Exhibit 99.1
American Campus Communities Inc. Reports First Quarter 2006 Financial Results
AUSTIN, Texas--(BUSINESS WIRE)--May 2, 2006--American Campus
Communities Inc. (NYSE:ACC) today announced the following financial
results for the quarter ended March 31, 2006.
Highlights
-- Quarterly FFOM of $0.39 per fully diluted share or $7.0
million, compared to $0.33 or $4.2 million in the prior year
first quarter.
-- Increase in net operating income ("NOI") for same store owned
off-campus properties of 5.4 percent over the first quarter
2005.
-- Increase in same store occupancy for owned off-campus
portfolio to 98.9 percent as of March 31, 2006 compared to
97.2 percent as of March 31, 2005.
-- Increase in same store owned off-campus pre-leasing for the
2006-2007 academic year to 69 percent as of March 31, 2006
compared to 64 percent as of March 31, 2005.
-- Completed the acquisition of Royal Properties student housing
portfolio for a value of $244.3 million that consists of 13
existing properties with 5,745 beds in 10 major university
markets.
-- Increase in total market capitalization by 43.6 percent to
$900.1 million as of March 31, 2006 compared to $626.7 million
as of December 31, 2005.
First Quarter 2006 Operating Results
Revenue for the 2006 first quarter totaled $28.1 million, up 43.7
percent from $19.5 million in the 2005 first quarter. Net income for
the 2006 first quarter totaled $3.7 million, or $0.21 per fully
diluted share, compared with $8.2 million, or $0.65 per fully diluted
share, for the same quarter in 2005. Net income decreased primarily
due to a gain from the disposition of real estate of approximately
$5.9 million, or $0.46 per share, that was recognized during the 2005
first quarter. Excluding the gain from disposition of real estate, net
income for the 2005 first quarter would have been $0.19 per fully
diluted share, resulting in an increase of $.02 per fully diluted
share when compared to the net income for the 2006 first quarter. FFO
for the 2006 first quarter totaled $8.9 million, or $0.49 per fully
diluted share, compared with $5.7 million, or $0.45 per fully diluted
share, for the first quarter 2005. FFOM for the 2006 first quarter
totaled $7.0 million, or $0.39 per fully diluted share, compared with
$4.2 million, or $0.33 per fully diluted share, for the first quarter
2005. A reconciliation of FFO and FFOM to net income is shown on Table
3.
NOI for same store owned off-campus properties was $7.1 million in
the quarter, up 5.4 percent from $6.7 million in the 2005 first
quarter. NOI for the total owned off-campus property portfolio
increased 54.3 percent to $11.7 million for the quarter from $7.6
million in the comparable period of 2005, primarily due to the impact
of acquisitions completed during both periods and a development
property placed into service during 2005.
"This quarter, we attained substantial external growth consistent
with our disciplined investment criteria and continued internal growth
in our core business," said Bill Bayless, CEO and president of
American Campus Communities. "In addition to increasing our owned
portfolio by 52 percent through the Royal acquisition, we also
achieved positive same store NOI growth for the sixth consecutive
quarter since our initial public offering."
Portfolio Update
Leasing status for our owned off-campus portfolio is 83 percent
applied for and 78 percent pre-leased for the 2006-2007 academic year
as of April 28, 2006.
Callaway Villas, a 704-bed community in development that we
anticipate will open in the Fall 2006 and serve the students attending
Texas A&M University, is currently 81 percent applied for and 72
percent pre-leased.
Construction continues at The Village at Newark with completion
scheduled for Summer 2007 and occupancy expected to occur in Fall
2007.
The University of New Orleans continues to be an active on-campus
third-party development project. The University is in the process of
obtaining necessary approvals for the financing and commencement of
construction during the summer of 2006.
Supplemental Information and Earnings Conference Call
Supplemental financial and operating information, as well as this
release, are available in the investor relations section of the
American Campus Communities website,
www.americancampuscommunities.com. In addition, the company will host
a conference call to discuss first quarter results and the 2006
outlook on Wednesday, May 3, 2006 at 10 a.m. EST (9:00 a.m. CST). To
participate by telephone, call 866-362-4666 passcode 79852272 at least
five minutes prior to the call.
To listen to the live broadcast, go to
www.americancampuscommunities.com or www.earnings.com at least 15
minutes prior to the call so that required audio software can be
downloaded. Informational slides in the form of the supplemental
analyst package can be accessed via the website. A replay of the
conference call will be available beginning two hours after the end of
the call until May 10, 2006 by dialing 888-286-8010 or 617-801-6888
passcode 60192254. The replay also will be available for 30 days at
www.americancampuscommunities.com and at www.earnings.com. The call
will also be available as a podcast on http://www.REITcafe.com and on
the company's website shortly after the call.
Non-GAAP Financial Measures
As defined by NAREIT, FFO represents income (loss) before
allocation to minority interests (computed in accordance with GAAP),
excluding gains (or losses) from sales of property, plus real estate
related depreciation and amortization (excluding amortization of loan
origination costs) and after adjustments for unconsolidated
partnerships and joint ventures. We present FFO because we consider it
an important supplemental measure of our operating performance and
believe it is frequently used by securities analysts, investors and
other interested parties in the evaluation of REITs, many of which
present FFO when reporting their results. FFO is intended to exclude
GAAP historical cost depreciation and amortization of real estate and
related assets, which assumes that the value of real estate diminishes
ratably over time. Historically, however, real estate values have
risen or fallen with market conditions. Because FFO excludes
depreciation and amortization unique to real estate, gains and losses
from property dispositions and extraordinary items, it provides a
performance measure that, when compared year over year, reflects the
impact to operations from trends in occupancy rates, rental rates,
operating costs, development activities and interest costs, providing
perspective not immediately apparent from net income. We compute FFO
in accordance with standards established by the Board of Governors of
NAREIT in its March 1995 White Paper (as amended in November 1999 and
April 2002), which may differ from the methodology for calculating FFO
utilized by other equity REITs and, accordingly, may not be comparable
to such other REITs. Further, FFO does not represent amounts available
for management's discretionary use because of needed capital
replacement or expansion, debt service obligations or other
commitments and uncertainties. FFO should not be considered as an
alternative to net income (loss) (computed in accordance with GAAP) as
an indicator of our financial performance or to cash flow from
operating activities (computed in accordance with GAAP) as an
indicator of our liquidity, nor is it indicative of funds available to
fund our cash needs, including our ability to pay dividends or make
distributions.
As noted above, FFO excludes GAAP historical cost depreciation and
amortization of real estate and related assets because these GAAP
items assume that the value of real estate diminishes over time.
However, unlike the ownership of our owned off-campus properties, the
unique features of our ownership interest in our on-campus
participating properties cause the value of these properties to
diminish over time. For example, since the ground leases under which
we operate the participating properties require the reinvestment from
operations of specified amounts for capital expenditures and for the
repayment of debt while our interest in these properties terminates
upon the repayment of the debt, such capital expenditures do not
increase the value of the property to us and mortgage debt
amortization only increases the equity of the ground lessor.
Accordingly, when considering our FFO, we believe it is also a
meaningful measure of our performance to modify FFO to exclude the
operations of our on-campus participating properties and to consider
their impact on performance by including only that portion of our
revenues from those properties that are reflective of our share of net
cash flow and the management fees that we receive, both of which
increase and decrease with the operating measure of the properties, a
measure we refer to as FFOM.
The company defines property NOI as property revenues less direct
property operating expenses, excluding depreciation, but including
allocated corporate general and administrative expenses.
About American Campus Communities
American Campus Communities Inc. is one of the largest developers,
owners and managers of high-quality student housing communities in the
United States. The company is a fully integrated, self-managed and
self-administered equity real estate investment trust (REIT) with
expertise in the design, finance, development, construction
management, leasing and management of student housing properties.
American Campus Communities owns and manages a portfolio of 38 student
housing communities containing approximately 22,900 beds. Including
its owned properties, the company provides management and leasing
services at a total of 58 properties with more than 35,600 beds
located on or near college and university campuses. Additional
information is available at www.americancampuscommunities.com.
Forward-Looking Statements
This news release contains forward-looking statements, which
express the current beliefs and expectations of management. Except for
historical information, the matters discussed in this news release are
forward-looking statements and can be identified by the use of the
words "anticipate," "believe," "expect," "intend," "may," "might,"
"plan," "estimate," "project," "should," "will," "result" and similar
expressions. Such statements are based on current expectations and
involve a number of known and unknown risks and uncertainties that
could cause our future results, performance or achievements to differ
significantly from the results, performance or achievements expressed
or implied by such forward-looking statements.
Our actual results could differ materially from those anticipated
in these forward-looking statements as a result of various factors,
including risks and uncertainties inherent in the national economy,
the real estate industry in general, and in our specific markets; the
effect of terrorism or the threat of terrorism; legislative or
regulatory changes including changes to laws governing REITS; our
dependence on key personnel whose continued service is not guaranteed;
availability of qualified acquisition and development targets;
availability of capital and financing; rising interest rates; rising
insurance rates; impact of ad valorem and income taxation; changes in
generally accepted accounting principals; and our continued ability to
successfully lease and operate our properties. While we believe these
forward-looking statements are based on reasonable assumptions, we can
give no assurance that our expectations will be achieved. These
forward-looking statements are made as of the date of this news
release, and we undertake no obligation to update publicly or revise
any forward-looking statement, whether as a result of new information,
future developments or otherwise.
Table 1
American Campus Communities Inc. and Subsidiaries
Consolidated Balance Sheets
(dollars in thousands)
March 31, December 31,
2006 2005
------------ ------------
Assets (unaudited)
Investments in real estate:
Owned off-campus properties, net $676,890 $417,098
On-campus participating properties, net 79,387 80,370
------------ ------------
Investments in real estate, net 756,277 497,468
Cash and cash equivalents 11,025 24,641
Restricted cash 12,609 9,502
Student contracts receivable, net 1,904 2,610
Other assets 20,101 16,641
------------ ------------
Total assets $801,916 $550,862
============ ============
Liabilities and stockholders' equity
Liabilities:
Secured debt $422,597 $291,646
Unsecured revolving credit facility 67,000 --
Accounts payable and accrued expenses 9,807 7,983
Other liabilities 26,294 25,155
------------ ------------
Total liabilities 525,698 324,784
Minority interests 35,011 2,851
Stockholders' equity:
Common stock 172 172
Additional paid in capital 253,432 233,388
Accumulated earnings and dividends (12,999) (10,817)
Accumulated other comprehensive income 602 484
------------ ------------
Total stockholders' equity 241,207 223,227
------------ ------------
Total liabilities and stockholders' equity $801,916 $550,862
============ ============
Table 2
American Campus Communities Inc. and Subsidiaries
Consolidated Statements of Operations
(dollars in thousands, except share and per share data)
Three Months Ended
March 31,
-------------------------
2006 2005
------------ ------------
Revenues: (unaudited)
Owned off-campus properties $19,487 $12,489
On-campus participating properties 5,982 5,493
Third-party development services 1,638 645
Third-party management services 662 710
Resident services 320 204
------------ ------------
Total revenues 28,089 19,541
Operating expenses:
Owned off-campus properties 8,149 5,136
On-campus participating properties 1,950 1,875
Third-party development
and management services 1,638 1,464
General and administrative 1,587 1,364
Depreciation and amortization 5,275 3,424
Ground/facility leases 192 212
------------ ------------
Total operating expenses 18,791 13,475
------------ ------------
Operating income 9,298 6,066
Non-operating income and (expenses):
Interest income 185 58
Interest expense (5,336) (3,808)
Amortization of deferred financing costs (355) (246)
Other non-operating income -- 430
------------ ------------
Total non-operating expenses (5,506) (3,566)
------------ ------------
Income before income taxes, minority
interests, and discontinued operations 3,792 2,500
Income tax provision -- (102)
Minority interests (128) (87)
------------ ------------
Income from continuing operations 3,664 2,311
Discontinued operations:
Loss attributable to discontinued
operations -- (2)
Gain from disposition of real estate -- 5,883
------------ ------------
Total discontinued operations -- 5,881
------------ ------------
Net income $3,664 $8,192
============ ============
Net income per share -- basic and diluted $0.21 $0.65
============ ============
Weighted average common shares outstanding:
Basic 17,209,779 12,622,145
============ ============
Diluted 18,176,189 12,769,939
============ ============
Table 3
American Campus Communities Inc. and Subsidiaries
Calculation of FFO and FFOM
(unaudited, dollars in thousands, except share and per share data)
Three Months Ended
March 31,
-------------------------
2006 2005
------------ ------------
Net income $3,664 $8,192
Minority interests 128 87
Gain from disposition of real estate -- (5,883)
Real estate-related depreciation and
amortization 5,155 3,326
------------ ------------
Funds from operations ("FFO") 8,947 5,722
Elimination of operations from on-campus
participating properties:
Net income from on-campus
participating properties (1,355) (1,310)
Amortization of investment
in on-campus participating properties (1,032) (879)
------------ ------------
6,560 3,533
Modifications to reflect operational
performance of on-campus participating
properties:
Our share of net cash flow(a) 192 212
Management fees 278 263
On-campus participating properties
development fees(b) -- 230
------------ ------------
Impact of on-campus participating
properties 470 705
------------ ------------
Funds from Operations -- modified for
operational performance of on-campus
participating properties ("FFOM") $7,030 $4,238
============ ============
FFO per share -- diluted $0.49 $0.45
============ ============
FFOM per share -- diluted $0.39 $0.33
============ ============
Weighted average common shares outstanding
-- diluted 18,176,189 12,769,939
============ ============
(a) 50 percent of the properties' net cash available for distribution
after payment of operating expenses, debt service (including
repayment of principal) and capital expenditures. Represents
amounts accrued for the interim periods.
(b) Development and construction management fees, including
construction savings earned under the general construction
contract, related to the Cullen Oaks Phase II on-campus
participating property completed in August 2005.
CONTACT: American Campus Communities Inc., Austin
Brian Nickel, 512-732-1000
