Exhibit 99.1
Kimco Realty Reports First Quarter 2003 Operating Results
NEW HYDE PARK, N.Y.--(BUSINESS WIRE)--April 28, 2003--
Net Income Per Share Increases 18.9 Percent to $0.63; FFO Per Share
Increases 4.0 Percent to $0.78
Kimco Realty Corporation (NYSE: KIM) today announced that net
income for the first quarter ended March 31, 2003 rose 16.5 percent to
$71.0 million from $60.9 million for the same period last year.
On a diluted per share basis, net income rose 18.9 percent to
$0.63 per common share from $0.53 per common share a year earlier.
First quarter funds from operations ("FFO"), a widely accepted measure
of REIT performance, rose 5.0 percent to $82.9 million from $78.9
million for the same period last year. On a diluted per common share
basis, first quarter FFO increased 4.0 percent to $0.78 from $0.75 a
year ago. FFO excludes gains on dispositions of operating properties
and gains on early extinguishment of debt of approximately $3.3
million, or $0.03 per share and $6.3 million, or $0.06 per share,
respectively. A complete reconciliation containing adjustments from
GAAP net income to FFO is included in this release. Revenues from
rental property increased 10.7 percent to $124.1 million from $112.1
million, a year ago.
During the quarter, Kimco increased the occupancy of its parent
shopping center portfolio to 89.1 percent from 87.8 percent at
December 31, 2002 and from a low of 85.3 percent at June 30, 2002. The
increase in occupancy was the result of new leasing and property
sales. For the quarter, Kimco signed 97 new leases in the parent
portfolio totaling 893,000 square feet. Average base rent on these new
leases is approximately $7.49 per square foot. Effective May 2003,
seven locations Kimco leased to Kmart Corporation in its operating
portfolios will be rejected as part of Kmart's plan of reorganization.
Kimco is in advanced discussions to lease or dispose of each of these
sites. The impact of these lease rejections is not expected to have a
material impact on the Company's financial results and had previously
been factored in the Company's earnings guidance.
Occupancy in the Company's operating joint ventures with
institutional investors remained strong during the quarter. Occupancy
in the Kimco Income REIT (KIR), which consists of 70 shopping centers
totaling 14.6 million square feet, was 98.6 percent. The Kimco Retail
Opportunity Portfolio (KROP), which consists of 17 shopping centers
totaling 2.2 million square feet, also maintained a high level of
occupancy at 95.1 percent. During the quarter, retailers' appetite for
new store locations remained strong. Across Kimco's portfolios,
including Kimco Developers Inc. (KDI), the Company signed 170 new
leases totaling approximately 1.3 million square feet at an average
base rent of $9.41 per square foot.
Investment Activity
-------------------
During the quarter, Kimco acquired interests in 10 shopping center
properties and three single tenant sites totaling 2.1 million square
feet of gross leasable area for an aggregate purchase price of
approximately $246.1 million. These properties were acquired for the
Company's portfolios as follows:
-- Kimco's parent portfolio acquired interests in six shopping
centers, for a total cost of $102.5 million, including one
shopping center in Canada in its joint venture with RioCan
REIT. In addition, subsequent to quarter end, the Company
acquired interests in three shopping centers for approximately
$102.8 million.
-- KIR acquired interests in two shopping centers for an
aggregate cost of $103.5 million. In addition to closing on
the previously announced acquisition of Parkway Supercenter in
Seattle, Washington, KIR acquired the Shoppes at Soncy in
Amarillo, Texas. Shoppes at Soncy is a 143,000 square foot
shopping center anchored by Ross Stores, Bed, Bath & Beyond
and Joann Fabrics.
-- The KROP joint venture acquired two shopping centers during
the quarter. West Ashley Shoppes, a 137,000 square foot
shopping center in Charleston, South Carolina, was acquired
for $9.2 million. Market Square at Montrose, a 506,000 Home
Depot anchored shopping center, was acquired for $30.9
million. This shopping center is located in Montrose, Ohio.
In addition to the shopping centers acquired, Kimco provided $13.1
million of preferred equity capital to owners of seven properties.
Kimco's Preferred Equity Program provides equity capital to real
estate owners and developers for expansions, redevelopment and
development.
Kimco's merchant building business, KDI, completed sales of eight
out-parcels in its portfolio and recorded gains on sales of
approximately $1.2 million. In addition, during 2003 KDI has acquired
interests in three new development projects totaling $8.1 million and
invested approximately $34.0 million in its pipeline of 19 existing
shopping center developments.
During the quarter, Kimco sold two shopping centers from its
Kimsouth portfolio for proceeds of approximately $11.0 million. The
Company's investment strategy for this portfolio, which originally
consisted of 37 shopping centers, includes re-tenanting, repositioning
and disposition of the properties. In total, the Company has disposed
of four properties for proceeds of $31.4 million since the acquisition
of Kimsouth during the fourth quarter of 2002.
Earnings Guidance
-----------------
Kimco's management updated its earnings guidance for the year,
providing a range for FFO per share of $3.16 - $3.21 for the year
ending December 31, 2003, which is within its previously issued range
of guidance. Management also projected the following range of
estimates of FFO for remaining three quarters of the year:
Quarter Ending FFO Range
June 30, 2003 $0.79 - $0.80
September 30, 2003 $0.79 - $0.81
December 31, 2003 $0.80 - $0.82
Corporate Governance
--------------------
Kimco's Board of Directors unanimously agreed to amend the
Company's 1998 Equity Participation Plan to generally prohibit the
re-pricing of stock options. More specifically, after any stock
options are granted, the exercise price of the stock option may not be
reduced by the Board without shareholder approval. In addition, the
Board established a Nominating and Corporate Governance Committee to
oversee all corporate governance matters.
Kimco, a publicly-traded real estate investment trust, has
specialized in shopping center acquisitions, development and
management for over 35 years. Kimco owns and operates the nation's
largest portfolio of neighborhood and community shopping centers with
interests in 630 properties comprising approximately 91.7 million
square feet of leasable space located throughout 41 states, Canada and
Mexico. For further information refer to the Company's web site at
www.kimcorealty.com.
Safe Harbor Statement: The statements in this release state the
Company's and management's hopes, intentions, beliefs, expectations or
projections of the future and are forward-looking statements. It is
important to note that the Company's actual results could differ
materially from those projected in such forward-looking statements.
Factors that could cause actual results to differ materially from
current expectations include, but are not limited to, (i) general
economic conditions, (ii) the inability of major tenants to continue
paying their rent obligations due to bankruptcy, insolvency or general
downturn in their business, (iii) local real estate conditions, (iv)
increases in interest rates, (v) increases in operating costs and real
estate taxes. Additional information concerning factors that could
cause actual results to differ materially from those forward-looking
statements is contained from time to time in the Company's SEC
filings, including but not limited to the Company's report on Form
10-K for the year ended December 31, 2002. Copies of each filing may
be obtained from the Company or the SEC.
Kimco Realty Corporation
Consolidated Statements of Income
(In thousands, except per share data)
Three Months Ended
March 31,
2003 2002
--------- ---------
Real Estate Operations:
- -----------------------
Revenues from rental property $124,062 $112,077
--------- ---------
Rental property expenses:
Rent 3,015 3,135
Real estate taxes 15,012 15,129
Operating and maintenance 16,742 11,884
--------- ---------
34,769 30,148
--------- ---------
89,293 81,929
Equity in income of real estate joint ventures, net 9,312 6,471
Minority interests in income of partnerships, net (1,591) (208)
Income from other real estate investments 4,900 4,461
Mortgage financing income 5,512 1,065
Management and other fee income 2,902 3,346
Depreciation and amortization (19,867) (18,213)
--------- ---------
Income from real estate operations 90,461 78,851
--------- ---------
Other Investments:
- ------------------
Interest, dividends and other investment income 2,402 7,125
Other income, net 318 3,871
--------- ---------
2,720 10,996
--------- ---------
Interest expense (22,724) (21,463)
General and administrative expenses (8,615) (7,527)
Gain on early extinguishment of debt 6,262 --
--------- ---------
Income from continuing operations
before income taxes 68,104 60,857
Provision for income taxes (1,822) (5,350)
--------- ---------
Income from continuing operations 66,282 55,507
--------- ---------
Discontinued Operations:
- ------------------------
Income from discontinued operating
properties 184 1,107
Gain on disposition of operating properties 3,280 --
---------- --------
Income from discontinued operations 3,464 1,107
---------- --------
Gain on sale of development properties (1) 1,215 4,280
---------- --------
Net income 70,961 60,894
Preferred dividends (4,609) (4,609)
---------- --------
Net income available to common
shareholders $66,352 $56,285
========== ========
Per common share:
Income from continuing operations:
- Basic $0.60 $0.53
========== ========
- Diluted $0.59(2) $0.52
========== ========
Net income:
- Basic $0.63 $0.54
========== ========
- Diluted $0.63(2) $0.53
========== ========
Weighted average shares outstanding:
- Basic 104,711 104,299
========== ========
- Diluted 108,229(2)105,386
========== ========
Income subject to income taxes $5,021 $13,637
(1) Included in the calculation of Income from continuing
operations per common share.
(2) Reflects the potential impact if certain units were converted
to common stock at the beginning of the period. Net income available
to common shareholders would be increased by $1,423 for the three
months ended March 31, 2003 reflecting the distribution associated
with the units.
Certain amounts in the prior period have been reclassified in
order to conform with the current period's presentation.
Kimco Realty Corporation
Funds From Operations
(In thousands, except per share data)
Three Months
Ended
March 31,
2003 2002
------- -------
Funds From Operations
Net income $70,961 $60,894
Gain on disposition of operating properties (3,280) --
Depreciation and amortization 19,894 18,846
Depreciation and amortization -
real estate joint ventures 6,200 3,800
Gain on early extinguishment of debt (6,262) --
Preferred stock dividends (4,609) (4,609)
------- -------
Funds from operations $82,904 $78,931
======= =======
Per common share:
- Basic $0.79 $0.76
======= =======
- Diluted $0.78(1) $0.75
======= =======
Weighted Average Share Information
Weighted average shares -
- Basic 104,711 104,299
======= =======
- Diluted 108,229(1) 105,386
======= =======
(1) Reflects the potential impact if certain units were converted
to common stock at the beginning of the period. Net income available
to common shareholders would be increased by $1,423 for the three
months ended March 31, 2003 reflecting the distribution associated
with the units.
Kimco Realty Corporation
Consolidated Balance Sheets
(In thousands, except share data)
March 31, December 31,
2003 2002
------------- -------------
Assets:
Operating real estate, net of accumulated
depreciation of $533,882 and $516,558,
respectively $ 2,737,937 $ 2,669,648
Investments and advances in real estate
joint ventures 442,857 412,672
Real estate under development 243,555 212,765
Other real estate investments 102,136 99,542
Mortgages and other financing receivables 73,510 94,024
Cash and cash equivalents 55,653 35,962
Marketable securities 77,467 66,992
Accounts and notes receivable 53,697 55,012
Other assets 108,252 110,261
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$3,895,064 $3,756,878
============= =============
Liabilities:
Notes payable $1,412,250 $1,302,250
Mortgages payable 212,680 230,760
Construction loans payable 64,417 43,972
Other liabilities, including minority
interests in partnerships 277,025 272,568
------------- -------------
1,966,372 1,849,550
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Stockholders' Equity:
Preferred stock, $1.00 par value,
authorized 5,000,000 shares
Class A Preferred Stock, $1.00 par value,
authorized 345,000 shares
Issued and outstanding 300,000 shares 300 300
Aggregate liquidation preference $75,000
Class B Preferred Stock, $1.00 par value,
authorized 230,000 shares
Issued and outstanding 200,000 shares 200 200
Aggregate liquidation preference $50,000
Class C Preferred Stock, $1.00 par value,
authorized 460,000 shares
Issued and outstanding 400,000 shares 400 400
Aggregate liquidation preference
$100,000
Common Stock, $.01 par value, authorized
200,000,000 shares
Issued and outstanding 104,940,140 1,049 1,046
and 104,601,828 shares, respectively
Paid-in capital 1,992,878 1,984,820
Cumulative distributions in excess of net
income (75,683) (85,367)
------------- -------------
1,919,144 1,901,399
Accumulated other comprehensive income 10,892 7,401
Notes receivable from officer stockholders (1,344) (1,472)
------------- -------------
1,928,692 1,907,328
------------- -------------
$3,895,064 $3,756,878
============= =============
Certain amounts in the prior period have been reclassified in
order to conform with the current period's presentation.
CONTACT: Kimco Realty Corporation
Scott Onufrey, 516/869-7190
sonufrey@kimcorealty.com