EXHIBIT 99.2
RAMCO-GERSHENSON PROPERTIES TRUST REPORTS RESULTS FOR FIRST QUARTER 2002
Diluted FFO per share of $0.62
SOUTHFIELD, Mich. -- RAMCO-GERSHENSON PROPERTIES TRUST (NYSE:RPT) announced
today results for the first quarter ended March 31, 2002.
For the three months ended March 31, 2002, diluted Funds from Operations (FFO)
were $7,454,000 compared with $7,958,000 for the three months ended March 31,
2001. On a per share basis first quarter results were $0.62 compared with $0.66
in 2001. The decrease in FFO for the quarter is primarily the result of the
major redevelopment of two shopping centers, Tel-Twelve and Lakeland. Both
centers experienced a planned drop in net income, affecting FFO, as the Company
took a substantial portion of the regional and local tenant rentals off line to
make way for national anchor credit tenants. The reduction in FFO also reflects
a reduction in income due to the sale in the first quarter of 2001 of White Lake
MarketPlace and Athens Towne Center.
Income from continuing operations for the three months ended March 31, 2002, was
$2,223,000 compared with $6,081,000 for the three months ended March 31, 2001.
On a diluted earnings per share basis, earnings from continuing operations
decreased from $0.67 in 2001 to $0.20 in 2002. The decrease in earnings is
attributable to the $5.0 million gain on the sale of White Lake and Athens Towne
Center, which occurred in the first quarter of last year.
"Our numbers are in line with expectations and are reflective of significant
changes occurring in our portfolio," said Dennis Gershenson, president and chief
executive officer. "We anticipated a drop in earnings this year as we take
income off line for the de-malling of our Tel-Twelve shopping center and the
expansion and retenanting of Lakeland. These projects demonstrate the Company's
willingness to accept a short-term decrease in FFO in order to achieve a
long-term increase in shareholder value. The income from our new national
tenants will begin to come on line in late 2002 and 2003. "
Asset Management
During the quarter the Company made substantial progress on the de-malling of
its 650,000 square foot Tel-Twelve shopping center in Southfield, Michigan. The
Designer Shoe Warehouse expansion and relocation is nearing completion and the
construction of the new Lowe's Home Improvement store will commence in the
second quarter with completion expected in the second quarter 2003. One retail
outlot building at the shopping center is complete and occupied. A second retail
outlot building is nearing completion.
The Publix Supermarket expansion at Lantana shopping center in Lantana, Florida
is on schedule. A grand re-opening of the center is planned for the fourth
quarter this year. Bed, Bath and Beyond is also currently under construction at
RPT's Jackson Crossing shopping center, with a planned fall opening.
Leasing
Leasing activity continues to be strong throughout the portfolio. In the first
quarter, the Company opened 11 new non-anchor stores, at an average base rent of
$14.14 per square foot, which is 24.5% above portfolio average. The Company also
renewed 40 non-anchor leases at an average increase of 6.9% over prior rental
rates. As of March 31, 2002 the portfolio was 94.0% leased.
Acquisitions/Dispositions
On April 10, 2002, the Company sold Hickory Corners, a 178,000 square foot
community shopping center located in Hickory, North Carolina. Total proceeds
from the sale approximated $10.7 million and will be deployed to pay down debt
and fund future acquisitions and redevelopments. This center was accounted for
as property held for sale at March 31, 2002.
Common Share Offering
The Company intends to issue 3,500,000 shares of common stock through a public
offering. Deutsche Bank Securities, McDonald Investments and Robertson Stephens
are underwriting the offering. Upon completion of the sale, approximately 10.9
million shares of common stock will be outstanding.
The Company intends to use the proceeds from the sale to redeem the Series A
Preferred Shares held by Morgan Stanley Asset Management and its clients and to
acquire the equity of RPT's institutional partner in Rivertowne Square and
Chester Springs shopping centers. The remaining proceeds will be utilized to pay
down the Company's credit facility.
A registration statement relating to these securities has been filed with the
Securities and Exchange Commission but has not yet become effective. These
securities may not be sold nor may offers to buy be accepted prior to the time
the registration statement becomes effective. This release shall not constitute
an offer to sell or the solicitation of an offer to buy nor shall there be any
sale of these securities in any State in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the securities
laws of any such State.
2002 Guidance
On April 8, 2002, the Company revised guidance previously stated to investors in
the third and forth quarter last year regarding the Company's expected funds
from operations (FFO) per share for 2002. The Company currently estimates that
FFO per share for 2002 are expected to be slightly lower, in the range of $2.20
to $2.30 per share. This revision in the estimated range primarily reflects the
greater number of shares expected to be outstanding during the year as a result
of the proposed offering of common stock, and the lag in time between the
closing of the offering and the full deployment of the capital raised for the
Company's operations.
Supplemental financial information is available via e-mail by sending requests
to dhendershot@rgpt.com and is also available at the investor section of our Web
page.
Ramco-Gershenson Properties Trust has a portfolio of 56 shopping centers
totaling approximately 11.2 million square feet of gross leasable area,
consisting of 55 community centers, of which nine are power centers and three
are single tenant properties, as well as one enclosed regional mall. The
Company's centers are located in Michigan, Ohio, Wisconsin, New Jersey,
Maryland, Virginia, North Carolina, South Carolina, Tennessee, Georgia, Alabama
and Florida. Headquartered in Southfield, Michigan, the Company is a fully
integrated, self-administered, publicly-traded real estate investment trust
(REIT) which owns, develops, acquires, manages and leases community shopping
centers, regional malls and single tenant retail properties, nationally.
This press release contains forward-looking statements with respect to the
operation of certain of the Trust's properties. Management of Ramco-Gershenson
believes the expectations reflected in the forward-looking statements made in
this document are based on reasonable assumptions. Certain factors could occur
that might cause actual results to vary. These include general economic
conditions, the strength of key industries in the cities in which the Trust's
properties are located, the performance of the Trust's tenants at the Trust's
properties and elsewhere, and other factors discussed in the Trust's reports
filed with the Securities and Exchange Commission.
RAMCO-GERSHENSON PROPERTIES TRUST
CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
Three Three
Months Months
Ended Ended
3/31/02 3/31/01
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REVENUES
Minimum rents $13,868 $15,032
Percentage rents 522 921
Recoveries from tenants 5,948 5,639
Fees and management income 651 658
Interest and other income 750 934
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Total Revenues 21,739 23,184
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EXPENSES
Real estate taxes 2,572 2,093
Recoverable operating expenses 3,384 3,724
Depreciation and amortization 4,010 3,926
Other operating 312 332
General and administrative 2,051 2,495
Interest expense 6,310 6,957
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Total Expenses 18,639 19,527
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Operating income 3,100 3,657
Earnings from unconsolidated entities 169 75
------------- -------------
Income from continuing operations before gain on
sale of real estate and minority interest 3,269 3,732
Gain on sale of real estate - 5,006
Minority interest (1,046) ( 2,657)
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Income from continuing operations 2,223 6,081
Income from discontinued operations 214 255
------------- -------------
Net income 2,437 6,336
Preferred dividends 828 828
------------- -------------
Net income available to common shareholders $1,609 $5,508
============= =============
Basic earnings per share:
Income from continuing operations $0.20 $0.74
============= =============
Income from discontinued operations $0.03 $0.03
============= =============
Net Income $0.23 $0.77
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Diluted earnings per share:
Income from continuing operations $0.20 $0.67
============= =============
Income from discontinued operations $0.03 $0.02
============= =============
Net Income $0.23 $0.69
============= =============
Weighted average shares outstanding:
Basic 7,089 7,121
============= =============
Diluted 7,146 9,124
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RAMCO-GERSHENSON PROPERTIES TRUST
CALCULATION OF FUNDS FROM OPERATIONS(1)
(In thousands, except per share data)
(Unaudited)
Three Three
Months Months
Ended Ended
3/31/02 3/31/01
------------- -------------
Net Income $2,437 $6,336
Add:
Depreciation and amortization expense 3,971 3,982
Minority Interest in partnership 1,046 2,657
Less:
Gain on sale of property(2) - 5,017
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Funds from Operations-diluted 7,454 7,958
Less:
Preferred share dividends 828 828
------------- -------------
Funds from Operations-basic $6,626 $7,130
============= =============
Funds from Operations per share:
Diluted $0.62 $0.66
============= =============
Basic $0.66 $0.71
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Basic weighted average shares outstanding(3) 10,034 10,066
Convertible Preferred shares and options 2,057 2,003
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Diluted weighted average shares outstanding(4) 12,091 12,069
============= =============
RAMCO-GERSHENSON PROPERTIES TRUST
CONSOLIDATED BALANCE SHEETS
(In thousands)
March 31, December 31,
2002 2001
------------------ --------------------
ASSETS (unaudited)
Investment in real estate, net $497,370 $496,269
Cash and cash equivalents 5,062 5,542
Accounts receivable, net 17,287 17,627
Equity investments in and advances to unconsolidated entities 12,986 12,977
Other assets, net 20,394 20,314
Property held for sale 7,210 ---
---------------- ---------------
Total Assets $560,309 $552,729
================ ===============
LIABILITIES AND SHAREHOLDERS' EQUITY
Mortgages and notes payable $355,488 $347,275
Distributions payable 5,043 5,062
Accounts payable and accrued expenses 18,985 18,830
---------------- ---------------
Total Liabilities 379,516 371,167
Minority Interest 47,853 48,157
Commitments and Contingencies --- ---
Shareholders' Equity 132,940 133,405
---------------- ---------------
Total Liabilities and Shareholders' Equity $560,309 $552,729
================ ===============
(1) Management generally consider funds from operations, also known as "FFO,"
an appropriate supplemental measure of our financial performance because it
is predicated on cash flow analyses. We have adopted the most recent
National Association of Real Estate Investment Trusts ("NAREIT") definition
of FFO, which was amended on April 4, 2002, to reflect the adoption that
FFO from income-producing property held for sale, sold or otherwise
transferred and reported in income from discontinued operations, should be
included in FFO. Under the NAREIT definition, FFO represents income before
minority interest, excluding extraordinary items, as defined under
accounting principles generally accepted in the United States of America,
gains on sales of depreciable property, plus real estate related
depreciation and amortization (excluding amortization of financing costs),
and after adjustments for unconsolidated partnerships and joint ventures.
Our computation of FFO may, however, differ from the methodology for
calculating FFO utilized by other real estate companies, and therefore, may
not be comparable to these other real estate companies. FFO should not be
considered an alternative to net income as an indication of our performance
or to cash flows as a measure of liquidity or our ability to pay
distributions.
FFO does not represent cash generated from operating activities in
accordance with generally accepted accounting principles and should not be
considered an alternative to net income as an indication of the Trust's
performance or to cash flows from operating activities as a measure of
liquidity or the ability to pay distributions. Furthermore, while net
income and cash generated from operating, investing and financing
activities, determined in accordance with generally accepted accounting
principles, consider capital expenditures which have been and will be
incurred in the future, the calculation of FFO does not.
(2) Excludes loss on sale of undepreciated land of $11.
(3) Represents the weighted average total shares outstanding, assuming the
redemption of all operating partnership units for common shares.
(4) Represents the weighted average total shares outstanding, assuming the
redemption of all operating partnership units for common shares, the
conversion of convertible preferred shares to common shares, and dilutive
stock options.
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For more information on Ramco-Gershenson Properties Trust visit our
Website @ www.ramcogershenson.com