Exhibit 99.1
Ramco-Gershenson Properties Trust Reports Results for Third Quarter 2005
FARMINGTON HILLS, Mich.--(BUSINESS WIRE)--Oct. 19, 2005--
Ramco-Gershenson Properties Trust (NYSE:RPT):
Financial Results for the Quarter Ended September 30, 2005:
-- Diluted FFO per share of $0.59
-- Diluted FFO of $11.6 million
-- Total revenues of $34.5 million
-- Diluted EPS of $0.19
-- Regular quarterly dividend of $0.4375 per common share paid
October 3, 2005
Operating Highlights for the Quarter Ended September 30, 2005:
-- Signed land lease with Home Depot to replace vacant Kmart in
Taylor, Michigan
-- Announced two additional core portfolio shopping center
expansions
-- Entered into a brokerage agreement to sell up to nine shopping
centers
-- Refinanced $99.3 million of high interest rate, long term debt
-- Commenced the development of Rossford Pointe in Rossford, Ohio
-- Opened 28 non-anchor stores at an average base rent of $11.87
per square foot
-- Opened 3 anchor stores totaling over 172,000 square feet
-- Renewed 16 non-anchor leases, at an average base rent of
$14.32 per square foot, an increase of 4.7% over prior rents
paid
-- Portfolio occupancy rate of 93.5%
Ramco-Gershenson Properties Trust (NYSE:RPT) announced today
results for the third quarter and nine months ended September 30,
2005.
Financial Results
For the three months ended September 30, 2005, diluted Funds from
Operations (FFO) increased 67.1% or $4.7 million to a total of $11.6
million compared with $6.9 million for the three months ended
September 30, 2004. On a per share basis, diluted FFO increased 68.6%,
or $0.24, to $0.59 in 2005, compared with $0.35 in 2004. Excluding the
$0.24 per share one-time impairment loss charge related to the sale of
the Company's minority equity interest in the Fountain Walk shopping
center taken during the third quarter of 2004, FFO per share for the
quarter remained unchanged.
Total revenues for the three months ended September 30, 2005,
increased 9.7% or $3.0 million, to a total of $34.5 million, compared
with $31.5 million in 2004. Net income increased 221.6% or $3.3
million to a total of $4.8 million, compared with $1.5 million in
2004. Diluted earnings per share increased $0.20, to $0.19, compared
to $(0.01) in 2004.
For the nine months ended September 30, 2005, diluted FFO
increased 23.8% or $7.0 million to a total of $36.1 million compared
with $29.1 million for the nine months ended September 30, 2004. On a
per share basis, diluted FFO increased 24.7% or $0.36 to $1.82 in 2005
compared with $1.46 in 2004. Excluding the $0.24 per share one-time
impairment loss charge related to the sale of the Company's minority
equity interest in the Fountain Walk shopping center during the third
quarter of 2004, FFO per share for the nine months increased 8.2% or
$0.12.
Total revenues for the nine months ended September 30, 2005,
increased 20.5% or $18.1 million, to a total of $106.3 million
compared with $88.2 million in 2004. Net income increased 45.9% or
$4.4 million to a total of $13.9 million, compared with $9.5 million
in 2004. Diluted earnings per share increased 43.2%, or $0.16, to
$0.53, compared to $0.37 in 2004.
"We are pleased to report our third quarter financial and
operating results, which were in line with our expectations," said
Dennis Gershenson, President and Chief Executive Officer. "During the
quarter we announced three new redevelopment projects demonstrating
our ability to continually find opportunities to add value within our
core portfolio. To that same end, we commenced a new development
project adjacent to our Crossroads center near Toledo, Ohio. Also, we
have made substantial progress on our River City development. Taking
advantage of a favorable interest rate environment, we completed a
significant shopping center refinancing that will dramatically reduce
our interest expense. Our overall business plan remains on track and
we are confident that we will meet our business objectives for the
year."
Operating Highlights
Acquisitions/Dispositions
In September, the Company entered into an agreement with CB
Richard Ellis to market for sale up to nine shopping centers that are
either fully-valued or are located in markets where the Company no
longer plans to maintain a presence. The Company intends to use the
proceeds from the sale of these assets to pay down debt and fund its
business plan.
As of quarter end, the Company had completed approximately $319.4
million in acquisitions for its joint venture with ING Clarion, or
over 70.0% of the total venture commitment. The centers comprise over
2.1 million square feet of gross leasable area. To date, the Company
has contributed $42.2 million of its planned $54.0 million equity
commitment to the Venture.
Development/Development Joint Ventures
In September, the Company commenced the development of the
Rossford Pointe shopping center in Rossford, Ohio (a suburb of
Toledo). This development is adjacent to the Company's 480,000 square
foot Crossroads Centre. The ten acre site will include a recently
signed 20,339 square foot Petsmart, a 40,000 square foot retailer yet
to be named and 6,400 square feet of in-line retail space. Petsmart is
scheduled to open in the first quarter of 2006.
The Company also currently has three joint venture development
projects in process that encompass over 1.6 million square feet of
retail space and include Beacon Square in Grand Haven, Michigan,
Gaines Marketplace in Gaines Township, Michigan and River City
Marketplace in Jacksonville, Florida. As of September 30, 2005, the
Company had spent $52.4 million for the three developments, which have
an estimated total project cost of $108.1 million. The Company expects
Beacon Square and Gaines Marketplace to be substantially completed
prior to year-end.
During the quarter, the Company made substantial progress on its
River City Marketplace development in Jacksonville, Florida, including
the completion of a lease for a 30,167 square foot Ross Dress for Less
and a number of ancillary retail tenants. Ross Dress for Less joins
anchor tenants Wal-Mart in 203,091 square feet, Wallace Theaters in
54,298 square feet and Petsmart in 20,087 square feet. The Company is
currently in final lease negotiations with four additional national
anchor retailers and expects to execute these leases during the fourth
quarter of 2005. The Company expects that the shopping center will
open in the summer of 2006 with over 500,000 square feet of retail
space.
Asset Management
During the quarter, the Company began the expansion of its 461,000
square foot Spring Meadows shopping center in Holland, Ohio (a suburb
of Toledo) to include a 20,087 square foot Petsmart. The Spring
Meadows Petsmart expansion will involve the demolition of
approximately 8,400 square feet of occupied retail space. The Company
is also adding a 30,545 square foot TJ Maxx to its Jackson Crossing
shopping center in Jackson, Michigan. The addition of TJ Maxx marks
the sixth significant expansion at the center.
Also during the quarter, the Company signed a ground lease with
Home Depot USA at its Taylor Plaza in Taylor, Michigan. Home Depot is
currently in the process of obtaining the necessary government
approvals in order to demolish the existing Kmart for the construction
of a 102,000 square foot store. The new Home Depot store is expected
to open in the fall of 2006.
In addition, the Company opened a 20,010 square foot Peebles
department store at its Highland Square shopping center in Crossville,
Tennessee. The Peebles store is the second phase of the redevelopment
of this center, which also included the expansion of a Kroger
Supermarket, from 49,204 square feet to 63,000 square feet. During the
third quarter, the Company also opened a Dollar General Market in
approximately 29,000 square feet at its Tellico Plaza in Lenoir City,
Tennessee, completing the redevelopment of this center.
At quarter end, the Company had seven redevelopment projects in
process with a total project cost of $23.9 million.
Leasing
During the quarter, the Company opened 28 new non-anchor stores,
at an average base rent of $11.87 per square foot. The Company also
opened 3 new anchor stores, totaling over 172,000 square feet of gross
leasable area. In addition, the Company renewed 16 non-anchor leases,
at an average base rent of $14.32 per square foot, an increase of 4.7%
over prior rents paid. At quarter end, the portfolio was 93.5% leased,
compared to 92.9% at September 30, 2004.
Financing Activity, Debt and Market Capitalization
In September, the Company repaid early and without penalty $99.3
million in existing mortgage loans secured by ten of the Company's
assets with Lincoln National Life Insurance Company. The loans carried
a blended interest rate of 8.3% and were due to mature on January 10,
2006. The loans were repaid through interim secured financing provided
by KeyBank. The new secured term loan bears interest at 140 basis
points over LIBOR and matures on December 29, 2005, a date coterminous
with the Company's secured and unsecured revolving credit facilities.
As part of the refinancing of these centers, the Company executed
loan applications and locked interest rates for long term financing
for three of the ten shopping centers that secure the term loan. These
new loans will have a ten year maturity, with five years of interest
only payments, and carry a blended fixed interest rate of
approximately 5.2%. The proceeds from these financings will
approximate $64.8 million and will be used to pay down a portion of
the term loan facility as well as the Company's secured and unsecured
revolving lines of credit. The Company expects to close these loans
during the fourth quarter of 2005.
The Company's total capitalization as of September 30, 2005 was
approximately $1.3 billion. Total debt for the quarter was $674.4
million with an average interest rate of 5.7% and an average maturity
of 36 months. Debt to market capitalization at the end of the quarter
was 50.4%.
Dividend
On October 3, 2005, the Company paid a third quarter common share
cash dividend of $0.4375 per share to its shareholders of record on
September 20, 2005, based on an annual dividend of $1.75 per share. In
addition, a third quarter dividend of $0.5938 per Series B cumulative
redeemable preferred share and a third quarter dividend of $0.5664375
per Series C cumulative convertible preferred share were paid on
October 3, 2005, to shareholders of record on September 20, 2005.
Guidance and Conference Call Information
As announced previously, the Company estimates that 2005 annual
diluted FFO per share to be between $2.39 and $2.44. It also expects
earnings per diluted common share to be between $0.71 and $0.75. The
Company is projecting 2006 FFO to be between $2.53 and $2.58 and
earnings per diluted common share to be between $0.59 and $0.64.
The Company
RPT will host a live broadcast of its 3rd Quarter conference call
on October 20, 2005 at 10:00 a.m. eastern time, to discuss its
financial results and 2005 & 2006 guidance. The live broadcast will be
available online at www.rgpt.com and www.streetevents.com and also by
telephone at (800) 539-5010 (no pass code needed). A replay will be
available shortly after the call on the aforementioned websites (for
ninety days) or by telephone at (800) 642-1687, pass code 1058484 (for
one week).
Ramco-Gershenson Properties Trust has a portfolio of 81 shopping
centers totaling approximately 17.9 million square feet of gross
leasable area, consisting of 80 community centers and one enclosed
regional mall. The Company's centers are located in Michigan, Ohio,
Indiana, Wisconsin, New Jersey, Maryland, Virginia, North Carolina,
South Carolina, Tennessee, Georgia, Alabama and Florida. Headquartered
in Farmington Hills, Michigan, the Company is a fully integrated,
self-administered, publicly-traded real estate investment trust (REIT)
which owns, develops, acquires, manages and leases community shopping
centers, regional malls and single tenant retail properties,
nationally.
This press release may contain forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995
and should be reviewed in conjunction with the Company's filings with
the U.S. Securities and Exchange Commission and other publicly
available information regarding the Company. Management of
Ramco-Gershenson believes that expectations reflected in
forward-looking statements are based on reasonable assumptions.
Certain factors could occur that might cause actual results to vary.
These include general economic conditions, the strength of key
industries in the cities in which the Company's properties are
located, the performance of tenants at the Company's properties as
well as other factors.
RAMCO-GERSHENSON PROPERTIES TRUST
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
For the Three Months For the Nine Months
Ended September 30, Ended September 30,
--------------------- ---------------------
2005 2004 2005 2004
---------- ---------- ---------- ----------
(In thousands, except per share amounts)
(Unaudited)
REVENUES:
Minimum rents $22,639 $21,200 $69,487 $60,943
Percentage rents 185 261 538 644
Recoveries from tenants 9,390 7,945 28,854 23,499
Fees and management
income 1,121 1,486 3,859 2,099
Other income 1,194 575 3,529 989
---------- ---------- ---------- ----------
Total revenues 34,529 31,467 106,267 88,174
---------- ---------- ---------- ----------
EXPENSES:
Real estate taxes 4,495 3,980 13,370 11,214
Recoverable operating
expenses 5,104 4,511 15,584 13,404
Depreciation and
amortization 7,290 6,471 22,711 18,169
Other operating 798 286 1,614 978
General and
administrative 2,991 3,159 10,579 8,438
Interest expense 10,717 8,506 31,851 24,302
---------- ---------- ---------- ----------
Total expenses 31,395 26,913 95,709 76,505
---------- ---------- ---------- ----------
Operating Income 3,134 4,554 10,558 11,669
Impairment of investment in
unconsolidated entity - (4,775) - (4,775)
---------- ---------- ---------- ----------
Income from continuing
operations before gain
(loss) on sale of real
estate assets,
minority interest and
earnings from
unconsolidated entities 3,134 (221) 10,558 6,894
Gain on sale of real estate
assets 630 515 626 231
Minority interest (699) (73) (1,958) (1,121)
Earnings from
unconsolidated entities 610 54 1,541 141
---------- ---------- ---------- ----------
Income from continuing
operations 3,675 275 10,767 6,145
Income from discontinued
operations, net of
minority interest 1,129 1,219 3,087 3,351
---------- ---------- ---------- ----------
Net income 4,804 1,494 13,854 9,496
Preferred stock dividends (1,663) (1,664) (4,991) (3,150)
---------- ---------- ---------- ----------
Net income available to
common shareholders $3,141 $(170) $8,863 $6,346
========== ========== ========== ==========
Basic earnings per share:
Income from continuing
operations $0.12 $(0.08) $0.34 $0.18
Income from
discontinued
operations 0.07 0.07 0.19 0.20
---------- ---------- ---------- ----------
Net income $0.19 $(0.01) $0.53 $0.38
========== ========== ========== ==========
Diluted earnings per share:
Income from continuing
operations $0.12 $(0.08) $0.34 $0.17
Income from
discontinued
operations 0.07 0.07 0.19 0.20
---------- ---------- ---------- ----------
Net income $0.19 $(0.01) $0.53 $0.37
========== ========== ========== ==========
Basic weighted average
shares outstanding 16,838 16,822 16,835 16,814
========== ========== ========== ==========
Diluted weighted average
shares outstanding 16,887 17,026 16,880 17,019
========== ========== ========== ==========
COMPREHENSIVE INCOME
Net income $4,804 $1,494 $13,854 $9,496
Other comprehensive income:
Unrealized gains
(losses) on interest
rate swaps (113) (180) 20 910
---------- ---------- ---------- ----------
Comprehensive income $4,691 $1,314 $13,874 $10,406
========== ========== ========== ==========
Ramco-Gershenson Properties Trust
Calculation of Funds from Operations(1)
(In thousands, except per share data)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ -----------------
2005 2004 2005 2004
---------- ------- -------- --------
Net Income $4,804 $1,494 $13,854 $9,496
Depreciation and amortization
expense 8,211 6,767 25,368 19,617
Loss (Gain) on sale of depreciable
property (630) 62 (653) 1,465
Minority interest in partnership:
Continuing operations 698 152 1,957 1,450
Discontinued operations 185 133 538 252
---------- ------- -------- --------
Funds from operations 13,268 8,608 41,064 32,280
Preferred stock dividends (1,663) (1,664) (4,991) (3,150)
---------- ------- -------- --------
Funds from operations available to
common shareholders $11,605 $6,944 $36,073 $29,130
========== ======= ======== ========
Weighted average equivalent shares
outstanding, diluted 19,816 19,956 19,810 19,949
========== ======= ======== ========
Funds from operations available
for common shareholders, per
diluted share $0.59 $0.35 $1.82 $1.46
(1) Management considers funds from operations, also known as "FFO,"
an appropriate supplemental measure of the financial performance
of an equity REIT. Under the NAREIT definition, FFO represents
income before minority interest, excluding extraordinary items, as
defined under accounting principles generally accepted in the
United States of America ("GAAP"), gains on sales of depreciable
property, plus real estate related depreciation and amortization
(excluding amortization of financing costs), and after adjustments
for unconsolidated partnerships and joint ventures. FFO should not
be considered an alternative to GAAP net income as an indication
of our performance. We consider FFO as a useful measure for
reviewing our comparative operating and financial performance
between periods or to compare our performance to different REITs.
However, our computation of FFO may differ from the methodology
for calculating FFO utilized by other real estate companies, and
therefore, may not be comparable to these other real estate
companies.
RAMCO-GERSHENSON PROPERTIES TRUST
CONSOLIDATED BALANCE SHEETS
September 30, December 31,
2005 2004
------------- ------------
(Unaudited)
(In thousands, except per
share amounts)
ASSETS
Investment in real estate, net $880,878 $951,176
Real estate assets held for sale 61,287 -
Cash and cash equivalents 15,030 15,045
Accounts receivable, net 31,321 26,845
Equity investments in unconsolidated
entities 46,508 9,182
Note receivable from unconsolidated entity 2,102 -
Other assets, net 37,984 41,530
------------- ------------
Total Assets $1,075,110 $1,043,778
============= ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Mortgages and notes payable $674,427 $633,435
Accounts payable and accrued expenses 34,519 30,003
Distributions payable 10,312 9,963
------------- ------------
Total Liabilities 719,258 673,401
Minority Interest 38,905 40,364
SHAREHOLDERS' EQUITY
Preferred Shares of Beneficial Interest,
par value $.01, 10,000 shares
authorized:
9.5% Series B Cumulative Redeemable
Preferred Shares; 1,000
shares issued and outstanding,
liquidation value of $25,000 23,804 23,804
7.95% Series C Cumulative Convertible
Preferred Shares; 1,889 shares issued
and outstanding, liquidation value of
$53,837 51,741 51,741
Common Shares of Beneficial Interest, par
value $.01, 45,000 shares authorized;
16,839 and 16,829 issued and outstanding
as of September 30, 2005 and
December 31, 2004 168 168
Additional paid-in capital 342,868 342,719
Accumulated other comprehensive income 240 220
Cumulative distributions in excess of net
income (101,874) (88,639)
------------- ------------
Total Shareholders' Equity 316,947 330,013
------------- ------------
Total Liabilities and Shareholders'
Equity $1,075,110 $1,043,778
============= ============
For more information on Ramco-Gershenson Properties Trust visit
the Company's Website at: www.rgpt.com
CONTACT: Ramco-Gershenson Properties Trust
Dennis Gershenson or Richard Smith, 248-350-9900
Fax: 248-350-9925