EXHIBIT 99.1
RELEASE: IMMEDIATE
GETTY REALTY CORP. ANNOUNCES
FINANCIAL RESULTS FOR THE QUARTER
ENDED MARCH 31, 2004
JERICHO, NY, APRIL 27, 2004 --- Getty Realty Corp. (NYSE-GTY) today
reported the Company's financial results for the quarter ended March 31, 2004.
Our net earnings were $9.2 million for the quarter ended March 31,
2004, an increase of $0.6 million, or 7.0%, over the comparable period in 2003
principally due to the impact of the $0.6 million one-time accounting charge
recorded in the quarter ended March 31, 2003. FFO increased $1.2 million, or
11.6%, to $11.0 million for the quarter ended March 31, 2004 principally due to
the elimination of $1.3 million in quarterly preferred stock dividends as a
result of the conversion and redemption of our then outstanding convertible
preferred stock in September 2003. AFFO increased $1.4 million, or 17.0%, to
$9.9 million in the quarter ended March 31, 2004. AFFO increased more than FFO
on both a dollar and percentage basis due to $0.3 million in lower deferred
rental revenues (which are included in FFO, but excluded from AFFO) recorded for
the quarter ended March 31, 2004 as compared to the quarter ended March 31,
2003.
Diluted earnings per common share for the quarter ended March 31, 2004
increased 8.8% to $0.37 per share, as compared to $0.34 per share for the
quarter ended March 31, 2003. FFO per common share remained flat at $0.45 per
share in both periods, while AFFO per common share increased 2.6% to $0.40 per
share as compared to $0.39 per share in the 2003 period. All diluted per common
share amounts reflect the impact of the conversion and redemption of our then
outstanding convertible preferred stock in September 2003, except for diluted
earnings per common share for the quarter ended March 31, 2003, where the impact
of the conversion was anti-dilutive. FFO and AFFO are supplemental non-GAAP
measures of the performance of real estate investment trusts and are defined and
reconciled to net earnings in the financial tables at the end of this release.
Revenues from rental properties for the quarter ended March 31, 2004
were $16.5 million as compared to $16.7 million for the comparable prior year
period. Rent received for the quarter ended March 31, 2004 was $15.4 million as
compared with $15.3 million for the comparable prior year period. In addition to
rent received, revenues from rental properties include deferred rental revenue
accrued due to recognition of rental income on a straight-line basis of $1.1
million for the quarter ended March 31, 2004 and $1.4 million for the comparable
prior year period. Deferred rental revenue is included in net earnings and FFO
but is excluded from AFFO.
Rental property expenses, which include rent expense, were $2.5 million
for the quarter ended March 31, 2004, a decrease of $0.4 million from the
quarter ended March 31, 2003. The decrease was primarily due to a reduction in
annual rent expense of $1.3 million as a result
of the exercise of lease purchase options, including the purchase of 41 leased
properties in May 2003 for a purchase price of $13.0 million.
Environmental expenses, net of estimated recoveries, for the quarter
ended March 31, 2004 were $1.7 million as compared to $1.5 million for the
comparable prior year period. The increase was primarily due to $0.3 million of
higher legal fees incurred in the current period partially offset by a decrease
in net change in estimated environmental costs of $0.2 million. We adopted
Statement of Financial Standard No. 143 and changed our method used to account
for estimated environmental costs effective January 1, 2003, which resulted in a
one-time charge of $0.6 million that was recorded during the quarter ended March
31, 2003, and is included in cumulative effect of accounting change in the
consolidated statements of operations.
Depreciation and amortization for the quarter ended March 31, 2004 was
$1.8 million, a decrease of $0.3 million compared to the prior period, as a
result of certain assets becoming fully depreciated and dispositions of
properties.
Getty Realty's First Quarter Earnings Conference Call is scheduled for
tomorrow, Wednesday, April 28, 2004 at 9:00 a.m. Eastern Time. To participate in
the conference call, please dial 1-719-457-2604 five to ten minutes before the
scheduled start time and reference pass code 149339. If you cannot participate
in the live event, a replay will be available beginning on April 28, 2004 at
noon though midnight, May 1, 2004. To access the replay, please dial
1-719-457-0820 and reference passcode 149339.
Getty Realty Corp. is a real estate investment trust specializing in the
ownership and leasing of retail motor fuel, convenience store properties and
petroleum distribution terminals. The Company owns and leases approximately
1,000 properties in the Eastern United States.
Certain statements in this news release may constitute "forward looking
statements" within the meaning of Private Securities Litigation Reform Act of
1995. When used herein, the words "believes", "expects", "plans", "projects",
"estimates" and similar expressions are intended to identify forward-looking
statements. Such forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results, performance
and achievements of the Company to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements.
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GETTY REALTY CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
Three months
ended March 31,
----------------------------
2004 2003
-------- --------
Revenues:
Revenues from rental properties $ 16,511 $ 16,677
Other income, net 133 354
-------- --------
Total revenues 16,644 17,031
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Expenses:
Rental property expenses 2,521 2,912
Environmental expenses, net 1,732 1,547
General and administrative expenses 1,377 1,293
Depreciation expense 1,836 2,139
Interest expense 21 33
-------- --------
Total expenses 7,487 7,924
-------- --------
Net earnings before cumulative effect of accounting change 9,157 9,107
Cumulative effect of accounting change -- (550)
-------- --------
Net earnings 9,157 8,557
Preferred stock dividends -- 1,272
-------- --------
Net earnings applicable to common shareholders $ 9,157 $ 7,285
======== ========
Net earnings per common share:
Basic $ .37 $ .34
Diluted $ .37 $ .34
Weighted average common shares outstanding:
Basic 24,671 21,442
Diluted 24,689 21,456
Dividends declared per share:
Preferred -- $ .44375
Common $ .4250 $ .41250
GETTY REALTY CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
(unaudited)
March 31, December 31,
Assets: 2004 2003
- ---------------------------------- --------- ------------
Real Estate:
Land $ 143,354 $ 142,724
Buildings and improvements 175,482 175,498
--------- ---------
318,836 318,222
Less - accumulated depreciation (101,606) (100,488)
--------- ---------
Real estate, net 217,230 217,734
Cash and equivalents 18,703 19,905
Deferred rent receivable 21,769 20,653
Recoveries from state underground storage tank funds, net 7,247 7,454
Mortgages and accounts receivable, net 4,973 5,565
Prepaid expenses and other assets 484 692
--------- ---------
Total assets $ 270,406 $ 272,003
========= =========
Liabilities and Shareholders' Equity:
Environmental remediation costs $ 23,385 $ 23,551
Dividends payable 10,489 10,483
Accounts payable and accrued expenses 8,887 9,100
Mortgages payable 823 844
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Total liabilities 43,584 43,978
--------- ---------
Commitments and contingencies
Shareholders' equity:
Common stock, par value $.01 per share; authorized
50,000,000 shares; issued
24,679,662 at March 31, 2004 and
24,664,384 at December 31, 2003 247 247
Paid-in capital 257,335 257,206
Dividends paid in excess of earnings (30,760) (29,428)
--------- ---------
Total shareholders' equity 226,822 228,025
--------- ---------
Total liabilities and shareholders' equity $ 270,406 $ 272,003
========= =========
GETTY REALTY CORP. AND SUBSIDIARIES
RECONCILIATION OF NET EARNINGS TO
FUNDS FROM OPERATIONS AND
ADJUSTED FUNDS FROM OPERATIONS
(in thousands, except per share amounts)
(unaudited)
Three months
ended March 31,
----------------------------
2004 2003
-------- --------
Net earnings $ 9,157 $ 8,557
Preferred stock dividends -- (1,272)
-------- --------
Net earnings applicable to common
shareholders 9,157 7,285
Depreciation expense 1,836 2,139
Gains on sales of real estate -- (126)
Cumulative effect of accounting change -- 550
-------- --------
Funds from operations 10,993 9,848
Straight-line rent (1,116) (1,408)
-------- --------
Adjusted funds from operations $ 9,877 $ 8,440
======== ========
Diluted per common share amounts (a):
Earnings per share $ .37 $ .34
Funds from operations per share $ .45 $ .45
Adjusted funds from operations per share $ .40 $ .39
Diluted weighted average number of common shares outstanding:
Used to calculate net earnings per share 24,689 21,456
Assumed conversion of preferred shares -- 3,242
-------- --------
Used to calculate funds from operations
and adjusted funds from operations per
common share 24,689 24,698
======== ========
(a) Diluted earnings, funds from operations ("FFO") and adjusted funds from
operations ("AFFO") per common share are computed by dividing net earnings
applicable to common shareholders, FFO and AFFO, respectively, by the diluted
weighted average number of common share equivalents outstanding during the
period. Diluted FFO and AFFO per share give effect, for the quarter ended March
31, 2003, to the dilution from the conversion of Series A Participating
Convertible Redeemable Preferred Stock into common stock utilizing the two class
method. Accordingly, for the quarter ended March 31, 2003, preferred stock
dividends are added back to FFO and AFFO, which sums are then divided by the
diluted weighted average number of common share equivalents outstanding for the
period. There were no preferred shares outstanding during the quarter ended
March 31, 2004.
FUNDS FROM OPERATIONS ("FFO") IS GENERALLY CONSIDERED TO BE AN
APPROPRIATE SUPPLEMENTAL NON-GAAP MEASURE OF THE PERFORMANCE OF REAL ESTATE
INVESTMENT TRUSTS. IN ACCORDANCE WITH THE NATIONAL ASSOCIATION OF REAL ESTATE
INVESTMENT TRUSTS' DEFINITION, FFO IS DEFINED AS NET EARNINGS APPLICABLE TO
COMMON SHAREHOLDERS BEFORE DEPRECIATION AND AMORTIZATION, GAINS OR LOSSES ON
SALES OF REAL ESTATE, DISCONTINUED OPERATIONS, EXTRAORDINARY ITEMS AND
CUMULATIVE EFFECT OF ACCOUNTING CHANGE. ADJUSTED FUNDS FROM OPERATIONS ("AFFO")
IS A SUPPLEMENTAL NON-GAAP MEASURE THAT WE DEFINE AS FFO LESS STRAIGHT-LINE
RENT. AFFO IS A MEANINGFUL SUPPLEMENTAL MEASURE OF PERFORMANCE DUE TO THE
SIGNIFICANT IMPACT OF STRAIGHT-LINE RENT ON OUR NET EARNINGS AND FFO. NEITHER
FFO NOR AFFO REPRESENTS CASH GENERATED FROM OPERATING ACTIVITIES IN ACCORDANCE
WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES AND THEREFORE SHOULD NOT BE
CONSIDERED AN ALTERNATIVE FOR NET INCOME OR AS A MEASURE OF LIQUIDITY.
Contact: Thomas J. Stirnweis
(516) 478-5403
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