Exhibit 99.1
Ramco-Gershenson Properties Trust Reports Results for the Third Quarter 2006
FARMINGTON HILLS, Mich.--(BUSINESS WIRE)--Oct. 25,
2006--Ramco-Gershenson Properties Trust (NYSE:RPT) announced today
results for the third quarter ended September 30, 2006.
Financial Highlights for the quarter ended September 30, 2006:
-- Diluted FFO per share of $0.63, a 6.8% increase over last year
-- Diluted FFO of $13.5 million, a 16.4% increase over last year
-- Total Revenues of $38.8 million, a 9.9% increase over last
year
-- Income from continuing operations of $4.5 million, a 9.8%
increase over last year
-- Diluted EPS from continuing operations of $0.17, a 21.4%
increase over last year
Operating Highlights for the quarter ended September 30, 2006:
-- Agreed to form a $75 Million Joint Venture with Heitman Value
Partners Investments LLC
-- Acquired Collins Pointe Plaza in Cartersville, GA
-- Executed 55,600 SF Gander Mountain lease at River City
Marketplace in Jacksonville, FL
-- Commenced the redevelopment of West Allis Towne Centre in West
Allis, WI
-- Opened 39 stores, 12.1% over portfolio average rents
-- Renewed 27 leases, 15.3% over prior rental rates
-- Increase in same center operating income of 6.6%
-- Increase in portfolio occupancy to 94.7%, compared to 93.5% in
2005
Financial Results
For the three months ended September 30, 2006, diluted Funds from
Operations (FFO) increased 16.4% to $13.5 million, compared with $11.6
million for the three months ended September 30, 2005. In 2006, the
Series C Preferred Shares were dilutive and, therefore, the dividends
paid did not impact our diluted FFO. In 2005, the shares were
anti-dilutive and reduced diluted FFO by $1.1 million for dividends
paid. Had the shares been dilutive in 2005, diluted FFO for the three
months ended September 30, 2006, would have increased $0.8 million or
6.3%. On a per share basis, diluted FFO increased 6.8% to $0.63,
compared with $0.59 in 2005. Net income from continuing operations for
the three months ended September 30, 2006, increased 9.8% to $4.5
million, compared with $4.1 million in 2005. On a per share basis,
income from continuing operations increased 21.4% to $0.17, compared
to $0.14 in 2005.
For the nine months ended September 30, 2006, diluted FFO
increased 12.5% to $40.6 million, compared with $36.1 million for the
nine months ended September 30, 2005. For the reasons stated above,
the Series C Preferred Shares had a positive impact on FFO. Had the
shares been dilutive in 2005, diluted FFO for the nine months ended
September 30, 2006, would have increased $1.3 million or 3.3%. On a
per share basis, diluted FFO increased 3.3% to $1.88, compared with
$1.82 in 2005. Net income from continuing operations for the nine
months ended September 30, 2006, increased 14.4% to $ 13.5 million,
compared with $11.8 million in 2005. On a per share basis, income from
continuing operations increased 27.5% to $0.51, compared to $0.40 in
2005.
"We are pleased to report very positive financial and operating
results for the third quarter," said Dennis Gershenson, President and
Chief Executive Officer. "Our Company continues to realize upon
opportunities in each of its three core disciplines, acquisitions,
development and asset management, evidenced by our actions this
quarter. Throughout the remainder of the year we will continue to
focus on these core competencies to achieve our growth objectives."
Acquisitions
During the quarter, the Company agreed to form a joint venture
(the Venture) with Heitman Value Partners Investments LLC, to acquire
$75 million of neighborhood, community or power shopping centers with
significant value-added opportunities in infill locations in
metropolitan trade areas. Ramco will manage the Venture and will
receive fees for acquisitions, property and asset management as well
as leasing, tenant coordination and construction.
The Venture's initial acquisitions will include Paulding Pavilion
and Collins Pointe Plaza, both in metropolitan Atlanta, Georgia. These
centers were acquired by the Company in April and August of 2006,
respectively, with the objective of contributing them to the Venture.
Collins Pointe is an 81,000 square foot community center formerly
anchored by Winn-Dixie/Save-Rite. Included in the acquisition was an
undeveloped outlot adjacent to the center. As previously announced,
Paulding Pavilion is a community shopping center located in Hiram,
Georgia and was formerly anchored by a Publix Supermarket, which is
currently being retenanted.
Development
The Company continues to make great strides in the development of
its one million square foot River City Marketplace in Jacksonville,
Florida. During the quarter, the Company signed a lease for a 55,600
square foot Gander Mountain. With the execution of this lease, as of
September 30, 2006, the Company had anchor commitments for the
shopping center of approximately 584,000 square feet. In addition, the
Company had signed leases for nearly 135,000 square feet of small shop
retail space and had completed five outlot sales. The Company is
planning a Grand Opening celebration at the shopping center on
November 17, 2006.
Other developments in progress at quarter-end include Rossford
Pointe in Rossford, Ohio and The Shoppes of Fairlane Meadows in
Dearborn, Michigan. Both of these developments are adjacent to
shopping centers owned by the Company.
As of September 30, 2006, the Company had spent $86.0 million on
these projects, which have an expected aggregate cost of $122 million.
When complete, the centers will account for approximately 1.1 million
square feet of retail space.
Asset Management
In September, as part of a value-added redevelopment of its
Lakeshore Marketplace in Norton Shores, Michigan, the Company sold a
10.5 acre parcel to Target for the construction of a 126,800 square
foot discount department store. Target is relocating to the site from
its current location in Muskegon, Michigan. Target will join anchor
tenants Barnes & Noble, TJ Maxx, Toys R Us, Elder-Beerman and Hobby
Lobby at the center.
Also during the quarter, the Company commenced the value-added
redevelopment of the West Allis Towne Centre in West Allis, Wisconsin
with the signing of Office Depot in 22,350 square feet. Office Depot
will take a large portion of the space vacated by Kohl's Supermarket.
The lease with Kohl's was terminated in September of 2006. Details
regarding the ongoing redevelopment of the center will be part of
future releases.
Including the projects listed above, at quarter-end the Company
was in the process of redeveloping a total of six shopping centers at
an aggregate cost of $16.0 million impacting approximately 347,000
square feet of retail space.
Leasing
During the quarter, the Company opened 32 non-anchor and 7 anchor
stores, at an average increase of 12.1% over portfolio average rents.
The Company also renewed 26 non-anchor and one anchor lease, at an
average increase of 15.3% over prior rental rates. Additionally, same
center operating income increased 6.6% for the quarter. At September
30, 2006, the portfolio was 94.7% leased, compared to 93.5% at
September 30, 2005.
Market Capitalization and Debt
Total debt at quarter-end was approximately $720.9 million with an
average interest rate of 6.3% and an average maturity of 48 months. Of
that total debt, $526.1 million was fixed rate debt and $194.8 million
was variable rate debt. At September 30, 2006, debt to market
capitalization was 50.3% and total capitalization approximated $1.4
billion.
Dividend
On October 3, 2006, the Company paid a third quarter dividend of
$0.4475 per common share, 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, for the period of July 1, 2006 through September 30, 2006 to
shareholders of record on September 20, 2006.
Earnings Guidance/Conference Call
As stated previously, the Company estimates that 2006 annual
diluted FFO will be between $2.53 and $2.58. It also expects earnings
per diluted common share to be between $0.79 and $0.84.
Ramco-Gershenson will host a live broadcast of its third quarter
conference call on Thursday, October 26, 2006 at 9:00 a.m. eastern
time. The live broadcast will be available online at www.rgpt.com and
www.streetevents.com and also by telephone at (866) 831-6291
(participant code 37037886). A replay will be available shortly after
the call on the aforementioned websites (for ninety days) or by
telephone at (888) 286-8010 (pass code 89316278), for one week.
Supplemental financial information is available via e-mail by
sending requests to dhendershot@rgpt.com and is also available at the
investor section of our web page.
As of September 30, 2006, Ramco-Gershenson Properties Trust owns
interests in 81 shopping centers totaling approximately 18.3 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, Florida, Georgia, Ohio, Wisconsin, Tennessee, Indiana, New
Jersey, Virginia, South Carolina, North Carolina, and Maryland.
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,
--------------------- --------------------
2006 2005 2006 2005
---------- ---------- --------- ----------
(In thousands, except per share amounts)
(Unaudited)
REVENUES:
Minimum rents $ 25,328 $ 23,223 $ 75,113 $ 71,226
Percentage rents 225 185 610 558
Recoveries from tenants 10,738 9,580 30,920 29,543
Fees and management
income 1,312 1,121 4,073 3,859
Other income 1,212 1,194 3,092 3,529
---------- ---------- --------- ----------
Total revenues 38,815 35,303 113,808 108,715
---------- ---------- --------- ----------
EXPENSES:
Real estate taxes 5,025 4,628 14,793 13,805
Recoverable operating
expenses 6,000 5,175 17,236 15,896
Depreciation and
amortization 8,105 7,375 24,058 23,125
Other operating 1,263 808 2,882 1,657
General and
administrative 3,328 2,991 10,724 10,579
Interest expense 11,767 10,717 33,326 31,851
---------- ---------- --------- ----------
Total expenses 35,488 31,694 103,019 96,913
---------- ---------- --------- ----------
Income from continuing
operations before gain on
sale of real estate assets,
minority interest and
earnings from
unconsolidated entities 3,327 3,609 10,789 11,802
Gain on sale of real estate
assets 1,204 630 2,937 626
Minority interest (877) (769) (2,549) (2,142)
Earnings from unconsolidated
entities 864 610 2,356 1,541
--------------------- --------- ----------
Income from continuing
operations 4,518 4,080 13,533 11,827
---------- ---------- --------- ----------
Discontinued operations, net
of minority interest:
Gain (loss) on sale of
real estate assets (28) - 926 -
Income from operations 9 724 402 2,027
---------- ---------- --------- ----------
Income (loss) from
discontinued operations (19) 724 1,328 2,027
---------- ---------- --------- ----------
Net income 4,499 4,804 14,861 13,854
Preferred stock dividends (1,664) (1,663) (4,991) (4,991)
---------- ---------- --------- ----------
Net income available to
common shareholders $ 2,835 $ 3,141 $ 9,870 $ 8,863
========== ========== ========= ==========
Basic earnings per share:
Income from continuing
operations $ 0.17 $ 0.14 $ 0.51 $ 0.40
Income from
discontinued
operations - 0.05 0.08 0.13
---------- ---------- --------- ----------
Net income $ 0.17 $ 0.19 $ 0.59 $ 0.53
========== ========== ========= ==========
Diluted earnings per share:
Income from continuing
operations $ 0.17 $ 0.14 $ 0.51 $ 0.40
Income from
discontinued
operations - 0.05 0.08 0.13
--------------------- --------- ----------
Net income $ 0.17 $ 0.19 $ 0.59 $ 0.53
========== ========== ========= ==========
Basic weighted average
shares outstanding 16,565 16,838 16,696 16,835
========== ========== ========= ==========
Diluted weighted average
shares outstanding 16,621 16,887 16,739 16,880
========== ========== ========= ==========
COMPREHENSIVE INCOME
Net income $ 4,499 $ 4,804 $ 14,861 $ 13,854
Other comprehensive income :
Unrealized gains
(losses) on interest
rate swaps (1,005) (113) 190 20
---------- ---------- --------- ----------
Comprehensive income $ 3,494 $ 4,691 $ 15,051 $ 13,874
========== ========== ========= ==========
RAMCO-GERSHENSON PROPERTIES TRUST
CALCULATION OF FUNDS FROM OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ -----------------
2006 2005 2006 2005
--------- -------- -------- --------
Net Income $ 4,499 $ 4,804 $14,861 $13,854
Add:
Depreciation and amortization
expense:
Continuing operations real
estate 8,713 7,926 25,838 24,338
Discontinued operations real
estate - 285 - 1,030
Gain on sale of real estate (1) (25) (630) (25) (653)
Minority interest in
partnership:
Continuing operations 877 769 2,549 2,142
Discontinued operations - 114 69 353
Less:
Discontinued operations, loss
(gain) on sale of real estate,
net of minority interest 28 - (926) -
--------- -------- -------- --------
Funds from operations 14,092 13,268 42,366 41,064
Less:
Series B Preferred Stock
dividend (593) (594) (1,781) (1,782)
Series C Preferred Stock
dividend - (1,069) - (3,209)
--------- -------- -------- --------
Funds from operations available to
common shareholders $13,499 $11,605 $40,585 $36,073
========= ======== ======== ========
Weighted average equivalent shares
outstanding, diluted 21,439 19,816 21,557 19,810
========= ======== ======== ========
Funds from operations available to
common shareholders,
per diluted share $ 0.63 $ 0.59 $ 1.88 $ 1.82
========= ======== ======== ========
- ----------------------------------
(1) Excludes gain (loss) on sale of undepreciated land of $2,911 in
2006 and ($27) in 2005.
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,
2006 2005
------------- ------------
(Unaudited)
(In thousands, except per
share amounts)
ASSETS
Investment in real estate, net $950,305 $922,103
Real estate assets held for sale - 61,995
Cash and cash equivalents 16,671 14,929
Accounts receivable, net 38,499 32,341
Equity investments in unconsolidated
entities 53,763 53,398
Other assets, net 39,416 40,509
------------- ------------
Total Assets $1,098,654 $1,125,275
============= ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Mortgages and notes payable $720,882 $724,831
Accounts payable and accrued expenses 29,787 31,353
Distributions payable 10,389 10,316
Capital lease obligation 7,739 7,942
------------- ------------
Total Liabilities 768,797 774,442
Minority Interest 37,207 38,423
SHAREHOLDERS' EQUITY
Preferred Shares of Beneficial Interest,
par value $0.01, 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 $0.01, 45,000 shares authorized;
16,574 and 16,847 issued and outstanding
as of September 30, 2006 and December
31, 2005, respectively 166 168
Additional paid-in capital 335,560 343,011
Accumulated other comprehensive income
(loss) 146 (44)
Cumulative distributions in excess of net
income (118,767) (106,270)
------------- ------------
Total Shareholders' Equity 292,650 312,410
------------- ------------
Total Liabilities and Shareholders'
Equity $1,098,654 $1,125,275
============= ============
For further information on Ramco-Gershenson Properties Trust visit the
Company's Website at www.rgpt.com
CONTACT: Ramco-Gershenson Properties Trust
Dennis Gershenson, President & CEO
or Richard Smith, CFO, 248-350-9900
FAX: 248-350-9925