Capital Automotive REIT Reports Q3 and Nine Month Results
26 October 1998
Capital Automotive REIT Reports Third Quarter and Nine Month Results
MCLEAN, Va., Oct. 26 -- Capital Automotive REIT
today announced financial results for the third quarter and
nine months ended September 30, 1998.
For the third quarter, the Company reported funds from operations (FFO) of
$8.5 million, or $0.28 per basic and diluted share, on total revenues of
$10.4 million. Net income in the third quarter was $5.2 million, or $0.21 per
basic and diluted share. FFO results are based on basic and diluted weighted
average number of common shares and units of 31 million.
For the nine month period ended September 30, 1998, funds from operations
were $17.8 million, or $0.71 per basic share or $0.70 per diluted share, on
total revenues of $22.2 million. Net income for the period was $11.7 million,
or $0.57 per basic and $0.56 per diluted share. FFO results for the nine
month period are based on basic weighted average number of shares and units of
25.3 million and diluted weighted average number of shares and units of
25.5 million.
The Company also announced today that its Board of Trustees has declared a
cash dividend of $0.27 per share for the third quarter. The dividend is
payable on November 20,1998 to shareholders of record as of November 9, 1998.
Thomas D. Eckert, president and chief executive officer, stated, "Despite
the challenging capital markets, Capital Automotive completed $149 million in
acquisitions during the third quarter bringing our total to $413 million for
the first nine months of 1998. As of the end of the third quarter, we have
fully invested the proceeds of our February, 1998 IPO. Through further
geographic and franchise diversification our portfolio has been significantly
strengthened. Currently, 75% of our properties are located in the top 50
automotive markets and 65% of our annualized revenues are derived from tenants
who are among the top 100 dealer groups in the country. Both of these
statistics reflect the high quality properties and stable tenants in our
portfolio. The weighted average cap rate of our portfolio is 10.7%, which we
believe represents an attractive yield in today's environment. Our third
quarter FFO pro forma run rate (defined as the annualized third quarter FFO)
at September 30, 1998 was $1.28 per share, which we believe positions the
Company for strong performance in 1999. The recently expanded three million
share repurchase program further illustrates our strong belief in the
intrinsic value of our company."
In October, 1998, the Company closed on a $50 million bridge loan that
will roll over into a permanent $150 million term loan. The Company expects
to close on the $150 million, ten year term loan during the fourth quarter.
The interest rate on this loan was locked in September at 7.67%. The Company
is also pursuing several alternative sources of future acquisition funding.
As previously announced, during the third quarter, Capital Automotive REIT
closed on $149 million in property acquisitions. Consideration for the
properties consisted of substantially all cash. As of September 30, 1998,
Capital Automotive owned 96 properties, including 137 automotive franchises
representing 35 brands in 16 states. The Company owns the property used by
23 dealership groups, nine of which are in the top 100 dealer groups in the
country according to Automotive News.
Capital Automotive REIT, headquartered in McLean, Virginia, is a
self-administered, self-managed real estate investment trust formed to acquire
the real property and improvements used by operators of multi-site,
multi-franchised motor vehicle dealerships and motor vehicle related business.
Additional information on Capital Automotive REIT is available on the
Company's website at http://www.capitalautomotive.com.
The matters discussed in this press release include forward-looking
statements. In addition, when used in this press release, the words "intends
to," "believes," "anticipates," "expects," "pro forma" and similar expressions
are intended to identify forward-looking statements. Such statements are
subject to a number of risks and uncertainties. Actual results in the future
could differ materially and adversely from those described in the
forward-looking statements as a result of various important factors, including
the general economic climate, the supply of and demand for automotive
properties, interest rate levels, the availability of financing, and other
risks associated with the acquisition and leasing of properties, including
risks that the tenants will not pay rent or that operating costs may be
greater than anticipated, acquisitions that are pursued by the Company may not
be consummated for a variety of reasons, including the failure to reach
agreement with the seller and the other risk factors set forth in the
Company's filings with the Securities and Exchange Commission. The Company
undertakes no obligation to publicly release the result of any revisions to
these forward-looking statements that may be made to reflect any future events
or circumstances.
CAPITAL AUTOMOTIVE REIT
UNAUDITED FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA)
Statements of Operations: Three Months Ended Nine Months Ended
Sept 30, 1998 Sept 30, 1998
Revenue:
Rental income $8,425 $15,254
Interest income 1,938 6,975
Total revenue 10,363 22,229
Expenses:
Depreciation and amortization 1,972 3,311
General and administrative 1,630 3,992
Interest 159 328
Total expenses 3,761 7,631
Net income before
minority interest 6,602 14,598
Minority interest (1,381) (2,928)
Net income applicable to
common shareholders $5,221 $11,670
Basic earnings per share $0.21 $0.57
Diluted earnings per share $0.21 $0.56
Weighted average number of
common shares - basic 24,713 20,597
Weighted average number of
common shares - diluted 24,713 20,665
Funds from Operations:
Net income before minority
interest $6,602 $14,598
Adjustments:
Add: Real estate depreciation
and amortization 1,947 3,241
Funds from operations: $8,549 $17,839
Basic funds from operations
per share $0.28 $0.71
Diluted funds from operations
per share $0.28 $0.70
Weighted average number of
common shares and units
- basic 31,018 25,293
Weighted average number of
common shares and units
- diluted 31,018 25,534
As of
Selected Balance Sheet Data(in thousands) Sept 30,
1998
Real estate before accumulated depreciation $413,273
Cash and cash equivalents 40,138
Total assets 456,068
Borrowings under line of credit 13,000
Total other liabilities 11,249
Minority interest 90,335
Total shareholders' equity 341,484
Selected Portfolio Data:
Properties 96
States 16
Land acres 521
Square feet of building (in millions) 3.4
Average lease term (in years) 13
Dealership groups 23
"Top 100" dealership groups* 9
Franchises 137
Automotive brands 35
*as published in "Automotive News"