Weingarten Realty (NYSE: WRI) announced today the results of its
fourth quarter and year ended December 31, 2009. In addition, the
Company introduced its new supplemental financial package with
additional information which can be found on the company’s website
under the Investor Relations tab.
Net Income
The Company reported net income attributable to common
shareholders of $72.6 million or $0.60 per diluted share for the
fourth quarter of 2009, as compared to a net loss of $9.5 million
or $0.11 per share for the same period in 2008. For the twelve
months ended December 31, 2009, the Company reported net income
attributable to common shareholders of $135.6 million or $1.23 per
share, as compared to net income attributable to common
shareholders of $109.1 million or $1.28 per share for the same
period in 2008. As previously reported, the Company issued 32
million additional common shares in April of 2009, which
significantly impacts all per share comparisons between years.
A reconciliation of net income attributable to common
shareholders to FFO is included in the financial tables
accompanying this press release.
Funds for Operations (“FFO”)
FFO for the fourth quarter of 2009 totaled $0.42 per diluted
share or $51.6 million, as compared to $0.15 per share or $12.7
million for 2008. FFO for the three months ended December 31, 2009
included $0.02 per share of impairment losses from operating
property sales or contributions to joint ventures. FFO for the
three months ended December 31, 2008 included $0.52 per share of
impairment losses on land held for development, and $0.15 per share
from gains related to the early retirement of debt. FFO excluding
these items for the three months ended December 31, 2009 and
December 31, 2008 would have been $0.44 and $0.52 per share
respectively.
“While there were numerous items that impact the comparability
of the results between years such as impairments, dispositions and
interest capitalization, it is important to understand that
operations negatively impacted FFO by only $8.2 million or $0.10
per share from 2008 to 2009. We believe this was an outstanding
performance in light of the severe economic conditions we faced in
2009,” stated Drew Alexander, President and Chief Executive
Officer.
FFO Guidance
Weingarten narrowed its initial earnings guidance for 2010 based
on its latest projections of operations, views of the retail market
and economic conditions. Full-year FFO is expected to be $1.58 to
$1.70 per diluted share.
Operating Results
For the quarter, the Company produced strong leasing results
with 311 new leases and renewals, totaling 1.7 million square feet
and representing $15.3 million of annual revenue. The 311
transactions were comprised of 148 new leases and 163 renewals
which represent annual revenue of $7.3 million and $8.0 million,
respectively. For leases commencing during the quarter, the average
rental rate was flat on a GAAP basis, and for the full year rental
rates have increased 6.2%.
During the fourth quarter retail and industrial occupancy
declined slightly to 91.8% and 87.8%, respectively, compared to
third quarter occupancy of 92.1% for retail and 88.0% for
industrial. Overall occupancy for the fourth quarter was 90.8%
compared to 91.1% during the third quarter of 2009.
Same Property Net Operating Income (NOI) was down 2.3% overall
during the quarter, with retail properties down 2.0% and industrial
properties down 4.8%. Full year Same Property NOI was down
3.8%.
“Leasing velocity remains strong with 50 leases being signed in
the last 10 days of 2009. During the fourth quarter our production
was up 40% from a year ago,” said Johnny Hendrix, Executive Vice
President of Asset Management.
Financing
The Company reported earlier this month, it extended and renewed
its revolving credit agreement. The new $500 million revolver now
matures in February 2013. Currently, there is no outstanding
balance under this agreement, as the Company has over $100 million
in excess cash. The excess cash and extended revolver positions the
Company well for future growth opportunities.
“During 2009, Weingarten raised $1.2 billion through the sale of
equity, secured and unsecured debt and one-off property sales
including contributions made to joint ventures. These proceeds
significantly improved our liquidity position allowing us to reduce
our short-term debt maturities,” said Steve Richter, Executive Vice
President and CFO.
Dividend
On February 24, 2010, the Board of Trust Managers declared an
increase in the common dividend to $0.26 per share for the first
quarter of 2010. This represents a 4% increase resulting in an
annualized dividend of $1.04 per share. The dividend is payable in
cash on March 15, 2010 to shareholders of record on March 8,
2010.
The Board of Trust Managers also declared dividends on the
Company’s preferred shares. Dividends related to the 6.75% Series D
Cumulative Redeemable Preferred Shares (NYSE:WRIPrD) are $0.421875
per share for the quarter. Dividends on the 6.95% Series E
Cumulative Redeemable Preferred Shares (NYSE:WRIPrE) are $0.434375
per share for the same period. Dividends on the 6.50% Series F
Cumulative Redeemable Preferred Shares (NYSE:WRIPrF) are $0.40625
per share for the quarter. All common and preferred dividends are
payable on March 15, 2010 to shareholders of record on March 8,
2010.
Looking Forward
The development program now includes only ten properties at
various stages of development with an estimated Weingarten
investment of $175 million when completed. Weingarten’s strategic
operating plan for 2010 is to continue to improve operating
fundamentals, plant seeds for growth, and increase shareholder
value.
“As we enter 2010, we feel our operations have stabilized
providing comfort to increase the dividend by 4% to an annualized
amount of $1.04 per share. We are excited that our solid balance
sheet, excess cash, full availability under the revolver and our
national platform will allow Weingarten to direct our concentration
on growth initiatives this year,” stated Drew Alexander, President
and Chief Executive Officer.
Conference Call Information
The Company also announced that it will host a live webcast of
its quarterly conference call on February 25, 2010 at 10:00 a.m.
Central Time. The live webcast can be accessed via the Company’s
Web site at www.weingarten.com. Alternatively, if you are not able
to access the call on the web, you can listen live by phone by
calling (877) 763-1324 (no confirmation code). A replay and Podcast
will also be available through the Company’s Web site starting
approximately two hours following the live call or can be heard by
calling (800) 642-1687, identification number 49135088 until 11:59
PM Central Time on February 26, 2010.
About Weingarten Realty Investors
Weingarten Realty Investors (NYSE: WRI) is a commercial real
estate owner, manager and developer. At December 31, 2009, the
company owned or operated under long-term leases, either directly
or through its interest in real estate joint ventures or
partnerships, a total of 376 developed income-producing properties
and 10 properties under various stages of construction and
development. The total number of properties includes 307
neighborhood and community shopping centers located in 22 states
spanning the country from coast to coast. The company also owns 76
industrial projects located in California, Florida, Georgia,
Tennessee, Texas and Virginia and three other operating properties
located in Arizona and Texas. At December 31, 2009, the Company’s
portfolio of properties was approximately 70.0 million square feet.
To learn more about the Company’s operations and growth strategies,
please visit www.weingarten.com
Forward-Looking Statements
Statements included herein that state the Company’s or
Management’s intentions, hopes, beliefs, expectations or
predictions of the future are “forward-looking” statements within
the meaning of the Private Securities Litigation Reform Act of 1995
which by their nature, involve known and unknown risks and
uncertainties. The Company’s actual results, performance or
achievements could differ materially from those expressed or
implied by such statements. Reference is made to the Company’s
regulatory filings with the Securities and Exchange Commission for
information or factors that may impact the Company’s
performance.
Financial StatementsWeingarten Realty Investors(in
thousands, except per share amounts)
Three Months Ended Twelve Months Ended
December 31, December 31,
CONDENSED CONSOLIDATED STATEMENTS OF
INCOME 2009 2008 2009 2008
AND FUNDS FROM OPERATIONS
(Unaudited) (Unaudited) Rentals, net $ 136,479 $ 142,135 $ 554,107
$ 578,960 Other Income 5,712 3,527
18,001 13,788 Total Revenues
142,191 145,662 572,108
592,748 Depreciation and Amortization 36,396 36,234 147,895
149,812 Operating Expense 27,633 37,222 102,966 113,493 Ad Valorem
Taxes, net 16,199 16,549 70,678 70,618 Impairment Loss 2,209 52,539
34,983 52,539 General and Administrative Expense 6,732
5,987 25,930 25,761
Total Expenses 89,169 148,531
382,452 412,223 Operating Income 53,022
(2,869 ) 189,656 180,525 Interest Expense, net (37,960 ) (37,594 )
(153,207 ) (156,318 ) Interest and Other Income, net 2,923 414
11,427 4,333 Gain on Redemption of Convertible Senior Unsecured
Notes 12,961 25,311 12,961 Equity in Earnings (Loss) of Real Estate
Joint Ventures and Partnerships, net 2,765 (3,341 ) 5,548 12,196
Gain on Merchant Development Sales 69 102 18,688 8,342 Benefit
(Provision) for Income Taxes 702 13,210
(6,338 ) 10,219 Income (Loss) from Continuing
Operations 21,521 (17,117 ) 91,085
72,258 Operating (Loss) Income from
Discontinued Operations (18 ) 1,841 3,160 11,617 Gain on Sale of
Property from Discontinued Operations 48,380
14,739 55,765 68,722
Income from Discontinued
Operations
48,362 16,580 58,925 80,339 Gain on Sale of Property 12,892
1,897 25,266 1,998
Net Income 82,775 1,360 175,276 154,595 Less: Net Income
Attributable to Noncontrolling Interests (1,280 )
(1,975 ) (4,174 ) (8,943 ) Net Income (Loss) Adjusted
for Noncontrolling Interests 81,495 (615 ) 171,102 145,652
Less: Preferred Share
Dividends
(8,869 ) (8,869 ) (35,476 ) (34,711 ) Redemption Costs of Preferred
Shares (1,850 ) Net Income (Loss)
Attributable to Common Shareholders--Basic $ 72,626
($9,484 ) $ 135,626 $ 109,091 Earnings Per Common
Share--Basic $ 0.61 ($0.11 ) $ 1.24 $ 1.29
Net Income (Loss) Attributable to Common
Shareholders--Diluted $ 73,087 ($9,484 ) $ 135,626
$ 109,091 Earnings Per Common Share--Diluted $ 0.60
($0.11 ) $ 1.23 $ 1.28 Funds
from Operations: Net Income (Loss) Attributable to Common
Shareholders $ 72,626 ($9,484 ) $ 135,626 $ 109,091 Depreciation
and Amortization 34,765 35,602 144,211 150,137 Depreciation and
Amortization of Unconsolidated Joint Ventures 5,018 3,200 18,433
11,898 Gain on Sale of Property (61,270 ) (16,629 ) (81,006 )
(70,066 ) Loss (Gain) on Sale of Property of Unconsolidated Joint
Ventures 10 (4 ) (2 ) Funds from
Operations--Basic $ 51,139 $ 12,699 $ 217,260
$ 201,058 Funds from Operations Per Common Share--Basic $
0.43 $ 0.15 $ 1.98 $ 2.38 Funds from
Operations--Diluted $ 51,600 $ 12,699 $ 217,260
$ 201,058 Funds from Operations Per Common
Share--Diluted $ 0.42 $ 0.15 $ 1.97 $ 2.37
Weighted Average Shares Outstanding--Basic 119,515
86,664 109,546 84,474
Weighted Average Shares Outstanding--Diluted 122,162
86,664 110,178 84,917
December 31, December 31, 2009 2008
CONDENSED
CONSOLIDATED BALANCE SHEETS (Unaudited) (Audited) Property $
4,658,396 $ 4,915,472 Accumulated Depreciation (856,281 ) (812,323
) Investment in Real Estate Joint Ventures and Partnerships, net
315,248 357,634 Notes Receivable from Real Estate Joint Ventures
and Partnerships 317,838 232,544 Unamortized Debt and Lease Costs,
net 103,396 119,464 Accrued Rent and Accounts Receivable, net
96,372 103,873 Cash and Cash Equivalents 153,584 58,946 Restricted
Deposits and Mortgage Escrows 12,778 33,252 Other, net
89,054 105,350 Total Assets $ 4,890,385
$ 5,114,212 Debt, net $ 2,531,847 $ 3,148,636
Accounts Payable and Accrued Expenses 137,727 179,432 Other, net
114,155 90,461 Total Liabilities
2,783,729 3,418,529 Commitments and
Contingencies 41,000 Preferred
Shares of Beneficial Interest 8 8 Common Shares of Beneficial
Interest 3,615 2,625 Accumulated Additional Paid-In Capital
1,958,975 1,514,940 Net Income Less Than Accumulated Dividends
(37,350 ) (37,245 ) Accumulated Other Comprehensive Loss
(23,958 ) (29,676 ) Shareholders' Equity 1,901,290 1,450,652
Noncontrolling Interest 205,366 204,031
Total Liabilities, Shareholders' Equity and Noncontrolling Interest
$ 4,890,385 $ 5,114,212
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