Exhibit 99.1
[GRAPHIC OMITTED]
RE: LEXINGTON CORPORATE PROPERTIES TRUST
ONE PENN PLAZA
SUITE 4015
NEW YORK, NY 10119
FOR FURTHER INFORMATION:
AT THE COMPANY: AT FINANCIAL RELATIONS BOARD:
Patrick Carroll Diane Hettwer Tim Grace
Chief Financial Officer Analyst Inquiries Media Inquiries
(212) 692-7200 (312) 640-6760 (312) 640-6667
FOR IMMEDIATE RELEASE
TUESDAY, MARCH 1, 2005
LEXINGTON CORPORATE PROPERTIES TRUST ANNOUNCES
FOURTH QUARTER AND TWELVE MONTH RESULTS
New York, NY - March 1, 2005- Lexington Corporate Properties Trust (NYSE:LXP)
("Lexington"), a real estate investment trust, today announced results for its
fourth quarter and twelve months ended December 31, 2004.
2004 and Recent Highlights
- --------------------------
o Acquired 44 properties for an aggregate investment of $935 million at a
GAAP cap rate of 8.9%, including $502 million in joint ventures;
o Sold eight non-core properties for $7.0 million in excess of book value;
o Expanded equity base by approximately $295 million by issuing common and
preferred shares;
o Increased institutional equity committed to joint ventures by
approximately $145 million;
o Obtained $369.9 million of non-recourse mortgage financing at a weighted
average fixed interest rate of 5.49% - lowering overall fixed rate
borrowing costs from 7.08% to 6.58% for consolidated properties;
o Extended leases on ten properties;
o Raised dividend to annual rate of $1.44 per common share, the twelfth
consecutive annual increase; and
o Generated total shareholder return of 18.8%.
Quarterly Results
Funds from operations were $18.5 million, or $0.34 per diluted share/unit, for
the fourth quarter of 2004, after the impact of $3.6 million in impairment
charges (including minority interest share of $0.9 million) ($0.07 per diluted
share/unit) and $2.9 million in charges due to a tenant bankruptcy ($0.05 per
diluted share/unit). This compares to $19.7 million, or $0.45 per diluted
share/unit, for the fourth quarter of 2003. Lexington operated with greater cash
balances and vacancy than in the prior year and this limited growth in FFO per
share before the effect of the charges discussed above.
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Rental revenue for the quarter totaled $36.5 million, compared to rental revenue
of $28.2 million for the same period last year. Net income allocable to common
shareholders was $4.9 million in the fourth quarter of 2004, after the impact of
the impairment charges and the charges relating to a tenant bankruptcy discussed
above, and $1.4 million in gains on sale of properties, or $0.10 per diluted
share/unit. This is compared to $10.9 million, after the impact of debt
satisfaction gains and $1.0 million on gains on sale of properties, or $0.28 per
diluted share/unit, for the same period last year.
Twelve Months Results
For the twelve months ended December 31, 2004, FFO were $83.6 million, or $1.60
per diluted share/unit, after the impact of $6.7 million in impairment charges
(including minority interest share of $1.3 million) ($0.13 per diluted
share/unit) and $2.9 million in charges due to a tenant bankruptcy ($0.06 per
diluted share/unit). This compares to $64.5 million, or $1.63 per diluted
share/unit net of $7.5 million in debt satisfaction charges, ($0.19 per diluted
share/unit), for the same period last year. Lexington operated with greater cash
balances and vacancy during 2004 which reduced FFO per share excluding the
charges previously discussed.
Rental revenue for the twelve months ended December 31, 2004, totaled $140.0
million, compared to rental revenue of $105.1 million for the same period last
year. Net income allocable to common shareholders was $37.9 million for the
twelve months ended December 31, 2004, after the impairment charges and the
charges relating to a tenant bankruptcy discussed above and $5.5 million in
gains on sale of properties, or $0.80 per diluted share/unit, compared to $30.3
million, after the impact of debt satisfaction charges discussed above and $2.2
million in gains on sale of properties, or $0.88 per diluted share/unit, for the
same period last year.
Conference Call
Management will discuss the financial results on a conference call today at 2:00
p.m. Eastern Time. The toll-free dial in number is 800-218-0204. The replay of
the call will be available through March 8, 2005. The toll-free telephone number
for the replay is 800-405-2236, passcode 11022822. The conference call can also
be accessed on the internet at www.lxp.com and www.fulldisclosure.com. A
supplemental reporting package can be accessed at www.lxp.com.
Comments From Management
Commenting on Lexington's financial results, T. Wilson Eglin, Chief Executive
Officer said, "Lexington had numerous accomplishments in 2004. We acquired
forty-four properties for $935 million - our busiest year of acquisition volume
by a wide margin. We continued to build our balance sheet to support further
growth by raising $295 million of equity on terms that we believe were very
favorable for shareholders. We also established a third joint venture investment
program and obtained $145 million of equity commitments to our joint venture
programs. Lexington took advantage of an attractive interest rate environment in
2004 and obtained $369.9 million of non-recourse mortgage financing at a
weighted average fixed interest rate of 5.49%. This had the effect of lowering
our overall fixed rate borrowing costs by fifty basis points and reducing
floating rate debt by $94 million to less than 2% of total debt. In addition, we
continued to make good progress on the leasing front by extending leases on ten
properties and ended the year with 98.1% occupancy. We also sold eight
properties consistent with our objective of reducing our retail property
portfolio and exiting smaller markets."
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Lexington Corporate Properties Trust is a real estate investment trust that owns
and manages office, industrial and retail properties net-leased to major
corporations throughout the United States and provides investment advisory and
asset management services to investors in the net lease area. Lexington common
shares closed Monday, February 28, 2005 at $22.02 per share. Lexington pays an
annualized dividend of $1.44 per share. Additional information about Lexington
is available at www.lxp.com.
Lexington believes that funds from operations ("FFO") enhances an investor's
understanding of Lexington's financial condition, results of operations and cash
flows. Lexington believes that FFO is an appropriate, but limited, measure of
the performance of an equity REIT. FFO is defined in the April 2002 "White
Paper" issued by the National Association of Real Estate Investment Trusts, Inc.
("NAREIT") as "net income (or loss) computed in accordance with generally
accepted accounting principles ("GAAP"), excluding gains (or losses) from sales
of property, plus real estate depreciation and amortization and after
adjustments for unconsolidated partnerships and joint ventures." FFO should not
be considered an alternative to net income as an indicator of operating
performance or to cash flows from operating activities as determined in
accordance with GAAP, or as a measure of liquidity to other consolidated income
or cash flow statement data as determined in accordance with GAAP.
This release contains certain forward-looking statements which involve known and
unknown risks, uncertainties or other factors not under Lexington's control
which may cause actual results, performance or achievements of Lexington to be
materially different from the results, performance, or other expectations
implied by these forward-looking statements. These factors include, but are not
limited to, (i) the failure to continue to qualify as a real estate investment
trust, (ii) changes in general business and economic conditions, (iii)
competition, (iv) increases in real estate construction costs, (v) changes in
interest rates, (vi) changes in accessibility of debt and equity capital
markets, and (vii) those other factors and risks detailed in Lexington's
periodic filings with the Securities and Exchange Commission. Forward-looking
statements, which are based on certain assumptions and describe the Company's
future plans, strategies and expectations, are generally identifiable by use of
the words "believes," "expects," "intends," "anticipates," "estimates,"
"projects" or similar expressions. Lexington undertakes no obligation to
publicly release the results of any revisions to those forward-looking
statements which may be made to reflect events or circumstances after the
occurrence of unanticipated events. Accordingly, there is no assurance that
Lexington's expectations will be realized.
Financial Tables Follow
- -----------------------
This release contains certain forward-looking statements which involve known and
unknown risks, uncertainties or other factors not under the Company's control
which may cause actual results, performance or achievements of the Company to be
materially different from the results, performance, or other expectations
implied by these forward-looking statements. These factors include, but are not
limited to, those detailed in the Company's periodic filings with the Securities
and Exchange Commission.
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LEXINGTON CORPORATE PROPERTIES TRUST
AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except per share data)
Three Months Twelve Months
Ended Ended
December 31, December 31,
2004 2003 2004 2003
---- ---- ---- ----
Gross revenues:
Rental $ 36,452 $ 28,160 $ 140,003 $ 105,057
Advisory fees 1,710 739 4,885 1,429
Tenant reimbursements 2,068 1,059 6,337 4,498
----------- ----------- ----------- -----------
Total gross revenues 40,230 29,958 151,225 110,984
Expense applicable to revenues:
Depreciation and amortization (12,106) (6,856) (38,930) (25,623)
Property operating (3,269) (2,084) (10,451) (8,107)
General and administrative (3,933) (2,646) (13,939) (9,659)
Write off - tenant bankruptcy (2,884) - (2,884) -
Non-operating income 711 160 3,276 1,442
Interest and amortization expense (12,230) (8,430) (46,437) (35,793)
Debt satisfaction charges - 226 - (7,459)
----------- ----------- ----------- ------------
Income before (provision) benefit for income 6,519 10,328 41,860 25,785
taxes, minority interests and equity in
earnings of joint ventures
(Provision) benefit for income taxes 635 17 (1,181) (259)
Minority interests (693) (1,272) (4,196) (3,569)
Equity in earnings of joint ventures 1,811 1,551 7,194 5,707
----------- ----------- ----------- -----------
Income from continuing operations 8,272 10,624 43,677 27,664
----------- ----------- ----------- -----------
Discontinued operations, net of minority interest:
Income from discontinued operations 38 770 1,102 3,794
Impairment charges (2,671) - (5,447) -
Gains on sales of properties 1,410 1,047 5,475 2,191
----------- ----------- ----------- -----------
Total discontinued operations (1,223) 1,817 1,130 5,985
------------ ----------- ----------- -----------
Net income 7,049 12,441 44,807 33,649
Dividends attributable to preferred shares
- - Series B (1,590) (1,590) (6,360) (3,392)
Dividends attributable to preferred shares
- - Series C (585) - (585) -
----------- ----------- ------------ -----------
Net income allocable to common shareholders $ 4,874 $ 10,851 $ 37,862 $ 30,257
Depreciation and amortization 12,020 7,304 39,894 27,634
Minority interests - OP Units (311) 1,334 2,570 4,039
Amortization of leasing commissions 98 206 647 812
Joint venture adjustment - depreciation 2,658 1,084 7,559 3,951
Preferred share dividend - Series C 585 - 585 -
Gains on sales of properties (1,410) (1,047) (5,475) (2,191)
------------ ------------ ------------ ------------
Funds from operations2 $ 18,514 $ 19,732 $ 83,642 $ 64,502
=========== =========== =========== ===========
Rent below GAAP revenue1 $ 414 $ 772 $ 3,350 $ 3,790
Per share/unit
Basic net income $ 0.10 $ 0.28 $ 0.81 $ 0.89
Diluted net income $ 0.10 $ 0.28 $ 0.80 $ 0.88
Funds from operations2-basic $ 0.34 $ 0.45 $ 1.60 $ 1.64
Funds from operations2-diluted $ 0.34 $ 0.45 $ 1.60 $ 1.63
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AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(dollars in thousands)
12/31/04 12/31/03
-------- --------
Real estate, at cost $ 1,407,872 $ 1,162,395
Accumulated depreciation (180,610) (160,623)
Investment in joint ventures 132,738 69,225
Properties held for sale - discontinued 13,216 36,478
operations
Intangible assets, net 54,736 14,736
Cash and cash equivalents 146,957 15,923
Deferred expenses, net 7,860 10,013
Rent receivable 4,123 -
Rent receivable - deferred 23,923 24,069
Due from affiliates 45,800 -
Other assets 40,472 35,195
---------------- ----------------
$ 1,697,087 $ 1,207,411
================ ================
Mortgages and notes payable $ 765,144 $ 551,385
Liabilities - discontinued operations 1,688 -
Other liabilities 22,388 10,667
Prepaid rent 3,818 2,482
Minority interests 56,759 59,220
Shareholders' equity 847,290 583,657
---------------- ----------------
$ 1,697,087 $ 1,207,411
================ ================
Common shares 48,621,273 40,682,001
Preferred shares - Series B 3,160,000 3,160,000
Preferred shares - Series C 2,700,000 -
Operating partnership units 5,408,699 5,430,454
---------------- ----------------
59,889,972 49,272,455
================ ================
1 Equal to the difference between rents collected and straight-line rental
income recognized under generally accepted accounting principles.
2 The Company believes that Funds From Operations ("FFO") enhances an
investor's understanding of the Company's financial condition, results of
operations and cash flows. The Company believes that FFO is an appropriate,
but limited, measure of the performance of an equity REIT. FFO is defined in
the October 1999 "White Paper" issued by the National Association of Real
Estate Investment Trusts, Inc. ("NAREIT") as "net income (or loss) computed
in accordance with generally accepted accounting principles ("GAAP"),
excluding gains (or losses) from sales of property, plus real estate
depreciation and amortization and after adjustments for unconsolidated
partnerships and joint ventures." FFO should not be considered an
alternative to net income as an indicator of operating performance or to
cash flows from operating activities as determined in accordance with GAAP,
or as a measure of liquidity to other consolidated income or cash flow
statement data as determined in accordance with GAAP.
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AND CONSOLIDATED SUBSIDIARIES
EARNINGS PER SHARE
AND FUNDS FROM OPERATIONS PER SHARE
(dollars in thousands, except per share data)
Three Months Ended Twelve Months Ended
December 31, December 31,
2004 2003 2004 2003
---- ---- ---- ----
Earning Per Share
- -----------------
Basic
Income from continuing operations $ 8,272 $ 10,624 $ 43,677 $ 27,664
Less preferred dividends (2,175) (1,590) (6,945) (3,392)
---------- ---------- ---------- ----------
Income allocable to common shareholders from
continuing operations - basic 6,097 9,034 36,732 24,272
Total income (loss) from discontinued
operations - basic (1,223) 1,817 1,130 5,985
---------- ---------- ---------- ----------
Net income allocable to common shareholders $ 4,874 $ 10,851 $ 37,862 $ 30,257
========== ========== ========== ==========
Weighted average number of common shares
outstanding 48,092,092 38,513,927 46,551,328 34,074,935
========== ========== ========== ==========
Per share data:
Income from continuing operations $ 0.13 $ 0.23 $ 0.79 $ 0.71
Income from discontinued operations (0.03) 0.05 0.02 0.18
---------- ---------- ---------- ----------
Net income $ 0.10 $ 0.28 $ 0.81 $ 0.89
========== ========== ========== ==========
Diluted
Income allocable to common shareholders from
continuing operations - basic $ 6,097 $ 9,034 $ 36,732 $ 24,272
Adjustments:
Incremental income attributed to assumed
conversion of dilutive securities - - 4,192 3,569
---------- ---------- ---------- ----------
Income allocable to common shareholders from
continuing operations - diluted 6,097 9,034 40,924 27,841
Total income (loss) from discontinued operations
- diluted (1,223) 1,817 691 6,899
---------- ---------- ---------- ----------
Net income allocable to common shareholders
- diluted $ 4,874 $ 10,851 $ 41,615 $ 34,740
========== ========== ========== ==========
Weighted average number of shares used in
calculation of basic earnings per share 48,092,092 38,513,927 46,551,328 34,074,935
Add incremental shares representing:
Shares issuable upon exercises of
employee share options 126,179 218,824 131,415 202,504
Shares issuable upon conversion of
dilutive securities - - 5,366,166 5,216,433
---------- ---------- ---------- ----------
Weighted average number of shares used in
calculation of diluted earnings per common share 48,218,271 38,732,751 52,048,909 39,493,872
========== ========== ========== ==========
Per share data:
Income from continuing operations - diluted $ 0.13 $ 0.23 $ 0.79 $ 0.70
Income (loss) from discontinued operations
- diluted (0.03) 0.05 0.01 0.18
---------- ---------- ---------- ----------
Net income diluted $ 0.10 $ 0.28 $ 0.80 $ 0.88
========== ========== ========== ==========
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AND CONSOLIDATED SUBSIDIARIES
EARNINGS PER SHARE
AND FUNDS FROM OPERATIONS PER SHARE
(dollars in thousands, except per share data)
Three Months Ended Twelve Months Ended
December 31, December 31,
2004 2003 2004 2003
---- ---- ---- ----
Funds From Operations
- ---------------------
Basic and Diluted
- -----------------
Net income allocable to common shareholders
Adjustments: $ 4,874 $ 10,851 $ 37,862 $ 30,257
Depreciation and amortization 12,020 7,304 39,894 27,634
Minority interests-OP Units (311) 1,334 2,570 4,039
Amortization of leasing commissions 98 206 647 812
Joint venture adjustment-depreciation 2,658 1,084 7,559 3,951
Preferred dividends-Series C 585 - 585 -
Gains on sale of properties (1,410) (1,047) (5,475) (2,191)
------------ ------------ ------------ ------------
Funds from operations $ 18,514 $ 19,732 $ 83,642 $ 64,502
============ ============ ============ ============
Basic
- -----
Weighted average shares outstanding-basic EPS 48,092,092 38,513,927 46,551,328 34,074,935
Operating partnership units 5,390,583 5,201,210 5,366,166 5,216,433
Preferred shares - Series C 1,313,116 - 330,073 -
------------ ------------ ------------ ------------
Weighted average shares outstanding-basic FFO 54,795,791 43,715,137 52,247,567 39,291,368
============ ============ ============ ============
FFO per share $ 0.34 $ 0.45 $ 1.60 $ 1.64
============ ============ ============ ============
Diluted
- -------
Weighted average shares outstanding-diluted EPS 48,218,271 38,732,751 52,048,909 39,493,872
Operating partnership units 5,390,583 5,201,210 - -
Preferred shares - Series C 1,313,116 - 330,073 -
------------ ------------ ------------ ------------
Weighted average shares outstanding-diluted FFO 54,921,970 43,933,961 52,378,982 39,493,872
============ ============ ============ ============
FFO per share $ 0.34 $ 0.45 $ 1.60 $ 1.63
============ ============ ============ ============
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