NEW YORK, March 01, 2017 (GLOBE NEWSWIRE) -- Lexington Realty Trust ("Lexington") LXP, a real estate investment trust focused on single-tenant real estate investments, today announced results for the fourth quarter and year ended December 31, 2016.
Fourth Quarter 2016 Highlights
- Generated Net Income attributable to common shareholders of $14.4 million, or $0.06 per diluted common share.
- Generated Adjusted Company Funds From Operations available to all equityholders and unitholders - diluted ("Adjusted Company FFO") of $59.7 million, or $0.24 per diluted common share.
- Acquired two industrial properties for an aggregate cost of $97.5 million and completed three of the four buildings of the Lake Jackson, TX build-to-suit project at an estimated cost of $78.5 million.
- Disposed of nine office properties for $87.1 million.
- Invested $25.4 million in on-going build-to-suit projects.
- Committed to acquire two industrial properties in 2017 for an aggregate cost of $71.7 million.
- Completed 658,000 square feet of new leases and lease extensions with overall portfolio 96.0% leased at quarter end.
Full Year 2016 Highlights
- Generated Net Income attributable to common shareholders of $89.1 million, or $0.37 per diluted common share.
- Generated Adjusted Company FFO of $277.7 million, or $1.14 per diluted common share, inclusive of $0.03 per diluted common share related to the Westlake, Texas termination payment received and fully included as income in the second quarter of 2016.
- Acquired/completed six consolidated properties and one nonconsolidated property for an aggregate initial basis of $390.1 million.
- Disposed of 28 consolidated properties for gross proceeds of $663.0 million.
- Completed 4.7 million square feet of new leases and lease extensions.
- Retired $374.1 million of secured debt, which had a weighted-average fixed interest rate of 5.0% and a weighted-average term to maturity of 6.6 years and obtained $254.7 million of secured debt with a weighted-average fixed interest rate of 4.3% and a weighted-average term to maturity of 19.1 years.
- Repaid all $177.0 million of borrowings outstanding under its $400.0 million unsecured revolving credit facility.
- Repurchased 1.2 million common shares at an average price of $7.56 per share and issued 1.0 million common shares at an average price of $10.75 per share under its At-The-Market ("ATM") offering program.
Subsequent Events
- Disposed of six properties for aggregate gross proceeds of $88.9 million.
- Acquired two industrial properties for an aggregate purchase price of $50.6 million.
- Issued 1.6 million common shares at an average gross price of $10.89 per share under its ATM offering program.
- Completed the last building at the Lake Jackson, Texas build-to-suit project.
- Sold the tenant-in-common interest in the Oklahoma City, Oklahoma property for $6.3 million and collected $8.5 million in full satisfaction of the loan receivable owed from the other tenant-in-common.
- Sold the Kennewick, Washington loan receivable for $80.4 million.
Adjusted Company FFO is a non-GAAP financial measure. It and certain other non-GAAP financial measures are defined and reconciled later in this press release.
T. Wilson Eglin, Chief Executive Officer and President of Lexington Realty Trust, commented "Positive fourth quarter activity rounded out a highly successful year for Lexington. Sales during the quarter brought total 2016 consolidated disposition volume to $663 million at GAAP and cash cap rates of 10.2% and 5.1%, respectively. We used the proceeds to complete $390 million of new investment activity at favorable spreads and to improve our balance sheet, which brought our leverage to 5.2x net debt to Adjusted EBITDA, its lowest level in recent years. Our investments were more focused in the industrial area during the quarter, and this represents a trend that is expected to continue in 2017."
FINANCIAL RESULTS
Revenues
For the quarter ended December 31, 2016, total gross revenues were $95.3 million, compared with total gross revenues of $106.6 million for the quarter ended December 31, 2015. The decrease was primarily attributable to 2016 property sales, particularly the sale of the New York City land investments, and lease expirations, partially offset by revenue generated from property acquisitions and new leases.
Net Income Attributable to Common Shareholders
For the quarter ended December 31, 2016, net income attributable to common shareholders was $14.4 million, or $0.06 per diluted share, compared with net income attributable to common shareholders for the quarter ended December 31, 2015 of $33.2 million, or $0.14 per diluted share.
Adjusted Company FFO
For the quarter ended December 31, 2016, Lexington generated Adjusted Company FFO of $59.7 million, or $0.24 per diluted share, compared to Adjusted Company FFO for the quarter ended December 31, 2015 of $69.6 million, or $0.29 per diluted share.
Dividends/Distributions
As previously announced, during the fourth quarter of 2016, Lexington declared a regular quarterly common share dividend/distribution for the quarter ended December 31, 2016 of $0.175 per common share/unit, which was paid on January 17, 2017 to common shareholders/unitholders of record as of December 30, 2016. Lexington previously announced and declared a dividend of $0.8125 per share on its Series C Cumulative Convertible Preferred Stock ("Series C Preferred Shares"), which was paid on February 15, 2017 to Series C Preferred Shareholders of record as of January 31, 2017.
Transaction Activity
ACQUISITIONS AND COMPLETED BUILD-TO-SUIT TRANSACTIONS | |||||||||||||||||||||||||||
Primary Tenant (Guarantor) | Location | Sq. Ft. | Property Type | Initial Basis ($000) | Estimated Annual GAAP Rent ($000) | Initial Annualized Cash Rent ($000) | Estimated GAAP Yield | Initial Cash Yield | Approximate Lease Term (Yrs) | ||||||||||||||||||
Aryzta, LLC (Aryzta AG) | Romeoville, IL | 188,000 | Industrial | $ | 52,700 | $ | 3,544 | $ | 3,301 | 6.7 | % | 6.3 | % | 15 | |||||||||||||
Amazon.com.dedc, LLC (Amazon.com Inc.) | Edwardsville, IL | 770,000 | Industrial | 44,800 | 2,682 | 2,501 | 6.0 | % | 5.6 | % | 10 | ||||||||||||||||
The Dow Chemical Company(1) | Lake Jackson, TX | 389,000 | Office | 78,484 | 8,673 | 7,108 | 9.5 | % | 7.7 | % | 20 | ||||||||||||||||
1,347,000 | $ | 175,984 | $ | 14,899 | $ | 12,910 | 7.8 | % | 6.7 | % | |||||||||||||||||
1. Three of four buildings completed in Q4 2016. Estimated GAAP and cash yields reflect estimated costs of completion of final building and developer partner payout of all four buildings, as set forth in the table immediately below. |
ON-GOING BUILD-TO-SUIT PROJECTS | |||||||||||||||||
Location | Sq. Ft. | Property Type | Maximum Commitment/Estimated Completion Cost ($000) | GAAP Investment Balance as of 12/31/2016 ($000)(1) | Estimated Completion Date | Approximate Lease Term (Yrs) | |||||||||||
Lake Jackson, TX(2) | 275,000 | Office | $ | 78,447 | $ | 55,960 | 1Q 17 | 20 | |||||||||
Charlotte, NC | 201,000 | Office | 62,445 | 40,443 | 2Q 17 | 15 | |||||||||||
Opelika, AL | 165,000 | Industrial | 37,000 | 10,249 | 2Q 17 | 25 | |||||||||||
641,000 | $ | 177,892 | $ | 106,652 | |||||||||||||
1. During the quarter, Lexington funded $25.4 million of the projected costs of the above projects, including the completed Lake Jackson buildings. | |||||||||||||||||
2. Total project is 664,000 square feet. 389,000 square feet completed in Q4 2016 as set forth in the table above. |
FORWARD PURCHASE COMMITMENTS | |||||||||||||||||||
Location | Sq. Ft. | Property Type | Maximum Acquisition Cost ($000) | Estimated Acquisition Date | Estimated GAAP Yield | Estimated Initial Cash Yield | Approximate Lease Term (Yrs) | ||||||||||||
Grand Prairie, TX | 215,000 | Industrial | $ | 24,725 | 2Q 17 | 7.6 | % | 6.2 | % | 20 | |||||||||
Warren, MI(1) | 260,000 | Industrial | 47,000 | 3Q 17 | 8.3 | % | 7.3 | % | 15 | ||||||||||
475,000 | $ | 71,725 | 8.0 | % | 6.9 | % | |||||||||||||
1. Lexington provided a $4.6 million letter of credit to secure its obligation to purchase this property. |
PROPERTY DISPOSITIONS | ||||||||||||||||||
Primary Tenant | Location | Property Type | Gross Disposition Price ($000) | Annualized Net Income(1)(2) ($000) | Annualized NOI(1) ($000) | Month of Disposition | ||||||||||||
Vacant | Canonsburg, PA | Office | $ | 8,250 | $ | (330 | ) | $ | (330 | ) | October | |||||||
Avnet, Inc. | Phoenix, AZ | Office | 32,000 | 1,276 | 1,949 | October | ||||||||||||
Bank of America, National Association | Los Angeles, CA | Office | 19,200 | 1,014 | 1,107 | November | ||||||||||||
BluePearl Holdings, LLC(3) | Tampa, FL/Houston TX | Office | 15,177 | 566 | 946 | November | ||||||||||||
Nextel of Texas, Inc.(4) | Temple, TX | Office | 7,463 | (366 | ) | 800 | December | |||||||||||
Vacant | Westmont, IL | Office | 5,000 | (682 | ) | (635 | ) | December | ||||||||||
$ | 87,090 | $ | 1,478 | $ | 3,837 | |||||||||||||
1. Quarterly period prior to sale annualized. | ||||||||||||||||||
2. Excludes impairment charges recognized. | ||||||||||||||||||
3. Includes four properties. | ||||||||||||||||||
4. Conveyed to lender in a foreclosure sale. | ||||||||||||||||||
LOAN INVESTMENTS
Lexington collected an aggregate $1.6 million in full satisfaction of three loan investments secured by portfolios of single-tenant retail properties.
Leasing Activity
During the fourth quarter of 2016, Lexington executed the following new and extended leases:
LEASE EXTENSIONS | ||||||||||||
Location | Primary Tenant(1) | Prior Term | Lease Expiration Date | Sq. Ft. | ||||||||
Office/Multi-Tenant | ||||||||||||
1 | San Antonio | TX | United Healthcare Services, Inc. | 11/2017 | 11/2024 | 142,500 | ||||||
2-3 | Various | HI/PA | N/A | 2016-2017 | 2019-2020 | 1,521 | ||||||
3 | Total office lease extensions | 144,021 | ||||||||||
Industrial/Multi-Tenant | ||||||||||||
1 | Plymouth | IN | Bay Valley Foods, LLC | 12/2016 | 12/2018 | 300,500 | ||||||
2 | Antioch | TN | Wirtgen America, Inc. | 12/2016 | 12/2019 | 73,500 | ||||||
2 | Total industrial/multi-tenant lease extensions | 374,000 | ||||||||||
Other | ||||||||||||
1 | Chattanooga | TN | BI-LO LLC/K-VA-T Food Stores, Inc. | 06/2017 | 06/2019 | 42,130 | ||||||
1 | Total other lease extensions | 42,130 | ||||||||||
6 | Total lease extensions | 560,151 | ||||||||||
NEW LEASES | ||||||||||||
Location | Lease Expiration Date | Sq. Ft. | ||||||||||
Office/Multi-Tenant | ||||||||||||
1 | Farmers Branch | TX | Brain Synergy Institute, LLC d/b/a Cerebrum Health Centers | 09/2024 | 12,707 | |||||||
2 | Richmond | VA | N/A | 02/2027 | 8,503 | |||||||
3 | Hampton | VA | Wisconsin Physicians Service Insurance Corporation(2) | 08/2023 | 71,073 | |||||||
4-9 | Honolulu/Farmers Branch | HI/TX | N/A | 2017-2022 | 5,436 | |||||||
9 | Total new office leases | 97,719 | ||||||||||
9 | Total new leases | 97,719 | ||||||||||
15 | TOTAL NEW AND EXTENDED LEASES | 657,870 | ||||||||||
1. Leases greater than 10,000 square feet. | ||||||||||||
2. Lease commences January 1, 2020 following expiration of existing tenant's lease. |
As of December 31, 2016, Lexington's portfolio was 96.0% leased, excluding any property subject to a mortgage in default.
BALANCE SHEET/CAPITAL MARKETS
In the fourth quarter of 2016, Lexington issued 976,109 common shares at an average price of $10.75 per share under its ATM offering program.
During the fourth quarter of 2016, Lexington satisfied $14.0 million of secured debt with a weighted-average interest rate of 5.2%.
2017 EARNINGS GUIDANCE
Lexington estimates that its net income attributable to common shareholders per diluted common share for the year ended December 31, 2017 will be within an expected range of $0.64 to $0.67. Lexington estimates that its Adjusted Company FFO for the year ended December 31, 2017 will be within an expected range of $0.94 to $0.98 per diluted common share. This guidance is forward looking, excludes the impact of certain items and is based on current expectations.
FOURTH QUARTER 2016 CONFERENCE CALL
Lexington will host a conference call today, Wednesday, March 1, 2017, at 8:30 a.m. Eastern Time, to discuss its results for the quarter ended December 31, 2016. Interested parties may participate in this conference call by dialing 1-844-825-9783 (U.S.), 1-412-317-5163 (International) or 1-855-669-9657 (Canada). A replay of the call will be available through June 1, 2017, at 1-877-344-7529 (U.S.), 1-412-317-0088 (International) or 1-855-669-9658 (Canada); pin code for all replay numbers is 10100256. A live webcast of the conference call will be available at www.lxp.com within the Investors section.
ABOUT LEXINGTON REALTY TRUST
Lexington Realty Trust LXP is a publicly traded real estate investment trust (REIT) that owns a diversified portfolio of real estate assets consisting primarily of equity and debt investments in single-tenant net-leased commercial properties across the United States. Lexington seeks to expand its portfolio through build-to-suit transactions, sale-leaseback transactions and other transactions, including acquisitions. For more information, including Lexington's Quarterly Supplemental Information package, or to follow Lexington on social media, visit www.lxp.com.
This release contains certain forward-looking statements which involve known and unknown risks, uncertainties or other factors not under Lexington's control which may cause actual results, performance or achievements of Lexington and its subsidiaries to be materially different from the results, performance, or other expectations implied by these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed under the headings "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Risk Factors" in Lexington's periodic reports filed with the Securities and Exchange Commission, including, but not limited to, risks related to: (1) the authorization by Lexington's Board of Trustees of future dividend declarations, (2) Lexington's ability to achieve its estimates of net income attributable to common shareholders and Adjusted Company FFO for the year ending December 31, 2017, (3) the successful consummation of any lease, acquisition, build-to-suit, disposition, financing or other transaction on the terms described herein or at all, (4) the failure to continue to qualify as a REIT, (5) changes in general business and economic conditions, including the impact of any legislation, (6) competition, (7) increases in real estate construction costs, (8) changes in interest rates, (9) changes in accessibility of debt and equity capital markets, and (10) future impairment charges. Copies of the periodic reports Lexington has filed with the Securities and Exchange Commission are available on Lexington's web site at www.lxp.com. Forward-looking statements, which are based on certain assumptions and describe Lexington's future plans, strategies and expectations, are generally identifiable by use of the words "believes," "expects," "intends," "anticipates," "estimates," "projects", "may," "plans," "predicts," "will," "will likely result," "is optimistic," "goal," "objective" or similar expressions. Except as required by law, Lexington undertakes no obligation to revise those forward-looking statements to reflect events or circumstances after the occurrence of unanticipated events. Accordingly, there is no assurance that Lexington's expectations will be realized.
References to Lexington refer to Lexington Realty Trust and its consolidated subsidiaries. All interests in properties and loans are held through special purpose entities, which are separate and distinct legal entities, some of which are consolidated for financial statement purposes and/or disregarded for income tax purposes. The assets and credit of each special purpose entity with a property subject to a mortgage loan (a "property owner subsidiary") are not available to creditors to satisfy the debt or other obligations of any other person, including any other special purpose entity or affiliate. Consolidated entities that are not property owner subsidiaries do not directly own any of the assets of a property owner subsidiary (or the general partner, member of managing member of such property owner subsidiary, but merely hold partnership, membership or beneficial interests therein, which interests are subordinate to the claims of the property owner subsidiary's general partner's, member's or managing member's creditors).
Non-GAAP Financial Measures - Definitions
Lexington has used non-GAAP financial measures as defined by the Securities and Exchange Commission Regulation G in this Quarterly Earnings Press Release and in other public disclosures.
Lexington believes that the measures defined below are helpful to investors in measuring our performance or that of an individual investment. Since these measures exclude certain items which are included in their respective most comparable measures under generally accepted accounting principles ("GAAP"), reliance on the measures has limitations; management compensates for these limitations by using the measures simply as supplemental measures that are weighed in balance with other GAAP measures. These measures are not necessarily indications of our cash flow available to fund cash needs. Additionally, they should not be used as an alternative to the respective most comparable GAAP measures when evaluating Lexington's financial performance or cash flow from operating, investing or financing activities or liquidity.
Cash Rent: Cash Rent is calculated by making adjustments to GAAP rent to remove the impact of GAAP required adjustments to rental income such as adjustments for straight-line rents relating to free rent periods and contractual rent increases. Cash Rent excludes lease termination income. Lexington believes Cash Rent provides a meaningful indication of an investment's ability to fund cash needs.
Company Funds Available for Distribution ("FAD"): FAD is calculated by making adjustments to Adjusted Company FFO (see below) for (1) straight-line rent adjustments, (2) lease incentive amortization, (3) amortization of above/below market leases, (4) lease termination payments, net, (5) non-cash interest, net, (6) non-cash charges, net, (7) cash paid for tenant improvements, and (8) cash paid for lease costs. Although FAD may not be comparable to that of other real estate investment trusts ("REITs"), Lexington believes it provides a meaningful indication of its ability to fund cash needs. FAD is a non-GAAP financial measure and should not be viewed as an alternative measurement of operating performance to net income, as an alternative to net cash flows from operating activities or as a measure of liquidity.
Funds from Operations ("FFO") and Adjusted Company FFO: Lexington believes that Funds from Operations, or FFO, which is a non-GAAP measure, is a widely recognized and appropriate measure of the performance of an equity REIT. Lexington believes FFO is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO when reporting their results. FFO is intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. As a result, FFO provides 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, interest costs and other matters without the inclusion of depreciation and amortization, providing perspective that may not necessarily be apparent from net income.
The National Association of Real Estate Investment Trusts, or NAREIT, defines FFO as "net income (or loss) computed in accordance with GAAP, excluding gains (or losses) from sales of property, plus real estate depreciation and amortization and after adjustments for non-consolidated partnerships and joint ventures." NAREIT clarified its computation of FFO to exclude impairment charges on depreciable real estate owned directly or indirectly. FFO does not represent cash generated from operating activities in accordance with GAAP and is not indicative of cash available to fund cash needs.
Lexington presents FFO available to common shareholders and unitholders - basic and also presents FFO available to all equityholders and unitholders - diluted on a company-wide basis as if all securities that are convertible, at the holder's option, into Lexington's common shares, are converted at the beginning of the period. Lexington also presents Adjusted Company FFO available to all equityholders and unitholders - diluted which adjusts FFO available to all equityholders and unitholders - diluted for certain items which we believe are not indicative of the operating results of Lexington's real estate portfolio. Lexington believes this is an appropriate presentation as it is frequently requested by security analysts, investors and other interested parties. Since others do not calculate these measures in a similar fashion, these measures may not be comparable to similarly titled measures as reported by others. These measures should not be considered as an alternative to net income as an indicator of Lexington's operating performance or as an alternative to cash flow as a measure of liquidity.
GAAP and Cash Yield or Capitalization Rate: GAAP and cash yields or capitalization rates are measures of operating performance used to evaluate the individual performance of an investment. These measures are not presented or intended to be viewed as a liquidity or performance measure that present a numerical measure of Lexington's historical or future financial performance, financial position or cash flows. The yield or capitalization rate is calculated by dividing the annualized NOI (as defined below, except GAAP rent adjustments are added back to rental income to calculate GAAP yield or capitalization rate) the investment is expected to generate (or has generated) by the acquisition/completion cost (or sale) price.
Net Operating Income ("NOI"): NOI is a measure of operating performance used to evaluate the individual performance of an investment. This measure is not presented or intended to be viewed as a liquidity or performance measure that presents a numerical measure of Lexington's historical or future financial performance, financial position or cash flows. Lexington defines NOI as operating revenues (rental income (less GAAP rent adjustments and lease termination income), tenant reimbursements and other property income) less property operating expenses. Other REITs may use different methodologies for calculating NOI, and accordingly, Lexington's NOI may not be comparable to that of other companies. Because NOI excludes general and administrative expenses, interest expense, depreciation and amortization, acquisition-related expenses, other nonproperty income and losses, and gains and losses from property dispositions, it provides a performance measure that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating commercial real estate and the impact to operations from trends in occupancy rates, rental rates, and operating costs, providing a perspective on operations not immediately apparent from net income. Lexington believes that net income is the most directly comparable GAAP measure to NOI.
LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES | |||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||
(Unaudited and in thousands, except share and per share data) | |||||||||||||||
Three months ended December 31, | Twelve months ended December 31, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Gross revenues: | |||||||||||||||
Rental | $ | 87,261 | $ | 98,934 | $ | 398,065 | $ | 399,485 | |||||||
Tenant reimbursements | 8,065 | 7,692 | 31,431 | 31,354 | |||||||||||
Total gross revenues | 95,326 | 106,626 | 429,496 | 430,839 | |||||||||||
Expense applicable to revenues: | |||||||||||||||
Depreciation and amortization | (41,361 | ) | (41,403 | ) | (166,048 | ) | (163,198 | ) | |||||||
Property operating | (12,512 | ) | (14,055 | ) | (47,355 | ) | (59,655 | ) | |||||||
General and administrative | (8,072 | ) | (6,750 | ) | (31,104 | ) | (29,276 | ) | |||||||
Non-operating income | 3,543 | 3,216 | 13,043 | 11,429 | |||||||||||
Interest and amortization expense | (19,459 | ) | (21,466 | ) | (88,032 | ) | (89,739 | ) | |||||||
Debt satisfaction gains (charges), net | (157 | ) | 11,397 | (975 | ) | 25,150 | |||||||||
Impairment charges | (24,332 | ) | (2,762 | ) | (100,236 | ) | (36,832 | ) | |||||||
Gains on sales of properties | 23,097 | — | 81,510 | 23,307 | |||||||||||
Income before provision for income taxes, equity in earnings of non-consolidated entities and discontinued operations | 16,073 | 34,803 | 90,299 | 112,025 | |||||||||||
Provision for income taxes | (340 | ) | (104 | ) | (1,439 | ) | (568 | ) | |||||||
Equity in earnings of non-consolidated entities | 1,196 | 814 | 7,590 | 1,752 | |||||||||||
Income from continuing operations | 16,929 | 35,513 | 96,450 | 113,209 | |||||||||||
Discontinued operations: | |||||||||||||||
Income from discontinued operations | — | — | — | 109 | |||||||||||
Provision for income taxes | — | — | — | (4 | ) | ||||||||||
Gains on sales of properties | — | — | — | 1,577 | |||||||||||
Total discontinued operations | — | — | — | 1,682 | |||||||||||
Net income | 16,929 | 35,513 | 96,450 | 114,891 | |||||||||||
Less net income attributable to noncontrolling interests | (928 | ) | (663 | ) | (826 | ) | (3,188 | ) | |||||||
Net income attributable to Lexington Realty Trust shareholders | 16,001 | 34,850 | 95,624 | 111,703 | |||||||||||
Dividends attributable to preferred shares – Series C | (1,572 | ) | (1,572 | ) | (6,290 | ) | (6,290 | ) | |||||||
Allocation to participating securities | (38 | ) | (49 | ) | (225 | ) | (313 | ) | |||||||
Net income attributable to common shareholders | $ | 14,391 | $ | 33,229 | $ | 89,109 | $ | 105,100 | |||||||
Income per common share – basic: | |||||||||||||||
Income from continuing operations | $ | 0.06 | $ | 0.14 | $ | 0.38 | $ | 0.44 | |||||||
Income from discontinued operations | — | — | — | 0.01 | |||||||||||
Net income attributable to common shareholders | $ | 0.06 | $ | 0.14 | $ | 0.38 | $ | 0.45 | |||||||
Weighted-average common shares outstanding – basic | 235,066,967 | 233,448,100 | 233,633,058 | 233,455,056 | |||||||||||
Income per common share – diluted: | |||||||||||||||
Income from continuing operations | $ | 0.06 | $ | 0.14 | $ | 0.37 | $ | 0.44 | |||||||
Income from discontinued operations | — | — | — | 0.01 | |||||||||||
Net income attributable to common shareholders | $ | 0.06 | $ | 0.14 | $ | 0.37 | $ | 0.45 | |||||||
Weighted-average common shares outstanding – diluted | 235,204,568 | 239,411,055 | 237,679,031 | 233,751,775 | |||||||||||
Amounts attributable to common shareholders: | |||||||||||||||
Income from continuing operations | $ | 14,391 | $ | 33,229 | $ | 89,109 | $ | 103,418 | |||||||
Income from discontinued operations | — | — | — | 1,682 | |||||||||||
Net income attributable to common shareholders | $ | 14,391 | $ | 33,229 | $ | 89,109 | $ | 105,100 | |||||||
LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES | |||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||
As of December 31, | |||||||
(Unaudited and in thousands, except share and per share data) | |||||||
2016 | 2015 | ||||||
Assets: | |||||||
Real estate, at cost | $ | 3,533,172 | $ | 3,789,711 | |||
Real estate - intangible assets | 597,294 | 692,778 | |||||
Investments in real estate under construction | 106,652 | 95,402 | |||||
4,237,118 | 4,577,891 | ||||||
Less: accumulated depreciation and amortization | 1,208,792 | 1,179,969 | |||||
Real estate, net | 3,028,326 | 3,397,922 | |||||
Assets held for sale | 23,808 | 24,425 | |||||
Cash and cash equivalents | 86,637 | 93,249 | |||||
Restricted cash | 31,142 | 10,637 | |||||
Investment in and advances to non-consolidated entities | 67,125 | 31,054 | |||||
Deferred expenses, net | 33,360 | 42,000 | |||||
Loans receivable, net | 94,210 | 95,871 | |||||
Rent receivable – current | 7,516 | 7,193 | |||||
Rent receivable – deferred | 31,455 | 87,547 | |||||
Other assets | 37,888 | 18,505 | |||||
Total assets | $ | 3,441,467 | $ | 3,808,403 | |||
Liabilities and Equity: | |||||||
Liabilities: | |||||||
Mortgages and notes payable, net | $ | 738,047 | $ | 872,643 | |||
Revolving credit facility borrowings | — | 177,000 | |||||
Term loans payable, net | 501,093 | 500,076 | |||||
Senior notes payable, net | 494,362 | 493,526 | |||||
Convertible notes payable, net | — | 12,126 | |||||
Trust preferred securities, net | 127,096 | 126,996 | |||||
Dividends payable | 47,264 | 45,440 | |||||
Liabilities held for sale | 191 | 8,405 | |||||
Accounts payable and other liabilities | 59,601 | 41,479 | |||||
Accrued interest payable | 6,704 | 8,851 | |||||
Deferred revenue - including below market leases, net | 39,895 | 42,524 | |||||
Prepaid rent | 14,723 | 16,806 | |||||
Total liabilities | 2,028,976 | 2,345,872 | |||||
Commitments and contingencies | |||||||
Equity: | |||||||
Preferred shares, par value $0.0001 per share; authorized 100,000,000 shares: | |||||||
Series C Cumulative Convertible Preferred, liquidation preference $96,770; 1,935,400 shares issued and outstanding | 94,016 | 94,016 | |||||
Common shares, par value $0.0001 per share; authorized 400,000,000 shares, 238,037,177 and 234,575,225 shares issued and outstanding in 2016 and 2015, respectively | 24 | 23 | |||||
Additional paid-in-capital | 2,800,736 | 2,776,837 | |||||
Accumulated distributions in excess of net income | (1,500,966 | ) | (1,428,908 | ) | |||
Accumulated other comprehensive loss | (1,033 | ) | (1,939 | ) | |||
Total shareholders' equity | 1,392,777 | 1,440,029 | |||||
Noncontrolling interests | 19,714 | 22,502 | |||||
Total equity | 1,412,491 | 1,462,531 | |||||
Total liabilities and equity | $ | 3,441,467 | $ | 3,808,403 | |||
LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES | |||||||||||||
EARNINGS PER SHARE | |||||||||||||
(Unaudited and in thousands, except share and per share data) | |||||||||||||
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||
EARNINGS PER SHARE: | |||||||||||||
Basic: | |||||||||||||
Income from continuing operations attributable to common shareholders | $ | 14,391 | $ | 33,229 | $ | 89,109 | $ | 103,418 | |||||
Income from discontinued operations attributable to common shareholders | — | — | — | 1,682 | |||||||||
Net income attributable to common shareholders | $ | 14,391 | $ | 33,229 | $ | 89,109 | $ | 105,100 | |||||
Weighted-average number of common shares outstanding | 235,066,967 | 233,448,100 | 233,633,058 | 233,455,056 | |||||||||
Income per common share: | |||||||||||||
Income from continuing operations | $ | 0.06 | $ | 0.14 | $ | 0.38 | $ | 0.44 | |||||
Income from discontinued operations | — | — | — | 0.01 | |||||||||
Net income attributable to common shareholders | $ | 0.06 | $ | 0.14 | $ | 0.38 | $ | 0.45 | |||||
Diluted: | |||||||||||||
Income from continuing operations attributable to common shareholders - basic | $ | 14,391 | $ | 33,229 | $ | 89,109 | $ | 103,418 | |||||
Impact of assumed conversions | — | 711 | (159 | ) | — | ||||||||
Income from continuing operations attributable to common shareholders | 14,391 | 33,940 | 88,950 | 103,418 | |||||||||
Income from discontinued operations attributable to common shareholders - basic | — | — | — | 1,682 | |||||||||
Impact of assumed conversions | — | — | — | — | |||||||||
Income from discontinued operations attributable to common shareholders | — | — | — | 1,682 | |||||||||
Net income attributable to common shareholders | $ | 14,391 | $ | 33,940 | $ | 88,950 | $ | 105,100 | |||||
Weighted-average common shares outstanding - basic | 235,066,967 | 233,448,100 | 233,633,058 | 233,455,056 | |||||||||
Effect of dilutive securities: | |||||||||||||
Share options | 137,601 | 220,125 | 230,352 | 296,719 | |||||||||
Operating Partnership Units | — | 3,834,962 | 3,815,621 | — | |||||||||
6.00% Convertible Guaranteed Notes | — | 1,907,868 | — | — | |||||||||
Weighted-average common shares outstanding - diluted | 235,204,568 | 239,411,055 | 237,679,031 | 233,751,775 | |||||||||
Income per common share: | |||||||||||||
Income from continuing operations | $ | 0.06 | $ | 0.14 | $ | 0.37 | $ | 0.44 | |||||
Income from discontinued operations | — | — | — | 0.01 | |||||||||
Net income attributable to common shareholders | $ | 0.06 | $ | 0.14 | $ | 0.37 | $ | 0.45 | |||||
LEXINGTON REALTY TRUST AND CONSOLIDATED SUBSIDIARIES | ||||||||||||||||||
ADJUSTED COMPANY FUNDS FROM OPERATIONS & FUNDS AVAILABLE FOR DISTRIBUTION | ||||||||||||||||||
(Unaudited and in thousands, except share and per share data) | ||||||||||||||||||
Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||||
2016 | 2015 | 2016 | 2015 | |||||||||||||||
FUNDS FROM OPERATIONS: | ||||||||||||||||||
Basic and Diluted: | ||||||||||||||||||
Net income attributable to common shareholders | $ | 14,391 | $ | 33,229 | $ | 89,109 | $ | 105,100 | ||||||||||
Adjustments: | ||||||||||||||||||
Depreciation and amortization | 39,840 | 39,708 | 159,363 | 157,644 | ||||||||||||||
Impairment charges - real estate | 24,332 | 2,762 | 100,236 | 36,832 | ||||||||||||||
Noncontrolling interests - OP units | 686 | 457 | (159 | ) | 1,999 | |||||||||||||
Amortization of leasing commissions | 1,520 | 1,695 | 6,684 | 5,554 | ||||||||||||||
Joint venture and noncontrolling interest adjustment | 369 | 453 | 1,111 | 1,788 | ||||||||||||||
Gains on sales of properties, including non-consolidated entities | (23,729 | ) | (487 | ) | (87,520 | ) | (25,371 | ) | ||||||||||
Tax on sales of properties | 2 | — | 52 | — | ||||||||||||||
FFO available to common shareholders and unitholders - basic | 57,411 | 77,817 | 268,876 | 283,546 | ||||||||||||||
Preferred dividends | 1,572 | 1,572 | 6,290 | 6,290 | ||||||||||||||
Interest and amortization on 6.00% Convertible Notes | — | 253 | 532 | 1,048 | ||||||||||||||
Amount allocated to participating securities | 38 | 49 | 225 | 313 | ||||||||||||||
FFO available to all equityholders and unitholders - diluted | 59,021 | 79,691 | 275,923 | 291,197 | ||||||||||||||
Debt satisfaction (gains) charges, net, including non-consolidated entities | 157 | (11,397 | ) | 975 | (25,086 | ) | ||||||||||||
Transaction costs/Other | 508 | 1,285 | 837 | 1,864 | ||||||||||||||
Adjusted Company FFO available to all equityholders and unitholders - diluted | 59,686 | 69,579 | 277,735 | 267,975 | ||||||||||||||
FUNDS AVAILABLE FOR DISTRIBUTION: | ||||||||||||||||||
Adjustments: | ||||||||||||||||||
Straight-line rents | (2,051 | ) | (12,460 | ) | (37,748 | ) | (47,702 | ) | ||||||||||
Lease incentives | 417 | 387 | 1,673 | 1,544 | ||||||||||||||
Amortization of above/below market leases | 530 | 418 | 2,057 | 261 | ||||||||||||||
Lease termination payments, net | (1,814 | ) | 2,420 | (8,216 | ) | 3,086 | ||||||||||||
Non-cash interest, net | (387 | ) | (638 | ) | (1,913 | ) | (118 | ) | ||||||||||
Non-cash charges, net | 2,092 | 2,213 | 8,998 | 8,821 | ||||||||||||||
Tenant improvements | (665 | ) | (7,242 | ) | (1,957 | ) | (20,426 | ) | ||||||||||
Lease costs | (393 | ) | (2,439 | ) | (6,558 | ) | (6,681 | ) | ||||||||||
Company Funds Available for Distribution | $ | 57,415 | $ | 52,238 | $ | 234,071 | $ | 206,760 | ||||||||||
Per Common Share and Unit Amounts | ||||||||||||||||||
Basic: | ||||||||||||||||||
FFO | $ | 0.24 | $ | 0.33 | $ | 1.13 | $ | 1.19 | ||||||||||
Diluted: | ||||||||||||||||||
FFO | $ | 0.24 | $ | 0.33 | $ | 1.13 | $ | 1.19 | ||||||||||
Adjusted Company FFO | $ | 0.24 | $ | 0.29 | $ | 1.14 | $ | 1.10 | ||||||||||
Weighted-Average Common Shares | ||||||||||||||||||
Basic: | ||||||||||||||||||
Weighted-average common shares outstanding - basic EPS | 235,066,967 | 233,448,100 | 233,633,058 | 233,455,056 | ||||||||||||||
Operating partnership units(1) | 3,808,185 | 3,834,962 | 3,815,621 | 3,848,434 | ||||||||||||||
Weighted-average common shares outstanding - basic FFO | 238,875,152 | 237,283,062 | 237,448,679 | 237,303,490 | ||||||||||||||
Diluted: | ||||||||||||||||||
Weighted-average common shares outstanding - diluted EPS | 235,204,568 | 239,411,055 | 237,679,031 | 233,751,775 | ||||||||||||||
Unvested share-based payment awards | 674,053 | — | 549,049 | 3,326 | ||||||||||||||
6.00% Convertible Guaranteed Notes | — | — | 1,077,626 | 2,041,629 | ||||||||||||||
Operating partnership units(1) | 3,808,185 | — | — | 3,848,434 | ||||||||||||||
Preferred shares - Series C | 4,710,570 | 4,710,570 | 4,710,570 | 4,710,570 | ||||||||||||||
Weighted-average common shares outstanding - diluted FFO | 244,397,376 | 244,121,625 | 244,016,276 | 244,355,734 | ||||||||||||||
(1) Includes OP units other than OP units held by Lexington. |
RECONCILIATION OF NON-GAAP MEASURES | |||||||
2017 EARNINGS GUIDANCE | |||||||
Twelve Months Ended December 31, 2017 | |||||||
Range | |||||||
Estimated: | |||||||
Net income attributable to common shareholders per diluted common share(1) | $ | 0.64 | $ | 0.67 | |||
Depreciation and amortization | 0.67 | 0.68 | |||||
Impact of capital transactions | (0.37 | ) | (0.37 | ) | |||
Estimated Adjusted Company FFO per diluted common share | $ | 0.94 | $ | 0.98 | |||
(1) Assumes all convertible securities are dilutive. |
Contact: Investor or Media Inquiries for Lexington Realty Trust: Heather Gentry, Senior Vice President of Investor Relations Lexington Realty Trust Phone: (212) 692-7200 E-mail: hgentry@lxp.com
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.