Exhibit 99.1
Ramco-Gershenson Properties Trust Reports Results
for Fourth Quarter and Year-End 2006
FARMINGTON HILLS, Mich.--(BUSINESS WIRE)--Feb. 21,
2007--Ramco-Gershenson Properties Trust (NYSE:RPT) announced today
results for the fourth quarter and twelve months ended December 31,
2006.
Financial Information for the Fourth Quarter 2006:
-- Diluted FFO per share of $0.65, an increase of 8.3%
-- Diluted FFO of $14.0 million, an increase of 18.6%
-- Total revenues of $39.4 million, an increase of 8.8%
-- Diluted EPS from continuing operations of $1.09
-- Quarterly dividend of $0.4475 per common share
Financial Information for the Year-End 2006:
-- Diluted FFO per share of $2.54, an increase of 5.0%
-- Diluted FFO of $54.6 million, an increase of 14.0%
-- Total revenues of $153.2 million, an increase of 5.7%
-- Diluted EPS from continuing operations of $1.65
-- Annual dividend of $1.79 per common share
Company Highlights in 2006:
-- Announced a favorable conclusion to the Company's IRS Tax Case
-- Entered into a new $450 million joint venture to acquire
Midwest and Mid-Atlantic shopping centers
-- Entered into a $75 million joint venture with Heitman Value
Partners LLC
-- Celebrated the grand opening of the 1.2 million SF River City
Marketplace in Jacksonville, FL
-- Completed the value-added redevelopment of 10 shopping
centers, started 5 new redevelopments
-- Sold seven non-core shopping centers for $47 million
-- Raised the annual dividend 2.3% to $1.79 per share
-- Opened 124 new non-anchor stores, 10.1% above portfolio
average rents
-- Renewed 171 non-anchor leases, 10.1% above prior rental rates
-- Won NAREIT's Gold Award for contents of its 2005 Annual Report
Financial Results
For the three months ended December 31, 2006, diluted Funds from
Operations (FFO) increased 18.6% to $14.0 million compared with $11.8
million for the three months ended December 31, 2005. On a per share
basis, diluted FFO increased 8.3% to $0.65, compared with $0.60 in
2005. Total revenues increased 8.8% to $39.4 million, compared to
$36.2 million in 2005. Net income from continuing operations was $20.8
million, compared to $3.6 million in 2005. Net Income from continuing
operations for the three months ended December 31, 2006, included a
$19.1 million gain on the sale of several assets to joint ventures
that occurred during the fourth quarter. On a diluted per share basis,
income from continuing operations was $1.09 per share compared to
$0.12 per share in 2005.
For the twelve months ended December 31, 2006, diluted Funds from
Operations (FFO) increased 14.0% to $54.6 million compared with $47.9
million for the twelve months ended December 31, 2005. On a per share
basis, diluted FFO increased 5.0% to $2.54, compared with $2.42 in
2005. Total revenues increased 5.7% to $153.2 million, compared to
$144.9 million in 2005. Net income from continuing operations was
$34.3 million, compared to $15.5 million in 2005. As noted above, net
income from continuing operations for the year was positively impacted
from the gain on asset sales to joint ventures that occurred during
the fourth quarter. On a diluted per share basis, income from
continuing operations was $1.65 per share compared to $0.52 per share
in 2005.
"Our 2006 operating and financial results continue to reflect an
aggressive business plan and the strength of our core shopping center
portfolio," said Dennis Gershenson, President and Chief Executive
Officer. "During the year we entered into two substantial joint
ventures for the acquisition and redevelopment of over $500 million in
shopping center assets. We made tremendous progress on our 1.2 million
square foot River City Marketplace development and posted solid
leasing results and redevelopment returns, which were driven by strong
tenant demand. We expect our business initiatives this year to lay the
groundwork for future growth."
Operating Highlights
Joint Venture Acquisition Activity
During the fourth quarter, the Company entered into a $450 million
joint venture with an investor advised by Heitman LLC for the
acquisition of Midwest and Mid-Atlantic shopping centers.
Ramco-Gershenson holds a 20% equity interest in the partnership and
will be responsible for managing the Venture and its properties
earning market fees for its services. In December, the Company sold
Merchants' Square in Carmel, Indiana and Crofton Centre in Crofton,
Maryland to the joint venture. These assets are valued at $70.9
million. The Company expects to sell one additional asset to the
Venture, bringing the total sale of assets to $125 million.
Also during the fourth quarter, the Company entered into a $75
million joint venture with Heitman Value Partners LLC to acquire
shopping centers with significant value-added opportunities in
metropolitan trade areas. Ramco-Gershenson is responsible for the
management of the Venture. Collins Pointe in Cartersville, Georgia (a
suburb of Atlanta), which was acquired by Ramco-Gershenson in August,
was sold to the Venture in November. It is expected that Paulding
Pavilion in Hiram, Georgia, which was acquired by the Company in
April, will be sold to the Venture by the end of the first quarter of
2007.
In December, the Company purchased the former Home Expo building
adjacent to the Troy Marketplace in Troy, Michigan, an asset already
part of the Company's joint venture with ING Clarion Partners, LLC.
The Company plans to redevelop and re-tenant this new acquisition,
which contains approximately 93,000 square feet of retail space.
Subsequent to year-end, the Company acquired Cocoa Commons, a 75,120
square foot community shopping center located in Cocoa, Florida, also
for its joint venture with ING Clarion. The center is anchored by a
51,420 square foot Publix Supermarket and includes an expansion area
for the development of an additional 15,000 square feet of retail
space. Including these two acquisitions, the Venture has purchased 14
shopping centers totaling $405 million or approximately 90% of the
total partnership commitment.
Dispositions
In September, the Company sold a 10.5 acre parcel to Target for
the construction of a 126,800 square foot department store at its
Lakeshore Marketplace in Norton Shores, Michigan (a suburb of
Muskegon, Michigan). Target will join Barnes & Noble, TJ Maxx,
Elder-Beerman and Hobby Lobby, bringing the total square footage of
the center to approximately 475,000 square feet.
In January of 2006, the Company sold a seven shopping center
portfolio that comprised approximately 935,000 square feet for $47
million and a non-FFO gain of approximately $900,000. The proceeds
from the sale were used to pay down the Company's unsecured revolving
credit facility. The centers sold were part of the Company's plan to
sell assets located in non-strategic markets with limited
opportunities for growth.
Development
In the fourth quarter, the Company celebrated the grand opening of
the first phase of its River City Marketplace in Jacksonville,
Florida. During the quarter, the Company completed negotiations with
three additional anchor tenants finalizing the anchor leasing for the
entire center. The anchor tenancies account for over 682,000 square
feet and include Wal-Mart, Lowe's, Best Buy, Ashley Furniture, Gander
Mountain, Wallace (Hollywood) Theatre, Ross Dress for Less, Michael's,
Petsmart, Bed, Bath & Beyond, OfficeMax and Old Navy. In addition, the
Company has completed ten outlot sales and leased approximately
167,000 square feet of in-line retail space at the center. At
completion, the shopping center complex will comprise approximately
1.2 million square feet.
At year-end, the Company had two additional development projects
in process: Rossford Pointe in Rossford, Ohio and The Shoppes of
Fairlane Meadows, in Dearborn, Michigan. Both centers are being
developed on parcels of land adjacent to shopping centers owned by the
Company.
As of December 31, 2006, the Company had spent $89.2 million on
the developments in progress, which have an estimated total project
cost of $117.2 million.
Asset Management
During the year, the Company completed 10 value-added
redevelopments with a total project cost of $25.5 million producing an
11.2% return on new dollars invested. Each of the projects involved
the addition or expansion of a national or regional anchor retailer
eager to increase its presence in the marketplace.
The Company is currently expanding/redeveloping five additional
shopping centers. Three of the projects are in metropolitan Michigan
markets with superior demographics. The projects include Troy
Marketplace and Hunter's Square, both in Oakland County in suburban
Detroit. These two centers are part of the Company's joint venture
with ING/Clarion. The third redevelopment project in Michigan is
Lakeshore Marketplace in Norton Shores (a suburb of Muskegon). These
three projects combined impact approximately 253,000 square feet of
retail space at the centers. The other two projects are West Allis
Towne Centre in West Allis, Wisconsin and Paulding Pavilion in Hiram,
Georgia. All of the projects were started in 2006. As of year-end the
Company had spent $1.9 million on these redevelopments, which have an
estimated project cost of $18.4 million.
Leasing/Same Center Operating Results
During 2006, the Company opened 124 new non-anchor stores in
394,926 square feet, at an average base rent of $16.64 per square
foot, an increase of 10.1% over portfolio average rents. The Company
also renewed 171 non-anchor leases in 544,519 square feet, at an
average base rent of $14.94 per square foot, an increase of 10.1% over
prior rental rates. Additionally, the Company signed 18 new anchor
leases and renewed 9 anchors during the year. Overall, portfolio
average base rents increased 5.6% to $10.09 per square foot in 2006
from $9.55 in 2005. On an annual basis, same-center property operating
income increased 1.8%. At year-end, the portfolio was 93.6% leased.
Debt and Market Capitalization
Total debt at year-end was $676.2 million with an average interest
rate of 6.3% and an average maturity of 45 months. Of that total debt,
$499.8 million was fixed rate debt and $176.4 million was variable
rate debt. Total capitalization for the Company was approximately $1.5
billion at December 31, 2006, with debt to market capitalization ratio
of 44.5%.
Dividend
In March 2006, the Company's Board of Trustees approved a 2.3%
increase in the annual common share dividend paid quarterly in the
months of April, July, October and January. The increase raised the
2006 annual dividend from $1.75 to $1.79.
On January 2, 2007, the Company paid a fourth quarter dividend of
$0.4475 per common share, a fourth quarter dividend of $0.5938 per
Series B cumulative redeemable preferred share and a fourth quarter
dividend of $0.5664375 per Series C cumulative convertible preferred
share, for the period of October 1, 2006 through December 31, 2006 to
shareholders of record on December 20, 2006.
Earnings Guidance/Conference Call
The Company expects 2007 annual diluted FFO per share to be
between $2.61 and $2.69, and plans to discuss these estimates as part
of its fourth quarter conference call. In addition, the Company
expects earnings per diluted common share to be between $0.80 and
$0.85.
Management considers funds from operations, also known as "FFO" to
be an appropriate supplemental measure of financial performance for a
REIT. Please see the reconciliation of funds from operations to net
income later in this press release.
Ramco-Gershenson will host a live broadcast of its fourth
quarter/year-end conference call on February 22, 2007 at 10:00 a.m.
eastern time, to discuss its financial results and 2007 guidance. The
live broadcast will be available online at www.rgpt.com and
www.streetevents.com and also by telephone at (800) 638-5439 (passcode
93100334). A replay will be available shortly after the call on the
aforementioned websites (for ninety days) or by telephone at (888)
286-8010, passcode 67548830 (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.
Ramco-Gershenson Properties Trust, headquartered in Farmington
Hills, Michigan, 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. As of
December 31, 2006, Ramco-Gershenson owned interests in 81 shopping
centers totaling approximately 18.3 million square feet of gross
leasable area in Michigan, Florida, Georgia, Ohio, Wisconsin,
Tennessee, Indiana, New Jersey, Virginia, South Carolina, North
Carolina, and Maryland. For further information on Ramco-Gershenson
Properties Trust visit the Company's website at www.rgpt.com.
This press release contains forward-looking statements with
respect to the operation of certain of the Trust's properties.
Management of Ramco-Gershenson believes the expectations reflected in
the forward-looking statements made in this document 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 Trust's
properties are located, the performance of the Trust's tenants at the
Trust's properties and elsewhere and other factors discussed in the
Trust's reports filed with the Securities and Exchange Commission.
RAMCO-GERSHENSON PROPERTIES TRUST
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
For the Three Months For the Twelve Months
Ended December 31, Ended December 31,
-------------------- ---------------------
2006 2005 2006 2005
---------- --------- ---------- ----------
Revenues
Minimum rents $25,381 $23,937 $100,494 $95,163
Percentage rents 312 191 922 749
Recoveries from tenants 11,245 9,923 42,165 39,466
Fees and management
income 1,603 1,619 5,676 5,478
Other income 900 494 3,992 4,023
---------- --------- ---------- ----------
Total revenues 39,441 36,164 153,249 144,879
---------- --------- ---------- ----------
Expenses
Real estate taxes 6,110 4,529 20,903 18,334
Recoverable operating
expenses 6,141 6,127 23,377 22,023
Depreciation and
amortization 8,617 7,447 32,675 30,572
Other operating 835 1,604 3,717 3,261
General and
administrative 2,276 2,930 13,000 13,509
Interest expense 12,083 10,570 45,409 42,421
---------- --------- ---------- ----------
Total expenses 36,062 33,207 139,081 130,120
---------- --------- ---------- ----------
Income from continuing
operations before gain on
sale of real estate
assets, minority interest
and earnings from
unconsolidated entities 3,379 2,957 14,168 14,759
Gain on sale of real estate
assets 20,451 510 23,388 1,136
Minority interest (3,692) (690) (6,241) (2,833)
Earnings from
unconsolidated entities 646 859 3,002 2,400
---------- --------- ---------- ----------
Income from continuing
operations 20,784 3,636 34,317 15,462
Income from discontinued
operations (21) 1,003 1,307 3,031
---------- --------- ---------- ----------
Net income 20,763 4,639 35,624 18,493
Preferred stock dividends (1,664) (1,664) (6,655) (6,655)
---------- --------- ---------- ----------
Net income available to
common shareholders $19,099 $2,975 $28,969 $11,838
========== ========= ========== ==========
Basic earnings per share:
Income from continuing
operations $1.15 $0.12 $1.66 $0.52
Income from discontinued
operations 0.00 0.06 0.08 0.18
---------- --------- ---------- ----------
Net income $1.15 $0.18 $1.74 $0.70
========== ========= ========== ==========
Diluted earnings per share:
Income from continuing
operations $1.09 $0.12 $1.65 $0.52
Income from discontinued
operations 0.00 0.06 0.08 0.18
---------- --------- ---------- ----------
Net income $1.09 $0.18 $1.73 $0.70
========== ========= ========== ==========
Basic weighted average
shares outstanding 16,572 16,841 16,665 16,837
========== ========= ========== ==========
Diluted weighted average
shares outstanding 18,542 16,879 16,718 16,880
========== ========= ========== ==========
RAMCO-GERSHENSON PROPERTIES TRUST
CALCULATION OF FUNDS FROM OPERATIONS
(In thousands, except per share amounts)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------ -------------------
2006 2005 2006 2005
--------- -------- ---------- --------
Net income $20,763 $4,639 $35,624 $18,493
Add:
Depreciation and amortization
expense 9,230 7,967 35,068 33,335
Minority interest in
partnership:
Continuing operations 3,692 690 6,241 2,833
Discontinued operations - 175 69 527
Less:
Loss (gain) on sale of
depreciable property (19,084) 16 (19,109) (637)
Discontinued operations,
(gain) loss on sale 12 - (914) -
--------- -------- ---------- --------
Funds from operations 14,613 13,487 56,979 54,551
Less:
Preferred stock dividends (594) (1,664) (2,375) (6,655)
--------- -------- ---------- --------
Funds from operations available
to common shareholders (1) $14,019 $11,823 $54,604 $47,896
========= ======== ========== ========
Weighted average equivalent
shares outstanding (2)
Basic 19,499 19,770 19,594 19,766
========= ======== ========== ========
Diluted 21,469 19,808 21,536 19,810
========= ======== ========== ========
Funds from operations available
for common shareholders, per
diluted share $0.65 $0.60 $2.54 $2.42
========= ======== ========== ========
(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.
(2) In 2006, the Company's Series C Preferred Shares were dilutive
and, therefore, the dividends paid did not impact our diluted FFO.
For the three months and year ended December 31, 2006, 1,889 Series C
Preferred Shares were included in the calculation of the diluted
weighted average equivalent shares outstanding. In 2005, the shares
were antidilutive and reduced diluted FFO by $1.1 million for
dividends paid during the three months ended December 31, 2005 and by
$4.3 million for dividends paid during the year ended December 31,
2005.
RAMCO-GERSHENSON PROPERTIES TRUST
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share amounts)
December 31,
-----------------------
2006 2005
----------- -----------
Assets
Investment in real estate, net $897,975 $922,103
Real estate assets held for sale - 61,995
Cash and cash equivalents 19,322 14,929
Accounts receivable, net 33,692 32,341
Equity investments in and advances to
unconsolidated entities 75,824 53,398
Other assets, net 38,057 40,509
----------- -----------
Total Assets $1,064,870 $1,125,275
=========== ===========
Liabilities and Shareholders' Equity
Mortgages and notes payable $676,225 $724,831
Accounts payable and accrued expenses 26,424 31,353
Distributions payable 10,391 10,316
Capital lease obligation 7,682 7,942
----------- -----------
Total Liabilities 720,722 774,442
Minority Interest 39,565 38,423
Shareholders' Equity
Preferred Shares of Beneficial Interest,
par value $.01, 10,000 shares authorized:
9.5% Series B Cumulative Redeemable
Preferred Shares; 1,000 issued and
outstanding, liquidation value of
$25,000 23,804 23,804
7.95% Series C Cumulative Convertible
Preferred Shares; 1,889 issued as of
December 31, 2006 and 2005, 1,888 and
1,889 outstanding as of December 31,
2006 and 2005, respectively,
liquidation value of of $53,808 51,714 51,741
Common Shares of Beneficial Interest, par
value $.01, 30,000 shares authorized;
16,580and 16,847 issued and outstanding,
as of December 31, 2006 and 2005,
respectively 166 168
Additional paid-in capital 335,738 343,011
Accumulated other comprehensive income
(loss) 247 (44)
Cumulative distributions in excess of net
income (107,086) (106,270)
----------- -----------
Total Shareholders' Equity 304,583 312,410
----------- -----------
Total Liabilities and Shareholders'
Equity $1,064,870 $1,125,275
=========== ===========
CONTACT: Ramco-Gershenson Properties Trust
Dennis Gershenson, President & CEO
or Richard Smith, CFO, 248-350-9900
Fax: 248-350-9925