National Retail Properties (NNN) 8-K/A Other events

HISTORICAL FINANCIAL HIGHLIGHTS⁽¹⁾
(dollars in thousands, except per share data)

	2002			2001			2000			1999			1998
		(revised)			(revised)			(revised)			(revised)			(revised)
Gross revenues(2)	$	97,510		$	80,526		$	80,891		$	76,543		$	64,773
Earnings from continuing operations before     cumulative effect of change in accounting     principle		43,078			25,730			35,167			32,901			30,891
Net earnings		48,058			28,963			38,251			35,311			32,441
Total assets		954,108			1,006,628			761,611			749,789			685,595
Total long-term debt		384,589			435,333			360,381			350,971			292,907
Total equity		549,141			564,640			393,901			391,362			383,890
Cash dividends paid to common stockholders		51,178			38,637			37,760			37,495			35,672
Cash dividends paid to preferred stockholders		4,010			-			-			-			-
Weighted average common shares:
Basic		40,383,405			31,539,857			30,387,371			30,331,327			29,169,371
Diluted		40,588,957			31,717,043			30,407,507			30,408,219			29,397,154
Per share information:
Earnings from continuing operations before          cumulative effect of change in accounting          principle:
Basic		0.97			0.82			1.16			1.05			1.03
Diluted		0.97			0.81			1.16			1.05			1.02
Net earnings:
Basic		0.97			0.81			1.16			1.16			1.11
Diluted		1.09			0.91			1.26			1.16			1.10
Dividends paid to common stockholders		1.270			1.260			1.245			1.240			1.230
Dividends paid to preferred stockholders		2.250			-			-			-			-
Other data:
Funds from operations(3)		57,881			44,616			43,949			46,044			42,517
Cash flows provided by (used in):
Operating activities		58,705			38,008			50,198			47,876			41,260
Investing activities		39,983			(24,422	)		(22,372	)		(64,436	)		(145,643	)
Financing activities		(103,925	)		(8,802	)		(28,965	)		18,447			103,665

(1)

In accordance with Financial Accounting Standard Statement No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets” (“SFAS 144”) issued by the Financial Accounting Standards Board, the consolidated statements of earnings have been revised from those originally reported for the years ended December 31, 2002, 2001, 2000, 1999 and 1998 to reflect separately the results of discontinued operations for properties sold during the nine months ended September 30, 2003. The revision had no impact on the consolidated balance sheets, statements of stockholders’ equity or statements of cash flows. The revisions had no impact on net earnings or net earnings per share for the years ended December 31, 2002, 2001, 2000, 1999 and 1998.

(2)

Gross revenues include revenues from the Company’s continuing and discontinued operations. SFAS 144 addresses financial accounting and reporting for the impairment or disposal of long-lived assets and broadens the presentation of discontinued operations in the income statement to include a component of an entity. Accordingly, the results of operations related to these certain properties that have been classified as held for sale or have been disposed of in 2002 have been reclassified to earnings from discontinued operations.

10     thirteen consecutive years of increased dividends

⁽³⁾ Funds From Operations, commonly referred to as FFO, is a relative non-GAAP financial measure of performance and liquidity of an equity REIT in order to recognize that income-producing real estate historically has not depreciated on the basis determined under GAAP. For purposes of the Company, FFO is net earnings excluding depreciation, gains and losses on the disposition of real estate and non-recurring items of income and expense of the Company, 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. FFO does not necessarily represent cash provided by operating activities in accordance with accounting principles generally accepted in the United States of America and should not be considered an alternative to net income 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 is predicated on cash flow analysis. 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 following table reconciles FFO to their most directly comparable GAAP measure, net earnings available to common stockholders for the years ended December 31:

	2002		2001			2000			1999			1998
		(revised)		(revised)			(revised)			(revised)			(revised)
Reconciliation of funds from operations:
Net earnings available to common stockholders	$	44,048	$	28,963		$	38,251		$	35,311		$	32,441
Real estate depreciation and amortization:
Continuing operations		9,728		7,182			7,459			7,150			5,468
Discontinued operations		600		474			379			419			398
Partnership real estate depreciation		479		63			63			64			64
Expenses incurred in acquisition of advisor		-		12,582			1,521			9,824			5,501
Loss (gain) on disposition and impairment              of real estate:
Continuing operations		2,256		(4,648	)		(4,091	)		(6,724	)		(1,355	)
Discontinued operations		770		-			-			-			-
Cumulative effect of change in  ��           accounting principle		-		-			367			-			-
Funds from operations	$	57,881	$	44,616		$	43,949		$	46,044		$	42,517

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