EXHIBIT 99.1
RELEASE: IMMEDIATE
GETTY REALTY CORP. ANNOUNCES
FINANCIAL RESULTS FOR THE QUARTER AND SIX MONTHS
ENDED JUNE 30, 2005
JERICHO, NY, AUGUST 1, 2005 --- Getty Realty Corp. (NYSE-GTY) today
reported its financial results for the quarter and six months ended June 30,
2005.
Net earnings were $10.2 million for the quarter and $21.7 million for the
six months ended June 30, 2005, as compared with $9.4 million and $18.5 million
for the respective prior year periods. Net earnings increased by $0.8 million,
or 9.0%, for the quarter and by $3.1 million, or 16.9%, for the six months ended
June 30, 2005 over the comparable periods in 2004.
The increases in net earnings resulted from the properties acquired in
November 2004 and March 2005, and rent escalations, which generated additional
revenue from rental properties that was partially offset by additional
depreciation and amortization and interest expenses. The increases in net
earnings were also due to reductions in environmental expenses of $0.4 million
for the quarter and $2.1 million for the six month period ended June 30, 2005 as
compared to the prior year periods.
Funds from operations, or FFO, increased $1.2 million to $12.3 million for
the quarter and $3.6 million to $25.6 million for the six months ended June 30,
2005, as compared to the respective prior year periods.
Adjusted funds from operations, or AFFO, increased $1.4 million to $11.3
million for the quarter and $3.9 million to $23.7 million for the six months
ended June 30, 2005 as compared to the prior year quarter and six month periods.
The increases in FFO and AFFO were principally due to the increases in net
earnings described above. AFFO increased more than FFO on both a dollar and
percentage basis due to a decrease in deferred rental revenues (which are
included in net earnings and FFO but excluded from AFFO) of $0.1 million for the
quarter and $0.3 million for the six months ended June 30, 2005 as compared to
the prior year periods. 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.
Earnings per share increased $0.03 per share to $0.41 per share for the
quarter and $0.13 per share to $0.88 per share for the six months ended June 30,
2005, as compared to the prior year periods. For the quarter ended June 30,
2005, FFO per share increased $0.05 per share to $0.50 per share and AFFO per
share increased $0.06 per share to $0.46 per share as compared to the prior year
period. FFO per share increased $0.15 per share to $1.04 per share and AFFO per
share increased $0.16 per share to $0.96 per share for the six months ended June
30, 2005 as compared to the prior year period.
Revenues from rental properties were $17.9 million for the quarter and
$35.3 million for the six months ended June 30, 2005 as compared to $16.4
million and $33.0 million for the respective prior year periods. Rent received
for the quarter was $16.9 million and $33.4 million for the six months ended
June 30, 2005 as compared with $15.3 million for the quarter and $30.7
million for the six month period ended in 2004. The increase in rent received
was primarily due to rental income from the properties acquired in November 2004
and March 2005 and rent escalations, and was partially offset by the effect of
lease terminations and property dispositions. In addition to rent received,
revenues from rental properties include deferred rental revenues accrued due to
recognition of rental income on a straight-line basis of $1.0 million for the
quarter and $1.9 million for the six months ended June 30, 2005 as compared to
$1.1 million and $2.2 million for the respective prior year periods.
Environmental expenses, net of estimated recoveries, were $1.3 million for
the quarter and $1.4 million for the six months ended June 30, 2005, which
decreased by $0.4 million for the quarter and by $2.1 million for the six month
period as compared to $1.8 million recorded for the prior year quarter and $3.5
million recorded for prior year six month period. The decreases were due to
reduced environmental litigation expense and related legal fees which decreased
by $0.6 million for the quarter and by $1.5 million for the six months ended
June 30, 2005 and smaller net changes in estimated environmental costs and
accretion expenses, which decreased by $0.6 million as compared to the prior six
month period.
Depreciation and amortization expense was $2.1 million for the quarter and
$4.0 million for the six month period ended June 30, 2005, as compared to $1.8
million and $3.7 million for the respective prior year periods. The increase was
due to depreciation and amortization on properties acquired in November 2004 and
March 2005 partially offset by property dispositions.
Interest expense, principally related to borrowings under lines of credit
used to acquire properties in November 2004 and March 2005, was $0.5 million for
the quarter and $0.6 million for the six months ended June 30, 2005 and was
insignificant in the prior year periods.
Getty Realty's Second Quarter Earnings Conference Call is scheduled for
tomorrow, Tuesday, August 2, 2005 at 9:00 a.m. Eastern Time. To participate in
the conference call, please dial 719-457-2653 five to ten minutes before the
scheduled start time and reference pass code 8385496. If you cannot participate
in the live event, a replay will be available beginning on August 2, 2005 at
noon though midnight, August 5, 2005. To access the replay, please dial
719-457-0820 and reference pass code 8385496.
Getty Realty Corp. is the largest publicly-traded real estate investment
trust in the United States specializing in ownership and leasing of motor
fuel/convenience store properties and petroleum distribution terminals. The
Company owns and leases over 1,050 properties in the Eastern United States.
CERTAIN STATEMENTS IN THIS NEWS RELEASE MAY CONSTITUTE "FORWARD LOOKING
STATEMENTS" WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT
OF 1995. WHEN THE WORDS "BELIEVES", "EXPECTS", "PLANS", "PROJECTS", "ESTIMATES"
AND SIMILAR EXPRESSIONS ARE USED IN THIS RELEASE, THEY IDENTIFY FORWARD-LOOKING
STATEMENTS. THESE FORWARD-
LOOKING STATEMENTS ARE BASED ON MANAGEMENT'S CURRENT BELIEFS AND ASSUMPTIONS AND
INFORMATION CURRENTLY AVAILABLE TO MANAGEMENT AND INVOLVE KNOWN AND UNKNOWN
RISKS (INCLUDING THE RISKS THAT ARE DESCRIBED FROM TIME TO TIME IN THE COMPANY'S
FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION), 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 THESE FORWARD-LOOKING STATEMENTS. GETTY
UNDERTAKES NO OBLIGATION TO PUBLICLY RELEASE REVISIONS TO THESE FORWARD-LOOKING
STATEMENTS THAT REFLECT FUTURE EVENTS OR CIRCUMSTANCES OR THE OCCURRENCE OF
UNANTICIPATED EVENTS.
-more-
GETTY REALTY CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
(unaudited)
June 30, December 31,
-------- ------------
2005 2004
-------- ------------
Assets:
Real Estate:
Land $172,096 $156,571
Buildings and improvements 199,529 190,019
-------- --------
371,625 346,590
Less - accumulated depreciation and amortization (106,654) (106,463)
-------- --------
Real estate, net 264,971 240,127
Deferred rent receivable 27,002 25,117
Cash and equivalents 651 15,700
Recoveries from state underground storage tank funds, net 4,977 5,437
Mortgages and accounts receivable, net 3,761 3,961
Prepaid expenses and other assets 1,478 386
-------- --------
Total assets $302,840 $290,728
======== ========
Liabilities and Shareholders' Equity:
Debt $ 37,938 $ 24,509
Environmental remediation costs 20,317 20,626
Dividends payable 10,761 10,495
Accounts payable and accrued expenses 7,819 9,595
-------- --------
Total liabilities 76,835 65,225
-------- --------
Commitments and contingencies
Shareholders' equity:
Common stock, par value $.01 per share; authorized
50,000,000 shares; issued
24,714,766 at June 30, 2005
and 24,694,071 at December 31, 2004 247 247
Paid-in capital 257,668 257,295
Dividends paid in excess of earnings (31,910) (32,039)
-------- --------
Total shareholders' equity 226,005 225,503
-------- --------
Total liabilities and shareholders' equity $302,840 $290,728
======== ========
GETTY REALTY CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
Three months ended Six months ended
June 30, June 30,
------------------ -----------------
2005 2004 2005 2004
------- ------- ------- -------
Revenues from rental properties $17,872 $16,443 $35,268 $32,954
Expenses:
Rental property expenses 2,560 2,487 5,184 5,008
Environmental expenses, net 1,348 1,783 1,411 3,515
General and administrative expenses 1,289 1,255 2,600 2,632
Depreciation and amortization expense 2,065 1,828 4,014 3,664
------- ------- ------- -------
Total expenses 7,262 7,353 13,209 14,819
------- ------- ------- -------
Operating income 10,610 9,090 22,059 18,135
Other income, net 55 296 191 429
Interest expense (451) (19) (600) (40)
------- ------- ------- -------
Net earnings $10,214 $ 9,367 $21,650 $18,524
======= ======= ======= =======
Net earnings per common share:
Basic $ .41 $ .38 $ .88 $ .75
Diluted $ .41 $ .38 $ .88 $ .75
Weighted average shares outstanding:
Basic 24,714 24,680 24,707 24,675
Diluted 24,728 24,713 24,721 24,715
Dividends declared per share: $ .435 $ .425 $ .870 $ .850
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 Six months ended
June 30, June 30,
------------------ ----------------
2005 2004 2005 2004
------- ------- ------- -------
Net earnings $10,214 $ 9,367 $21,650 18,524
Depreciation and amortization expense 2,065 1,828 4,014 3,664
Gains on sales of real estate - (146) (72) (146)
------- ------- ------- -------
Funds from operations 12,279 11,049 25,592 22,042
Deferred rental revenue
(straight-line rent) (985) (1,115) (1,885) (2,231)
------- ------- ------- -------
Adjusted funds from operations $11,294 $ 9,934 $23,707 $19,811
======= ======= ======= =======
Diluted per common share amounts:
Earnings per share $ .41 $ .38 $ .88 $ .75
Funds from operations per share $ .50 $ .45 $ 1.04 $ .89
Adjusted funds from operations
per share $ .46 $ .40 $ .96 $ .80
Diluted weighted average
shares outstanding 24,728 24,713 24,721 24,715
IN ADDITION TO MEASUREMENTS DEFINED BY GENERALLY ACCEPTED ACCOUNTING PRINCIPLES
("GAAP"), GETTY ALSO FOCUSES ON FUNDS FROM OPERATIONS ("FFO") AND ADJUSTED FUNDS
FROM OPERATIONS ("AFFO") TO MEASURE ITS PERFORMANCE. FFO IS GENERALLY CONSIDERED
TO BE AN APPROPRIATE SUPPLEMENTAL NON-GAAP MEASURE OF THE PERFORMANCE OF REITS.
FFO IS DEFINED BY THE NATIONAL ASSOCIATION OF REAL ESTATE INVESTMENT TRUSTS AS
NET EARNINGS BEFORE DEPRECIATION AND AMORTIZATION, GAINS OR LOSSES ON SALES OF
REAL ESTATE, NON-FFO ITEMS REPORTED IN DISCONTINUED OPERATIONS AND EXTRAORDINARY
ITEMS. OTHER REITS MAY USE DEFINITIONS OF FFO AND OR AFFO THAT ARE DIFFERENT
THAN GETTY'S AND, ACCORDINGLY, MAY NOT BE COMPARABLE.
GETTY BELIEVES THAT FFO IS HELPFUL TO INVESTORS IN MEASURING ITS PERFORMANCE
BECAUSE FFO EXCLUDES VARIOUS ITEMS INCLUDED IN GAAP NET EARNINGS THAT DO NOT
RELATE TO, OR ARE NOT INDICATIVE OF, GETTY'S FUNDAMENTAL OPERATING PERFORMANCE
SUCH AS GAINS OR LOSSES FROM PROPERTY SALES AND DEPRECIATION AND AMORTIZATION.
IN GETTY'S CASE, HOWEVER, GAAP NET EARNINGS AND FFO INCLUDE THE SIGNIFICANT
IMPACT OF DEFERRED RENTAL REVENUE (STRAIGHT-LINE RENT) ON ITS RECOGNITION OF
REVENUES FROM RENTAL PROPERTIES, WHICH RESULTS FROM FIXED RENTAL INCREASES
SCHEDULED UNDER CERTAIN LEASES WITH ITS TENANTS. IN ACCORDANCE WITH GAAP, THE
AGGREGATE MINIMUM RENT DUE OVER THE INITIAL TERM OF THESE LEASES IS RECOGNIZED
ON A STRAIGHT-LINE BASIS RATHER THAN WHEN DUE. AS A RESULT, GETTY PAYS
PARTICULAR ATTENTION TO AFFO, A SUPPLEMENTAL NON-GAAP PERFORMANCE MEASURE THAT
GETTY DEFINES AS FFO LESS STRAIGHT-LINE RENT. IN GETTY'S VIEW, AFFO PROVIDES A
MORE ACCURATE DEPICTION OF THE IMPACT OF SCHEDULED RENT INCREASES UNDER THESE
LEASES THAN FFO. NEITHER FFO NOR AFFO REPRESENT CASH GENERATED FROM OPERATING
ACTIVITIES CALCULATED IN ACCORDANCE WITH GAAP AND THEREFORE SHOULD NOT BE
CONSIDERED AN ALTERNATIVE FOR GAAP NET EARNINGS OR AS A MEASURE OF LIQUIDITY.
Contact: Thomas J. Stirnweis
(516) 478-5403