Exhibit 99.1
KIMCO REALTY REPORTS RECORD OPERATING RESULTS,
THIRD QUARTER FFO INCREASES 13.6 PERCENT TO $0.50 PER SHARE;
MANAGEMENT INCREASES EARNINGS GUIDANCE
Highlights:
- FFO Increased 14.4 Percent to $116.3 Million
- FFO Per Share Increased 13.6 Percent to $0.50
- Net Income Increased 8.7 Percent to $85.3 Million
- Net Income Per Share Increased 9.1 Percent to $0.36
- Company Increases 2005 Earnings Guidance: Anticipates 10.7 Percent
Growth in FFO Per Share
- Increases 2006 FFO Guidance
NEW HYDE PARK, N.Y., Oct. 25 /PRNewswire-FirstCall/ -- Kimco Realty
Corporation (NYSE: KIM) today announced net income for the third quarter ended
September 30, 2005 of $85.3 million compared to $78.5 million a year earlier, an
increase of 8.7 percent. On a per share basis, net income increased 9.1 percent
to $0.36 from $0.33 reported in the third quarter of 2004. All prior period
amounts presented have been adjusted to reflect the Company's 2-for-1 stock
split that was effective August 8, 2005.
Kimco's third quarter funds from operations ("FFO"), a widely accepted
supplemental measure of REIT performance, rose 14.4 percent to $116.3 million
from $101.6 million for the same period last year. On a per share basis, third
quarter FFO increased 13.6 percent to $0.50 from $0.44 a year ago. Quarterly FFO
excludes gains on dispositions of operating properties net of minority interests
and joint venture properties of approximately $5.6 million, or $0.02 per share,
in 2005 and approximately $8.0 million, or $0.03 per share, in 2004.
For the nine months ended September 30, 2005, net income increased 15.6
percent to $256.0 million from $221.3 million for the same period last year. Net
income per share increased 13.8 percent to $1.07 from $0.94 a year ago. Funds
from operations rose 11.8 percent to $337.2 million for the nine-month period
ended September 30, 2005 from $301.7 million in the year earlier period. On a
per share basis, FFO increased 9.8 percent to $1.45 from $1.32 reported a year
ago. Funds from operations for the nine months ended September 30, 2005 excludes
gains on dispositions and transfers of operating properties net of minority
interests and joint venture properties of approximately $26.3 million or $0.11
per share and approximately $14.9 million or $0.06 per share for the same period
last year.
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 94.2
percent from 94.1 percent at June 30, 2005 and 92.9 percent a year earlier.
Kimco's occupancy is the highest level in Company history. For the quarter,
Kimco signed 128 new leases in the portfolio totaling 690,500 square feet and 65
lease renewals totaling 415,300 square feet. Year to date the Company has signed
334 new leases in this portfolio totaling approximately 1.8 million square feet
and 254 lease renewals totaling 1.7 million square feet. The average increase in
base rent for new leases signed for same space leases was 11.4 percent and 10.6
percent for the quarter and nine months ended September 30, 2005, respectively.
Occupancy in the Company's combined operating portfolio encompassing
approximately 108.5 million square feet of gross leasable area was 94.8 percent,
90 basis points higher than a year ago.
Investment Activity
Kimco has acquired property interests totaling $544 million for the
Company's core portfolio, co-investment programs and international portfolios
since the end of the second quarter. A summary of the significant investments is
as follows:
- Kimco acquired all the shares of GDE Properties Corporation, a private
entity that owned a portfolio of three supermarket anchored properties
located in Southern and Central California for approximately $104.5
million. The properties are Marigold Center, Laband Village and Plaza di
Northridge. Marigold Center, located in San Luis Obispo, California,
contains 175,000 square feet of gross leasable area and is anchored by
Vons, Michaels and Sav-on Drug. Laband Village located in Chino Hills,
California, is a 73,000 square foot neighborhood shopping center anchored
by Stater Bros. Market, the largest privately owned supermarket chain in
Southern California. Plaza di Northridge in Northridge, California, is a
160,000 square foot, 100 percent leased shopping center anchored by
Gelson's supermarket, Linens-N-Things and DSW. These properties will
remain in Kimco's parent portfolio.
- Kimco acquired four shopping centers for the Company's co-investment
programs totaling $146 million. Stafford Marketplace, a 332,000 square
foot shopping center located in Stafford, Virginia, was purchased for
approximately $80.0 million. This shopping center is anchored by Shoppers
Food Warehouse, TJ Maxx, Pier 1 Imports, Borders and several other
national tenants. Yorkshire Plaza located in Aurora, Illinois, was also
acquired for approximately $29.7 million. Yorkshire Plaza is 362,000
square feet and anchored by Best Buy, Value City, Pier I Imports and
Sportsmart. The Company also acquired Greeley Commons in Greeley,
Colorado, and North Quincy Plaza in Quincy, Massachusetts. Greeley
Commons is a 139,000 square foot shopping center anchored by Bed Bath &
Beyond, Michaels, Petco and Circuit City and is currently 100 percent
leased. North Quincy Plaza is an 80,510 square foot in-fill neighborhood
center anchored by Victory Supermarket and Brooks Pharmacy. These
properties were acquired for an aggregate cost of approximately $36.0
million.
- In addition, Kimco formed a new joint venture with a new institutional
partner and transferred a previously acquired portfolio of 45 net leased
properties to the venture. Kimco is also under contract to purchase Doc
Stone Market located in Stafford, Virginia, for this venture. Doc Stone
Market is a 100,000 square foot center anchored by Giant Food, Petco and
Staples, valued at approximately $17.2 million.
- In Mexico, Kimco formed a strategic joint venture with American
Industries, a leading real estate owner and operator in Mexico. Kimco
invested approximately $55 million to acquire a 50 percent interest in
American Industries' portfolio of 57 net leased industrial, warehouse and
distribution facilities. The portfolio has a gross value of approximately
$277 million and the tenant leases are triple net, U.S. Dollar denominated
obligations of U.S. and multi-national tenants.
- Also in Mexico, Kimco invested $2.6 million to acquire an interest in a
development to be anchored by Walmart. The project will be a 105,000
square foot multi-tenant shopping center located in the city of Tuxtepec
in the State of Oaxaca. Kimco now has an ownership interest in 70
properties in Mexico with a gross real estate value of approximately $475
million.
In addition, Kimco made several opportunistic investments through its Kimco
Select Investment and Retail Property Solutions business lines. Kimco's Retail
Property Solutions team participated in the successful recapitalization and
emergence from bankruptcy of Frank's Nursery and Crafts, which has been renamed
FNC Realty. At emergence, FNC Realty consisted of 55 properties of which, eight
were subsequently sold. The remaining properties are being leased, redeveloped
or marketed for sale by Kimco. Kimco Select invested approximately $14 million
to purchase an interest in One City Center, an office building located in
Houston, Texas. The building is predominantly leased to credit tenants with long
term leases and was purchased well below replacement cost. Kimco Select, through
a joint venture, also purchased a 90 percent interest in a first mortgage
receivable with a principal amount due of $46.7 million at a significant
discount. The Company also agreed to provide up to $33 million of construction
financing for a 388,412 square foot Target-anchored retail center in Richland
Township, Pennsylvania. In addition to receiving interest income from the loan,
Kimco will receive an ownership position in the completed project.
Kimco's preferred equity investment program continued to provide a
meaningful contribution to FFO and growth in the Company's invested assets.
During the quarter, two preferred equity investments were redeemed and Kimco
realized profit participation of approximately $4.4 million. Five new preferred
equity investments were initiated during the quarter totaling approximately
$21.4 million of new investment, including one Canadian property in Kamloops,
British Columbia, and domestically in properties in San Marcos, Texas; Sarasota,
Florida; Lansing, Illinois; and Hamilton, New Jersey.
Kimco's merchant building business, Kimco Developers Inc. (KDI), completed
the sale of one shopping center and sold portions of five additional projects
generating proceeds of $59.6 million. These property sales resulted in gains on
sales of approximately $8.1 million, net of tax. Several pad sites and one
additional shopping center are currently under contract for sale in the fourth
quarter of 2005. In addition, KDI acquired land for six new projects for a total
of $67.9 million and invested an additional $87.6 million in its pipeline of 31
shopping center developments.
Increased Earnings Guidance
As a result of the Company's continued strong operating results, Kimco's
management increased its projection for FFO per share to $1.96 for the full year
ending December 31, 2005. This estimate is $0.02 per share above the high end of
the range of guidance management provided last quarter. Management also
increased guidance for FFO per share for the year ending December 2006 to
between $2.09 and $2.14, which represents growth in FFO of between 7.0 percent
and 9.0 percent. Management's increase was from prior guidance for 2006 of
between $2.07 per share to $2.10 per share.
Kimco, a publicly-traded real estate investment trust, has specialized in
shopping center acquisitions, development and management for over 45 years.
Kimco owns and operates the nation's largest portfolio of neighborhood and
community shopping centers with interests in 946 properties comprising
approximately 127.0 million square feet of leasable space located throughout 43
states, Canada and Mexico. For further information refer to the Company's web
site at http://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, 2004. Copies of each filing
may be obtained from the Company or the SEC.
Contact:
Kimco Realty Corporation
Scott Onufrey
(516) 869-7190
sonufrey@kimcorealty.com
Kimco Realty Corporation
Condensed Consolidated Statements of Income
(In thousands, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------------- ---------------------------
2005 2004 2005 2004
------------ ------------ ------------ ------------
Revenues from
rental property $ 130,441 $ 120,330 $ 388,177 $ 386,366
------------ ------------ ------------ ------------
Rental property expenses:
Rent 2,618 2,662 7,851 8,441
Real estate taxes 16,715 15,796 49,270 48,508
Operating and
maintenance 14,013 12,100 45,681 41,462
------------ ------------ ------------ ------------
33,346 30,558 102,802 98,411
------------ ------------ ------------ ------------
Net operating income 97,095 89,772 285,375 287,955
Income from other real
estate investments 13,432 5,119 41,961 20,414
Mortgage financing income 3,303 3,179 9,873 9,637
Management and other
fee income 6,946 6,008 22,076 18,836
Depreciation and
amortization (26,627) (23,623) (79,364) (75,301)
------------ ------------ ------------ ------------
94,149 80,455 279,921 261,541
Interest, dividends
and other investment
income 9,141 8,595 17,594 13,170
Other income/
(expense), net (1,810) 4,790 9,346 10,994
Interest expense (33,890) (25,740) (93,027) (81,134)
General and
administrative
expenses (14,084) (11,034) (38,837) (31,652)
------------ ------------ ------------ ------------
53,506 57,066 174,997 172,919
Benefit/(provision)
for income taxes 860 24 (4,073) (5,395)
Equity in income of
real estate joint
ventures, net 18,052 13,864 57,140 39,792
Minority interests
in income, net (3,663) (2,312) (10,711) (7,059)
Gain on sale of
development
properties
net of tax of $2,443,
$1,047, $9,575 and
$4,935, respectively 8,121 1,571 18,835 7,404
------------ ------------ ------------ ------------
Income from
continuing
operations 76,876 70,213 236,188 207,661
------------ ------------ ------------ ------------
Discontinued
Operations:
Income from
discontinued
operating
properties 2,821 2,825 5,130 6,235
Loss on operating
properties held
for sale/sold -- (913) (2,615) (5,064)
Gain on disposition
of operating
properties 4,964 6,386 14,425 12,498
------------ ------------ ------------ ------------
Income from
discontinued
operations 7,785 8,298 16,940 13,669
------------ ------------ ------------ ------------
Gain on transfer
of operating
properties(1) -- -- 2,301 --
Loss on transfer
of operating
properties(1) -- -- (150) --
Gain on disposition
of operating
properties(1) 682 -- 682 --
------------ ------------ ------------ ------------
682 -- 2,833 --
------------ ------------ ------------ ------------
Net income 85,343 78,511 255,961 221,330
Preferred stock
dividends (2,909) (2,909) (8,728) (8,728)
------------ ------------ ------------ ------------
Net income available
to common
shareholders $ 82,434 $ 75,602 $ 247,233 $ 212,602
============ ============ ============ ============
Per common share:
Income from
continuing
operations:
- Basic $ 0.33 $ 0.30 $ 1.02 $ 0.89
============ ============ ============ ============
- Diluted(2) $ 0.32 $ 0.30 $ 1.00 $ 0.88
============ ============ ============ ============
Net income:
- Basic $ 0.36 $ 0.34 $ 1.09 $ 0.96
============ ============ ============ ============
- Diluted(2) $ 0.36 $ 0.33 $ 1.07 $ 0.94
============ ============ ============ ============
Income subject to
income taxes $ 11,053 $ 2,585 $ 35,553 $ 26,313
Weighted Average Share
Information
Three Months Ended Nine Months Ended
September 30, September 30,
For earnings per --------------------------- ---------------------------
share calculations: 2005 2004 2005 2004
- -------------------------------- ------------ ------------ ------------ ------------
Weighted average
shares -
- Basic 227,017 223,052 226,310 222,302
============ ============ ============ ============
- Diluted(2) 231,733 227,242 230,585 226,518
============ ============ ============ ============
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) The potential impact if certain units were converted to common stock at the
beginning of the period would have an anti-dilutive effect on net income
and therefore have not been included.
Kimco Realty Corporation
Funds From Operations
(In thousands, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------------- ---------------------------
2005 2004 2005 2004
------------ ------------ ------------ ------------
Funds From
Operations(1)
Net income $ 85,343 $ 78,511 $ 255,961 $ 221,330
Gain on disposition
of operating
properties,
net of minority
interests (5,646) (6,386) (17,408) (12,065)
Gain on disposition
of joint venture
operating properties -- (1,637) (8,930) (2,860)
Depreciation and
amortization 26,671 24,395 80,563 77,608
Depreciation and
amortization -
real estate joint
ventures 12,807 9,631 35,786 26,444
Preferred stock
dividends (2,909) (2,909) (8,728) (8,728)
------------ ------------ ------------ ------------
Funds from
operations(1) $ 116,266 $ 101,605 $ 337,244 $ 301,729
============ ============ ============ ============
Per common share:
- Basic $ 0.51 $ 0.46 $ 1.49 $ 1.36
============ ============ ============ ============
- Diluted(2) $ 0.50 $ 0.44 $ 1.45 $ 1.32
============ ============ ============ ============
Weighted Average
Share Information
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------------- ---------------------------
For funds from
operations per
share calculations: 2005 2004 2005 2004
- -------------------------------- ------------ ------------ ------------ ------------
Weighted average
shares -
- Basic 227,017 223,052 226,310 222,302
============ ============ ============ ============
- Diluted(2) 236,499 232,009 235,352 231,284
============ ============ ============ ============
(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 $1,739 and $1,502 for the three months ended September 30,
2005 and 2004, respectively, and $4,953 and $4,506 for the nine months
ended September 30, 2005 and 2004, respectively, reflecting the
distributions associated with these units.
Kimco Realty Corporation
Condensed Consolidated Balance Sheets
(In thousands, except share data)
September 30, December 31,
2005 2004
------------- -------------
Assets:
Operating real estate, net of accumulated
depreciation of $723,818 and $634,642,
respectively $ 3,072,729 $ 3,095,360
Investments and advances in real estate
joint ventures 666,088 595,175
Real estate under development 479,914 362,220
Other real estate investments 252,856 188,536
Mortgages and other financing receivables 145,034 140,717
Cash and cash equivalents 69,940 38,220
Marketable securities 204,996 123,771
Accounts and notes receivable 64,034 52,182
Other assets 212,885 153,416
------------- -------------
$ 5,168,476 $ 4,749,597
============= =============
Liabilities:
Notes payable $ 1,836,475 $ 1,608,925
Mortgages payable 310,084 353,071
Construction loans payable 210,570 156,626
Dividends payable 77,903 71,489
Other liabilities 264,496 216,195
------------- -------------
2,699,528 2,406,306
------------- -------------
Minority interests 124,174 106,891
------------- -------------
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 and outstanding 227,252,825
and 224,852,812 shares, respectively 2,273 2,249
Paid-in capital 2,241,995 2,199,419
Retained earnings/(cumulative distributions
in excess of net income) 30,357 (3,749)
------------- -------------
2,275,325 2,198,619
Accumulated other comprehensive income 69,449 37,781
------------- -------------
2,344,774 2,236,400
------------- -------------
$ 5,168,476 $ 4,749,597
============= =============
Kimco Realty Corporation
Reconciliation of Projected Diluted Net Income Per Common Share to
Projected Funds From Operations Per Common Share
Projected Range
Projected Full Year 2006
Full Year -------------------------
2005 Low High
----------- ----------- -----------
Projected diluted earnings
per common share $ 1.43 $ 1.51 $ 1.57
Projected depreciation and
amortization 0.45 0.46 0.48
Projected depreciation and
amortization real estate joint
ventures, net of minority
interests 0.21 0.22 0.24
Gain on disposition of operating
properties (0.09) (0.07) (0.10)
Gain on disposition of joint
venture operating properties,
net of minority interests (0.04) (0.03) (0.05)
----------- ----------- -----------
Projected FFO per diluted
common share $ 1.96 $ 2.09 $ 2.14
=========== =========== ===========
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.
SOURCE Kimco Realty Corporation
-0- 10/25/2005
/CONTACT: Scott Onufrey of Kimco Realty Corporation, +1-516-869-7190,
sonufrey@kimcorealty.com /
/Web site: http://www.kimcorealty.com /