Exhibit 99.1
[FINANCIAL RELATIONS BOARD LOGO]
[news LOGO]
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 Claire Koeneman Tim Grace
Chief Financial Officer Analyst Inquiries Media Inquiries
(212) 692-7200 (312) 640-6745 (312) 640-6667
FOR IMMEDIATE RELEASE
TUESDAY NOVEMBER 1, 2005
LEXINGTON CORPORATE PROPERTIES TRUST ANNOUNCES
THIRD QUARTER RESULTS
New York, NY - November 1, 2005 - Lexington Corporate Properties Trust
(NYSE:LXP) ("Lexington"), a real estate investment trust, today announced
results for its third quarter ending September 30, 2005.
Third Quarter Highlights
- ------------------------
o 11.4% increase in FFO per share;
o Acquired four properties (three in joint ventures) for $85.1 million
at a GAAP cap rate of 7.7%;
o Sold two non-core properties (one in a joint venture) for an aggregate
$6.8 million in excess of aggregate book value and provided $11.1
million in secured financing at 5.16%;
o Expanded equity base by approximately $60.7 million by issuing common
shares;
o Obtained an aggregate $105.6 million of non-recourse mortgage
financings secured by eight properties at a weighted average fixed
interest rate of 5.16%; and
o Extended/entered into new leases on six properties.
Quarterly Results
Funds from operations ("FFO") were $30.2 million or $0.49 per diluted common
share/unit, net of $0.2 million in impairment charges and $0.7 million in debt
satisfaction charges recognized in a joint venture aggregating $0.01 per diluted
common share/unit, for the third quarter of 2005. This compares to $23.6
million, or $0.44 per diluted common share/unit, net of $0.6 million in
impairment charges or $0.01 per diluted common share/unit, for the third quarter
of 2004.
Rental revenues for the quarter totaled $51.0 million, compared to rental
revenues of $35.1 million for the same period last year. Net income allocable to
common shareholders was $4.9 million in the third quarter of 2005, or $0.08 per
diluted common share/unit, after $1.6 million in gains on sale of properties and
$0.2 million in impairment charges. This compares to $9.6 million, or $0.19 per
diluted common share/unit, after the impact of $0.6 million impairment charges
for the same period last year.
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Net income allocable to common shareholders in 2005 has been impacted by the
convertible preferred share offering completed by Lexington in the fourth
quarter of 2004.
Nine Month Results
For the nine months ended September 30, 2005, FFO were $87.4 million, or $1.44
per diluted common share/unit, after $3.9 million in net debt satisfaction gains
including $0.7 million in debt satisfaction charges recognized by a joint
venture, or $0.06 per diluted common share/unit and $0.9 million in aggregate
impairment charges or $0.02 per diluted common share/unit, compared to $65.1
million, or $1.26 per diluted common share/unit, after $3.1 million in aggregate
impairment charges or $0.06 per diluted common share/unit, for the same period
last year.
Rental revenues for the nine months ended September 30, 2005, totaled $133.3
million, compared to rental revenues of $99.9 million for the same period last
year. Net income allocable to common shareholders for the nine months ended
September 30, 2005 was $22.1 million or $0.41 per diluted common share/unit,
after $6.7 million of gains on sales of properties, $3.9 million in net debt
satisfaction gains, including $0.7 million in debt satisfaction charges
recognized by a joint venture, and $0.8 million of net impairment charges
compared to $33.0 million or $0.71 per diluted common share/unit, after $2.8
million in impairment charges and $4.1 million of gains on sales of properties,
for the same period last year. Net income allocable to common shareholders in
2005 has been impacted by the convertible preferred share offering completed by
Lexington in the fourth quarter of 2004.
Conference Call
Management will discuss the financial results and Lexington's business plan on a
conference call today at 2:00 p.m. Eastern time. The toll-free dial-in number is
800-218-8862. A replay of the conference call will be available through November
8, 2005. The toll-free telephone number for the replay is 800-405-2236, passcode
11040866. International callers can access the conference call by dialing
303-262-2140 and the replay by dialing 303-590-3000 (same passcode). The
conference call can also be accessed on the internet at http://www.lxp.com.
Comments From Management
Commenting on Lexington's financial results, T. Wilson Eglin, Chief Executive
Officer said, "Lexington's funds from operations for the quarter were $0.49 per
share after the impact of an impairment charge and a debt satisfaction charge
associated with a property sale aggregating $0.01 per share. This represents an
11.4% increase compared to the third quarter last year. We made good progress on
the leasing front with six leases signed during the third quarter which brings
our total for the year to thirteen. A key factor driving our strong improvement
in operating results has been our acquisition activity, which totals over $1.0
billion for 2005 after we acquired four properties for $85.1 million in the
third quarter."
Mr. Eglin added, "The acquisition environment has become even more competitive
as the year has progressed and we expect that our investment activity will slow
considerably until conditions change. In fact, we are likely to become a much
more active seller of properties in our portfolio in order to take advantage of
current valuations. The combination of greater disposition activity and fewer
acquisitions will impact our FFO per share, which we believe will be $0.47 -
$0.49 per share in the fourth quarter of 2005. While this is lower than our
previous expectations, we can't help but note the obvious: property valuations
are extremely high and it is clearly a seller's market."
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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, October 31, 2005 at $21.78 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
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LEXINGTON CORPORATE PROPERTIES TRUST
AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(dollars in thousands, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
2005 2004 2005 2004
---- ---- ---- ----
Gross revenues:
Rental $ 51,023 $ 35,066 $ 133,309 $ 99,925
Advisory fees 995 1,448 4,186 3,174
Tenant reimbursements 4,213 1,293 7,207 3,958
---------- ---------- ---------- ----------
Total gross revenues 56,231 37,807 144,702 107,057
Expense applicable to revenues:
Depreciation and amortization (20,600) (10,909) (50,322) (27,411)
Property operating (7,929) (2,906) (15,978) (7,704)
General and administrative (4,164) (3,987) (13,175) (9,997)
Non-operating income 337 1,807 1,189 2,563
Interest and amortization expense (18,597) (12,344) (47,264) (33,550)
Debt satisfaction gains, net -- -- 4,632 --
---------- ---------- ---------- ----------
Income before (provision) benefit for income taxes, minority
interests, equity in earnings of non-consolidated entities
and discontinued operations 5,278 9,468 23,784 30,958
(Provision) benefit for income taxes 111 (350) 44 (1,817)
Minority interests (791) (673) (3,002) (2,740)
Equity in earnings of non-consolidated entities 2,328 1,862 5,087 5,383
---------- ---------- ---------- ----------
Income from continuing operations 6,926 10,307 25,913 31,784
---------- ---------- ---------- ----------
Discontinued operations, net of minority interest:
Income from discontinued operations 656 1,418 2,676 4,684
Impairment charges (207) (562) (800) (2,775)
Gains on sales of properties 1,595 -- 6,656 4,065
---------- ---------- ---------- ----------
Total discontinued operations 2,044 856 8,532 5,974
---------- ---------- ---------- ----------
Net income 8,970 11,163 34,445 37,758
Dividends attributable to preferred shares - Series B (1,590) (1,590) (4,770) (4,770)
Dividends attributable to preferred shares - Series C (2,519) -- (7,556) --
----------- ---------- ----------- ----------
Net income allocable to common shareholders $ 4,861 $ 9,573 $ 22,119 $ 32,988
========== ========== ========== ==========
Funds from operations(1) $ 30,213 $ 23,571 $ 87,354 $ 65,128
========== ========== ========== ==========
Per share/unit
Basic net income $ 0.10 $ 0.20 $ 0.45 $ 0.72
Diluted net income $ 0.08 $ 0.19 $ 0.41 $ 0.71
Funds from operations(1)-basic $ 0.49 $ 0.44 $ 1.45 $ 1.27
Funds from operations(1)-diluted $ 0.49 $ 0.44 $ 1.44 $ 1.26
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LEXINGTON CORPORATE PROPERTIES TRUST
AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(dollars in thousands)
9/30/05 12/31/04
------- --------
Real estate, at cost $ 1,932,746 $ 1,407,872
Accumulated depreciation (225,225) (180,610)
Investment in joint ventures 168,159 132,738
Properties held for sale - discontinued operations 48,222 13,216
Intangible assets, net 137,101 54,736
Cash and cash equivalents 61,115 146,957
Deferred expenses, net 13,209 7,860
Rent receivable 2,717 4,123
Rent receivable - deferred 25,688 23,923
Due from affiliates -- 45,800
Other assets 49,869 40,472
----------- -----------
$ 2,213,601 $ 1,697,087
========= =========
Mortgages and notes payable $ 1,186,907 $ 765,144
Liabilities - discontinued operations 26,748 1,688
Other liabilities 21,978 22,388
Prepaid rent 10,015 3,818
Minority interests 56,401 56,759
Shareholders' equity 911,552 847,290
----------- -----------
$ 2,213,601 $ 1,697,087
========= =========
Common shares 51,974,639 48,621,273
Preferred shares - Series B 3,160,000 3,160,000
Preferred shares - Series C 3,100,000 2,700,000
Operating partnership units 5,371,163 5,408,699
----------- --------------
63,605,802 59,889,972
========== ===========
1 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 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.
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LEXINGTON CORPORATE PROPERTIES TRUST
AND CONSOLIDATED SUBSIDIARIES
EARNINGS PER SHARE
AND FUNDS FROM OPERATIONS PER SHARE
(dollars in thousands, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
2005 2004 2005 2004
---- ---- ---- ----
Earning Per Share
- -----------------
Basic
Income from continuing operations $ 6,926 $ 10,307 $ 25,913 $ 31,784
Less preferred dividends (4,109) (1,590) (12,326) (4,770)
--------------- --------------- -------------- --------------
Income allocable to common shareholders from continuing
operations - basic 2,817 8,717 13,587 27,014
Total income from discontinued operations - basic 2,044 856 8,532 5,974
--------------- --------------- -------------- --------------
Net income allocable to common shareholders - basic $ 4,861 $ 9,573 $ 22,119 $ 32,988
=============== =============== ============== ==============
Weighted average number of common shares outstanding 50,837,178 47,901,818 49,269,497 46,033,992
=============== =============== ============== ==============
Per share data:
Income from continuing operations $ 0.06 $ 0.18 $ 0.28 $ 0.59
Income from discontinued operations 0.04 0.02 0.17 0.13
--------------- --------------- -------------- --------------
Net income $ 0.10 $ 0.20 $ 0.45 $ 0.72
=============== =============== ============== ==============
Diluted
Income allocable to common shareholders from continuing
operations-basic $ 2,817 $ 8,717 $ 13,587 $ 27,014
Adjustments:
Incremental income (loss) attributed to assumed
conversion of dilutive securities (48) 673 695 2,740
--------------- --------------- -------------- --------------
Income allocable to common shareholders from
continuing operations-diluted 2,769 9,390 14,282 29,754
Total income from discontinued operations - diluted 2,044 954 8,532 6,805
--------------- --------------- -------------- --------------
Net income allocable to common shareholders - diluted $ 4,813 $ 10,344 $ 22,814 $ 36,559
=============== =============== ============== ==============
Weighted average number of shares used in calculation
of basic earnings per share 50,837,178 47,901,818 49,269,497 46,033,992
Add incremental shares representing:
Shares issuable upon exercises of employee share options
78,046 118,533 78,382 129,695
Shares issuable upon conversion of dilutive interests
6,849,435 5,329,395 6,849,435 5,357,968
--------------- --------------- -------------- --------------
Weighted average number of shares used in calculation of
diluted earnings per common share 57,764,659 53,349,746 56,197,314 51,521,655
=============== =============== ============== ==============
Per share data:
Income from continuing operations - diluted $ 0.04 $ 0.17 $ 0.26 $ 0.58
Income from discontinued operations - diluted 0.04 0.02 0.15 0.13
--------------- --------------- -------------- --------------
Net income - diluted $ 0.08 $ 0.19 $ 0.41 $ 0.71
=============== =============== ============== ==============
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LEXINGTON CORPORATE PROPERTIES TRUST
AND CONSOLIDATED SUBSIDIARIES
EARNINGS PER SHARE
AND FUNDS FROM OPERATIONS PER SHARE
(dollars in thousands, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
2005 2004 2005 2004
---- ---- ---- ----
Funds From Operations
- ---------------------
Basic and Diluted
- -----------------
Net income allocable to common shareholders $ 4,861 $ 9,573 $ 22,119 $ 32,988
Adjustments:
Depreciation and amortization 20,467 11,014 50,251 27,874
Minority interests-OP Units 804 771 3,055 2,880
Amortization of leasing commissions 143 184 395 549
Joint venture adjustment-depreciation 4,754 2,029 12,374 4,902
Preferred dividends-Series C 2,519 -- 7,556 --
Gains on sale of properties (1,595) -- (6,656) (4,065)
Gains on sale of properties - Joint Venture (1,740) -- (1,740) --
------------- ------------- ------------- -------------
Funds from operations $ 30,213 $ 23,571 $ 87,354 $ 65,128
============= ============= ============= =============
Basic
- -----
Weighted average shares outstanding-basic EPS 50,837,178 47,901,818 49,269,497 46,033,992
Operating partnership units 5,373,592 5,329,395 5,378,078 5,357,968
Preferred shares - Series C 5,779,330 -- 5,779,330 --
------------- ------------- ------------- -------------
Weighted average shares outstanding-basic FFO 61,990,100 53,231,213 60,426,905 51,391,960
============= ============= ============= =============
FFO per share $ 0.49 $ 0.44 $ 1.45 $ 1.27
============= ============= ============= =============
Diluted
- -------
Weighted average shares outstanding-diluted EPS 57,764,659 53,349,746 56,197,314 51,521,655
Operating partnership units 5,373,592 -- 5,378,078 --
Preferred shares - Series C 5,779,330 -- 5,779,330 --
Non-dilutive convertible interests (6,849,435) -- (6,849,435) --
------------- ------------- ------------- -------------
Weighted average shares outstanding-diluted FFO 62,068,146 53,349,746 60,505,287 51,521,655
============= ============= ============= =============
FFO per share $ 0.49 $ 0.44 $ 1.44 $ 1.26
============= ============= ============= =============
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