Exhibit 99.1
Ramco-Gershenson Properties Trust Reports Results
for Second Quarter 2007
Posts Solid Operating Statistics and Reaffirms 2007 Annual FFO
Guidance
FARMINGTON HILLS, Mich.--(BUSINESS WIRE)--July 25,
2007--Ramco-Gershenson Properties Trust (NYSE:RPT) announced today
results for the second quarter ended June 30, 2007.
Financial Information for the Second Quarter 2007:
-- Diluted FFO per share of $0.60
-- Diluted FFO of $12.9 million
-- Total revenues of $37.2 million
-- Diluted EPS from continuing operations of $0.56
Company Highlights for the Second Quarter 2007:
-- Announces $270 million development pipeline
-- Formed new acquisition joint venture
-- Completed the redemption of Series C Preferred Shares
-- Increased same center operating income by 3.4%
-- Opened 21 new non-anchor stores, 37.6% over portfolio rental
averages
-- Renewed 24 non-anchor leases, 12.9% over prior rental rates
Financial Results
For the three months ended June 30, 2007, diluted Funds from
Operations (FFO) decreased 4.4% to $12.9 million compared with $13.5
million for the three months ended June 30, 2006. On a per share
basis, diluted FFO decreased 4.8% to $0.60, compared with $0.63 in
2006. The primary reasons for the decrease in FFO related to the sale
of assets to newly formed joint ventures as well as a significant
lease termination fee received last year. Total revenues decreased
3.1% to $37.2 million, compared to $38.4 million in 2006, also
primarily due to the sale of properties mentioned above. Income from
continuing operations was $11.0 million, which included a gain on the
sale of real estate assets, net of minority interest of $7.7 million
or $0.36 per share compared to income from continuing operations of
$4.7 million in 2006. On a diluted per share basis, income from
continuing operations was $0.56 per share compared to $0.18 per share
in 2006.
For the six months ended June 30, 2007, diluted Funds from
Operations (FFO) increased 0.4% to $27.2 million compared with $27.1
million for the six months ended June 30, 2006. On a per share basis,
diluted FFO increased 0.8% to $1.26, compared with $1.25 in 2006.
Total revenues increased 3.2% to $77.4 million, compared to $75.0
million in 2006. Income from continuing operations was $34.9 million,
which included a gain on the sale of real estate assets, net of
minority interest of $26.8 million or $1.44 per share compared to
income from continuing operations of $9.0 million in 2006. On a
diluted per share basis, income from continuing operations was $1.82
per share compared to $0.34 per share in 2006.
"I am pleased to report that we posted solid operating statistics
for the second quarter including strong same center income growth and
leasing results for both new leases and renewals," said Dennis
Gershenson, President and Chief Executive Officer. "We acknowledge
that our funds from operations did not meet analyst expectations for
the quarter, however, our 2007 business plan, which includes the
ramping up of three new development projects, the initiation of a
number of value-added redevelopments plus an aggressive acquisition
schedule, is on track. We are confident of achieving our stated
financial objectives for the year and reaffirm our FFO guidance."
Operating Highlights
Joint Venture Acquisitions
During the quarter, the Company sold two of its shopping centers
to a newly formed joint venture with a discretionary fund that invests
in core assets managed by Heitman LLC. The shopping centers, which
include Kissimmee West in Kissimmee, Florida and Shoppes of Lakeland
in Lakeland, Florida, have an aggregate value of $52.9 million.
Ramco-Gershenson will hold a 7% interest in the joint venture and will
continue to manage the properties earning market fees for the services
it performs. Expansion of the joint venture will be on an
asset-by-asset basis.
Development
The Company is currently pursuing three new shopping center
developments driven by strong retailer demand and solid market
demographics. The Company is currently working with the respective
community governmental agencies to complete the entitlement processes
for these projects, which represent a variety of retail concepts
including mixed-use and town center formats. The developments are:
-- The Town Center at Aquia in Stafford, Virginia includes the
complete value-added redevelopment of an existing 200,000
square foot shopping center owned by the Company. When
complete the mixed-use asset will encompass over 650,000
square feet of upscale office, retail/entertainment components
and approximately 300 residential units. During the second
quarter, the Company signed a lease with Northrop Grumman to
occupy 49,000 square feet or approximately one-half of the
first Class A Office Building currently under construction at
the site. The office building is expected to open in January
of 2008. The total project cost is estimated at $150 million.
-- Hartland Towne Square in Hartland, Michigan is being developed
through a joint venture as a 550,000 square foot traditional
community center featuring two major anchors to include a
department/grocery superstore and a home improvement store.
The center will also include at least three mid-box national
retailers as well as a number of outlots. Hartland Towne
Square is located on the northeast corner of the US-23 and
M-59 interchange at a midpoint between Detroit to the east,
Ann Arbor to the south and Lansing to the west. The total
project cost is estimated at $50 million.
-- Northpointe Town Center in Jackson, Michigan is being
developed as a 575,000 square foot combination power center
and town center, which will include retail, entertainment and
office components. Located at the interchange of I-94 and
US-127, the new development will complement two other
Ramco-Gershenson properties in the market, which currently
account for over 850,000 square feet. The 70 acre project
results from strong retailer demand and the inability to
accommodate retailer requests at the Company's two existing
shopping centers. The total project cost is estimated at $70
million.
Including the aforementioned projects, the Company is currently
developing six centers totaling approximately 3.0 million square feet
with an estimated total project cost of $385 million.
Redevelopment
At June 30, 2007, the Company had six value-added redevelopment
projects in process for both wholly-owned and joint venture properties
impacting approximately 390,000 square feet with a total project cost
of $25.1 million.
The Company is currently in the process of finalizing negotiations
for five additional redevelopments, which are expected to come on-line
prior to the end of the year. These projects include the addition of
at least one anchor tenant to shopping centers in Michigan, Florida
and Georgia.
Leasing
During the second quarter, for both core and joint venture
properties, 21 new non-anchor stores opened in 62,705 square feet, at
an average base rent of $21.55 per square foot, an increase of 37.6%
over portfolio average rents. In addition, 24 non-anchor leases were
renewed impacting 85,955 square feet, at an average base rent of
$13.40 per square foot, an increase of 12.9% over prior rental rates.
Same center property operating income for the quarter increased 3.4%.
At June 30, 2007, the portfolio was 92.7% occupied.
Debt and Market Capitalization
Total debt at quarter-end was approximately $663.6 million with an
average interest rate of 6.1% and an average maturity of 56 months. Of
that total, $558.5 million was fixed rate debt and $105.1 million was
variable rate debt. As of June 30, 2007, debt to market capitalization
was 45.5% and total capitalization approximated $1.5 billion.
Preferred Share Redemption/Dividend
During the quarter, the Company completed the redemption of its
7.95% Series C Cumulative Convertible Preferred Shares of Beneficial
Interest. As of June 1, 2007, 1,857,846 Series C Preferred Shares, or
approximately 98% of the 1,889,000 shares had been converted into
common shares. The remaining 31,154 Series C Preferred Shares were
redeemed on June 1, 2007, at the redemption price of $28.50 plus
accrued and unpaid dividends totaling $11,765.
On July 2, 2007, the Company paid a second quarter common share
dividend of $0.4625 per share and a second quarter dividend of $0.5938
per Series B cumulative redeemable preferred share for the period of
April 1, 2007 through June 30, 2007, to shareholders of record on June
20, 2007.
Earnings Guidance/Conference Call
The Company expects 2007 annual diluted FFO per share to be
between $2.61 and $2.69. In addition, the Company expects earnings per
diluted common share to be between $2.10 and $2.20.
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 first quarter
conference call on Thursday, July 26, 2007, at 9:00 a.m. eastern time,
to discuss its financial results. The live broadcast will be available
online at www.rgpt.com and www.streetevents.com and also by telephone
at (800) 265-0241, passcode 65700079. A replay will be available
shortly after the call on the aforementioned websites (for ninety
days) or by telephone at (888) 286-8010, passcode 94351117 (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
June 30, 2007, Ramco-Gershenson owned interests in 84 shopping centers
totaling approximately 18.8 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 AND COMPREHENSIVE INCOME
(In Thousands, except per share amounts)
(Unaudited)
For the Three Months For the Six Months
Ended June 30, Ended June 30,
-------------------- ------------------
2007 2006 2007 2006
----------- -------- --------- --------
REVENUES:
Minimum rents $24,495 $25,151 $48,768 $49,785
Percentage rents 96 - 408 385
Recoveries from tenants 10,733 10,307 22,469 20,182
Fees and management income 1,426 1,519 4,030 2,761
Other income 498 1,440 1,676 1,880
----------- -------- --------- --------
Total revenues 37,248 38,417 77,351 74,993
----------- -------- --------- --------
EXPENSES:
Real estate taxes 5,061 4,891 10,232 9,768
Recoverable operating
expenses 5,574 5,634 12,257 11,236
Depreciation and
amortization 8,331 7,876 16,468 15,953
Other operating 765 917 1,274 1,619
General and administrative 3,874 3,295 6,907 7,396
Interest expense 10,744 10,989 21,762 21,559
----------- -------- --------- --------
Total expenses 34,349 33,602 68,900 67,531
----------- -------- --------- --------
Income from continuing
operations before gain on sale
of real estate assets,
minority interest and earnings
from unconsolidated entities 2,899 4,815 8,451 7,462
Gain on sale of real estate
assets 8,941 25 31,376 1,733
Minority interest (1,507) (885) (6,035) (1,672)
Earnings from unconsolidated
entities 712 755 1,118 1,492
-------------------- ------------------
Income from continuing
operations 11,045 4,710 34,910 9,015
----------- -------- --------- --------
Discontinued operations, net of
minority interest:
Gain (Loss) on sale of real
estate assets - (3) - 954
Income from operations - 70 - 393
----------- -------- --------- --------
Income from discontinued
operations - 67 - 1,347
----------- -------- --------- --------
Net income 11,045 4,777 34,910 10,362
Preferred stock dividends (606) (1,664) (2,269) (3,328)
Loss on redemption of preferred
shares (35) - (35) -
----------- -------- --------- --------
Net income available to common
shareholders $10,404 $ 3,113 $32,606 $ 7,034
=========== ======== ========= ========
Basic earnings per common
share:
Income from continuing
operations $ 0.58 $ 0.18 $ 1.89 $ 0.34
Income from discontinued
operations - - - 0.08
----------- -------- --------- --------
Net income $ 0.58 $ 0.18 $ 1.89 $ 0.42
=========== ======== ========= ========
Diluted earnings per common
share:
Income from continuing
operations $ 0.56 $ 0.18 $ 1.82 $ 0.34
Income from discontinued
operations - - - 0.08
----------- -------- --------- --------
Net income $ 0.56 $ 0.18 $ 1.82 $ 0.42
=========== ======== ========= ========
Basic weighted average common
shares outstanding 17,847 16,679 17,221 16,763
=========== ======== ========= ========
Diluted weighted average common
shares outstanding 21,483 16,714 18,557 16,800
=========== ======== ========= ========
COMPREHENSIVE INCOME
Net income $11,045 $ 4,777 $34,910 $10,362
Other comprehensive income:
Unrealized gain on interest
rate swaps 420 641 197 1,195
----------- -------- --------- --------
Comprehensive income $11,465 $ 5,418 $35,107 $11,557
=========== ======== ========= ========
RAMCO-GERSHENSON PROPERTIES TRUST
CALCULATION OF FUNDS FROM OPERATIONS (1)
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
------------------ ------------------
2007 2006 2007 2006
--------- -------- --------- --------
Net Income $11,045 $ 4,777 $ 34,910 $10,362
Add:
Depreciation and amortization
expense 9,291 8,460 18,253 17,125
Minority interest in
partnership:
Continuing operations 1,487 885 5,990 1,672
Discontinued operations - 12 - 69
Less:
Gain on sale of real estate (2) (8,316) - (30,814) -
Discontinued operations, gain
(loss) on sale of real estate,
net of minority interest - 3 - (954)
--------- -------- --------- --------
Funds from operations 13,507 14,137 28,339 28,274
Less:
Series B Preferred Stock
dividends (594) (594) (1,188) (1,188)
--------- -------- --------- --------
Funds from operations available
to common shareholders $12,913 $13,543 $ 27,151 $27,086
========= ======== ========= ========
Weighted average equivalent
shares outstanding, diluted 21,483 21,532 21,478 21,619
========= ======== ========= ========
Funds from operations available
to common shareholders
per diluted share $ 0.60 $ 0.63 $ 1.26 $ 1.25
========= ======== ========= ========
(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) Excludes gain on sale of undepreciated land of $562 in 2007 and
$1,733 in 2006.
RAMCO-GERSHENSON PROPERTIES TRUST
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share amounts)
June 30, December 31,
2007 2006
----------- ------------
(Unaudited)
ASSETS
Investment in real estate, net $ 913,536 $ 897,975
Cash and cash equivalents 8,603 11,550
Restricted cash 9,780 7,772
Accounts receivable, net 35,828 33,692
Equity investments in and advances to
unconsolidated entities 73,469 75,824
Other assets, net 39,332 38,057
----------- ------------
Total Assets $1,080,548 $1,064,870
=========== ============
LIABILITIES
Mortgages and notes payable $ 663,551 $ 676,225
Accounts payable and accrued expenses 35,565 26,424
Distributions payable 10,478 10,391
Capital lease obligation 7,564 7,682
----------- ------------
Total Liabilities 717,158 720,722
Minority Interest 42,837 39,565
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,
1,888 shares outstanding as of
December 31, 2006, liquidation value
of $53,808 - 51,714
Common Shares of Beneficial Interest, par
value $0.01, 45,000 shares authorized;
18,469 and 16,580 issued and outstanding
as of June 30, 2007 and December 31,
2006, respectively 185 166
Additional paid-in capital 386,804 335,738
Accumulated other comprehensive income 444 247
Cumulative distributions in excess of net
income (90,684) (107,086)
----------- ------------
Total Shareholders' Equity 320,553 304,583
----------- ------------
Total Liabilities and Shareholders'
Equity $1,080,548 $1,064,870
=========== ============
CONTACT: Ramco-Gershenson Properties Trust
Dennis Gershenson, President & CEO
or Richard Smith, CFO
Phone: 248-350-9900
Fax: 248-350-9925