Exhibit 99.1
Kimco Realty Reports Record Fourth Quarter and Full Year Operating Results
NEW HYDE PARK, N.Y.--(BUSINESS WIRE)--Feb. 13, 2007--Kimco Realty
Corporation (NYSE: KIM)
Highlights:
-- Net Income Increased 22.5% for the Quarter and 17.8% for the
Year
-- Funds From Operations Increased 16.0% for the Quarter and
17.1% for the Year
-- Net Income Per Share Increased 13.3% for the Quarter and 11.8%
for the Year
-- Funds From Operations Per Share Increased 5.5% for the Quarter
and 10.5% for the Year
-- Assets Under Management Increased to $14.0 Billion
-- Portfolio Occupancy Increased 50 Basis Points During the
Quarter to 95.5%
-- Investments for 2006 Exceeded $7.1 Billion in Total Value;
$1.0 Billion in First Month of 2007
-- Establishes Joint Venture in Chile
Kimco Realty Corporation (NYSE: KIM) today announced that net
income for the quarter ended December 31, 2006 increased 22.5 percent
to $131.9 million compared to $107.7 million a year earlier. On a per
diluted share basis, net income increased 13.3 percent to $0.51 from
$0.45 reported for the fourth quarter last year. Funds from operations
("FFO"), a widely accepted supplemental measure of REIT performance,
rose 16.0 percent to $147.8 million during the quarter from $127.5
million for the same period last year. On a per diluted share basis,
fourth quarter FFO increased 5.5 percent to $0.58 from $0.55 a year
ago. Funds from operations excludes gains on dispositions of operating
properties net of minority interests and joint venture properties of
approximately $44.8 million, or $0.17 per diluted common share in 2006
and $19.0 million, or approximately $0.08 per share in 2005.
For the year ended December 31, 2006, net income increased to 17.8
percent to $428.3 million from $363.6 million. On a diluted common
share basis, net income for the year increased 11.8 percent to $1.70
compared to $1.52 per diluted share a year earlier. Funds from
operations rose 17.1 percent to $544.3 million from $464.7 million in
the year earlier period. On a diluted per common share basis, FFO
increased 10.5 percent to $2.21 from $2.00 a year ago. Funds from
operations for the current year excludes gains on dispositions of
operating properties net of minority interests and joint venture
properties of $88.3 million or approximately $0.35 per diluted common
share and $45.4 million or approximately $0.19 per diluted common
share for the same period last year.
These operating results are consistent with the Company's
objective of generating a high level of income and FFO growth over
time. Kimco's compound annual growth rate in FFO per share is 10.6
percent in the 15 year period since its initial public offering in
1991.
Funds from operations (FFO) is a supplemental non-GAAP financial
measure used as a standard in the real estate industry to measure and
compare the operating performance of real estate companies. A complete
reconciliation containing adjustments from GAAP net income to FFO is
included in this release.
During the quarter, Kimco's parent portfolio occupancy increased
to 95.5 percent from 95.0 percent at September 30, 2006 and 94.6
percent a year earlier. Kimco's occupancy is the highest level in
Company history. For the quarter, Kimco signed 107 new leases in the
portfolio totaling 515,000 square feet and 105 lease renewals totaling
627,000 square feet. For the year, the Company signed 468 new leases
in this portfolio totaling approximately 1.8 million square feet and
420 lease renewals totaling 1.9 million square feet. The average
increase in base rent for new leases signed for same space leases was
18.2 percent and 20.0 percent for the quarter and year ended December
31, 2006, respectively. Occupancy in the Company's combined operating
portfolio encompassing approximately 138.0 million square feet of
gross leasable area was 95.8 percent, 70 basis points higher than a
year ago.
Investment Activity
During the year, Kimco acquired properties and investments for the
Company's core holdings portfolio, the investment management programs
and its operating businesses totaling in excess of $7.1 billion. The
Company's balance sheet continues to be one of the strongest in the
real estate industry. At year end, the Company had $345.0 million in
cash and unused credit facilities with capacity in excess of $1.1
billion.
U.S. Investments
Kimco acquired interests in 166 properties totaling 28.1 million
square feet during the fourth quarter of 2006 and the first month of
2007. In aggregate, the value of these acquisitions exceeded $5.4
billion, including the previously announced acquisitions of Pan
Pacific Retail Properties Inc. for $4.1 billion and the Crow Holdings
portfolio for $920 million. Additional significant shopping center
acquisitions during this period included the following:
-- The Company acquired two shopping centers for its
co-investment program with UBS Wealth Management. Woodbury
Centre located in Harriman, New York, is a 228,000 square foot
Kohl's anchored Shopping center that was acquired by the
venture in January for $43.6 million. In addition, Riverwalk
Marketplace located Duluth, Georgia, was acquired for $20.4
million. Riverwalk Marketplace is a recently constructed
78,000 square foot shopping center anchored by Whole Foods.
-- In the Company's co-investment program with G.E. Pension
Trust, the Company acquired Conroe Marketplace, a 244,000
square foot shopping center located in Conroe, Texas. Anchor
tenants at this property include TJ Maxx, Ross Stores, Bed
Bath & Beyond and Petsmart. The property was purchased for
$60.5 million.
-- Kimco also acquired Fountains at Arbor Lakes, a 407,000 square
foot recently completed shopping center located in Maple
Grove, Minnesota. Fountains at Arbor Lakes is anchored by a
Lowe's home improvement center and several other national
tenants. The property was purchased for approximately $95.0
million.
-- During the fourth quarter, Kimco completed the previously
announced acquisition of three properties located in Puerto
Rico. Ponce Town Center, Villa Maria Shopping Center and
Rexville Towne Center were acquired, completing the
acquisition of a $451.9 million portfolio of seven shopping
centers totaling 2.2 million square feet.
As a result of the Company's successful shopping center
acquisition program for the investment management business, Kimco now
manages assets with an approximate value of $14.0 billion. Kimco's
investment management business contributed approximately $44.4 million
to FFO during the quarter and $131.1 million for the year. These
amounts represent increases of 84 percent and 50 percent for the
quarter and full year, respectively.
U.S. Preferred Equity Investments
Kimco invested approximately $35.7 million in seven U.S. preferred
equity transactions during the quarter, for a total of 30 transactions
encompassing 73 properties and totaling $181.5 million for the full
year. During the quarter, the Company received payment of two
preferred equity investments resulting in proceeds of $11.6 million
for the quarter. In addition, Kimco invested $16.3 million in five
transactions during January 2007. The Company currently owns interests
in 133 properties in the U.S. preferred equity portfolio.
Canada
Kimco invested $10.0 million in three preferred equity
transactions in Canada during the quarter, and made an additional $8.2
million investment subsequent to quarter end. During the quarter,
Kimco completed its fourth preferred equity investment with Sandalwood
Management in Canada, investing $7.1 million in a portfolio of three
properties totaling 312,000 square feet. In addition, Kimco funded a
$2.5 million preferred equity investment in a portfolio of three
shopping centers with Abacus Capital in Canada. The three shopping
centers total approximately 120,000 square feet and are located in
suburban Toronto, Ontario. Subsequent to quarter end, Kimco funded an
additional $8.2 million investment with Abacus in a nine property
portfolio located in Ottawa, Ontario. Kimco has also completed four
investment transactions with Abacus. In aggregate, Kimco currently
owns interests in 104 properties in its Canadian preferred equity
portfolio.
Mexico
In Mexico, Kimco commenced six new shopping center developments,
acquired one stabilized Walmart and Office Depot anchored shopping
center in Mexicali, Baja California, and acquired three net leased
industrial properties for an aggregate investment of approximately
$78.5 million for the quarter. For the full year, Kimco commenced 11
new retail developments in Mexico with a total estimated project cost
of $342.8 million upon completion.
The new developments closed in the fourth quarter included:
-- Miguel Aleman Shopping Center, located in Monterrey, Mexico,
is a 386,000 square foot development project anchored by an
HEB grocery store. The property is located in a densely
populated section of the city where there are more than
255,000 people living within two miles. Total anticipated
costs to complete the project are approximately $41.1 million.
-- Walmart Plaza, located in Juarez, Mexico, is a ground up
development of a 154,000 square foot center anchored by a
Walmart Super Center. Total anticipated costs to complete this
development project are approximately $19.2 million.
-- Plaza Nuevo Laredo, located on the border between Texas and
Mexico in Nuevo Laredo, Mexico, is a 420,000 square foot
development project anchored by Home Depot and Walmart.
Completion of the development is expected in September 2007 at
a gross cost of approximately $30.8 million.
-- Plaza Mexiquense is a 161,000 square foot development located
in Tecamac, a city north east of Mexico City, Mexico. The
project is anchored by Bodega Aurrera, a neighborhood grocery
chain owned by Walmart. Total anticipated costs to complete
the project are expected to be approximately $13.2 million.
-- Plaza Cuautla, is a 566,000 square foot development located in
Cuautla a south east suburb of Mexico City, Mexico. The
development project is anchored by a Walmart Super Center,
Sam's Club, Suburbia and Cinepolis movie theatre. Total
anticipated costs to complete are expected to be approximately
$32.0 million.
-- Subsequent to quarter end, Kimco commenced a ground up
development on a 126,000 square foot shopping center located
in Huehuetoca, a suburb of Mexico City. The development is
expected to be completed in June 2007 at a cost of
approximately $10.3 million.
Chile
Kimco formed a joint venture with PATIO Gestion Inmobilaria, S.A.,
an established retail developer in Chile, to acquire and develop
shopping centers in major markets throughout the country. In its first
transaction, the venture will acquire a 50 percent interest in four
existing properties located in Chile's densely populated capital city
of Santiago. The properties being acquired have an acquisition value
of $16.2 million and they total 153,600 square feet, including
expansion space. The largest tenants include Farmacias Ahumada and
Farmacias Cruz Verde, leading Chilean pharmacy chains and leading
supermarket retailers, Cencosud and D&S.
Kimco has targeted Chile for expansion based on the Country's
superior investment returns, established retail real estate market,
consistent retail sales growth, strong and growing economy, and stable
government. In addition, Chile has an "A" investment rating from
Standard & Poor's and there is a vibrant mortgage market for financing
real estate investments.
Kimco Developers, Inc.
Kimco's merchant building business, Kimco Developers, Inc. (KDI)
sold three recently completed shopping center developments and seven
additional pad sites during the quarter. The development sales and two
earn- out payments generated proceeds of approximately $115.8 million
and gains on sales, net of taxes in the amount of $10.3 million for
the quarter. For the full year, KDI had proceeds from sales of
approximately $260.0 million and gains on sales, net of taxes in the
amount of $25.1 million.
During the quarter, KDI acquired a 160 acre land parcel for future
development in Marana, Arizona for approximately $30.0 million and an
additional parcel for KDI's existing Avenues Walk development project
in Jacksonville, Florida for approximately $4.5 million. In addition,
KDI purchased an interest in a 90 acre parcel in McMinnville, Oregon,
a suburb of Portland, for future development for approximately $4.1
million. Overall, KDI is currently developing 28 projects comprised of
11.6 million square feet.
Disposition Activity
Kimco continued to sell properties in non-strategic markets, with
weak demographics or limited prospects for growth. During the quarter
the Company sold 15 properties from the Company's core holdings
portfolio. In aggregate, these sales generated proceeds of $156.3
million and net gains on sales of approximately $40.7 million. For the
year, Kimco sold or disposed of 36 properties from this portfolio
totaling $294.2 million and generated gains on sales of $72.0 million
from this portfolio.
Earnings Guidance
As a result of the Company's continued strong investment and
operating performance, management increased its previously issued
range of FFO guidance to $2.39 - $2.49 from a range of $2.37-$2.47 per
share for the year ending December 31, 2007. A reconciliation of
management's projections from earnings per diluted common share to FFO
per diluted common share is included in this release.
Kimco Realty Corporation is a publicly traded real estate
investment trust that has specialized in shopping center acquisitions,
development and management for more than 45 years. The Company owns
and operates the nation's largest portfolio of neighborhood and
community shopping centers with interests in 1,348 properties
comprising approximately 175.4 million square feet of leasable space
located throughout 45 states, Canada, Mexico and Puerto Rico. 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, 2005. 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 Year Ended
December 31, December 31,
2006 2005 2006 2005
--------- --------- --------- ---------
Revenues from rental property $157,253 $132,396 $593,880 $505,557
--------- --------- --------- ---------
Rental property expenses:
Rent 2,952 2,596 11,786 10,267
Real estate taxes 19,491 17,412 75,515 64,731
Operating and maintenance 20,810 15,412 74,178 58,715
--------- --------- --------- ---------
43,253 35,420 161,479 133,713
--------- --------- --------- ---------
Net operating income 114,000 96,976 432,401 371,844
Income from other real estate
investments 16,123 15,652 77,062 56,751
Mortgage financing income 3,058 17,712 18,816 27,586
Management and other fee
income 11,130 8,398 40,684 30,474
Depreciation and amortization (41,821) (26,176) (141,070) (101,432)
--------- --------- --------- ---------
102,490 112,562 427,893 385,223
Interest, dividends and other
investment income 15,964 10,743 54,417 28,350
Other income/(expense), net 880 (3,891) 9,522 5,400
Interest expense (45,591) (35,156) (172,888) (126,901)
General and administrative
expenses (21,760) (17,967) (77,683) (56,799)
--------- --------- --------- ---------
51,983 66,291 241,261 235,273
Benefit (provision) for income
taxes (3,613) 3,727 (4,387) (165)
Equity in income of real
estate joint ventures, net 34,133 20,313 106,930 77,454
Minority interests in income
of partnerships, net (6,700) (1,678) (26,254) (12,260)
Gain on sale of development
properties, net of tax of
$2,262, $1,249, $12,155 and
$10,824, respectively 10,281 3,976 25,121 22,812
--------- --------- --------- ---------
Income from continuing
operations 86,084 92,629 342,671 323,114
--------- --------- --------- ---------
Discontinued Operations:
- -------------------------------
Income from discontinued
operating properties 4,622 3,374 14,004 14,337
Minority interest on
discontinued operating
properties 32 (347) (1,497) (476)
Loss on operating properties
held for sale/sold (608) (2,483) (1,421) (5,098)
Gain on disposition of
operating properties, net of
tax 40,703 14,494 72,042 28,918
--------- --------- --------- ---------
Income from discontinued
operations 44,749 15,038 83,128 37,681
--------- --------- --------- ---------
Gain on transfer of operating
properties (1) -- -- 1,394 2,301
Loss on transfer of operating
properties(1) -- -- -- (150)
Gain on sale of operating
properties, net of tax (1) 1,066 -- 1,066 682
--------- --------- --------- ---------
1,066 -- 2,460 2,833
--------- --------- --------- ---------
Net income 131,899 107,667 428,259 363,628
Preferred stock dividends (2,909) (2,909) (11,638) (11,638)
--------- --------- --------- ---------
Net income available to common
shareholders $128,990 $104,758 $416,621 $351,990
========= ========= ========= =========
Per common share:
Income from continuing
operations:
- Basic $ 0.34 $ 0.39 $ 1.39 $ 1.39
========= ========= ========= =========
- Diluted $ 0.33(2) $ 0.39(3) $ 1.36(2) $ 1.36(2)
========= ========= ========= =========
Net income:
- Basic $ 0.52 $ 0.46 $ 1.74 $ 1.55
========= ========= ========= =========
- Diluted $ 0.51(2) $ 0.45(3) $ 1.70(2) $ 1.52(2)
========= ========= ========= =========
Weighted Average Share
Information Three Months Ended Year Ended
For earnings per share December 31, December 31,
calculations: 2006 2005 2006 2005
---------- ---------- ---------- ----------
Weighted average shares -
- Basic 247,752 227,625 239,552 226,641
========== ========== ========== ==========
- Diluted 253,717(2) 236,464(3) 244,615(2) 230,868(2)
========== ========== ========== ==========
Note: Reclassifications: Certain amounts in the prior period have
been reclassified in order to conform with the current period's
presentation.
(1) Included in the calculation of income from continuing
operations per share in accordance with SEC guidelines.
(2) Reflects the potential impact if certain units were converted
to common stock at the beginning of the period. The impact of the
conversion would have an anti-dilutive effect on net income and
therefore have not been included.
(3) Reflects the potential impact if certain units were converted
to common stock at the beginning of the period. Net income would be
increased by $1,739 for the three months ended December 31, 2005.
Kimco Realty Corporation
Funds From Operations
(In thousands, except per share data)
Three Months Ended Year Ended
December 31, December 31,
2006 2005 2006 2005
--------- --------- --------- ---------
Funds From Operations(1)
Net income $131,899 $107,667 $428,259 $363,628
Gain on disposition of
operating properties, net of
minority interests (40,703) (14,203) (71,776) (31,611)
Gain on disposition of joint
venture operating properties (4,107) (4,846) (16,549) (13,776)
Depreciation and amortization 42,089 27,470 144,319 108,032
Depreciation and amortization
- real estate joint ventures 21,562 14,272 71,731 50,059
Preferred stock dividends (2,909) (2,909) (11,638) (11,638)
--------- --------- --------- ---------
Funds from operations(1) $147,831 $127,451 $544,346 $464,694
========= ========= ========= =========
Per common share:
- Basic $ 0.60 $ 0.56 $ 2.27 $ 2.05
========= ========= ========= =========
- Diluted (2) $ 0.58 $ 0.55 $ 2.21 $ 2.00
========= ========= ========= =========
Weighted Average Share Information Three Months
Ended Year Ended
December 31, December 31,
2006 2005 2006 2005
-------- -------- -------- --------
Weighted average shares -
- Basic 247,752 227,625 239,552 226,641
======== ======== ======== ========
- Diluted (2) 259,878 236,464 250,315 235,634
======== ======== ======== ========
(1) Most industry analysts and equity REITs, including the
Company, generally consider funds from operations ("FFO") to be an
appropriate supplemental measure of the performance of an equity REIT.
FFO is defined as net income applicable to common shares before
depreciation and amortization, extraordinary items, cumulative effect
of accounting changes, gains on sales of operating real estate, plus
the pro-rata amount of depreciation and amortization of unconsolidated
joint ventures, net of minority interests, determined on a consistent
basis. Given the nature of the Company's business as a real estate
owner and operator, the Company believes that FFO is helpful to
investors as a measure of its operational performance. FFO does not
represent cash generated from operating activities in accordance with
generally accepted accounting principles and therefore should not be
considered an alternative for net income as a measure of liquidity. In
addition, the comparability of the Company's FFO with the FFO reported
by other REITs may be affected by the differences that exist regarding
certain accounting policies relating to expenditures for repairs and
other recurring items.
(2) Reflects the potential impact if certain units were converted
to common stock at the beginning of the period. Funds from operations
would be increased by $2,410 and $1,739 for the three months ended
December 31, 2006 and 2005, respectively, and $8,587 and $6,693 for
the year ended December 31, 2006 and 2005, respectively, reflecting
the distributions associated with these units.
Kimco Realty Corporation
Consolidated Balance Sheets
(In thousands, except per share data)
December 31, December 31,
2006 2005
------------ ------------
Assets:
Operating real estate, net of accumulated
depreciation of $806,670 and $740,127,
respectively $4,156,667 $3,209,158
Investments and advances in real estate
joint ventures 1,067,918 735,648
Real estate under development 1,037,982 611,121
Other real estate investments 451,731 283,035
Mortgages and other financing receivables 162,669 132,675
Cash and cash equivalents 345,065 76,273
Marketable securities 202,659 206,452
Accounts and notes receivable 83,418 64,329
Other assets 361,171 215,945
------------ ------------
$7,869,280 $5,534,636
============ ============
Liabilities:
Notes payable $2,748,345 $2,147,405
Mortgages payable 567,917 315,336
Construction loans payable 270,981 228,455
Dividends payable 93,222 78,169
Other liabilities 396,614 255,213
------------ ------------
4,077,079 3,024,578
------------ ------------
Minority interests in partnerships 425,242 122,844
------------ ------------
Stockholders' Equity:
Preferred stock, $1.00 par value, authorized
3,600,000 shares
Class F Preferred Stock, $1.00 par value,
authorized 700,000 shares
Issued and outstanding 700,000 shares 700 700
Aggregate liquidation preference $175,000
Common Stock, $.01 par value, authorized
300,000,000 shares
Issued 251,416,749 and outstanding
250,870,169 at December 31, 2006; 2,509 2,281
Issued and outstanding 228,059,056 at
December 31, 2005
Paid-in capital 3,178,016 2,255,332
Retained earnings 140,509 59,855
------------ ------------
3,321,734 2,318,168
Accumulated other comprehensive income 45,225 69,046
------------ ------------
3,366,959 2,387,214
------------ ------------
$7,869,280 $5,534,636
============ ============
Reclassifications:
Certain amounts in the prior period have been reclassified in
order to conform with the current period's presentation.
Kimco Realty Corporation
Reconciliation of Projected Diluted Net Income Per Common Share to
Projected Funds From Operations Per Common Share
Projected Range
Full Year 2007
Low High
--------- --------
Projected diluted earnings per common share $ 1.64 $ 1.81
Projected depreciation and amortization 0.56 0.57
Projected depreciation and amortization
from real estate joint ventures, net of
minority interests 0.29 0.31
Gain on disposition of operating properties (0.05) (0.10)
Gain on disposition of joint venture
operating properties (0.05) (0.10)
--------- --------
Projected FFO per diluted common share $ 2.39 $ 2.49
========= ========
Projections involve numerous assumptions such as rental income
(including assumptions on percentage rent), interest rates, tenant
defaults, occupancy rates, foreign currency exchange rates (such as
the US-Canadian rate), selling prices of properties held for
disposition, expenses (including salaries and employee costs),
insurance costs and numerous other factors. Not all of these factors
are determinable at this time and actual results may vary from the
projected results, and may be above or below the range indicated. The
above range represents management's estimate of results based upon
these assumptions as of the date of this press release.
CONTACT: Kimco Realty Corporation
Scott Onufrey, 516-869-7190
sonufrey@kimcorealty.com