FOR IMMEDIATE RELEASE
November 9, 2006
Contact: Rosemarie Faccone
or Susan Jordan
732-577-9997
UMH PROPERTIES, INC. REPORTS NINE-MONTH EARNINGS
FREEHOLD, NJ, November 9, 2006........UMH Properties, Inc. (AMEX:UMH) reported net income of $3,635,000 or $0.36 a share for the nine months ended September 30, 2006, as compared to $5,544,000 or $0.59 a share for the nine months ended September 30, 2005.
A summary of significant financial information for the three months and nine months ended September 30, 2006 and 2005 is as follows:
For the Three Months Ended
9/30/06 | 9/30/05 | |||||
Total Revenues | $ | 9,894,000 | $ | 11,248,000 | ||
Total Expenses | $ | 9,659,000 | $ | 9,024,000 | ||
Net Income | $ | 276,000 | $ | 2,260,000 | ||
Net Income per Share | $ | .03 | $ | .24 | ||
FFO (1) | $ | 1,096,000 | $ | 3,062,000 | ||
FFO per Share (1) | $ | .11 | $ | .32 | ||
Weighted Average Shares Outstanding | 10,167,000 | 9,567,000 | ||||
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For the Nine Months Ended
9/30/06 | 9/30/05 | |||||
Total Revenues | $ | 29,750,000 | $ | 29,108,000 | ||
Total Expenses | $ | 26,216,000 | $ | 23,584,000 | ||
Net Income | $ | 3,635,000 | $ | 5,544,000 | ||
Net Income per Share | $ | .36 | $ | .59 | ||
FFO (1) | $ | 6,079,000 | $ | 8,063,000 | ||
FFO per Share (1) | $ | .61 | $ | .86 | ||
Weighted Average Shares Outstanding | 10,039,000 | 9,392,000 | ||||
(1) Non-GAAP Information: Funds from Operations (FFO) is defined as net income excluding gains (or losses) from sales of depreciable assets, plus depreciation. FFO per share is defined as FFO divided by the weighted average shares outstanding. FFO and FFO per share should be considered as supplemental measures of operating performance used by real estate investment trusts (REITs). FFO and FFO per share exclude historical cost depreciation as an expense and may facilitate the comparison of REITs which have different cost bases. The items excluded from FFO and FFO per share are significant components in understanding and assessing the Company’s financial performance. FFO and FFO per share (1) do not represent cash flow from operations as defined by generally accepted accounting principles; (2) should not be considered as alternatives to net income or net income per share as mea sures of operating performance or to cash flows from operating, investing and financing activities; and (3) are not alternatives to cash flow as a measure of liquidity. FFO and FFO per share, as calculated by the Company, may not be comparable to similarly entitled measures reported by other REITs.
The Company’s FFO for the three and nine months ended September 30, 2006 and 2005 is calculated as follows:
Three Months | Nine Months | |||||||
9/30/06 | 9/30/05 | 9/30/06 | 9/30/05 | |||||
Net Income | $276,000 | $2,260,000 | $3,635,000 | $5,544,000 | ||||
Gain on Sales of Depreciable Assets | (41,000) | (36,000) | (100,000) | (21,000) | ||||
Depreciation Expense | 861,000 | 838,000 | 2,544,000 | 2,540,000 | ||||
FFO | $1,096,000 | $3,062,000 | $6,079,000 | $8,063,000 | ||||
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The following are the cash flows provided by (used in) by operating, investing and financing activities for the nine months ended September 30, 2006 and 2005:
9/30/06 | 9/30/05 | |||
Operating Activities | $3,239,000 | $2,427,000 | ||
Investing Activities | (4,051,000) | (9,365,000) | ||
Financing Activities | (3,168,000) | 2,590,000 |
Samuel A. Landy, President, stated, “Income and expense from our securities portfolio, our derivative position and our interest rate swaps are volatile. In 2006, we recorded a loss on sales of securities available for sale of $430,000, as compared to a gain of $1,210,000 for 2005, a decrease of over $1,640,000. This was primarily due to the $823,000 write-down to the carrying value of securities which were considered other than temporarily impaired. The Company also realized a substantial portion of the unrealized gain in the securities portfolio in 2005. The fair value of the Company’s interest rate swaps decreased interest expense by $625,000 in 2005, while only decreasing it by $29,000 in 2006, a swing of almost $600,000.”
Mr. Landy further stated, “Our sales of manufactured homes into our communities have continued to grow, generating increased rental revenue and upgrading our communities. Sales increased almost 20% in 2006 as compared to 2005. UMH is also looking for investment opportunities to enhance our operations. In the first quarter, we purchased a 270-space community in Lebanon, Tennessee. We are in the process of expansions at several of our communities. UMH has substantial cash and borrowing power available should further opportunities arise.”
UMH Properties, Inc., a publicly-owned real estate investment trust, owns and operates twenty-eight manufactured home communities located in New Jersey, New York, Pennsylvania, Ohio and Tennessee. In addition, the Company owns a portfolio of REIT securities.
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