Excel Trust Inc : Excel Trust Announces Fourth Quarter and Year Ended 2012 Results, Increases Dividend
02/27/2013| 05:25pm US/Eastern
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Excel Trust, Inc. (NYSE:EXL) announced today financial and operating
results for the quarter and year ended December 31, 2012. A supplemental
financial package with additional information can be found on Excel
Trust's website under the Investor Relations tab.
Highlights for the Year Ended 2012
Reported Adjusted Funds from Operations (AFFO) for the quarter of
$8.5 million, or $0.20 per diluted share and for the year of $28.6
million, or $0.78 per diluted share (5% increase year over year)
Reported Funds from Operations (FFO) for the quarter of $8.6
million or $0.20 per diluted share and for the year of $27.3 million,
or $0.74 per diluted share (21% increase year over year)
Acquired approximately $440 million in properties
Surpassed $1 billion in total assets
Contributed La Costa Towne Center (San Diego, CA) into a joint
venture
Improved terms and increased our unsecured credit facility to $250
million, expandable to $450 million
"2012 was transformational for Excel Trust in several respects. By
acquiring $440 million in quality properties, our asset base surpassed
$1.1 billion and our portfolio now exceeds 5.5 million square feet,"
commented Gary Sabin, Chairman and CEO. "We lowered our cost of debt by
improving our credit facility and anticipate beginning discussions with
the rating agencies in order to position the Company to access the
unsecured debt markets. These are important milestones for the Company
and we are well on our way to accomplishing the goals we set at the time
of our IPO a little over two and half years ago."
Excel Trust reported Adjusted Funds From Operations (AFFO) for the
fourth quarter of $8.5 million, or $0.20 per diluted share, and $28.6
million, or $0.78 per diluted share for the year. Excel Trust reported
Funds From Operations (FFO) for the fourth quarter of $8.6 million or
$0.20 per diluted share, and $27.3 million, or $0.74 per diluted share
for the year. Net loss attributable to the common stockholders for the
fourth quarter was $2.2 million or $0.06 per diluted share, and $8.5
million or $0.26 per diluted share for the year.
Included in FFO for the quarter ended December 31, 2012 were transaction
costs of $0.4 million related to acquisitions, or $0.01 per diluted
share, and $1.6 million or $0.04 per diluted share in the twelve months
ended December 31, 2012. Also, included in FFO was non-cash compensation
expense of approximately $0.8 million, or $0.02 per diluted share in the
quarter ended December 31, 2012 and $3.2 million or $0.09 per diluted
share in the twelve months ended December 31, 2012, resulting from the
Company's incentive stock award plan. Finally, FFO was impacted by a
non-cash gain related to changes in the fair value of financial
instruments and the redemption of certain OP units of approximately $0.4
million, or $0.01 per diluted share. For the twelve months ended
December 31, 2012, this gain was $1.5 million, or approximately $0.04
per diluted share.
Excel Trust considers AFFO and FFO important supplemental measures of
its operating performance and believes that they are frequently used by
securities analysts, investors and other interested parties in the
evaluation of real estate investment trusts (REITs), many of which
present AFFO and FFO when reporting their results. A complete
reconciliation containing adjustments from GAAP net income available to
common shareholders to AFFO and FFO and a definition of both are
included at the end of this release.
Summary of Significant Activities During Fourth Quarter 2012
On October 1, 2012, Excel Trust acquired the Pavilion Crossing, a newly
constructed 68,400 square foot retail shopping center located in
Brandon, Florida, for approximately $13.1 million. The property is
approximately 97% leased and is anchored by a Publix grocery store.
On October 19, 2012, Excel Trust acquired a portfolio of six shopping
centers in Florida and Virginia for approximately $262.8 million as
outlined below.
Florida Properties - Orlando, FL:Five of the shopping centers
are in the Orlando, Florida area (four centers are wholly owned and a
50% interest was acquired in a fifth center) which together comprise
319,264 square feet. Major tenants include Walgreens, CVS Pharmacy,
Fifth Third Bank, Regions Bank, Fleming's and Ruth's Chris Steak House.
The shopping centers are approximately 95% leased and the weighted
average household income in a three mile radius is estimated to be
$127,286 (Source: AGS 2012).
West Broad Village - Richmond, Virginia: The sixth center is in
Richmond, Virginia and comprises 386,047 square feet of retail and
commercial space, with an additional 339 apartment units above the
center. The retail portion is approximately 76% leased with another
35,000 square feet entitled but not constructed. Major tenants include
Whole Foods, HomeGoods, REI, Wells Fargo, South University and Dave &
Busters. In a three mile radius the average household income is
estimated to be $106,356 (Source: AGS 2012).
On October 30, 2012, Excel Trust completed the issuance of a public
offering of 9,775,000 shares of its common stock, including the exercise
of an overallotment option of 1,275,000 shares, at a public offering
price of $12.00 per share, resulting in net proceeds of approximately
$113.1 million after deducting the underwriters' discount and estimated
commissions and offering expenses.
Events Subsequent to Fourth Quarter 2012
On January 24, 2013, Excel Trust acquired Tracy Pavilion, a 374,766
square foot shopping center in Tracy, California, for approximately $32
million. The Company owns 162,353 square feet as Home Depot and WinCo
are both tenant owned. Other major tenants include, Marshalls, Ross,
PetSmart, Staples and Ulta. In a five mile radius average household
income is estimated to be $95,558 (Source: AGS 2013).
First Quarter 2013 Dividend Declared
The Board of Directors declared a first quarter 2013 cash dividend of
$0.17 per share compared to a cash dividend of $0.1625 per share for the
previous quarter, to be paid on April 15, 2013 to shareholders of record
as of March 29, 2013.
The Board of Directors has also declared a dividend of $0.4375 per share
on the Company's Series A Cumulative Convertible Perpetual Preferred
Shares, and a dividend of $0.5078 on its Series B Cumulative Redeemable
Preferred Shares. The dividend on Excel Trust's outstanding Series A and
Series B Preferred Shares will be payable on April 15, 2013 to the
Series A and Series B Preferred shareholders of record as of March 29,
2013.
Guidance
Excel Trust expects its AFFO per share for fiscal year 2013 to be
between $0.80 and $0.88 and its FFO per share to be between $0.76 and
$0.84. The above excludes transaction costs, leasing commissions and
tenant improvement allowances. Excel Trust believes that AFFO is the
most helpful indicator of the Company's ability to pay recurring
dividends since it adjusts for certain non-cash and non-recurring items.
The foregoing estimates are forward-looking and reflect management's
view of current and future market conditions, including certain
assumptions with respect to leasing activity, rental rates, occupancy
levels, interest rates, and the amount and timing of acquisitions and
development activities. Excel Trust's actual results may differ
materially from these estimates.
Conference Call
In conjunction with Excel Trust's results, you are invited to listen to
its conference call on Thursday, February 28, 2013 at 1:00 p.m. Eastern
Time.
Phone: Conference call access information is as follows: Dial
in number: (800) 299-8538 International Dial in number: (617)
786-2902 Pass code: 34697712
Internet: A live webcast of the conference call will be available
through Excel Trust's web site at www.exceltrust.com.
The conference call will be recorded and available for replay for seven
days beginning at 4:00 p.m. ET on February 28, 2013. Replay access
information is as follows:
Dial in number: (888) 286-8010 International Dial in number: (617)
801-6888 Pass code: 30082346
About Excel Trust
Excel Trust, Inc. is a retail focused REIT that primarily targets
community and power centers, grocery anchored neighborhood centers and
freestanding retail properties. The Company has elected to be treated as
a REIT, for U.S. federal income tax purposes. Excel Trust trades
publicly on the NYSE under the symbol "EXL". For more information on
Excel Trust, Inc., please visit www.exceltrust.com.
Forward Looking Statements
This press release may contain statements that are forward-looking, as
that term is defined by the Private Securities Litigation Reform Act of
1995 or by the Securities and Exchange Commission in its rules,
regulations and releases. These statements include, but are not limited
to, discussions related to the Company's expectations regarding the
performance of its business, its liquidity and capital resources and
other non-historical statements. These forward-looking statements are
based on management's beliefs, as well as assumptions made by, and
information currently available to, management. When used in this
release, the words "believe," "anticipate," "estimate," "expect,"
"intend" and similar expressions are intended to identify
forward-looking statements. Although management believes that the
expectations reflected in these forward-looking statements are
reasonable, it can give no assurance that these expectations will prove
to have been correct.
Funds From Operations (FFO) and Adjusted Funds From Operations (AFFO)
Excel Trust considers FFO and AFFO to be important supplemental measures
of its operating performance and believes they are frequently used by
securities analysts, investors and other interested parties in the
evaluation of REITs, many of which present FFO and AFFO when reporting
their results. FFO and AFFO are intended to exclude GAAP historical cost
depreciation and amortization of real estate and related assets, which
assumes that the value of real estate assets diminishes ratably over
time. Historically, however, real estate values have risen or fallen
with market conditions. Because FFO and AFFO exclude depreciation and
amortization unique to real estate, gains and losses from property
dispositions and extraordinary items, they provide a performance measure
that, when compared year-over-year, reflects the impact to operations
from trends in occupancy rates, rental rates, operating costs,
development activities and interest costs, providing perspective not
immediately apparent from net income.
Excel Trust computes FFO in accordance with standards established by the
National Association of Real Estate Investment Trusts, or NAREIT. As
defined by NAREIT, FFO represents net income (loss) (computed in
accordance with generally accepted accounting principles, or GAAP),
excluding real estate-related depreciation and amortization, impairment
charges and net gains (losses) on the disposition of assets.
Excel Trust computes AFFO by adding to FFO the non-cash compensation
expense, amortization of prepaid financing costs and non-recurring
transaction costs, and other one-time items, then subtracting or adding
straight-line rents, amortization of above and below market leases and
non-incremental capital expenditures. Excel Trust's computation of FFO
and AFFO may differ from the methodology for calculating FFO and AFFO
utilized by other equity REITs and, accordingly, may not be comparable
to such other REITs. Further, FFO and AFFO do not represent amounts
available for management's discretionary use because of needed capital
replacement or expansion, debt service obligations, or other commitments
and uncertainties.
FFO and AFFO should not be considered alternatives to net income (loss)
(computed in accordance with GAAP) as an indicator of Excel Trust's
financial performance or to cash flow from operating activities
(computed in accordance with GAAP) as an indicator of Excel Trust's
liquidity, nor are they indicative of funds available to fund Excel
Trust's cash needs, including Excel Trust's ability to pay dividends or
make distributions.
Summarized Financial Statements
Reported results are preliminary and not final until the filing of Excel
Trust's Form 10-K for the period ended December 31, 2012 with the
Securities and Exchange Commission and, therefore, remain subject to
adjustment. The accompanying notes to follow in the Form 10-K are an
integral part of these consolidated and combined financial statements.
EXCEL TRUST, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
December 31, 2012
December 31, 2011
ASSETS:
Property:
Land
$
320,289
$
236,941
Buildings
564,352
287,226
Site improvements
51,875
28,257
Tenant improvements
42,903
28,517
Construction in progress
1,709
21,312
Less accumulated depreciation
(36,765
)
(18,294
)
Property, net
944,363
583,959
Cash and cash equivalents
5,596
5,292
Restricted cash
5,657
3,680
Tenant receivables, net
5,376
4,174
Lease intangibles, net
85,646
68,556
Mortgage loan receivable
-
2,000
Deferred rent receivable
5,983
2,997
Other assets
17,618
17,013
Investment in unconsolidated entities
9,015
-
Total assets
$
1,079,254
$
687,671
LIABILITIES AND EQUITY:
Liabilities:
Mortgages payable, net
$
333,935
$
244,961
Notes payable
75,000
21,000
Accounts payable and other liabilities
25,319
21,080
Lease intangibles, net
26,455
13,843
Dividends/distributions payable
9,773
5,801
Total liabilities
470,482
306,685
Equity:
Stockholders' equity
Preferred stock
136,423
47,703
Common stock
448
302
Additional paid-in capital
459,151
319,875
Cumulative deficit
(1,414
)
(3,277
)
594,608
364,603
Accumulated other comprehensive loss
(572
)
(811
)
Total stockholders' equity
594,036
363,792
Non-controlling interests
14,736
17,194
Total equity
608,772
380,986
Total liabilities and equity
$
1,079,254
$
687,671
The notes in the Form 10-Q or 10-K are an integral part of these
condensed consolidated financial statements.
EXCEL TRUST, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data and dividends per share)
Three Months Ended December 31, 2012
Three Months Ended December 31, 2011
Year Ended December 31, 2012
Year Ended December 31, 2011
Revenues:
Rental revenue
$
20,971
$
12,783
$
71,522
$
44,265
Tenant recoveries
3,654
3,480
14,190
10,300
Other income
457
313
1,432
662
Total revenues
25,082
16,576
87,144
55,227
Expenses:
Maintenance and repairs
1,578
1,441
5,688
3,792
Real estate taxes
2,817
2,136
9,921
6,373
Management fees
329
172
914
576
Other operating expenses
1,313
762
4,085
3,106
Changes in fair value of contingent consideration
(160
)
(106
)
(281
)
(434
)
General and administrative
3,642
3,846
13,778
12,773
Depreciation and amortization
10,588
6,354
36,021
23,290
Total expenses
20,107
14,605
70,126
49,476
Net operating income
4,975
1,971
17,018
5,751
Interest expense
(4,727
)
(3,552
)
(16,556
)
(13,181
)
Interest income
48
70
173
297
Loss from equity in unconsolidated entities
(162
)
-
(320
)
-
Gain on acquisition of real estate and sale of land parcel
-
542
-
1,479
Changes in fair value of financial instruments and gain on OP unit
redemption
418
1,238
1,530
1,154
Net income (loss) from continuing operations
552
269
1,845
(4,500
)
Income from discontinued operations before gain on sale of real
estate
assets
-
-
-
1,023
Gain on sale of real estate assets
-
-
-
3,976
Income from discontinued operations
-
-
-
4,999
Net income (loss)
552
269
1,845
499
Net (income) loss attributable to non-controlling interests
4
9
18
(51
)
Net income (loss) attributable to Excel Trust, Inc.
556
278
1,863
448
Preferred stock dividends
(2,744
)
(875
)
(10,353
)
(3,228
)
Net loss attributable to the common stockholders
$
(2,188
)
$
(597
)
$
(8,490
)
$
(2,780
)
Basic and diluted net loss per share
$
(0.06
)
$
(0.03
)
$
(0.26
)
$
(0.15
)
Weighted-average common shares outstanding - basic and diluted
40,830
29,272
34,681
22,465
Dividends declared per common share
$
0.1625
$
0.160
$
0.650
$
0.605
The notes in the Form 10-Q or 10-K are an integral part of these
condensed consolidated financial statements.
Reconciliation of Net Income to FFO and AFFO
For the Periods Ended December 31, 2012
(In thousands, except per share data)
Excel Trust, Inc.'s FFO and AFFO available to common stockholders
and operating partnership unitholders and a reconciliation to net
income(loss) for the three months and year-ended December 31, 2012
is as follows:
Three Months Ended December 31, 2012
Three Months Ended December 31, 2011
Year Ended December 31, 2012
Year Ended December 31, 2011
Net loss attributable to the common stockholders
$
(2,188
)
$
(597
)
$
(8,490
)
$
(2,780
)
Add:
Non-controlling interests in operating partnership
(67
)
(28
)
(297
)
(53
)
Preferred stock dividends
-
-
Depreciation and amortization
10,588
6,354
36,021
23,705
Deduct:
Depreciation and amortization related to joint venture
237
(64
)
72
(199
)
Gain on acquisition of real estate and sale of land parcel
-
(542
)
-
(1,479
)
Gain on sale of real estate assets
-
-
-
(3,976
)
Funds from operations
$
8,570
$
5,123
$
27,306
$
15,218
Adjustments:
Transaction costs
387
231
1,572
753
Deferred financing costs
457
412
1,867
1,367
Stock-based and other non-cash compensation expense
817
1,371
3,223
4,497
Changes in fair value of contingent consideration
(160
)
(106
)
(281
)
(434
)
Changes in fair value of financial instruments
(418
)
(1,238
)
(1,530
)
(1,154
)
Straight-line effects of lease revenue
(1,130
)
(392
)
(3,139
)
(1,968
)
Amortization of above and below market leases
77
79
65
153
Non-incremental capital expenditures
(97
)
(58
)
(469
)
(123
)
Adjusted funds from operations
$
8,503
$
5,422
$
28,614
$
18,309
Weighted average common shares outstanding
40,830
29,272
34,681
22,465
Add:
OP units
1,272
1,405
1,231
1,261
Restricted stock
254
402
306
369
Contingent consideration related to business combinations
20
127
73
206
LTIP restricted stock
-
-
-
-
Common stock issuable upon conversion of preferred stock
-
-
-
-
Weighted average common shares outstanding - diluted (FFO and AFFO)
42,376
31,206
36,291
24,301
Funds from operations per share (diluted)
$
0.20
$
0.16
$
0.74
$
0.61
Adjusted funds from operations per share (diluted)
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