's computation of FFO may
differ in certain respects from the methodology utilized by other
REITs to calculate FFO. (4) Excludes gain / loss on sale of land.
The above does not purport to disclose all items required under
GAAP. The Company's Form 10-Q for the quarter ended June 30, 2004
should be read in conjunction with the above information.
DATASOURCE: New Plan Excel Realty Trust, Inc. CONTACT: Stacy
Lipschitz, Senior Vice President - Corporate Communications, New
Plan Excel Realty Trust, Inc., +1-212-869-3000, ext. 3359 Web site:
http://www.newplanexcel.com/
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