FARMINGTON HILLS, Mich., July 30 /PRNewswire-FirstCall/ -- SECOND
Quarter 2009 Highlights: -- 2nd quarter FFO increases 9%
year-over-year -- Year-to-date FFO increases 9.6% year-over-year --
$0.50 per share quarterly dividend paid July 14, 2009 Agree Realty
Corporation (NYSE:ADC) today announced results for the quarter
ended June 30, 2009. Second quarter funds from operations ("FFO")
increased 9.0% to $5,910,000 compared with FFO in the second
quarter of 2008 of $5,420,000. FFO per diluted share was $0.70
compared with $0.65 for the second quarter of 2008. A
reconciliation of net income to FFO is included in the financial
tables accompanying this press release. Net income was $4,240,000,
or $0.54 per diluted share, compared with net income for the second
quarter of 2008 of $3,766,000 or $0.49 per share. Total revenues
increased 3.8% to $9,123,000, compared with total revenues of
$8,789,000 in the second quarter of 2008. For the six months ended
June 30, 2009, FFO increased 9.6% to $11,605,000 compared with FFO
for the six months ended June 30, 2008 of $10,586,000. FFO per
diluted share was $1.38 compared with $1.27 for the six months
ended June 30, 2008. Net income was $8,250,000, or $1.05 per
diluted share, compared with net income for the comparable period
last year of $7,345,000, or $0.96 per diluted share. Total revenues
increased 4.6% to $18,363,000 compared with total revenues of
$17,557,000 for the comparable period last year. "Despite
challenging economic conditions, we are extremely pleased to
deliver strong operating results for the quarter," said Richard
Agree, Chief Executive Officer. "We will continue to employ proven
development strategies while taking a conservative approach to the
deployment of our capital." Dividend The Company paid a cash
dividend of $0.50 per share on July 14, 2009 to shareholders of
record on June 30, 2009. The dividend is equivalent to an
annualized dividend of $2.00 per share and represents a payout
ratio of 72.2% of FFO for the quarter. Portfolio At June 30, 2009,
the Company's total assets were $259,925,000 and its portfolio
consisted of 71 properties located in 16 states and totaling
3,491,204 square feet. The portfolio was 98.2% leased at the end of
the quarter. The Company's construction in progress balance totaled
approximately $6,327,000 at June 30, 2009, and we capitalized
$45,339 of construction period interest during the second quarter
of 2009. Lease Expirations The following table, as of June 30,
2009, sets forth lease expirations for the next 10 years for the
Company's freestanding properties and community shopping centers,
assuming that none of the tenants exercise renewal options or
terminate their leases prior to the contractual expiration date.
Expiring Leases --------------- Number of Square Percent of
Annualized Percent of Expiration Leases Footage Total Base Rent
Total Year Expiring
-----------------------------------------------------------------
2009 3 10,300 0.3% $70,806 0.2% 2010 18 269,557 7.9% 1,535,626 4.5%
2011 27 230,834 6.7% 1,683,433 5.0% 2012 25 256,686 7.5% 1,346,191
4.0% 2013 19 325,013 9.5% 1,726,197 5.1% 2014 9 190,458 5.6%
985,856 2.9% 2015 13 673,042 19.6% 4,841,062 14.2% 2016 5 80,945
2.4% 1,664,513 4.9% 2017 3 22,844 0.7% 293,995 .9% 2018 12 237,582
6.9% 4,317,781 12.7% Thereafter 42 1,131,661 32.9% 15,523,360 45.6%
------------------- ---------- Total 176 3,428,922 $33,988,820
------------------- ---------- Annualized Base Rent of Properties
The following is a breakdown of base rents in effect at June 30,
2009 for each type of retail tenant: Credit Analysis
--------------- Retail Annualized Percent of Square Percent of
Tenant Base Rent Total Feet Total --------- ----------- -----------
-------- ----------- National $30,257,926 89.0% 2,945,247 85.9%
Regional 2,659,992 7.8% 376,806 11.0% Local 1,070,902 3.2% 106,869
3.1% ---------- --------- Total $33,988,820 3,428,922 ----------
--------- Major Tenants The following is a breakdown of base rents
in effect at June 30, 2009 for each of the Company's major tenants:
Tenant Analysis --------------- Retail Annualized Percent of Square
Percent of Tenant Base Rent Total Feet Total --------- -----------
----------- -------- ----------- Walgreen $9,946,099 29.3% 388,780
11.3% Borders 9,938,796 29.2% 979,474 28.6% Kmart 3,847,911 11.3%
999,766 29.2% ----------- ---- --------- ---- Subtotal $23,732,806
69.8% 2,368,020 69.1% ----------- ---- --------- ---- Outstanding
Shares and Operating Partnership Units For the three months and six
months ended June 30, 2009, the Company's fully diluted weighted
average shares outstanding were 7,894,349 and 7,834,404,
respectively. The basic weighted average shares outstanding for the
three months and six months ended June 30, 2009 were 7,879,183 and
7,825,957, respectively. The Company's assets are held by, and all
of its operations are conducted through, Agree Limited Partnership,
of which the Company is the sole general partner. As of June 30,
2009, there were 347,619 operating partnership units outstanding
and the Company held a 95.93% interest. For the three months and
six months ended June 30, 2009, the weighted average number of
operating partnership units outstanding, were 506,261 and 555,563,
respectively. Agree Realty Corporation owns, manages and develops
properties which are primarily single tenant properties leased to
major retail tenants and neighborhood community shopping centers.
The Company currently owns and operates a portfolio of 71
properties, which are located in 16 states and contain 3.5 million
square feet of gross leasable space. The Company considers portions
of the information contained in this release to be forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933 and Section 21E of the Securities Exchange Act of 1934,
each as amended. These forward-looking statements represent the
Company's expectations, plans and beliefs concerning future events.
Although these forward-looking statements are based on good faith
beliefs, reasonable assumptions and the Company's best judgment
reflecting current information, certain factors could cause actual
results to differ materially from such forward-looking statements.
Such factors are detailed from time to time in reports filed or
furnished by the Company with the Securities and Exchange
Commission, including the Company's Form 10-K for the year ended
December 31, 2006. Except as required by law, the Company assumes
no obligation to update these forward-looking statements, even if
new information becomes available in the future. For additional
information, visit the Company's home page on the Internet at
http://www.agreerealty.com/ Agree Realty Corporation Operating
Results (in thousands, except per share amounts) (Unaudited) Three
Months Ended Six Months Ended June 30, June 30, 2009 2008 2009 2008
Revenues: Minimum rents $8,431 $8,133 $16,942 $16,112 Percentage
rent 1 - 8 5 Operating cost reimbursements 682 654 1,401 1,437
Other income 9 2 12 3 Total Revenues 9,123 8,789 18,363 17,557
Expenses: Real estate taxes 489 451 967 916 Property operating
expenses 332 359 791 954 Land lease payments 215 171 430 339
General and administration 998 1,130 2,250 2,226 Depreciation and
amortization 1,420 1,348 2,814 2,643 Interest expense 1,161 1,239
2,286 2,499 Total Expenses 4,615 4,698 9,538 9,577 Income before
minority interest 4,508 4,091 8,825 7,980 Minority interest 268 325
575 635 Net Income $4,240 $3,766 $8,250 $7,345 Net Income Per Share
- Dilutive $0.54 $0.49 $1.05 $0.96 Reconciliation of Funds from
Operations to Net Income: (1) Net income $4,240 $3,766 $8,250
$7,345 Depreciation of real estate assets 1,386 1,314 2,747 2,577
Amortization of leasing costs 16 15 33 30 Minority interest 268 325
575 634 Funds from Operations $5,910 $5,420 $11,605 $10,586 Funds
from Operations Per Share - Dilutive $0.70 $0.65 $1.38 $1.27
Weighted average number of shares and OP units outstanding -
dilutive 8,401 8,357 8,390 8,356 (1) FFO is defined by the National
Association of Real Estate Investment Trusts, Inc. (NAREIT) to mean
net income computed in accordance with generally accepted
accounting principles (GAAP), excluding gains (or losses) from
sales of property, plus real estate related depreciation and
amortization and after adjustments for unconsolidated partnerships
and joint ventures. Management uses FFO as a supplemental measure
to conduct and evaluate the Company's business because there are
certain limitations associated with using GAAP net income by itself
as the primary measure of the Company's operating performance.
Historical cost accounting for real estate assets in accordance
with GAAP implicitly assumes that the value of real estate assets
diminishes predictably over time. Since real estate values instead
have historically risen or fallen with market conditions,
management believes that the presentation of operating results for
real estate companies that use historical cost accounting is
insufficient by itself. FFO should not be considered as an
alternative to net income as the primary indicator of the Company's
operating performance or as an alternative to cash flow as a
measure of liquidity. Further, while the Company adheres to the
NAREIT definition of FFO, its presentation of FFO is not
necessarily comparable to similarly titled measures of other REITs
due to the fact that not all REITs use the same definition. Agree
Realty Corporation Consolidated Balance Sheets (in thousands)
(Unaudited) June 30, December 31 2009 2008 Assets Land $92,895
$87,309 Buildings 218,454 210,650 Accumulated depreciation (61,250)
(58,502) Property under development 6,327 13,383 Cash and cash
equivalents 265 669 Rents receivable 924 965 Deferred costs, net of
amortization 1,538 1,437 Other assets 772 986 --- --- Total Assets
$259,925 $256,897 Liabilities Mortgages payable $65,955 67,624
Notes payable 38,336 32,945 Deferred revenue 10,380 10,725
Dividends and distributions payable 4,262 4,233 Other liabilities
2,364 3,388 ----- ----- Total Liabilities 121,297 118,915 -------
------- Stockholders' Equity Common stock (8,191,574 and 7,863,930
shares) 1 1 Additional paid-in capital 146,876 143,892 Deficit
(11,069) (11,258) Accumulated other comprehensive income (loss)
(212) - Non-controlling interest 3,032 5,347 ----- ----- Total
Stockholders' Equity 138,628 137,982 $259,925 $256,897 DATASOURCE:
Agree Realty Corporation CONTACT: Kenneth R. Howe, Chief Financial
Officer, Agree Realty Corporation, +1-248-737-4190 Web Site:
http://www.agreerealty.com/
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