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
THURSDAY FEBRUARY 16, 2006
LEXINGTON CORPORATE PROPERTIES TRUST ANNOUNCES
FOURTH QUARTER AND TWELVE MONTH RESULTS
New York, NY - February 16, 2006 - 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, 2005.
2005 Significant Events
- -----------------------
o 6.3% increase in Funds From Operations ("FFO") per share;
o Acquired 43 properties (18 in joint ventures) for $1.1 billion at an
average GAAP cap rate of 8.1%;
o Sold eight properties, including one in a joint venture, realizing
$13.3 million in gains;
o Obtained an aggregate $840.3 million of non-recourse mortgage
financings, including $403.2 million in joint ventures, secured by 50
properties at a weighted-average fixed interest rate of 5.20%;
o Extended/entered into new leases on 14 properties;
o Recognized $13.0 million in aggregate impairment charges;
o Formed Lexington Strategic Asset Corp., raising $61.7 million in cash
and contributed four properties, including mortgages, for a 32.3%
interest;
o Invested $22.9 million to acquire a $30 million subordinated interest
in $68.4 million of mortgage debt; and
o Increased dividend per share in January, 2006 for the 13th consecutive
year.
Quarterly Results
FFO were $16.8 million, or $0.27 per diluted common share/unit, net of $12.1
million in impairment charges and $0.9 million in debt satisfaction charges,
which inclusive of charges aggregated $0.21 per diluted common share/unit, for
the fourth quarter of 2005. This compares to $18.5 million, or $0.34 per diluted
common share/unit, after the impact of $3.6 million in impairment charges and
$2.9 million in charges due to a tenant bankruptcy, which inclusive of charges
aggregated $0.12 per diluted common share/unit, for the fourth quarter of 2004.
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Rental revenues from continuing operations for the quarter totaled $49.0
million, compared to rental revenues of $34.7 million for the same period last
year. Net loss allocable to common shareholders was $5.9 million in the fourth
quarter of 2005, or $(0.11) per diluted common share/unit, after the impact of
$4.9 million in gains on sale of properties, $12.1 million in impairment charges
and $0.9 million in debt satisfaction charges. This compares to net income
allocable to common shareholders of $4.9 million, or $0.09 per diluted common
share/unit, after $1.4 million in gains on sales of properties, $3.6 million in
impairment charges and $2.9 million in charges due to a tenant bankruptcy for
the same period last year. Net loss allocable to common shareholders in 2005 has
also been impacted by the convertible preferred share offering completed by
Lexington in the fourth quarter of 2004 and first quarter of 2005.
The property that the Company recognized the $12.1 million impairment charge for
is subject to an $11.9 million non-recourse mortgage. The Company has notified
the lender of its intent to effect a deed-in-lieu to satisfy this mortgage. Upon
completion of the deed-in-lieu the Company will recognize a gain for the
difference between the mortgage balance and the carrying value of the property.
Currently that gain approximates $5.9 million.
Twelve Month Results
For the twelve months ended December 31, 2005, FFO were $104.2 million, or $1.70
per diluted common share/unit, after $3.0 million in net debt satisfaction gains
including $0.7 million in a debt satisfaction loss recognized by a joint venture
and $13.0 million in impairment charges, which inclusive of such gains and
charges aggregated $0.16 per diluted common share/unit, compared to $83.6
million, or $1.60 per diluted common share/unit, after $6.7 million in aggregate
impairment charges and $2.9 million in charges due to a tenant bankruptcy, which
inclusive of charges aggregated $0.19 per diluted common share/unit, for the
same period last year.
Rental revenues from continuing operations for the twelve months ended December
31, 2005, totaled $180.9 million, compared to rental revenues of $133.1 million
for the same period last year. Net income allocable to common shareholders for
the twelve months ended December 31, 2005, was $16.3 million, or $0.33 per
diluted common share/unit, after $13.3 million of gains on sales of properties,
including a joint venture sale, and the net debt satisfaction gains and net
impairment charges discussed above, compared to $37.9 million, or $0.80 per
diluted common share/unit, after the impairment charges and tenant bankruptcy
discussed above and $5.5 million of gains on sales of properties, for the same
period last year. Net income allocable to common shareholders in 2005 has also
been impacted by the convertible preferred share offering completed by Lexington
in the fourth quarter of 2004 and first quarter of 2005.
Comments From Management
T. Wilson Eglin, Chief Executive Officer, said, "Operating results for the
fourth quarter of 2005 improved considerably compared to the prior year. Funds
from operations per share excluding one-time items were $0.48 per share - the
midpoint of our guidance - compared to $0.46 per share in the fourth quarter of
2004, an increase of about 5%. The stronger operating results were primarily a
result of acquisition activity, which totaled $1.1 billion in 2005. In November,
we signed our 14th lease of 2005 and were pleased to finish the year with 98.3%
occupancy. Demand for income-producing properties such as those in our portfolio
continues to be exceptionally strong. While this has made it difficult to
acquire properties that meet our yield parameters, it also means that we have
opportunities to sell properties on advantageous terms as evidenced by total
gains of $13.3 million in 2005. In the
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first quarter of 2006, we believe acquisition volume will be modest.
Nevertheless, we anticipate that funds from operations will be $0.47-$0.49 per
share before the impact of debt satisfaction items."
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 February
23, 2006. The toll-free telephone number for the replay is 800-405-2236,
passcode 11050477. International callers can access the conference call by
dialing 303-275-2170 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.
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 Wednesday, February 15, 2006 at $21.73 per share. Lexington pays
an annualized dividend of $1.46 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 Year Ended
December 31, December 31,
2005 2004 2005 2004
---- ---- ---- ----
Gross revenues:
Rental $ 49,043 $ 34,714 $ 180,871 $ 133,050
Advisory fees 1,180 1,710 5,365 4,885
Tenant reimbursements 3,702 1,471 10,896 5,429
---------- ---------- ---------- ----------
Total gross revenues 53,925 37,895 197,132 143,364
Expense applicable to revenues:
Depreciation and amortization (20,909) (11,770) (70,906) (38,928)
Property operating (7,537) (3,035) (23,494) (10,756)
General and administrative (4,441) (3,878) (17,612) (13,877)
Impairment loss (12,050) (3,584) (12,050) (3,584)
Non-operating income 330 710 1,519 3,272
Interest and amortization expense (18,309) (11,839) (65,065) (44,857)
Debt satisfaction (charges) gain, net (222) (56) 4,409 (56)
Write-off - tenant bankruptcy - (2,884) - (2,884)
---------- ----------- ---------- -----------
(Loss) income before benefit (provision) for income taxes, minority
interests, equity in earnings of non-consolidated entities and
discontinued operations (9,213) 1,559 13,933 31,694
Benefit (provision) for income taxes 105 635 150 (1,181)
Minority interests 963 377 (2,111) (2,414)
Equity in earnings of non-consolidated entities 1,132 1,811 6,220 7,194
---------- ---------- ---------- ----------
(Loss) income from continuing operations (7,013) 4,382 18,192 35,293
----------- ---------- ---------- ----------
Discontinued operations, net of minority interest:
Income from discontinued operations 1,041 1,273 4,479 6,830
Debt satisfaction charges (671) -- (725) --
Impairment charges (29) (16) (829) (2,791)
Gains on sales of properties 4,922 1,410 11,578 5,475
---------- ---------- ---------- ----------
Total discontinued operations 5,263 2,667 14,503 9,514
---------- ---------- ---------- ----------
Net (loss) income (1,750) 7,049 32,695 44,807
Dividends attributable to preferred shares - Series B (1,590) (1,590) (6,360) (6,360)
Dividends attributable to preferred shares - Series C (2,519) (585) (10,075) (585)
----------- ----------- ----------- -----------
Net (loss) income allocable to common shareholders $ (5,859) $ 4,874 $ 16,260 $ 37,862
=========== ========== ========== ==========
Funds from operations(1) $ 16,796 $ 18,514 $ 104,150 $ 83,642
========== ========== ========== ==========
Per share/unit
Basic net (loss) income $ (0.11) $ 0.10 $ 0.33 $ 0.81
Diluted net (loss) income $ (0.11) $ 0.09 $ 0.33 $ 0.80
Funds from operations(1)-basic $ 0.27 $ 0.34 $ 1.71 $ 1.60
Funds from operations(1)-diluted $ 0.27 $ 0.34 $ 1.70 $ 1.60
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LEXINGTON CORPORATE PROPERTIES TRUST
AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(dollars in thousands)
12/31/05 12/31/04
-------- --------
Real estate, at cost $ 1,883,115 $ 1,407,872
Accumulated depreciation (241,188) (180,610)
Investment in joint ventures 191,146 132,738
Properties held for sale - discontinued
operations 49,397 13,216
Intangible assets, net 128,775 54,736
Cash and cash equivalents 53,515 146,957
Deferred expenses, net 13,582 7,860
Rent receivable 7,673 4,123
Rent receivable - deferred 24,778 23,923
Due from affiliates -- 45,800
Other assets 49,439 40,471
------------- --------------
$ 2,160,232 $ 1,697,086
============= ==============
Mortgages and notes payable $ 1,139,971 $ 765,144
Liabilities - discontinued operations 32,145 1,688
Other liabilities 25,380 22,387
Prepaid rent 10,054 3,818
Minority interests 61,372 56,759
Shareholders' equity 891,310 847,290
------------- --------------
$ 2,160,232 $ 1,697,086
============= ==============
Common shares 52,155,855 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 5,720,071 5,408,699
------------- --------------
64,135,926 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 Year Ended
December 31, December 31,
2005 2004 2005 2004
---- ---- ---- ----
Earning Per Share
- -----------------
Basic
(Loss) income from continuing operations $ (7,013) $ 4,382 $ 18,192 $ 35,293
Less preferred dividends (4,109) (2,175) (16,435) (6,945)
--------------- --------------- --------------- --------------
(Loss) income allocable to common shareholders from
continuing operations - basic (11,122) 2,207 1,757 28,348
Total income from discontinued operations - basic 5,263 2,667 14,503 9,514
--------------- --------------- --------------- --------------
Net (loss) income allocable to common shareholders - basic $ (5,859) $ 4,874 $ 16,260 $ 37,862
=============== ============== ============== ==============
Weighted average number of common shares outstanding 51,516,136 48,092,092 49,835,773 46,551,328
=============== ============== ============== ==============
Per share data:
(Loss) income from continuing operations $ (0.21) $ 0.05 $ 0.04 $ 0.61
Income from discontinued operations 0.10 0.05 0.29 0.20
--------------- --------------- --------------- --------------
Net (loss) income $ (0.11) $ 0.10 $ 0.33 $ 0.81
=============== ============== ============== ==============
Diluted
(Loss) income allocable to common shareholders from
continuing operations-basic $ (11,122) $ 2,207 $ 1,757 $ 28,348
Adjustments:
Incremental (loss) income attributed to assumed
conversion of dilutive securities -- (377) -- 2,416
--------------- --------------- --------------- --------------
(Loss) income allocable to common shareholders from
continuing operations-diluted (11,122) 1,830 1,757 30,764
Total income from discontinued operations - diluted 5, 263 3,224 14,503 10,851
--------------- --------------- --------------- --------------
Net (loss) income allocable to common shareholders -
diluted $ (5,859) $ 5,054 $ 16,260 $ 41,615
=============== ============== ============== ==============
Weighted average number of shares used in calculation
of basic earnings per share 51,516,136 48,092,092 49,835,773 46,551,328
Add incremental shares representing:
Shares issuable upon exercises of employee
share options -- 126,179 66,876 131,415
Shares issuable upon conversion of dilutive
interests -- 5,390,583 -- 5,366,166
--------------- --------------- --------------- --------------
Weighted average number of shares used in calculation of
diluted earnings per common share 51,516,136 53,608,854 49,902,649 52,048,909
=============== ============== ============== ==============
Per share data:
(Loss) income from continuing operations - diluted $ (0.21) $ 0.03 $ 0.04 $ 0.59
Income from discontinued operations - diluted 0.10 0.06 0.29 0.21
--------------- --------------- --------------- --------------
Net (loss) income - diluted $ (0.11) $ 0.09 $ 0.33 $ 0.80
=============== ============== ============== ==============
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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 Year Ended
December 31, December 31,
2005 2004 2005 2004
---- ---- ---- ----
Funds From Operations
- ---------------------
Basic and Diluted
- -----------------
Net (loss) income allocable to common share-
holders - basic $ (5,859) $ 4,874 $ 16,260 $ 37,862
Adjustments:
Depreciation and amortization 20,793 12,020 71,044 39,894
Minority interests-OP Units (1,145) (311) 1,910 2,570
Amortization of leasing commissions 152 98 547 647
Joint venture adjustment-depreciation 5,258 2,658 17,632 7,559
Preferred dividends-Series C 2,519 585 10,075 585
Gains on sale of properties (4,922) (1,410) (11,578) (5,475)
Gains on sale of properties - Joint Venture -- -- (1,740) --
------------- ------------- ------------- -------------
Funds from operations $ 16,796 $ 18,514 $ 104,150 $ 83,642
============= ============= ============= =============
Basic
- -----
Weighted average shares outstanding-basic EPS 51,516,136 48,092,092 49,835,773 46,551,328
Operating partnership units 5,599,763 5,390,583 5,433,955 5,366,166
Preferred shares - Series C 5,779,330 1,313,116 5,779,330 330,073
------------- ------------- ------------- -------------
Weighted average shares outstanding-basic FFO 62,895,229 54,795,791 61,049,058 52,247,567
============= ============= ============= =============
FFO per share $ 0.27 $ 0.34 $ 1.71 $ 1.60
============= ============= ============= =============
Diluted
- -------
Weighted average shares outstanding-diluted EPS 51,516,136 53,608,854 49,902,649 52,048,909
Common share options 43,117 -- -- --
Operating partnership units 5,599,763 -- 5,433,955 --
Preferred shares - Series C 5,779,330 1,313,116 5,779,330 330,073
------------- ------------- ------------- -------------
Weighted average shares outstanding-diluted FFO 62,938,346 54,921,970 61,115,934 52,378,982
============= ============= ============= =============
FFO per share $ 0.27 $ 0.34 $ 1.70 $ 1.60
============= ============= ============= =============
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