Exhbiit 99
ENTERTAINMENT PROPERTIES REPORTS RECORD FIRST QUARTER RESULTS
Kansas City, MO, May 5, 2004, -- Entertainment Properties Trust (NYSE:EPR),
today reported financial results for the first quarter ended March 31, 2004. The
Company reported record first quarter revenues, net income and funds from
operations (FFO).
Total revenues increased 31% to $27.6 million for the first quarter of 2004 as
compared to $21.0 million for the same quarter in 2003. Net income available to
common shareholders increased 37% to $10 million as compared to $7.3 million in
the same quarter last year. Net income on a diluted per share basis increased
17% to $0.49 per share from $0.42 per share in the same quarter last year.
FFO on a fully diluted basis increased 36% to $15.5 million from $11.3 million
for the same quarter last year. Fully diluted FFO per share increased 18% to
$0.73 per share from $0.62 per share for the same quarter last year.
As previously announced, the Company's Board of Trustees declared a cash
dividend of $0.5625 per common share for the first quarter, payable on April 15,
2004 to shareholders of record on March 31, 2004. This represents an annual rate
of $2.25 per common share representing an increase of 12.5% compared to the
previous year. This was the Company's sixth consecutive annual dividend increase
since its first full year of operations in 1998. The Company's Board of Trustees
also declared a regular quarterly dividend of $0.59375 per series A Cumulative
Redeemable Preferred Share for the first quarter, payable on April 15, 2004 to
shareholders of record on March 31, 2004.
Earnings Guidance
Based on the Company's investment and financing activity, management is raising
its previously issued 2004 FFO guidance to a range of $3.05 to $3.15 per diluted
share from the previous range of $3.00 - $3.10 per diluted share. The increase
in guidance takes into account management's expectations for the timing of
additional real estate investments during the year, the addition of
straight-line rents associated with the recently acquired Entertainment Retail
Centers and the costs of debt facility changes.
Investment Activity
As previously announced the Company completed approximately $219 million in real
estate acquisitions during the first quarter. In March 2004, the Company
acquired four Megaplex theatre anchored retail centers in Canada which include
approximately 890,000 square feet of retail and entertainment space. On March
30, 2004, the Company completed the acquisition of three megaplex theatres in a
sale leaseback transaction with American Multi-Cinema (AMC). The theatres are
leased to AMC under 20 year triple-net leases.
Financing Activity
On March 29, 2004 the Company completed an amendment to its existing secured
revolving credit facility with Fleet Bank. Significant changes under the amended
facility include an increase to $150 million, extension of the term of the
facility to three years plus a one year extension, and improved pricing based on
LIBOR plus a grid-range of 175 basis points to 250 basis points. The amended
facility is syndicated to a group of nine lenders. At March 31, 2004 the Company
had $20 million outstanding under the Fleet Bank facility.
During April the Company repaid and terminated its $75 million secured credit
facility with iStar Financial. As a result of terminating the iStar facility the
Company will record a non-cash charge in the second quarter of approximately
$730,000 representing the write-off of deferred loan fees related to the
facility and a pre-payment charge of approximately $400,000. Proceeds from
borrowings under the amended Fleet credit facility were used to repay the iStar
facility. As of March 31, 2004, the Company had $20 million outstanding under
the iStar facility.
On March 1, 2004 we completed our second general partnership joint venture with
Atlantic of Hamburg, Germany. The Company contributed the AMC Tampa Veterans 24
screen theatre together with a related $14.6 million mortgage loan to the
partnership in exchange for a 20% interest in the partnership and $8.2 million
in cash. The Company originally
purchased the AMC Tampa Veterans theatre in 2003. The Company accounts for its
interest in the joint venture under the equity method of accounting.
On March 29, 2004 the Company obtained an unsecured $64.2 million term loan for
the purpose of acquiring three theatres in a sale-leaseback transaction with
AMC. Royal Bank of Canada and JP Morgan Chase Bank were Co-lenders in the
acquisition term loan facility. As of March 31, 2004 the $64.2 million term loan
was outstanding and included in the Company's total debt.
On April 20, 2004, the Company completed the sale of 2,250,000 common shares in
a public offering priced to the public at $33.00 per share. The underwriters
subsequently exercised the over-allotment option of 337,500 shares for a total
issuance of 2,587,500 shares. Of the total $81.7 million in net proceeds, $64.2
million was used to repay the unsecured acquisition related term loan debt and
the remainder was used to pay down borrowings under the amended Fleet credit
facility.
In conjunction with the Canadian property acquisitions completed for
approximately $152 million in March 2004, approximately USD$27 million of the
purchase price was paid in the form of 747,243 restricted common shares of EPR
valued at USD$36.25 per share. In addition, the Company received Canadian-dollar
non-recourse fixed rate loans provided by GMAC commercial mortgage of Canada,
Limited, in the aggregate amount of approximately USD$97 million.
ENTERTAINMENT PROPERTIES TRUST
Unaudited Financial Data
(in thousands except per share data)
Three months ended
March 31,
2004 2003
--------------- ---------------
Rental revenue $27,539 $20,458
Other income 72 587
--------------- ---------------
Total Income 27,611 21,045
Property operating expense 641 95
General and administrative expense, excluding amortization
of non-vested shares below 1,120 856
Interest expense, net 8,818 7,234
Depreciation and amortization 5,060 3,687
Amortization of non-vested shares 340 231
--------------- ---------------
Income before gain on sale of real estate, income from joint ventures, and
minority interest 11,632 8,942
Equity in income from joint ventures 128 91
Minority interest (430) (375)
--------------- ---------------
Net income $11,330 $8,658
Preferred dividend requirements (1,366) (1,366)
--------------- ---------------
Net income available to common shareholders $9,964 $7,292
=============== ===============
Basic net income per common share $0.50 $0.43
Diluted net income per common share $0.49 $0.42
ENTERTAINMENT PROPERTIES TRUST
Reconciliation of Net Income Available to Common Shareholders
to Funds From Operations (A)
(in thousands except per share data)
Three months ended
March 31,
FUNDS FROM OPERATIONS: 2004 2003
--------------- ---------------
Net income available to common shareholders $ 9,964 $ 7,292
Add: Real estate depreciation 5,013 3,641
Add: Share of joint ventures depreciation 42 32
--------------- ---------------
Basic funds from operations $15,019 $10,965
--------------- ---------------
Add: minority interest in net income 430 375
--------------- ---------------
Diluted funds from operations $15,449 $11,340
=============== ===============
FFO per common share: Basic $0.76 $0.64
Diluted $0.73 $0.62
Shares used for computation (in thousands): Basic 19,735 17,074
Diluted 21,184 18,274
Other financial information:
Straight-lined rental revenue $ 369 $ -
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, 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
(in thousands)
AS OF AS OF
MARCH 31, 2004 DECEMBER 31, 2003
-------------- -----------------
ASSETS
Rental properties, net $1,046,071 $870,944
Land held for development 47,121 29,152
Investment in joint ventures 2,689 1,336
Cash and cash equivalents 31,784 30,527
Restricted cash 6,495 6,495
Other assets 30,167 27,464
-------------- -----------------
Total assets $1,164,327 $965,918
-------------- -----------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Common dividends payable $ 11,512 $ 9,829
Preferred dividends payable 1,366 1,366
Unearned rent 2,281 895
Other liabilities 9,108 2,864
Long term debt 669,997 506,555
-------------- -----------------
Total liabilities 694,264 521,509
Minority interest 21,179 21,630
Shareholders' equity 448,884 422,779
-------------- -----------------
Total liabilities and shareholders' $1,164,327 $965,918
equity ============== =================
About Entertainment Properties Trust
Entertainment Properties Trust is the only publicly traded real estate
investment trust (REIT) focused on the acquisition of high-quality real estate
assets leased to leading location-based entertainment operators. Since November
of 1997, EPR has acquired more than $1 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 W. 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," or other comparable terms. The Company's actual financial
condition, results of operations and funds from operations may vary materially
from those contemplated by such forward-looking statements. A discussion of the
factors 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, 2003
and its prospectus filed under Rule 424(b) of the SEC on April 21, 2004.