Urstadt Biddle Properties Inc. (NYSE: UBA and UBP), a real
estate investment trust, today announced its fourth quarter and
full year financial results for the fiscal year ended October 31,
2012. The company also announced an increase in the quarterly
dividend rate on its Class A Common stock.
Diluted funds from operations (“FFO”) for the quarter ended
October 31, 2012 amounted to $5,945,000 or $0.19 per Common share
and $0.20 per Class A Common share compared with $7,846,000 or
$0.25 per Common share and $0.28 per Class A Common share in last
year’s fourth quarter. For the year ended October 31, 2012, diluted
FFO amounted to $30,627,000 or $0.98 per Common Share and $1.08 per
Class A Common share compared with $34,453,000 or $1.12 per Common
Share and $1.23 per Class A Common share in fiscal 2011. The FFO
amounts above included several significant one time items in fiscal
2012 and fiscal 2011. In an effort to assist investors in
analyzing changes to FFO, we have included a second FFO
reconciliation table on page 6 which explains the effect of these
one time items on the company’s FFO per share.
Net income applicable to Common and Class A Common stockholders
for the quarter ended October 31, 2012 amounted to $1,579,000 or
$0.05 per diluted Common share and $0.05 per diluted Class A Common
share compared with $3,785,000 or $0.12 per diluted Common share
and $0.14 per diluted Class A Common share in last year’s fourth
quarter. For the year ended October 31, 2012 net income applicable
to Common and Class A Common stockholders was $12,966,000 or $0.41
per diluted Common share and $0.46 per diluted Class A Common share
compared to $18,549,000 or $0.60 per diluted Common share and $0.66
per diluted Class A Common share in fiscal 2011.
The per share amounts for both FFO and net income in fiscal 2012
include the effect of the company issuing 2.5 million Class A
Common shares in a follow-on public offering on October 5, 2012. In
addition, the amounts for both FFO and net income in fiscal 2012
are reduced by preferred stock redemption charges of $2.0 million
which will be nonrecurring. FFO and net income applicable to Class
A Common and Common stockholders for the fiscal year ended October
31, 2011 included lease termination income in the amount of $2.99
million relating to a lease termination settlement with a grocery
store tenant that vacated its space in the company’s Meriden
property prior to expiration of its lease.
Base rental income and net operating income (exclusive of bad
debt expense and straight line rent) from properties owned in the
fiscal year ended October 31, 2012, when compared to the same
properties owned in fiscal 2011 increased by $501,000 and $411,000,
respectively. This resulted from normal base rent increases for
in-place leases at our existing properties and from net increases
caused primarily by new leases entered into at three properties
offset by vacancies primarily at two properties. For the fiscal
year ended October 31, 2012, base rental income and net operating
income for properties acquired in fiscal 2011 and fiscal 2012
increased by $3,146,000 and $2,705,000, respectively, when compared
with these same properties from the prior year. At October 31, 2012
the percentage of the gross leasable area of the company’s core
properties that was leased amounted to 89.2%, a decrease of 1.2%
from October 31, 2011. A portion of the decrease in the leased
percentage resulted when 89,000 sf of low rent per square foot
warehouse space formerly leased by a retail tenant at our Yorktown,
N.Y. property became vacant this quarter. In addition, our leased
percentage continues to be negatively affected by five properties
which are under re-development. For informational purposes,
excluding these re-development properties from our leased
percentage calculation results in an occupancy rate of 93.9% for
the remaining 45 core properties. The re-development at these five
properties ranges from building re-configurations to accommodate
tenants to rebuilding facades and reconfiguring portions of the
properties to make the properties more marketable to new tenants.
The company has three equity investments in unconsolidated joint
ventures (437,000 square feet); at October 31, 2012 those
properties were approximately 96.4% leased.
Commenting on the quarter’s operating results, Willing L.
Biddle, President and Chief Operating Officer of UBP, said, “In
fiscal 2012 the company completed two successful public stock
offerings. In early October the company sold 2.5 million shares of
Class A Common stock at a net price of $19.16 per share, close to
an all time high, which raised net proceeds of $48 million for the
company. In late October the company sold 5.175 million shares of a
new series of perpetual preferred stock with a 7.125% coupon rate,
raising an additional $125 million in net proceeds for the company.
The 7.125% coupon on the new preferred stock series was the lowest
perpetual preferred stock coupon rate in the company’s history. The
company used $18.2 million of the proceeds to retire a portion of
its Series C preferred stock bearing an 8.5% coupon rate. Shortly
following the end of the fiscal year, an additional $62 million was
utilized to redeem all of the Series E preferred stock, also
bearing a coupon rate of 8.5%. Following the planned redemption of
the remaining Series C stock in May 2013, the company should
realize annual savings of $1.375 million in preferred stock
dividend payments beginning in June 2013. Both offerings were
extremely well received by the investment community and demand for
the preferred stock offering significantly exceeded supply. In the
fourth quarter the company completed a refinancing of its expiring
unsecured credit line for an additional five years. We increased
the commitment under the line from $50 million to $80 million and
included two new banks in the syndicate, Bank of Montreal and
Regions Bank, who joined incumbent banks, Bank of New York Mellon
and Wells Fargo Bank N.A. We look forward to continuing to work
with our incumbent lenders and look forward to building long term
relationships with the new members of our bank group.”
Mr. Biddle continued, “The company’s number one focus remains
leasing the vacant space in our portfolio. Overall, we feel good
about the direction of our leasing at most of our properties,
although we do have five properties where the leasing environment
coming out of the recession has been more challenging. For these
properties, we believe we have an effective strategy in place to
improve each property’s position in its local marketplace and as a
result we expect to be successful in leasing the vacant space at
three of those properties in fiscal 2013. We are currently
exploring a zoning change at the fourth property which, if granted,
may significantly improve our ability to re-develop that center. In
addition, we are currently seeking zoning approval to construct and
operate a self storage facility in the newly vacant 89,000 sf
warehouse space at our Yorktown, N.Y. property that we expect will
generate higher income than the former warehouse use. In 2012, we
closed two property acquisitions in our core marketplace and as
always, we are actively in the market to purchase additional
shopping centers. We are encouraged to see an uptick in our
recurring FFO and our overall operating results this quarter as
some of the leasing we completed in late 2011 and 2012 began to
come on line. In addition, our results were bolstered by the
earnings from two acquisitions completed in 2012. After adjusting
for the $3 million lease termination income from fiscal 2011, our
operating results, same store base rental revenue, and same store
net operating income are up moderately for fiscal 2012 when
compared with the prior year. Looking ahead, we will continue to
focus on improving and re-developing our existing portfolio to
strengthen it for the long term.”
UBP Announces an Increase in Dividends to its Shareholders
for the Nineteenth Consecutive Year
At their regular December meeting, the company’s Directors
approved an increase in the quarterly dividend rate on shares of
the company’s Class A Common Stock. The quarterly dividend rate
declared for Class A Common stock was increased to $0.25 per share,
which represents an annualized increase of $0.01 per share for the
Class A Common shares. In consideration of the company’s charter
requirement that the Class A Common dividend rate be at least 10%
higher than the Common dividend rate, the Board of Directors
declared a quarterly dividend for the Common shares of $0.225 per
share, unchanged from the prior year. The $0.01 increase on the
Class A Common Stock dividend represents the nineteenth consecutive
year that the company has increased total dividends to its
shareholders. The Class A Common and Common dividends are payable
January 18, 2013 to stockholders of record on January 4, 2013.
Urstadt Biddle Properties Inc. is a self-administered equity
real estate investment trust which owns or has equity interests in
54 properties containing approximately 4.9 million square feet of
space. Listed on the New York Stock Exchange since 1969, it
provides investors with a means of participating in ownership of
income-producing properties. It has paid 172 consecutive quarters
of uninterrupted dividends to its shareholders since its inception
and has raised total dividends to its shareholders for the last 19
consecutive years.
Non-GAAP Financial MeasureFunds from Operations (“FFO”)
The company considers FFO to be a meaningful additional measure
of operating performance because it primarily excludes the
assumption that the value of its real estate assets diminishes
predictably over time and industry analysts have accepted it as a
performance measure. FFO is presented to assist investors in
analyzing the performance of the company. The company reports FFO
in addition to net income applicable to common shareholders and net
cash provided by operating activities. FFO is helpful as it
excludes various items included in net income that are not
indicative of the company’s operating performance, such as gains
(or losses) from sales of property and depreciation and
amortization. The company has adopted the definition suggested by
the National Association of Real Estate Investment Trusts
(“NAREIT”). The company defines FFO as net income computed in
accordance with accounting principles generally accepted in the
United States of America (“U.S. GAAP”), excluding gains (or losses)
from sales of property plus real estate related depreciation and
amortization, and after adjustments for unconsolidated joint
ventures. FFO does not represent cash flows from operating
activities in accordance with U.S. GAAP and is not indicative of
cash available to fund cash needs. FFO should not be considered as
an alternative to net income as an indicator of the company’s
operating performance or as an alternative to cash flow as a
measure of liquidity. Since all companies do not calculate FFO in a
similar fashion, the company’s calculation of FFO presented herein
may not be comparable to similarly titled measures as reported by
other companies. This quarter, the company also has presented an
alternative table of reconciliation between Net Income Available to
Common and Class A Common Stockholders to FFO, removing the effects
of preferred stock redemption costs from the fiscal 2012 results
and the one time significant lease termination income in the fiscal
2011 results relating to a tenant that left one of the company’s
shopping centers.
Certain statements contained herein may constitute
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking
statements involve known and unknown risks, uncertainties and other
factors which may cause the actual results, performance or
achievements of the company to be materially different from any
future results, performance or achievements expressed or implied by
such forward-looking statements. Such factors include, among other
things, risks associated with the timing of and costs associated
with property improvements, financing commitments and general
competitive factors.
(Table Follows)
URSTADT BIDDLE PROPERTIES INC. (NYSE:
UBA AND UBP)
FISCAL YEAR AND FOURTH QUARTER 2012
RESULTS
(in thousands, except per share data)
Fiscal Year Ended
Three Months Ended October
31, October 31,
2012 2011
2012 2011 (Unaudited)
(Unaudited) (Unaudited)
Revenues Base rents
$
68,443 $ 64,249
$ 17,458 $ 16,149 Recoveries
from tenants
20,603 21,552
5,244 5,510 Lease
termination income
89 3,196
2 65 Other income
2,160 2,014
355 447
Total Revenues
91,295
91,011 23,059
22,171 Expenses
Property operating
14,203 14,750
3,406 3,768 Property
taxes
15,114 14,522
3,885 3,669 Depreciation and
amortization
16,721 15,292
4,213 3,906 General and
administrative
7,545 7,521
1,890 1,942 Acquisition
costs
296 89
- 23 Directors' fees and expenses
262 261
61 57
Total Operating Expenses
54,141
52,435 13,455
13,365 Operating
Income 37,154 38,576
9,604 8,806
Non-Operating Income (Expense): Interest expense
(9,148 ) (7,865 )
(2,511 ) (2,012 )
Equity in net income (loss) from unconsolidated joint ventures
(138 ) 393
(95 ) 127 Other expense
- (6 )
- - Interest, dividends and other investment
income
892
851 219
215 Net Income
28,760 31,949
7,217 7,136
Noncontrolling
interests: Net income attributable to noncontrolling interests
(500 )
(306 ) (164
) (77 ) Net
income attributable to Urstadt Biddle Properties Inc.
28,260 31,643
7,053 7,059 Preferred stock dividends
(13,267 ) (13,094 )
(3,447 ) (3,274 )
Redemption of preferred stock
(2,027
) -
(2,027 )
- Net Income Applicable to Common and
Class A Common Stockholders $
12,966 $
18,549 $
1,579 $ 3,785
Diluted Earnings Per Share: Common
$
0.41 $ 0.60
$ 0.05 $ 0.12 Class A Common
$ 0.46 $ 0.66
$ 0.05 $ 0.14
Weighted Average Number of Diluted Shares
Outstanding: Common and Common Equivalent
8,204 7,961
8,320 8,030
Class A Common and Class A Common Equivalent
20,964 20,704
21,554 20,729
URSTADT BIDDLE PROPERTIES INC. (NYSE:
UBA AND UBP)
FISCAL YEAR AND FOURTH QUARTER ENDED
2012 RESULTS
(in thousands, except per share data)
Reconciliation of Net Income Available
to Common and Class A Common Stockholders To Funds From
Operations:
Fiscal Year Ended
October 31,
Three Months Ended
October 31,
2012 2011
2012 2011 Net Income
Applicable to Common and Class A Common Stockholders
$
12,966 $ 18,549
$ 1,579 $ 3,785 Real
property depreciation
13,277 12,258
3,436 3,105
Amortization of tenant improvements and allowances
2,906
2,450
645 639 Amortization of deferred leasing costs
479 541
116 150 Depreciation and amortization on
unconsolidated joint ventures
911 655
169 167 Loss on
sale of property
88
- - -
Funds from Operations Applicable to Common and Class A Common
Stockholders
$ 30,627
$ 34,453 $
5,945 $ 7,846
Funds from Operations (Diluted) Per Share: Common
$ 0.98 $
1.12 $ 0.19
$ .25 Class A Common
$ 1.08 $
1.23 $ 0.20
$ .28
The following table reconciles the company’s net income
available to Common and Class A Common Stockholder to Funds From
Operations after removing the fiscal 2012 preferred stock
redemption costs and the fiscal 2011 one time lease termination
income.
Reconciliation of Net Income Available to Common and Class A
Common Stockholders To Recurring Funds From Operations:
Fiscal Year Ended
October 31,
Three Months Ended
October 31,
2012 2011
2012 2011 Net Income
Applicable to Common and Class A Common Stockholders
$
12,966 $ 18,549
$ 1,579 $ 3,785 Add:
Redemption of preferred stock charges
2,027 -
2,027 -
Less: One time lease termination income
- (2,988 )
- - Net Income
Applicable to Common and Class A Common Stockholders
14,993
15,561
3,606 3,785 Real property depreciation
13,277 12,258
3,436 3,105 Amortization of tenant
improvements and allowances
2,906 2,450
645 639
Amortization of deferred leasing costs
479 541
116
150 Depreciation and amortization on unconsolidated joint ventures
911 655
169 167 Loss on sale of property
88 -
- - Funds from Operations
Applicable to Common and Class A Common Stockholders
$ 32,654 $
31,465 $
7,972 $ 7,846
Funds from Operations (Diluted) Per Share: Common
$ 1.04 $
1.02 $
0.25 $ .25 Class A
Common
$ 1.15
$ 1.13 $
0.27 $ .28
Balance Sheet Highlights (in thousands)
October 31, October 31,
2012
2011 (Unaudited)
Assets Cash and Cash
Equivalents $ 78,092
$ 4,529 Real
Estate investments before accumulated depreciation
$ 660,375
$ 631,167
Investments in and advances to unconsolidated joint ventures
$ 26,708
$ 26,384 Total
Assets $ 724,243
$ 576,264
Liabilities Revolving credit lines
$ 11,600
$ 41,850 Mortgage
notes payable and other loans $
143,236 $
118,135 Total Liabilities
$ 228,304
$ 175,019
Redeemable Preferred Stock $
21,510 $
96,203 Redeemable Noncontrolling
Interests $ 11,421
$ 2,824 Total
Stockholders’ Equity $
463,008 $
302,218
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