Sizeler Property Investors (SIZ) 8-K Sizeler Property Investors, Inc. Reports Second Quarter 2006 Operating

Exhibit 99.1

Sizeler Property Investors, Inc. Reports Second Quarter 2006 Operating

Results and Declares Quarterly Distributions

NEW ORLEANS, August 7, 2006—Sizeler Property Investors, Inc. (NYSE: SIZ) today announced its operating results for the three-month and six-month periods ended June 30, 2006.

Key Second Quarter Items:

• FFO totaled $5,775,000 or $0.27 per share, before non-ordinary expenses totaling approximately $912,000, for the three-month period ended June 30, 2006, compared to $3,953,000 or $0.20 per share, before non-ordinary expenses totaling approximately $910,000, for the same period a year ago—an increase of approximately 35% on a per share basis.

• After the non-ordinary expenses referred to above, FFO totaled $4,863,000 or $0.23 per share for the three-month period ended June 30, 2006 compared to $3,043,000 or $0.16 per share a year ago—an increase of approximately 44% on a per share basis.

• Equity Market Capitalization reached approximately $345 million at June 30, 2006, up from approximately $272 million at December 31, 2005.

• Administrative costs totaled $931,000 in 2006 compared to $1,693,000 for the same period a year ago.

• Interest coverage in the second quarter of 2006 was 4.30x as compared to 3.40x in the second quarter of 2005.

• Apartment net operating income—on a same property basis—totaled $3,524,000 in 2006 as compared to $3,224,000 in 2005, an increase of approximately 9.3%.

• Retail net operating income—on a same property basis—totaled $4,741,000 in 2006 as compared to $4,430,000 in 2005, an increase of approximately 7%.

• During the second quarter, the Company completed the sale of land in Lake Mary, Florida at a gain of $531,000 and Hammond Square Mall in Hammond, Louisiana at a loss of $5.3 million. The decision to sell Hammond Square Mall was based on market conditions.

• A quarterly distribution of $0.10 per share was declared, and will be paid to Common shareholders of record on August 21, 2006, payable on August 31, 2006.

• A quarterly distribution of $0.609375 per share was declared, and will be paid to the 9.75% Series B Cumulative Redeemable Preferred Stock shareholders of record on October 30, 2006, payable on November 15, 2006.

FOR THE THREE-MONTHS ended June 30, 2006, the Company recorded a net loss of $7,140,000 compared to net income of $15,925,000 for the same period in 2005. The 2006 period included a net loss on the sale of real estate assets of $4,805,000 primarily due to the sale of Hammond Square Mall. The Company also recorded accelerated depreciation expense of $4,258,000 due to the change in expected life for existing improvements as part of a redevelopment project for a new Publix supermarket and Office Depot at Lantana Shopping Center in Palm Beach County, Florida. The 2005 period included a gain on the sale of a real estate asset totaling $15,692,000. In 2006, $7,291,000 of net loss or $0.34 per share was allocated to common shareholders, compared to $15,720,000 of net income or $0.81 per share in the second quarter of 2005. Net income, before the sales of real estate assets and the accelerated charge to depreciation, for the three-month period ended June 30, 2006 totaled $1,923,000 compared to $233,000 a year ago.

Operating revenue from continuing operations totaled $13,134,000 for the three-months ended June 30, 2006, compared to $11,871,000 in the second quarter of 2005, an increase of $1,263,000 or 10.6%. The increase is attributable to an increase in retail revenue, an overall improvement in the level of apartment units leased as well as rents charged on these units, and the addition of The Villages of Williamsburg apartment property to the portfolio.

Operating costs from continuing operations increased approximately $630,000 due to higher real estate taxes, utility costs, costs of property operations and maintenance and due to the addition of the above mentioned property, as compared to 2005.

Administrative expenses were reduced to $931,000 as compared to $1,693,000 for the same period in 2005. This decrease for the quarter is attributable to lower costs for payroll, equipment maintenance, travel and entertainment, and legal and accounting services.

Interest expense decreased to $1,762,000 in 2006 from $2,215,000 in 2005, due primarily to the payoff of the second mortgages held on the apartment properties and the effects of conversion and redemption of approximately $56 million of debentures, partially offset by higher interest rates on our bank lines of credit.

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Non-ordinary expenses incurred during the second quarter ended June 30, 2006 totaled approximately $912,000. These non-ordinary items included:

• $755,000 of restructuring costs primarily composed of legal and financial consulting fees as well as compensation expense incurred due to the expensing of stock options granted in January 2006 in accordance with FAS 123(R).

• $157,000 of hurricane expenses.

This total of $912,000 compares to non-ordinary items included in the 2005 second quarter of $910,000 which consisted primarily of proxy contest costs.

For the three-month period ended June 30, 2006, the results of operations of Hammond Square Mall, sold in May 2006, were classified as discontinued operations and contributed $6,000 to earnings in the second quarter of 2006. For the three-month period ended June 30, 2005, the results of operations of Hammond Square Mall and Bryn Mawr Apartments, sold in May 2005, were classified as discontinued operations and had a net loss of $11,000 in the second quarter of 2005.

Reconciliation of Net Income to Reported FFO

( in thousands)

	Quarter ended June 30,
	2006				2005
	Dollars			Shares (a)	Dollars			Shares (a)
Net Income (Loss)	$	(7,140	)	21,451	$	15,925		19,317
Add (deduct):
Depreciation & Amortization		7,398				3,123
Gain/Loss on sale of Real Estate Assets		4,805				(15,692	)
Preferred Distributions		(151	)			(205	)
Amortization Costs		(49	)			(108	)
Funds from Operations - Available to Common Shareholders	$	4,863		21,451	$	3,043		19,317

(a) Weighted average shares outstanding.

FOR THE SIX-MONTHS ended June 30, 2006, the Company recorded a net loss of $4,430,000 compared to net income of $15,973,000 for the same period in

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2005. The 2006 period included the same items mentioned above regarding a net loss on the sale of real estate assets and an accelerated charge to depreciation totaling $9,063,000. The 2005 period likewise included the gain on the sale of a real estate asset of $15,692,000. In 2006, $4,776,000 of net loss or $0.23 per share was allocated to common shareholders, compared to $15,563,000 of net income or $0.94 per share allocated to common shareholders in the first six months of 2005. Net income, before the sales of real estate assets and the accelerated charge to depreciation, for the six-month period ended June 30, 2006 totaled $4,633,000 compared to $281,000 a year ago.

Operating revenue from continuing operations totaled $26,433,000 for the six-months ended June 30, 2006, compared to $23,717,000 for the first six months of 2005, an increase of $2,716,000 or 11.5%. The increase is attributable to an increase in retail revenue, an overall improvement in the level of apartment units leased as well as rents charged on these units, and the addition of The Villages of Williamsburg apartment property to the portfolio.

Operating costs from continuing operations increased approximately $1,228,000 due to higher costs for utilities, property operations and maintenance and due to the addition of the above mentioned property, as compared to 2005.

Administrative expenses were reduced to $1,754,000 as compared to $3,529,000 for the same period in 2005. This decrease for the six months is attributable to lower costs for payroll, equipment maintenance, travel and entertainment, and legal and accounting services.

Interest expense decreased to $3,694,000 in 2006 from $5,304,000 in 2005 due primarily to the payoff of the second mortgages held on the apartment properties and the effects of conversion and redemption of approximately $56 million of debentures, partially offset by higher interest rates on our bank lines of credit.

Non-ordinary expenses incurred during the first six months of 2006 totaled approximately $1,491,000. These non-ordinary items included:

• $1,146,000 of restructuring costs primarily composed of legal and financial consulting fees as well as compensation expense incurred due to the expensing of stock options granted in January 2006 in accordance with FAS 123 (R).

• $345,000 of hurricane expenses.

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This total of $1,491,000 compares to non-ordinary items for the first six months of 2005 of $1,292,000 which consisted primarily of proxy contest costs.

For the six-month period ended June 30, 2006, the results of operations of Hammond Square Mall were classified as discontinued operations and contributed $188,000 to earnings for the 2006 six-month period. For the six-month period ended June 30, 2005, the results of operations of Hammond Square Mall and Bryn Mawr Apartments were classified as discontinued operations and contributed $291,000 for the six-month period a year ago.

Reconciliation of Net Income to Reported FFO

( in thousands)

	Six-months ended June 30
	2006				2005
	Dollars			Shares (a)	Dollars			Shares (a)
Net Income (Loss)	$	(4,430	)	21,390	$	15,973		16,555
Add (deduct):
Depreciation & Amortization		10,594				6,379
Gain/Loss on sale of Real Estate Assets		4,805				(15,692	)
Preferred Distributions		(346	)			(410	)
Amortizations Costs		(100	)			(328	)
Funds from Operations - Available to Common Shareholders	$	10,523		21,390	$	5,922		16,555

(a) Weighted average shares outstanding.

Segment Results—On a Same Property Basis

The Company has two operating segments—retail and apartments. The table below shows the operating results on a same property basis for the three- and six-months ended June 30, 2006 compared to the same periods in 2005:

(in thousands)

	3-mos. June 30, 2006											3-mos. June 30, 2005
	Retail			Apartments			Other		Total			Retail			Apartments			Other			Total
Oper. Rev.	$	6,786		$	5,929		$	111	$	12,826		$	6,352		$	5,266		$	253		$	11,871
Oper. Exp.		(2,045	)		(2,405	)		—		(4,450	)		(1,922	)		(2,042	)		(14	)		(3,978	)
Oper. Inc.		4,741		$	3,524		$	111	$	8,376		$	4,430		$	3,224		$	239		$	7,893

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(in thousands)

	6-mos. June 30, 2006												6-mos. June 30, 2005
	Retail			Apartments			Other			Total			Retail			Apartments			Other			Total
Oper. Rev.	$	13,958		$	11,668		$	171		$	25,797		$	12,857		$	10,494		$	366		$	23,717
Oper. Exp.		(4,202	)		(4,569	)		(2	)		(8,773	)		(3,780	)		(4,053	)		(23	)		(7,856	)
Oper. Inc.	$	9,756		$	7,099		$	169		$	17,024		$	9,077		$	6,441		$	343		$	15,861

As of June 30, 2006, the apartment and retail portfolios were 98.7% and 95.2% leased, respectively, compared to 94.6% and 88.6% a year ago.

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SIZELER PROPERTY INVESTORS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

	June 30 2006			December 31 2005
	(Unaudited)			(Audited)
ASSETS
Real estate investments:
Land	$	42,664,000		$	46,412,000
Buildings and improvements, net of accumulated depreciation of $109,141,000 in 2006 and $120,301,000 in 2005		204,466,000			222,064,000
Construction in progress		3,283,000			3,192,000
Land held for development or sale		6,757,000			9,657,000
Investment in real estate partnership		931,000			917,000
		258,101,000			282,242,000
Cash and cash equivalents		4,693,000			5,787,000
Accounts receivable and accrued revenue, net of allowance for doubtful accounts of $288,000 in 2006 and $443,000 in 2005		4,264,000			6,904,000
Notes receivable		1,140,000			1,180,000
Prepaid expenses and other assets		5,702,000			6,094,000
Total Assets	$	273,900,000		$	302,207,000
LIABILITIES AND SHAREHOLDERS’ EQUITY
LIABILITIES
Mortgage notes payable	$	82,811,000		$	83,897,000
Bank notes payable		5,300,000			25,995,000
Accounts payable and accrued expenses		6,588,000			5,131,000
Tenant deposits and advance rents		921,000			851,000
Total Liabilities		95,620,000			115,874,000
SHAREHOLDERS’ EQUITY
Series A preferred stock, 40,000 shares authorized, none issued		—			—
Series B preferred stock, par value $0.0001 per share, liquidation preference $25 per share, 2,476,000 shares authorized, issued and outstanding — 247,000 in 2006 and 326,000 in 2005		1,000			1,000
Common stock, par value $0.0001 per share, 51,484,000 shares authorized, shares issued and outstanding — 21,456,000 in 2006 and 21,154,000 in 2005		1,000			1,000
Excess stock, par value $0.0001 per share, 16,000,000 authorized, none issued		—			—
Additional paid-in capital		256,522,000			255,475,000
Accumulated other comprehensive gain		—			55,000
Cumulative net income		68,975,000			73,405,000
Cumulative distributions paid		(147,219,000	)		(142,604,000	)
Total Shareholders’ Equity		178,280,000			186,333,000
Total Liabilities and Shareholders’ Equity	$	273,900,000		$	302,207,000

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SIZELER PROPERTY INVESTORS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

	Three months ended June 30						Six months ended June 30
	2006			2005			2006			2005
OPERATING REVENUE
Contractual rental income and charges	$	12,582,000		$	11,352,000		$	25,372,000		$	22,804,000
Other income		552,000			519,000			1,061,000			913,000
Total Operating Revenue		13,134,000			11,871,000			26,433,000			23,717,000
OPERATING EXPENSES
Real estate taxes		1,017,000			962,000			1,897,000			1,930,000
Utilities		470,000			426,000			933,000			847,000
Operations and maintenance		2,178,000			1,690,000			4,243,000			3,272,000
Other operating expenses		943,000			900,000			2,011,000			1,807,000
Administrative expenses		931,000			1,693,000			1,754,000			3,529,000
Proxy contest expenses		—			847,000			—			1,292,000
Hurricane expenses		157,000			—			345,000			—
Restructuring Costs		755,000			—			1,146,000			—
Depreciation and amortization		7,294,000			2,923,000			10,280,000			5,805,000
Total Operating Expenses		13,745,000			9,441,000			22,609,000			18,482,000
OPERATING INCOME (LOSS)		(611,000	)		2,430,000			3,824,000			5,235,000
Interest expense		1,762,000			2,215,000			3,694,000			5,304,000
Income (loss) from continuing operations before equity in income of partnership, net earnings (losses) from discontinued operations and gain (loss) on sale of real estate		(2,373,000	)		215,000			130,000			(69,000	)
Equity in income of partnership		32,000			29,000			57,000			59,000
Income (loss) from continuing operations before net earnings (losses) from discontinued operations and gain (loss) on sale of real estate		(2,341,000	)		244,000			187,000			(10,000	)
Gain(loss) on sale of real estate		(4,805,000	)		15,692,000			(4,805,000	)		15,692,000
Net earnings (losses) from discontinued real estate operations		6,000			(11,000	)		188,000			291,000
NET INCOME (LOSS)	$	(7,140,000	)	$	15,925,000		$	(4,430,000	)	$	15,973,000
NET INCOME (LOSS) ALLOCATION:
Allocable to preferred shareholders		151,000			205,000			346,000			410,000
Allocable to common shareholders		(7,291,000	)		15,720,000			(4,776,000	)		15,563,000
NET INCOME (LOSS) ALLOCATION:	$	(7,140,000	)	$	15,925,000		$	(4,430,000	)	$	15,973,000
Net income (loss) per common share - basic	$	(0.34	)	$	0.81		$	(0.23	)	$	0.94
Net income (loss)	$	(7,140,000	)	$	15,925,000		$	(4,430,000	)	$	15,973,000
Add (deduct) non cash items:
Depreciation and amort on real estate assets		7,398,000			3,123,000			10,594,000			6,379,000
Deferred financing cost amort		(49,000	)		(108,000	)		(100,000	)		(328,000	)
(Gain) loss on sale of real estate operations		4,805,000			(15,692,000	)		4,805,000			(15,692,000	)
Preferred distributions		(151,000	)		(205,000	)		(346,000	)		(410,000	)
FUNDS FROM OPERATIONS	$	4,863,000		$	3,043,000		$	10,523,000		$	5,922,000
FUNDS FROM OPERATIONS PER SHARE	$	0.23		$	0.16		$	0.49		$	0.36
Weighted average shares outstanding		21,451,000			19,317,000			21,390,000			16,555,000

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FUNDS FROM OPERATIONS

Funds from operations (FFO) is a non-GAAP financial measure. A description of how the Company calculates FFO is contained in the Company’s most recent Annual Report on Form 10-K filed with the SEC, which is available on the Investor Relations page of the Company’s website (www.sizeler.net).

In addition, FFO prior to non-ordinary expenses is a non-GAAP financial measure. Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP and should not be viewed in isolation. The Company’s management refers to these non-GAAP financial measures in making operational decisions because they provide meaningful supplemental information regarding the Company’s operational performance and facilitate management’s internal comparisons to the Company’s historical operating results. In addition, the Company has historically reported similar non-GAAP financial measures to investors and believes that the inclusion of comparative numbers provides consistency in its financial reporting. Investors are encouraged to review the reconciliation of the non-GAAP financial measures used in this press release to their most directly comparable GAAP financial measure.

FORWARD LOOKING STATEMENT

This release made by the Company may contain certain forward-looking statements that are subject to risk and uncertainty. Investors and potential investors in the Company’s securities are cautioned that a number of factors could adversely affect the Company and cause actual results to differ materially from those in the forward-looking statements, including, but not limited to (a) the inability to lease current or future vacant space in the Company’s properties; (b) decisions by tenants and anchor tenants who own their space to close stores at properties; (c) the inability of tenants to pay rent and other expenses; (d) tenant financial difficulties; (e) general economic and world conditions, including threats to the United States homeland from unfriendly factions; (f) decreases in rental rates available from tenants; (g) increases in operating costs at properties;

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(h) increases in corporate operating costs associated with new regulatory requirements; (i) lack of availability of financing for acquisition, development and rehabilitation of properties; (j) force majeure as it relates to construction and renovation projects; (k) possible dispositions of mature properties since the Company is continuously engaged in the examination of the various lines of business; (l) increases in interest rates; (m) a general economic downturn resulting in lower retail sales and causing downward pressure on occupancies and rents at retail properties; (n) forces of nature; (o) the adverse tax consequences if the Company were to fail to qualify as a REIT in any taxable year; and (p) inability of the Company to implement its strategic initiatives for foregoing or other reasons.

Except as required under federal securities laws and the rules and regulations of the SEC, the Company does not have any intention or obligation to update or revise any forward-looking statements in this release or other Company filings with the SEC, whether as a result of new information, future events, changes in assumptions or otherwise, including specifically any statements previously provided with respect to expected operating results or performance.

SOURCE Sizeler Property Investors, Inc.

Thomas A. Masilla, Jr., President of Sizeler Property Investors, Inc.,

504-471-6200

http://www.sizeler.net

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