Bedford Property Investors, Inc. (NYSE:BED) today announced its
financial results for the second quarter and six months ended June
30, 2005. Diluted earnings per share of common stock (EPS) for the
second quarter of 2005 were $0.55, compared with diluted EPS of
$0.30 achieved for the second quarter of 2004. EPS for the six
months ended June 30, 2005 were $0.98 compared with $0.59 for the
six months of 2004. Funds from operations (FFO) per share of common
stock for the second quarter of 2005 were $0.43, compared with FFO
per share of $0.76 achieved for the second quarter of 2004. FFO per
share of common stock for the first six months of 2005 were $0.89,
compared with FFO per share of common stock of $1.48 achieved in
the first six months of 2004. Financial Results Net income
available to common stockholders for the second quarter of 2005
increased by approximately $3,784,000 (78%) when compared with the
second quarter of 2004. Net income available to common stockholders
for the first six months of 2005 increased by approximately
$5,934,000 (62%) when compared with the same period in 2004. These
increases are mainly due to gains of approximately $9,095,000 and
$16,239,000 realized from the sales of operating properties for the
second quarter and first six months of 2005, respectively. Income
from continuing operations (which excludes the operating results
from properties sold and gains on sales) for the second quarter and
the first six months of 2005 decreased $2,579,000 and $4,995,000,
respectively, when compared to the same periods in 2004. These
decreases are the result of the loss of net operating income from
the property sales that occurred in 2004 and 2005, continued rental
rate reductions on our lease renewals and re-leasing, declines in
the operating portfolio occupancy, and increases in depreciation
expense, primarily due to improvements of real estate and
properties acquired and developed in 2004 and 2005. These decreases
were partially offset by additional net operating income resulting
from the property acquisitions and development undertaken in 2004.
FFO for the second quarter of 2005 were approximately $6,810,000,
compared to approximately $12,226,000 for the same period in 2004.
FFO for the six months ended June 30, 2005 were approximately
$14,057,000, compared to approximately $23,870,000 for the same
period in 2004. FFO is a non-GAAP financial measurement used by
real estate investment trusts to measure and compare operating
performance and is generally defined as net income computed in
accordance with GAAP, excluding extraordinary items and gains or
losses from sales of property, plus depreciation and amortization
of assets related to real estate, and after adjustments for
unconsolidated partnerships and joint ventures. A reconciliation of
our FFO to our net income available to common stockholders (the
most directly comparable GAAP measure) is included in the financial
data accompanying this press release. Property Operations As of
June 30, 2005, we owned and managed approximately 7.5 million
square feet of suburban office and industrial properties which
consisted of 81 operating properties totaling approximately 6.9
million square feet and six development and rehabilitation projects
totaling approximately 600,000 square feet. At quarter end our 7.5
million square foot portfolio was 80% occupied while our operating
portfolio was 88% occupied. During the second quarter of 2005, we
renewed and re-leased 451,294 square feet, or 82% of the expiring
square footage of 550,053. The average change in rental rates (on a
cash basis) in these new leases was a decrease of 16.0%. For the
six months ended June 30, 2005, we renewed and re-leased 606,927
square feet, or 69% of the expiring square footage. The average
change in rental rates (on a cash basis) in these new leases was a
decrease of 14.7%. Property Acquisitions In the second quarter of
2005, we purchased a 1.31 acre parking lot for approximately
$587,000 in Phoenix, Arizona. We purchased this lot, which is
adjacent to one of our existing operating properties, to
accommodate the parking needs of our tenants. Property Dispositions
In the second quarter of 2005, we sold five operating properties in
one transaction for $27,750,000. This sale consisted of two office
and three R & D buildings totaling 182,186 square feet and
generated a gain on sale of real estate investments of $9,095,000.
During the six months ended June 30, 2005, we sold six operating
properties in two transactions for a total of $43,550,000. These
sales consisted of two office and four R & D buildings totaling
291,966 square feet and generated gains on sale of real estate
investments of $15,989,000. In addition, we recorded a gain of
$250,000 from funds released from escrow in the first quarter of
2005 in connection with a property sold in the fourth quarter of
2004. Stock Repurchase During the second quarter of 2005, we
repurchased 178,363 shares of our common stock at an average cost
of $21.81 per share. Of the 178,363 shares repurchased, 635 shares
were repurchased from our employees who sold shares in settlement
of their payroll taxes upon the vesting of their restricted stock.
The remaining 177,728 shares were repurchased on the open market
pursuant to our common stock share repurchase program. Since the
inception of this repurchase program in November 1998, we have
repurchased a total of 8,694,344 shares of our common stock at an
average cost of $19.31 per share, which represents 38% of the
shares of common stock outstanding at November 30, 1998. Company
Information We are a self-administered equity real estate
investment trust that acquires, develops, owns and operates
multi-tenant suburban office and industrial properties in Arizona,
California, Colorado, Nevada, Oregon and Washington. As of June 30,
2005, we had 478 tenants. We are traded on the New York Stock
Exchange and the Pacific Exchange under the symbol "BED", and our
website is www.bedfordproperty.com. Investors, analysts and other
interested parties are invited to join our quarterly conference
call on Tuesday, July 19, 2005 at 8:00 a.m. PDT. To participate,
callers may dial 866-641-2830 and state ID#: 143428 and conference
call leader Hanh Kihara, five minutes beforehand. Investors also
have the opportunity to listen to the conference call live on the
Internet at our website at www.bedfordproperty.com, under Investor
Relations-Investor Overview, by clicking on the webcast icon. A
telephonic replay of the call is available through August 19, 2005
at 800-642-1687, ID#: 143428. -0- *T BEDFORD PROPERTY INVESTORS,
INC. CONSOLIDATED BALANCE SHEETS AS OF JUNE 30, 2005 AND DECEMBER
31, 2004 (Unaudited; in thousands, except share and per share
amounts) June 30, December 31, 2005 2004(1) ------------
-------------- Assets Real estate investments: Industrial buildings
$ 408,199 $ 417,613 Office buildings 345,541 332,695 Properties
under development 19,701 29,716 Land held for development 12,666
13,529 ----------- ----------- 786,107 793,553 Less accumulated
depreciation 94,117 85,436 ----------- ----------- 691,990 708,117
Operating properties held for sale, net - 8,293 -----------
----------- Total real estate investments 691,990 716,410 Cash and
cash equivalents 2,508 24,218 Accounts receivable, net 464 679
Notes receivable, net - 6,820 Other assets 42,848 45,356
----------- ----------- Total assets $ 737,810 $ 793,483
=========== =========== Liabilities and Stockholders' Equity Bank
loan payable $ 44,163 $ - Mortgage loans payable 316,588 351,335
Accounts payable and accrued expenses 7,773 13,135 Dividends
payable 10,311 63,898 Other liabilities 12,406 14,657 -----------
----------- Total liabilities 391,241 443,025 -----------
----------- Stockholders' equity: Preferred stock, $0.01 par value;
authorized 6,795,000 shares; issued none - - Series A 8.75%
cumulative redeemable preferred stock, $0.01 par value; authorized
and issued 805,000 shares at June 30, 2005 and December 31, 2004;
stated liquidation preference of $40,250 38,947 38,947 Series B
7.625% cumulative redeemable preferred stock, $0.01 par value;
authorized and issued 2,400,000 shares at June 30, 2005 and
December 31, 2004; stated liquidation preference of $60,000 57,769
57,769 Common stock, $0.02 par value; authorized 50,000,000 shares;
issued and outstanding 16,248,057 shares at June 30, 2005 and
16,325,584 shares at December 31, 2004 324 326 Additional paid-in
capital 287,683 289,132 Deferred stock compensation (11,361)
(10,114) Accumulated dividends in excess of net income (26,826)
(25,700) Accumulated other comprehensive income 33 98 -----------
----------- Total stockholders' equity 346,569 350,458 -----------
----------- Total liabilities and stockholders' equity $ 737,810 $
793,483 ============ =========== (1) The information in this column
was derived from the Company's audited consolidated balance sheet
for the year ended December 31, 2004. BEDFORD PROPERTY INVESTORS,
INC. CONSOLIDATED STATEMENTS OF INCOME FOR THE THREE AND SIX MONTHS
ENDED JUNE, 2005 AND 2004 (Unaudited; in thousands, except share
and per share amounts) Three Months Six Months 2005 2004 2005 2004
----------- ----------- ----------- ----------- Rental income $
23,543 $ 23,276 $ 47,176 $ 46,023 Rental expenses: Operating
expenses 4,872 4,082 9,404 7,731 Real estate taxes 2,931 2,598
5,939 5,176 Depreciation and amortization 7,246 6,550 14,658 12,670
General and administrative expenses 2,052 1,583 4,113 3,088
----------- ----------- ----------- ----------- Income from
operations 6,442 8,463 13,062 17,358 Other income (expense)
Interest income 26 11 166 29 Interest expense (5,274) (4,701)
(10,621) (9,785) ----------- ----------- ----------- -----------
Income from continuing operations 1,194 3,773 2,607 7,602
----------- ----------- ----------- ----------- Discontinued
operations: Income from discontinued operations 394 1,983 747 3,770
Gain on sale of operating properties 9,095 - 16,239 - -----------
----------- ----------- ----------- Income from discontinued
operations 9,489 1,983 16,986 3,770 ----------- ------------
----------- ----------- Net income 10,683 5,756 19,593 11,372
Preferred dividends - Series A (881) (881) (1,761) (1,761)
Preferred dividends - Series B (1,143) - (2,287) - -----------
----------- ----------- ----------- Net income available to common
stockholders $ 8,659 $ 4,875 $ 15,545 $ 9,611 ===========
=========== =========== =========== Income per common share -
basic: (Loss) income from continuing operations $ (0.05) $ 0.18 $
(0.09) $ 0.37 Income from discontinued operations 0.60 0.13 1.07
0.23 ----------- ----------- ----------- ----------- Net income
available to common stockholders $ 0.55 $ 0.31 $ 0.98 $ 0.60
=========== =========== =========== =========== Weighted average
number of shares - basic 15,764,606 15,838,442 15,800,793
15,898,655 =========== =========== =========== =========== Income
per common share - diluted: (Loss) income from continuing
operations $ (0.05) $ 0.18 $ (0.09) $ 0.36 Income from discontinued
operations 0.60 0.12 1.07 0.23 ----------- ----------- -----------
----------- Net income available to common stockholders $ 0.55 $
0.30 $ 0.98 $ 0.59 =========== =========== =========== ===========
Weighted average number of shares - diluted 15,795,296 16,059,299
15,858,864 16,181,870 =========== =========== ===========
=========== BEDFORD PROPERTY INVESTORS, INC. CONSOLIDATED FUNDS
FROM OPERATIONS FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2005
AND 2004 (in thousands, except share and per share amounts) Three
Months Six Months 2005 2004 2005 2004 ----------- -----------
----------- ----------- Net income available to common stockholders
$ 8,659 $ 4,875 $ 15,545 $ 9,611 Adjustments: Depreciation and
amortization: Continuing operations 7,246 6,550 14,658 12,670
Discontinued operations - 801 93 1,589 Gain on sale of operating
properties (9,095) - (16,239) - ----------- ----------- -----------
----------- Funds from Operations (FFO)(1) $ 6,810 $ 12,226 $
14,057 $ 23,870 =========== =========== =========== =========== FFO
per share - diluted $ 0.43 $ 0.76 $ 0.89 $ 1.48 ===========
=========== =========== =========== Weighted average number of
shares - diluted 15,795,296 16,059,299 15,858,864 16,181,870
=========== =========== =========== =========== (1) Although FFO is
not a financial measure calculated in accordance with accounting
principles generally accepted in the United States of America
(GAAP), we believe that FFO is an appropriate alternative measure
of the performance of an equity real estate investment trust
(REIT). Presentation of this information provides the reader with
an additional measure to compare the performance of equity REITs.
FFO is generally defined by the National Association of Real Estate
Investment Trusts as net income (loss) (computed in accordance with
GAAP), excluding extraordinary items such as gains (losses) from
sales of property, plus depreciation and amortization, and after
adjustments for unconsolidated partnerships and joint ventures. FFO
as set forth in the table above has been computed in accordance
with this definition. FFO does not represent cash generated by
operating activities in accordance with GAAP; it is not necessarily
indicative of cash available to fund cash needs and should not be
considered as an alternative to net income (loss) as an indicator
of our operating performance or as an alternative to cash flow as a
measure of liquidity. Furthermore, FFO as disclosed by other REITs
may not be comparable to our presentation. The most directly
comparable financial measure calculated in accordance with GAAP to
FFO is net income available to common stockholders. *T
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