BFS Saul Centers Inc

BETHESDA, Md., April 25 /PRNewswire-FirstCall/ -- Saul Centers, Inc. (NYSE:BFS), an equity real estate investment trust (REIT), announced its operating results for the quarter ended March 31, 2007. Total revenue for the quarter ended March 31, 2007 increased 9.6% to $36,684,000 compared to $33,467,000 for the 2006 quarter. Operating income, defined as net income available to common stockholders before minority interests and preferred stock dividends, increased 15.8% to $11,009,000 for the 2007 quarter compared to $9,509,000 for the comparable 2006 quarter. Net income available to common stockholders was $6,874,000 or $0.39 per diluted share for the 2007 quarter, a per share increase of 18.2% compared to net income available to common stockholders of $5,707,000 or $0.33 per diluted share for the 2006 quarter. The operating income increase for the 2007 quarter was produced by (1) Lansdowne Town Center, the 188,000 square foot shopping center development near Leesburg, Virginia, which commenced operations during the fourth quarter 2006, (2) successful leasing activity at several core properties and (3) to a lesser extent other development properties. Same property revenue for the total portfolio increased 5.1% for the 2007 quarter compared to the 2006 quarter and same property operating income increased 3.1%. The same property comparisons exclude the results of operations of properties not in operation for each of the comparable reporting periods. Same property operating income in the shopping center portfolio increased 2.7% for the 2007 quarter compared to the prior year's quarter. Same property operating income in the office portfolio grew 4.0% for the 2007 quarter. Successful leasing activity at several core properties produced the significant portion of increased property operating income for the 2007 quarter. As of March 31, 2007, 95.9% of the operating portfolio was leased, compared to 96.8% a year earlier. The company's significant development property, the 188,000 square foot Lansdowne Towne Center, was 91.0% leased at March 31, 2007. On a same property basis, 96.0% of the portfolio was leased, compared to the prior year level of 96.8%. Approximately half of the 2007 leasing percentage decrease resulted from the departure of a 32,000 square foot local grocery anchor at Belvedere shopping center in Baltimore, Maryland. Funds From Operations (FFO) available to common shareholders (after deducting preferred stock dividends) increased 11.3% to $15,457,000 in the 2007 quarter compared to $13,885,000 for the same quarter in 2006. On a diluted per share basis, FFO available to common shareholders increased 8.1% to $0.67 per share in 2007 compared to $0.62 per share for the 2006 quarter. FFO, a widely accepted non-GAAP financial measure of operating performance for real estate investment trusts, is defined as net income plus minority interests, extraordinary items and real estate depreciation and amortization, excluding gains and losses from property sales. FFO increased in the 2007 quarter due to increased operating income from (1) Lansdowne Town Center, (2) successful leasing activity at several core properties and (3) to a lesser extent acquisition and development properties. Saul Centers is a self-managed, self-administered equity real estate investment trust headquartered in Bethesda, Maryland. Saul Centers currently operates and manages a real estate portfolio of 47 community and neighborhood shopping center and office properties totaling approximately 7.9 million square feet of leasable area. Over 80% of the Company's property operating income is generated from properties in the metropolitan Washington, DC/Baltimore area. Saul Centers, Inc. Condensed Consolidated Balance Sheets ($ in thousands) March 31, December 31, 2007 2006 Assets (Unaudited) Real estate investments Land $154,690 $154,047 Buildings and equipment 638,108 631,797 Construction in progress 55,517 56,017 848,315 841,861 Accumulated depreciation (219,455) (214,210) 628,860 627,651 Cash and cash equivalents 8,427 8,061 Accounts receivable and accrued income, net 31,616 33,248 Deferred leasing costs, net 16,908 18,137 Prepaid expenses, net 2,363 2,507 Deferred debt costs, net 5,086 5,328 Other assets 8,315 5,605 Total assets $701,575 $700,537 Liabilities Mortgage notes payable $483,892 $487,443 Revolving credit facility 32,000 35,000 Dividends and distributions payable 12,061 11,558 Accounts payable, accrued expenses and other liabilities 19,078 16,409 Deferred income 11,975 12,251 Total liabilities 559,006 562,661 Minority Interests 5,537 5,785 Stockholders' Equity Preferred stock 100,000 100,000 Common stock 175 173 Additional paid in capital 147,297 141,554 Accumulated deficit (110,440) (109,636) Total stockholders' equity 137,032 132,091 Total liabilities and stockholders' equity $701,575 $700,537 Saul Centers, Inc. Condensed Consolidated Statements of Operations (In thousands, except per share amounts) Three Months Ended March 31, 2007 2006 Revenue (Unaudited) Base rent $29,021 $26,900 Expense recoveries 6,598 5,513 Percentage rent 202 326 Other 863 728 Total revenue 36,684 33,467 Operating Expenses Property operating expenses 4,805 3,968 Provision for credit losses 112 80 Real estate taxes 3,526 3,052 Interest expense and amortization of deferred debt 8,294 8,019 Depreciation and amortization of deferred leasing costs 6,448 6,376 General and administrative 2,490 2,463 Total operating expenses 25,675 23,958 Operating Income 11,009 9,509 Minority Interests (2,135) (1,802) Net Income 8,874 7,707 Preferred Dividends (2,000) (2,000) Net Income Available to Common Stockholders $6,874 $5,707 Per Share Net Income Available to Common Stockholders: Diluted $0.39 $0.33 Weighted Average Common Stock Outstanding: Common stock 17,415 16,911 Effect of dilutive options 203 152 Diluted weighted average common stock 17,618 17,063 Saul Centers, Inc. Supplemental Information (In thousands, except per share amounts) Three Months Ended March 31, 2007 2006 Reconciliation of Net Income to (Unaudited) Funds From Operations (FFO) (1) Net Income $8,874 $7,707 Add: Real property depreciation & amortization 6,448 6,376 Add: Minority interests 2,135 1,802 FFO 17,457 15,885 Less: Preferred dividends (2,000) (2,000) FFO available to common shareholders $15,457 $13,885 Weighted Average Shares Outstanding: Diluted weighted average common stock 17,618 17,063 Convertible limited partnership units 5,416 5,347 Diluted & converted weighted average shares 23,034 22,410 Per Share Amounts: FFO available to common shareholders $0.67 $0.62 Reconciliation of Net Income to Same Property Operating Income Net Income $8,874 $7,707 Add: Interest expense and amortization of deferred debt 8,294 8,019 Add: Depreciation and amortization of deferred leasing costs 6,448 6,376 Add: General and administrative 2,490 2,463 Less: Interest income (95) (67) Add: Minority interests 2,135 1,802 Property operating income 28,146 26,300 Less: Acquisitions & developments (1,279) (231) Total same property operating income $26,867 $26,069 Total Shopping Centers $19,946 $19,417 Total Office Properties 6,921 6,652 Total same property operating income $26,867 $26,069 (1) The National Association of Real Estate Investment Trusts (NAREIT) developed FFO as a relative non-GAAP financial measure of performance of an equity REIT in order to recognize that income-producing real estate historically has not depreciated on the basis determined under GAAP. FFO is defined by NAREIT as net income, computed in accordance with GAAP, plus minority interests, extraordinary items and real estate depreciation and amortization, excluding gains or losses from property sales. FFO does not represent cash generated from operating activities in accordance with GAAP and is not necessarily indicative of cash available to fund cash needs, which is disclosed in the Company's Consolidated Statements of Cash Flows for the applicable periods. There are no material legal or functional restrictions on the use of FFO. FFO should not be considered as an alternative to net income, its most directly comparable GAAP measure, as a indicator of the Company's operating performance, or as an alternative to cash flows as a measure of liquidity. Management considers FFO a meaningful supplemental measure of operating performance because it primarily excludes the assumption that the value of the real estate assets diminishes predictably over time (i.e. depreciation), which is contrary to what we believe occurs with our assets, and because industry analysts have accepted it as a performance measure. FFO may not be comparable to similarly titled measures employed by other REITs. DATASOURCE: Saul Centers, Inc. CONTACT: Scott V. Schneider of Saul Centers, Inc., +1-301-986-6220 Web site: http://www.saulcenters.com/

Copyright