ORLANDO, Fla., Aug. 3 /PRNewswire-FirstCall/ -- National Retail Properties, Inc. (NYSE: NNN), a real estate investment trust, today announced operating results for the quarter ended June 30, 2009. Highlights include:
Operating Results:
- Revenues, net earnings and FFO available to common stockholders:
Quarter Ended Six Months Ended
June 30, June 30,
2009 2008 2009 2008
---- ---- ---- ----
(in thousands, except per share data)
Revenues $58,681 $56,369 $116,645 $110,408
Net earnings available
to common stockholders $25,258 $27,570 $50,365 $58,113
Net earnings per common
share (diluted) $0.32 $0.38 $0.64 $0.80
FFO available to common
stockholders $36,002 $35,032 $71,057 $71,192
FFO per common share
(diluted) $0.45 $0.48 $0.90 $0.98
- NNN paid cash dividends to its common shareholders of $0.375 per share during the quarter and $0.75 for the six months ended June 30, 2009.
- Investment Portfolio occupancy was 96.7% at June 30, 2009.
Investments and Dispositions for the quarter ended June 30, 2009:
- Investments:
- $12.0 million of development funding in the Investment Portfolio with an aggregate 126,000 square feet of gross leasable area
- Dispositions:
- Three Investment properties with an aggregate 46,000 square feet of gross leasable area, with net proceeds of $5.6 million, resulting in a gain of $600,000
- One Inventory property with net proceeds of $493,000
Investments and Dispositions for the six months ended June 30, 2009:
- Investments
- $19.6 million of development funding in the Investment Portfolio with an aggregate 231,000 square feet of gross leasable area
- $2.2 million of development funding in the Inventory Portfolio
- Dispositions
- Six Investment properties with an aggregate 107,000 square feet of gross leasable area, with net proceeds of $9.7 million, resulting in a gain of $1.6 million
- Two Inventory properties with net proceeds of $5.4 million
Capital transactions for the quarter ended June 30, 2009:
- Issued 737,960 shares of common stock generating $12,511,000 of net proceeds pursuant to the Dividend Reinvestment and Stock Purchase Plan
- Repurchased $2.5 million of the Company's outstanding 5.125% convertible notes due June 2028, which notes provide holders with a 2013 put option, for a discounted purchase price of $2.0 million
National Retail Properties also announced revised 2009 FFO guidance from $1.65 to $1.75 per share to $1.65 to $1.70 per share. This guidance includes non-cash interest expense of approximately 7 cents per share due to changes required in accounting for convertible debt interest beginning in 2009. This equates to net earnings before any gains or losses from the sale of investment properties of $1.13 to $1.18 per share plus $0.52 per share of expected real estate related depreciation and amortization. This guidance is based on current plans and assumptions and subject to the risks and uncertainties more fully described in this press release and the company's reports filed with the Securities and Exchange Commission.
Craig Macnab, Chief Executive Officer, commented: "Our balance sheet remains strong and our portfolio is performing well as we maintain a high occupancy level in a challenging retail environment. We are well-positioned to take advantage of the acquisition opportunities that we expect to be available in the future."
National Retail Properties invests primarily in high-quality retail properties subject generally to long-term, net leases. As of June 30, 2009, the company owned 999 Investment properties in 44 states with a gross leasable area of approximately 11.4 million square feet. NNN is one of only four publicly traded REITs and 156 publicly traded companies in America to have increased its annual dividends for 19 or more consecutive years. For more information on the company, visit www.nnnreit.com.
Management will hold a conference call on August 3, 2009 at 10:30 a.m. EDT to review these results. The call can be accessed on National Retail Properties, Inc.'s web site live at http://www.nnnreit.com. For those unable to listen to the live broadcast, a replay will be available on the company's web site. In addition, a summary of any earnings guidance given on the call will be posted to the company's web site.
Statements in this press release that are not strictly historical are "forward-looking" statements. Forward-looking statements involve known and unknown risks, which may cause the company's actual future results to differ materially from expected results. These risks include, among others, general economic conditions, local real estate conditions, changes in interest rates, increases in operating costs, the availability of capital, and the profitability of the company's taxable subsidiary. Additional information concerning these and other factors that could cause actual results to differ materially from those forward-looking statements is contained from time to time in the company's Securities and Exchange Commission ("SEC") filings, including, but not limited to, the company's Annual Report on Form 10-K. Copies of each filing may be obtained from the company or the SEC. Consequently, such forward-looking statements should be regarded solely as reflections of the company's current operating plans and estimates. Actual operating results may differ materially from what is expressed or forecast in this press release. National Retail Properties undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date these statements were made.
The reported results are unaudited and there can be no assurance that the results will not vary from the final information for the quarter ended June 30, 2009. In the opinion of management, all adjustments considered necessary for a fair presentation of these reported results have been made.
Funds From Operations, commonly referred to as FFO, is a relative non-GAAP financial measure of operating performance of an equity REIT in order to recognize that income-producing real estate historically has not depreciated on the basis determined under GAAP. FFO is defined by the National Association of Real Estate Investment Trusts and is used by the company as follows: net earnings (computed in accordance with GAAP) plus depreciation and amortization of assets unique to the real estate industry, excluding gains (or including losses) on the disposition of real estate held for investment, and the company's share of these items from the company's unconsolidated partnerships.
FFO is generally considered by industry analysts to be the most appropriate measure of performance of real estate companies. FFO does not necessarily represent cash provided by operating activities in accordance with GAAP and should not be considered an alternative to net earnings as an indication of the company's performance or to cash flow as a measure of liquidity or ability to make distributions. Management considers FFO an appropriate measure of performance of an equity REIT because it primarily excludes the assumption that the value of the real estate assets diminishes predictably over time, and because industry analysts have accepted it as a performance measure. The company's computation of FFO may differ from the methodology for calculating FFO used by other equity REITs, and therefore, may not be comparable to such other REITs.
The company has determined that there are earnings from discontinued operations in each of its segments, real estate held for investment and real estate held for sale. All property dispositions from the company's held for investment segment are classified as discontinued operations. In addition, certain properties in the company's held for sale segment that have generated revenues before disposition are classified as discontinued operations. The results of operations for prior periods for these properties now classified as discontinued operations have been restated to reflect the results in earnings from discontinued operations for comparability purposes. These adjustments resulted in a decrease in the company's reported total revenues and total and per share earnings from continuing operations and an increase in the company's earnings from discontinued operations. However, the company's total and per share FFO and net earnings available to common stockholders are not affected.
National Retail Properties, Inc.
(In thousands, except per share data)
(unaudited)
Quarter Ended Six Months Ended
June 30, June 30,
2009 2008 2009 2008
---- ---- ---- ----
Income Statement Summary
Revenues:
Rental and earned income $54,592 $52,368 $108,321 $102,262
Real estate expense
reimbursement from tenants 2,109 1,423 4,456 2,977
Interest and other income
from real estate transactions 980 1,407 1,814 2,642
Interest income on commercial
mortgage residual interests 1,000 1,171 2,054 2,527
----- ----- ----- -----
58,681 56,369 116,645 110,408
------ ------ ------- -------
Disposition of real estate,
Inventory Portfolio:
Gross proceeds - - - 4,900
Costs - - - (4,879)
--- --- --- ------
Gain - - - 21
--- --- --- --
Operating expenses:
General and administrative 5,784 6,041 11,090 13,601
Real estate 3,241 2,247 6,828 4,627
Depreciation and
amortization 12,146 10,787 23,965 20,770
Impairment - real estate 1,064 - 1,064 -
Impairment - commercial
mortgage residual interests
valuation - - - 758
Restructuring charges - - 731 -
--- --- --- ---
22,235 19,075 43,678 39,756
------ ------ ------ ------
Other expenses (revenues):
Interest and other income (416) (1,008) (763) (2,229)
Interest expense 15,436 16,281 30,866 32,467
Loss on interest rate hedge - - - 804
--- --- --- ---
15,020 15,273 30,103 31,042
------ ------ ------ ------
Income tax benefit 546 1,767 1,082 4,418
Equity in earnings of
unconsolidated affiliate 107 101 210 180
Gain on note receivable
foreclosure 1,048 - 1,048 -
Gain on extinguishment
of debt 1,014 - 3,432 -
----- --- ----- ---
Earnings from continuing
operations 24,141 23,889 48,636 44,229
Earnings from discontinued
operations:
Real estate, Investment
Portfolio 2,762 4,178 4,809 10,120
Real estate, Inventory
Portfolio, net of income
tax expense 226 1,044 458 9,666
--- ----- --- -----
Net earnings including
noncontrolling interests 27,129 29,111 53,903 64,015
Loss (earnings) attributable to
noncontrolling interests:
Continuing operations (171) (252) (351) 759
Discontinued operations (4) 407 205 (3,269)
-- --- --- ------
(175) 155 (146) (2,510)
---- --- ---- ------
Net earnings attributable
to National Retail
Properties, Inc.
