EXHIBIT 99.1
ENTERTAINMENT PROPERTIES REPORTS RECORD THIRD QUARTER RESULTS
Kansas City, MO, November 1, 2006 -- Entertainment Properties Trust (NYSE:EPR),
today announced operating results for the third quarter ended September 30,
2006.
Total revenue increased 16% to $48.3 million for the third quarter compared to
$41.8 million for the same quarter in 2005. Net income available to common
shareholders increased 17% to $17.5 million from $14.9 million for the same
quarter last year. Net income on a diluted per common share basis increased 12%
to $0.65 per share from $0.58 per share in the same quarter last year.
Funds from operations (FFO) for the third quarter increased 16% to $25.2 million
from $21.8 million compared to the same quarter last year. FFO per diluted
common share increased 11% to $0.94 per share from $0.85 per share for the same
quarter last year.
For the nine months ended September 30, 2006, total revenue increased 21% to
$145.4 million compared to $120.5 million for the same period in 2005. Net
income available to common shareholders increased 20% to $51.1 million from
$42.5 million for the same period last year. Net income on a diluted per common
share basis increased 16% to $1.93 from $1.67 a year ago. FFO for the nine
months ended September 30, 2006 increased 18% to $73.9 million from $62.7
million a year ago. FFO per diluted common share increased 13% to $2.79 per
share from $2.46 per share for the same period last year.
DIVIDEND INFORMATION
On September 15, 2006, the Company declared a regular quarterly dividend of
$0.6875 per common share, which was paid on October 13, 2006 to common
shareholders of record on September 29, 2006. The third quarter cash dividend
represents an annualized dividend amount of $2.75 per common share and
represents a 10% increase compared to the third quarter last year. The Company
also declared and paid a third quarter cash dividend of $0.59375 per share on
the 9.5% Series A Preferred Shares and a cash dividend of $0.484375 per share on
the 7.75% Series B Preferred Shares issued in January 2005.
CAPITAL MARKETS ACTIVITY
On September 12 and September 14, 2006, the Company obtained non-recourse
mortgage loans totaling $27.8 million. These mortgages are secured by two
theatre properties located in California and one each in South Carolina and
North Carolina. The mortgage loans bear interest at 6.099%, mature on October 1,
2016 and require monthly principal and interest payments totaling $180 thousand
with final principal payments at maturity totaling $21.7 million. The net
proceeds from these loans were used to pay down the Company's unsecured line of
credit.
On September 29, 2006, the Company obtained non-recourse mortgage loans totaling
$20.9 million. These mortgages are secured by three theatre properties located
in Georgia, California and Louisiana. The mortgage loans bear interest at 6.02%,
mature on October 6, 2016 and require monthly principal and interest payments
totaling $135 thousand with final principal payments at maturity totaling $16.2
million. The net proceeds from these loans were used to pay down the Company's
unsecured line of credit.
INVESTMENT ACTIVITY
On August 17, 2006, the Company completed the acquisition of a megaplex theatre
property in Huntsville, Alabama. The Valley Bend 18 is operated by Rave Motion
Pictures and was acquired for a total cost (including land and building) of
approximately $18.3 million. This theatre is leased under a long-term triple-net
lease.
On September 1, 2006, the Company exercised its option to purchase 25 acres of
undeveloped land adjacent to its property in Suffolk, Virginia. The land was
acquired for a total cost of approximately $5.0 million. The Company intends to
develop this property into additional retail space.
During the three months ended September 30, 2006, the Company completed
development of a megaplex theatre property in Winston Salem, North Carolina. The
Grand 18 is operated by Southern Theatres and was completed for a total
development cost (including land and building) of approximately $15.8 million.
The land was purchased in 2005 by the Company for $3.6 million. This theatre is
leased to Southern Theatres under a long-term triple-net lease.
The Company's theatre development pipeline remains strong. As of September 30,
2006, the Company had five theatre development projects under construction for
which it has agreed to either finance the development costs or purchase the
theatre upon completion. These theatres are expected to have a total of 77
screens and their development costs (including land) are expected to be
approximately $75.6 million.
For the nine months ended September 30, 2006, the Company's investments totaled
$115.1 million.
ENTERTAINMENT PROPERTIES TRUST
CONSOLIDATED STATEMENTS OF INCOME
(DOLLARS IN THOUSANDS EXCEPT PER SHARE DATA)
(UNAUDITED)
THREE MONTHS NINE MONTHS
ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30,
----------------- -------------------
2006 2005 2006 2005
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Rental revenue $41,117 $36,942 $124,727 $107,230
Tenant reimbursements 3,857 2,783 10,832 8,853
Other income 737 602 3,020 2,489
Mortgage financing interest 2,629 1,498 6,808 1,969
------- ------- -------- --------
Total revenue 48,340 41,825 145,387 120,541
Property operating expense 4,884 3,835 14,457 11,448
Other operating expense 897 806 2,903 1,969
General and administrative expense 2,253 1,538 10,030 5,575
Costs associated with loan refinancing -- -- 673 --
Interest expense, net 12,234 11,005 35,179 30,766
Depreciation and amortization 7,890 7,011 23,191 20,381
------- ------- -------- --------
Income before gain on sale of land
and income from joint ventures 20,182 17,630 58,954 50,402
Gain on sale of land -- -- 345 --
Equity in income from joint ventures 191 184 566 546
------- ------- -------- --------
Net income $20,373 $17,814 $ 59,865 $ 50,948
Preferred dividend requirements (2,916) (2,916) (8,747) (8,437)
------- ------- -------- --------
Net income available to
common shareholders $17,457 $14,898 $ 51,118 $ 42,511
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Net income per common share:
Basic $ 0.66 $ 0.59 $ 1.96 $ 1.70
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Diluted $ 0.65 $ 0.58 $ 1.93 $ 1.67
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Dividends per common share $0.6875 $0.6250 $ 2.0625 $ 1.8750
======= ======= ======== ========
ENTERTAINMENT PROPERTIES TRUST
RECONCILIATION OF NET INCOME AVAILABLE TO COMMON SHAREHOLDERS TO FUNDS FROM
OPERATIONS (A)
(DOLLARS IN THOUSANDS EXCEPT PER SHARE DATA)
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
------------------ -----------------
2006 2005 2006 2005
------- ------- ------- -------
Net income available to common shareholders $17,457 $14,898 $51,118 $42,511
Add: Real estate depreciation and amortization 7,687 6,844 22,584 20,057
Add: Allocated share of joint venture depreciation 61 61 182 181
------- ------- ------- -------
FFO available to common shareholders 25,205 21,803 73,884 62,749
======= ======= ======= =======
FFO per common share:
Basic $ 0.96 $ 0.87 $ 2.83 $ 2.51
Diluted 0.94 0.85 2.79 2.46
Shares used for computation (in thousands):
Basic 26,298 25,086 26,093 24,995
Diluted 26,769 25,585 26,511 25,482
Other financial information:
Straight-lined rental revenue $ 671 $ 602 $ 1,824 $ 1,647
(A) The National Association of Real Estate Investment Trusts (NAREIT)
developed FFO as a relative non-GAAP financial measure of performance and
liquidity of an equity REIT in order to recognize that income-producing
real estate historically has not depreciated on the basis determined under
GAAP. FFO is a widely used measure of the operating performance of real
estate companies and is provided here as a supplemental measure to
Generally Accepted Accounting Principles (GAAP) net income available to
common shareholders and earnings per share. FFO, as defined under the
revised NAREIT definition and presented by us, is net income available to
common shareholders, computed in accordance with GAAP, excluding gains and
losses from sales of depreciable operating properties, plus real estate
related depreciation and amortization, and after adjustments for
unconsolidated partnerships, joint ventures and other affiliates.
Adjustments for unconsolidated partnerships, joint ventures and other
affiliates are calculated to reflect FFO on the same basis. FFO is a
non-GAAP financial measure. FFO does not represent cash flows from
operations as defined by GAAP and is not indicative that cash flows are
adequate to fund all cash needs and is not to be considered an alternative
to net income or any other GAAP measure as a measurement of the results of
the Company's operations or the Company's cash flows or liquidity as
defined by GAAP.
ENTERTAINMENT PROPERTIES TRUST
CONDENSED CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS)
AS OF AS OF
SEPTEMBER 30, 2006 DECEMBER 31, 2005
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(UNAUDITED)
ASSETS
Rental properties, net $1,355,857 $1,283,988
Property under development 28,776 19,770
Mortgage notes and related accrued interest receivable 68,069 44,067
Investment in joint ventures 2,211 2,297
Cash and cash equivalents 7,675 6,546
Restricted cash 6,114 13,124
Intangible assets, net 10,007 10,461
Deferred financing costs, net 11,077 10,896
Other assets 31,026 23,016
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Total assets $1,520,812 $1,414,165
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LIABILITIES AND SHAREHOLDERS' EQUITY
Common dividends payable $ 18,201 $ 15,770
Preferred dividends payable 2,916 2,916
Unearned rents 445 1,304
Accounts payable and accrued liabilities 8,701 7,928
Long-term debt 766,520 714,591
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Total liabilities 796,783 742,509
Minority interest 4,768 5,235
Shareholders' equity 719,261 666,421
---------- ----------
Total liabilities and shareholders' equity $1,520,812 $1,414,165
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ABOUT ENTERTAINMENT PROPERTIES TRUST
Entertainment Properties Trust is a real estate investment trust (REIT) and is
the largest owner of entertainment real estate in North America, owning megaplex
movie theatre properties, entertainment retail centers and other specialty
properties in metropolitan markets in the U.S. and Canada. Since November of
1997, EPR has acquired more than $1.5 billion of properties. The Company's
common shares of beneficial interest trade on the New York Stock Exchange under
the ticker symbol EPR. Entertainment Properties Trust Company contact: Jon Weis,
30 Pershing Road, Suite 201, Kansas City, Missouri 64108; 888/EPR-REIT; fax:
816/472-5794. The Company website is at www.eprkc.com.
Safe Harbor Statement: This press release includes forward-looking statements as
defined in the Private Securities Litigation Reform Act of 1995, identified by
such words as "will be," "intend," "continue," "believe," "may," "expect,"
"hope," "anticipate," "goal", "forecast" or other comparable terms. The
Company's actual financial condition, results of operations, funds from
operations, or business may vary materially from those contemplated by such
forward-looking statements and involve various risks and uncertainties. A
discussion of the risks and uncertainties that could cause actual results to
differ materially from those forward-looking statements is contained in the
Company's SEC filings, including the Company's annual report on Form 10-K for
the year ended December 31, 2005. Investors are cautioned not to place undue
reliance on any forward-looking statements.