ORLANDO, Fla., May 2, 2016 /PRNewswire/ -- National Retail Properties, Inc. (NYSE: NNN), a real estate investment trust, today announced its operating results for the quarter ended March 31, 2016. Highlights include:

Operating Results:

  • Revenues and net earnings, FFO, Recurring FFO and AFFO available to common stockholders and diluted per share amounts:

Quarter Ended

March 31,

2016

2015

(in thousands, except per share data)

Revenues

$

126,980

$

116,187

Net earnings available to common stockholders

$

61,824

$

45,119

Net earnings per common share

$

0.44

$

0.34

FFO available to common stockholders

$

80,098

$

70,843

FFO per common share

$

0.57

$

0.54

Recurring FFO available to common stockholders

$

80,318

$

70,999

Recurring FFO per common share

$

0.57

$

0.54

AFFO available to common stockholders

$

81,749

$

72,123

AFFO per common share

$

0.58

$

0.55

First Quarter 2016 Highlights:

  • FFO per share and Recurring FFO per share increased 5.6% over prior year results
  • AFFO per share increased 5.5% over prior year results
  • Portfolio occupancy was 99.1% at March 31, 2016, consistent with December 31, 2015, and 98.8% at March 31, 2015
  • Invested $125.2 million in property investments, including the acquisition of 46 properties with an aggregate 591,000 square feet of gross leasable area at an initial cash yield of 7.0%
  • Sold 10 properties for $52.8 million producing $16.9 million of gain on sales
  • Raised $88.0 million net proceeds from the issuance of 1,999,410 common shares

National Retail Properties announced an increase in 2016 FFO guidance from a range of $2.29 to $2.35 to a range of $2.31 to $2.36 per share before any impairment expense. The 2016 AFFO is estimated to be $2.36 to $2.41 per share.

Craig Macnab, Chief Executive Officer, commented: 'Our activity thus far in 2016, has set us up well for another solid, consistent year of growth. Our acquisition activity in the first quarter was encouraging, we harvested large gains by selling assets and importantly our balance sheet remains fortress-like as we were active issuing equity at attractive prices.'

National Retail Properties invests primarily in high-quality retail properties subject generally to long-term, net leases. As of March 31, 2016, the company owned 2,293 properties in 47 states with a gross leasable area of approximately 25.4 million square feet and with a weighted average remaining lease term of 11.3 years. For more information on the company, visit www.nnnreit.com.

Management will hold a conference call on May 2, 2016, at 2:00 p.m. ET to review these results. The call can be accessed on the National Retail Properties web site live at http://www.nnnreit.com. For those unable to listen to the live broadcast, a replay will be available on the company's web site. In addition, a summary of any earnings guidance given on the call will be posted to the company's web site.

Statements in this press release that are not strictly historical are 'forward-looking' statements. These statements generally are characterized by the use of terms such as 'believe,' 'expect,' 'intend,' 'may,' 'estimated,' or other similar words or expressions. Forward-looking statements involve known and unknown risks, which may cause the company's actual future results to differ materially from expected results. These risks include, among others, general economic conditions, local real estate conditions, changes in interest rates, increases in operating costs, the preferences and financial condition of the company's tenants, the availability of capital, risks related to the company's status as a REIT and the profitability of the company's taxable subsidiary. Additional information concerning these and other factors that could cause actual results to differ materially from these forward-looking statements is contained from time to time in the company's Securities and Exchange Commission ('SEC') filings, including, but not limited to, the company's Annual Report on Form 10-K. Copies of each filing may be obtained from the company or the SEC. Such forward-looking statements should be regarded solely as reflections of the company's current operating plans and estimates. Actual operating results may differ materially from what is expressed or forecast in this press release. National Retail Properties, Inc. undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date these statements were made.

The reported results are preliminary and not final and there can be no assurance that the results will not vary from the final information filed on Form 10-Q with the SEC for the quarter ended March 31, 2016. In the opinion of management, all adjustments considered necessary for a fair presentation of these reported results have been made.

Funds From Operations, commonly referred to as FFO, is a relative non-GAAP financial measure of operating performance of an equity REIT in order to recognize that income-producing real estate historically has not depreciated on the basis determined under GAAP. FFO is defined by the National Association of Real Estate Investment Trusts ('NAREIT') and is used by the company as follows: net earnings (computed in accordance with GAAP) plus depreciation and amortization of assets unique to the real estate industry, excluding gains (or including losses), any applicable taxes and noncontrolling interests on the disposition of certain assets, the company's share of these items from the company's unconsolidated partnerships and any impairment charges on a depreciable real estate asset.

FFO is generally considered by industry analysts to be the most appropriate measure of performance of real estate companies. FFO does not necessarily represent cash provided by operating activities in accordance with GAAP and should not be considered an alternative to net earnings as an indication of the company's performance or to cash flow as a measure of liquidity or ability to make distributions. Management considers FFO an appropriate measure of performance of an equity REIT because it primarily excludes the assumption that the value of the real estate assets diminishes predictably over time, and because industry analysts have accepted it as a performance measure. The company's computation of FFO may differ from the methodology for calculating FFO used by other equity REITs, and therefore, may not be comparable to such other REITs. A reconciliation of net earnings (computed in accordance with GAAP) to FFO, as defined by NAREIT, is included in the financial information accompanying this release.

Adjusted Funds From Operations ('AFFO') is a non-GAAP financial measure of operating performance used by many companies in the REIT industry. AFFO adjusts FFO for certain non-cash items that reduce or increase net income in accordance with GAAP. AFFO should not be considered an alternative to net earnings, as an indication of the company's performance or to cash flow as a measure of liquidity or ability to make distributions. Management considers AFFO a useful supplemental measure of the company's performance.

The company's computation of AFFO may differ from the methodology for calculating AFFO used by other equity REITs, and therefore, may not be comparable to such other REITs. A reconciliation of net earnings (computed in accordance with GAAP) to AFFO is included in the financial information accompanying this release.

National Retail Properties, Inc.

(in thousands, except per share data)

(unaudited)

Quarter Ended

March 31,

2016

2015

Income Statement Summary

Revenues:

Rental and earned income

$

122,475

$

112,064

Real estate expense reimbursement from tenants

3,590

3,515

Interest and other income from real estate transactions

463

163

Interest income on commercial mortgage residual interests

452

445

126,980

116,187

Operating expenses:

General and administrative

9,249

8,605

Real estate

4,787

4,759

Depreciation and amortization

34,655

32,141

Impairment - commercial mortgage residual interests valuation

220

-

Impairment losses, net of recoveries

572

1,028

49,483

46,533

Other expenses (revenues):

Interest and other income

(19)

(11)

Interest expense

23,586

21,786

Real estate acquisition costs

129

599

23,696

22,374

Income tax expense

-

(442)

Earnings before gain on disposition of real estate, net of income tax
expense

53,801

46,838

Gain on disposition of real estate, net of income tax expense

16,875

7,200

Earnings including noncontrolling interests

70,676

54,038

Loss (earnings) attributable to noncontrolling interests

7

(60)

Net earnings attributable to NNN

70,683

53,978

Series D preferred stock dividends

(4,762)

(4,762)

Series E preferred stock dividends

(4,097)

(4,097)

Net earnings available to common stockholders

$

61,824

$

45,119

National Retail Properties, Inc.

(in thousands, except per share data)

(unaudited)

Quarter Ended

March 31,

2016

2015

Weighted average common shares outstanding:

Basic

140,840

131,665

Diluted

141,326

132,110

Net earnings per share available to common stockholders:

Basic

$

0.44

$

0.34

Diluted

$

0.44

$

0.34

National Retail Properties, Inc.

(in thousands, except per share data)

(unaudited)

Quarter Ended

March 31,

2016

2015

Funds From Operations (FFO) Reconciliation:

Net earnings available to common stockholders

$

61,824

$

45,119

Real estate depreciation and amortization

34,577

32,028

Gain on disposition of real estate, net of income tax and noncontrolling
interest

(16,875)

(7,148)

Impairment losses - depreciable real estate, net of recoveries and income tax

572

844

Total FFO adjustments

18,274

25,724

FFO available to common stockholders

$

80,098

$

70,843

FFO per common share:

Basic

$

0.57

$

0.54

Diluted

$

0.57

$

0.54

Recurring Funds from Operations Reconciliation:

Net earnings available to common stockholders

$

61,824

$

45,119

Total FFO adjustments

18,274

25,724

FFO available to common stockholders

80,098

70,843

Impairment - commercial mortgage residual interests valuation

220

-

Impairment losses - non-depreciable real estate

-

156

Total Recurring FFO adjustments

220

156

Recurring FFO available to common stockholders

$

80,318

$

70,999

Recurring FFO per common share:

Basic

$

0.57

$

0.54

Diluted

$

0.57

$

0.54

National Retail Properties, Inc.

(in thousands, except per share data)

(unaudited)

Quarter Ended

March 31,

2016

2015

Adjusted Funds From Operations (AFFO) Reconciliation:

Net earnings available to common stockholders

$

61,824

$

45,119

Total FFO adjustments

18,274

25,724

Total Recurring FFO adjustments

220

156

Recurring FFO available to common stockholders

80,318

70,999

Straight line accrued rent

(242)

(205)

Net capital lease rent adjustment

340

334

Below market rent amortization

(859)

(1,024)

Stock based compensation expense

2,703

2,409

Capitalized interest expense

(511)

(390)

Total AFFO adjustments

1,431

1,124

AFFO available to common stockholders

$

81,749

$

72,123

AFFO per common share:

Basic

$

0.58

$

0.55

Diluted

$

0.58

$

0.55

Other Information:

Percentage rent

$

474

$

185

Amortization of debt costs

$

756

$

709

Scheduled debt principal amortization (excluding maturities)

$

260

$

409

Non-real estate depreciation expense

$

81

$

118

2016 Earnings Guidance:

FFO guidance for 2016 was increased from a range of $2.29 to $2.35 to a range of $2.31 to $2.36 per share before any impairment expense. The 2016 AFFO is estimated to be $2.36 to $2.41 per share. The FFO guidance equates to net earnings before any impairments or gains or losses from the sale of real estate of $1.32 to $1.37 per share, plus $0.99 per share of expected real estate depreciation and amortization. The guidance is based on current plans and assumptions and subject to risks and uncertainties more fully described in this press release and the company's reports filed with the Securities and Exchange Commission.

2016 Guidance

Net earnings per common share before any impairments or gains (losses) on
sale of real estate

$1.32 - $1.37 per share

Real estate depreciation and amortization per share

$0.99 per share

FFO per share

$2.31 - $2.36 per share

AFFO per share

$2.36 - $2.41 per share

G&A expenses

$35.5 Million

Real estate expenses, net of tenant reimbursements

$5.5 Million

Acquisition volume

$500 - $600 Million

Disposition volume

$85 - $100 Million

National Retail Properties, Inc.

(in thousands)

(unaudited)

March 31,
2016

December 31,
2015

Balance Sheet Summary

Assets:

Cash and cash equivalents

$

8,203

$

13,659

Restricted cash and cash held in escrow

43,136

601

Receivables, net of allowance

5,236

3,344

Mortgages, notes and accrued interest receivable, net of
allowance

8,558

8,688

Real estate portfolio:

Accounted for using the operating method, net of accumulated
depreciation and amortization

5,343,433

5,256,274

Accounted for using the direct financing method

14,178

14,518

Real estate held for sale

627

32,666

Commercial mortgage residual interests

10,801

11,115

Accrued rental income, net of allowance

25,575

25,529

Debt costs, net of accumulated amortization

3,662

4,003

Other assets

89,494

89,647

Total assets

$

5,552,903

$

5,460,044

Liabilities:

Line of credit payable

$

-

$

-

Mortgages payable, including unamortized premium and net of
unamortized debt costs

17,066

23,964

Notes payable, net of unamortized discount and unamortized
debt costs

1,952,723

1,951,980

Accrued interest payable

33,637

20,113

Other liabilities

115,315

121,594

Total liabilities

2,118,741

2,117,651

Stockholders' equity of NNN

3,433,910

3,342,134

Noncontrolling interests

252

259

Total equity

3,434,162

3,342,393

Total liabilities and equity

$

5,552,903

$

5,460,044

Common shares outstanding

143,236

141,008

Gross leasable area, Property Portfolio (square feet)

25,401

24,964

National Retail Properties, Inc.

Debt Summary

As of March 31, 2016

(in thousands)

(unaudited)

Unsecured Debt

Principal

Principal,
Net of Unamortized
Discount

Stated Rate

Effective
Rate

Maturity Date

Line of credit payable

$

-

$

-

L + 92.5 bps

-

January 2019

Unsecured notes payable:

2017

250,000

249,823

6.875

%

6.924

%

October 2017

2021

300,000

297,447

5.500

%

5.689

%

July 2021

2022

325,000

321,566

3.800

%

3.985

%

October 2022

2023

350,000

348,085

3.300

%

3.388

%

April 2023

2024

350,000

349,405

3.900

%

3.924

%

June 2024

2025

400,000

399,071

4.000

%

4.029

%

November 2025

Total

1,975,000

1,965,397

Total unsecured debt

$

1,975,000

$

1,965,397

Debt costs

(17,782)

Accumulated amortization

5,108

Debt costs, net of accumulated amortization

(12,674)

Notes payable, net of unamortized discount and
unamortized debt costs

$

1,952,723

Unsecured notes payable have a weighted average interest rate of 4.5% and a weighted maturity of 7 years

Mortgages Payable

Principal
Balance

Interest Rate

Maturity Date

Mortgage

$

14,414

5.230

%

July 2023

Mortgage

2,774

6.400

%

February 2017

$

17,188

Debt costs

(226)

Accumulated amortization

104

Debt costs, net of accumulated amortization

(122)

Mortgages payable, including unamortized
premium and net of unamortized debt costs

$

17,066

Includes unamortized premium

Mortgages payable have a weighted average interest rate of 5.4% and a weighted average maturity of 6 years

National Retail Properties, Inc.

Property Portfolio

Top 20 Lines of Trade

As of March 31,

Line of Trade

2016

2015

1.

Convenience stores

16.5

%

17.7

%

2.

Restaurants - full service

10.8

%

9.0

%

3.

Restaurants - limited service

7.9

%

6.9

%

4.

Automotive service

7.0

%

7.2

%

5.

Family entertainment centers

5.7

%

5.1

%

6.

Theaters

5.1

%

5.1

%

7.

Automotive parts

4.1

%

4.6

%

8.

Health and fitness

4.0

%

3.8

%

9.

Recreational vehicle dealers, parts and accessories

3.6

%

3.3

%

10.

Banks

3.4

%

3.6

%

11.

Sporting goods

2.9

%

3.7

%

12.

Wholesale clubs

2.3

%

2.8

%

13.

Drug stores

2.3

%

2.4

%

14.

Medical service providers

2.3

%

2.0

%

15.

Consumer electronics

2.2

%

2.4

%

16.

Travel plazas

2.0

%

2.3

%

17.

General merchandise

2.0

%

2.1

%

18.

Home improvement

2.0

%

1.9

%

19.

Home furnishings

1.8

%

1.8

%

20.

Grocery

1.7

%

1.6

%

Other

10.4

%

10.7

%

Total

100.0

%

100.0

%

Top 10 States

State

% of Total

State

% of Total

1.

Texas

19.6

%

6.

Georgia

4.4

%

2.

Florida

9.5

%

7.

Indiana

4.0

%

3.

Illinois

5.3

%

8.

Virginia

3.8

%

4.

North Carolina

5.1

%

9.

Alabama

3.1

%

5.

Ohio

5.1

%

10.

Tennessee

3.0

%

Based on the annualized base rent for all leases in place as of March 31, 2016.

Based on the annualized base rent for all leases in place as of March 31, 2015.

National Retail Properties, Inc.

Property Portfolio

Top Tenants (> 2.0%)

Properties

% of Total

Sunoco

125

5.8

%

Mister Car Wash

90

4.3

%

LA Fitness

25

3.9

%

Couche-Tard (Pantry)

86

3.6

%

Camping World

32

3.6

%

7-Eleven

77

3.5

%

SunTrust

121

3.2

%

AMC Theatre

17

3.1

%

Bell American (Taco Bell)

115

3.0

%

Chuck E. Cheese's

53

2.7

%

Frisch's Restaurant

74

2.4

%

Gander Mountain

12

2.3

%

BJ's Wholesale Club

7

2.3

%

Best Buy

19

2.1

%

Lease Expirations

% of
Total

# of
Properties

Gross Leasable
Area

% of
Total

# of
Properties

Gross Leasable
Area

2016

0.7

%

19

256,000

2022

5.6

%

95

1,189,000

2017

2.8

%

51

1,002,000

2023

2.4

%

55

905,000

2018

6.1

%

183

1,645,000

2024

2.6

%

49

770,000

2019

3.3

%

79

1,116,000

2025

5.5

%

133

1,118,000

2020

4.2

%

137

1,553,000

2026

6.0

%

167

1,732,000

2021

4.8

%

118

1,354,000

Thereafter

56.0

%

1,180

12,415,000

Based on the annual base rent of $496,053,000, which is the annualized base rent for all leases in place as of
March 31, 2016.

As of March 31, 2016, the weighted average remaining lease term is 11.3 years.

Square feet.

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/first-quarter-operating-results-and-increased-2016-guidance-announced-by-national-retail-properties-inc-300260331.html

SOURCE National Retail Properties, Inc.

National Retail Properties Inc. issued this content on 02 May 2016 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 02 May 2016 12:48:04 UTC. Original document available at http://www.snl.com/irweblinkx/file.aspx?IID=103064&FID=34124209