EX-99.1 2 c97115exv99w1.txt PRESS RELEASE EXHIBIT 99.1 RELEASE: IMMEDIATE GETTY REALTY CORP. ANNOUNCES FINANCIAL RESULTS FOR THE QUARTER AND SIX MONTHS ENDED JUNE 30, 2005 JERICHO, NY, AUGUST 1, 2005 --- Getty Realty Corp. (NYSE-GTY) today reported its financial results for the quarter and six months ended June 30, 2005. Net earnings were $10.2 million for the quarter and $21.7 million for the six months ended June 30, 2005, as compared with $9.4 million and $18.5 million for the respective prior year periods. Net earnings increased by $0.8 million, or 9.0%, for the quarter and by $3.1 million, or 16.9%, for the six months ended June 30, 2005 over the comparable periods in 2004. The increases in net earnings resulted from the properties acquired in November 2004 and March 2005, and rent escalations, which generated additional revenue from rental properties that was partially offset by additional depreciation and amortization and interest expenses. The increases in net earnings were also due to reductions in environmental expenses of $0.4 million for the quarter and $2.1 million for the six month period ended June 30, 2005 as compared to the prior year periods. Funds from operations, or FFO, increased $1.2 million to $12.3 million for the quarter and $3.6 million to $25.6 million for the six months ended June 30, 2005, as compared to the respective prior year periods. Adjusted funds from operations, or AFFO, increased $1.4 million to $11.3 million for the quarter and $3.9 million to $23.7 million for the six months ended June 30, 2005 as compared to the prior year quarter and six month periods. The increases in FFO and AFFO were principally due to the increases in net earnings described above. AFFO increased more than FFO on both a dollar and percentage basis due to a decrease in deferred rental revenues (which are included in net earnings and FFO but excluded from AFFO) of $0.1 million for the quarter and $0.3 million for the six months ended June 30, 2005 as compared to the prior year periods. FFO and AFFO are supplemental non-GAAP measures of the performance of real estate investment trusts and are defined and reconciled to net earnings in the financial tables at the end of this release. Earnings per share increased $0.03 per share to $0.41 per share for the quarter and $0.13 per share to $0.88 per share for the six months ended June 30, 2005, as compared to the prior year periods. For the quarter ended June 30, 2005, FFO per share increased $0.05 per share to $0.50 per share and AFFO per share increased $0.06 per share to $0.46 per share as compared to the prior year period. FFO per share increased $0.15 per share to $1.04 per share and AFFO per share increased $0.16 per share to $0.96 per share for the six months ended June 30, 2005 as compared to the prior year period. Revenues from rental properties were $17.9 million for the quarter and $35.3 million for the six months ended June 30, 2005 as compared to $16.4 million and $33.0 million for the respective prior year periods. Rent received for the quarter was $16.9 million and $33.4 million for the six months ended June 30, 2005 as compared with $15.3 million for the quarter and $30.7 million for the six month period ended in 2004. The increase in rent received was primarily due to rental income from the properties acquired in November 2004 and March 2005 and rent escalations, and was partially offset by the effect of lease terminations and property dispositions. In addition to rent received, revenues from rental properties include deferred rental revenues accrued due to recognition of rental income on a straight-line basis of $1.0 million for the quarter and $1.9 million for the six months ended June 30, 2005 as compared to $1.1 million and $2.2 million for the respective prior year periods. Environmental expenses, net of estimated recoveries, were $1.3 million for the quarter and $1.4 million for the six months ended June 30, 2005, which decreased by $0.4 million for the quarter and by $2.1 million for the six month period as compared to $1.8 million recorded for the prior year quarter and $3.5 million recorded for prior year six month period. The decreases were due to reduced environmental litigation expense and related legal fees which decreased by $0.6 million for the quarter and by $1.5 million for the six months ended June 30, 2005 and smaller net changes in estimated environmental costs and accretion expenses, which decreased by $0.6 million as compared to the prior six month period. Depreciation and amortization expense was $2.1 million for the quarter and $4.0 million for the six month period ended June 30, 2005, as compared to $1.8 million and $3.7 million for the respective prior year periods. The increase was due to depreciation and amortization on properties acquired in November 2004 and March 2005 partially offset by property dispositions. Interest expense, principally related to borrowings under lines of credit used to acquire properties in November 2004 and March 2005, was $0.5 million for the quarter and $0.6 million for the six months ended June 30, 2005 and was insignificant in the prior year periods. Getty Realty's Second Quarter Earnings Conference Call is scheduled for tomorrow, Tuesday, August 2, 2005 at 9:00 a.m. Eastern Time. To participate in the conference call, please dial 719-457-2653 five to ten minutes before the scheduled start time and reference pass code 8385496. If you cannot participate in the live event, a replay will be available beginning on August 2, 2005 at noon though midnight, August 5, 2005. To access the replay, please dial 719-457-0820 and reference pass code 8385496. Getty Realty Corp. is the largest publicly-traded real estate investment trust in the United States specializing in ownership and leasing of motor fuel/convenience store properties and petroleum distribution terminals. The Company owns and leases over 1,050 properties in the Eastern United States. CERTAIN STATEMENTS IN THIS NEWS RELEASE MAY CONSTITUTE "FORWARD LOOKING STATEMENTS" WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. WHEN THE WORDS "BELIEVES", "EXPECTS", "PLANS", "PROJECTS", "ESTIMATES" AND SIMILAR EXPRESSIONS ARE USED IN THIS RELEASE, THEY IDENTIFY FORWARD-LOOKING STATEMENTS. THESE FORWARD- LOOKING STATEMENTS ARE BASED ON MANAGEMENT'S CURRENT BELIEFS AND ASSUMPTIONS AND INFORMATION CURRENTLY AVAILABLE TO MANAGEMENT AND INVOLVE KNOWN AND UNKNOWN RISKS (INCLUDING THE RISKS THAT ARE DESCRIBED FROM TIME TO TIME IN THE COMPANY'S FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION), UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE THE ACTUAL RESULTS, PERFORMANCE AND ACHIEVEMENTS OF THE COMPANY TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY THESE FORWARD-LOOKING STATEMENTS. GETTY UNDERTAKES NO OBLIGATION TO PUBLICLY RELEASE REVISIONS TO THESE FORWARD-LOOKING STATEMENTS THAT REFLECT FUTURE EVENTS OR CIRCUMSTANCES OR THE OCCURRENCE OF UNANTICIPATED EVENTS. -more- GETTY REALTY CORP. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands, except share data) (unaudited)
June 30, December 31, -------- ------------ 2005 2004 -------- ------------ Assets: Real Estate: Land $172,096 $156,571 Buildings and improvements 199,529 190,019 -------- -------- 371,625 346,590 Less - accumulated depreciation and amortization (106,654) (106,463) -------- -------- Real estate, net 264,971 240,127 Deferred rent receivable 27,002 25,117 Cash and equivalents 651 15,700 Recoveries from state underground storage tank funds, net 4,977 5,437 Mortgages and accounts receivable, net 3,761 3,961 Prepaid expenses and other assets 1,478 386 -------- -------- Total assets $302,840 $290,728 ======== ======== Liabilities and Shareholders' Equity: Debt $ 37,938 $ 24,509 Environmental remediation costs 20,317 20,626 Dividends payable 10,761 10,495 Accounts payable and accrued expenses 7,819 9,595 -------- -------- Total liabilities 76,835 65,225 -------- -------- Commitments and contingencies Shareholders' equity: Common stock, par value $.01 per share; authorized 50,000,000 shares; issued 24,714,766 at June 30, 2005 and 24,694,071 at December 31, 2004 247 247 Paid-in capital 257,668 257,295 Dividends paid in excess of earnings (31,910) (32,039) -------- -------- Total shareholders' equity 226,005 225,503 -------- -------- Total liabilities and shareholders' equity $302,840 $290,728 ======== ========
GETTY REALTY CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) (unaudited)
Three months ended Six months ended June 30, June 30, ------------------ ----------------- 2005 2004 2005 2004 ------- ------- ------- ------- Revenues from rental properties $17,872 $16,443 $35,268 $32,954 Expenses: Rental property expenses 2,560 2,487 5,184 5,008 Environmental expenses, net 1,348 1,783 1,411 3,515 General and administrative expenses 1,289 1,255 2,600 2,632 Depreciation and amortization expense 2,065 1,828 4,014 3,664 ------- ------- ------- ------- Total expenses 7,262 7,353 13,209 14,819 ------- ------- ------- ------- Operating income 10,610 9,090 22,059 18,135 Other income, net 55 296 191 429 Interest expense (451) (19) (600) (40) ------- ------- ------- ------- Net earnings $10,214 $ 9,367 $21,650 $18,524 ======= ======= ======= ======= Net earnings per common share: Basic $ .41 $ .38 $ .88 $ .75 Diluted $ .41 $ .38 $ .88 $ .75 Weighted average shares outstanding: Basic 24,714 24,680 24,707 24,675 Diluted 24,728 24,713 24,721 24,715 Dividends declared per share: $ .435 $ .425 $ .870 $ .850
GETTY REALTY CORP. AND SUBSIDIARIES RECONCILIATION OF NET EARNINGS TO FUNDS FROM OPERATIONS AND ADJUSTED FUNDS FROM OPERATIONS (in thousands, except per share amounts) (unaudited)
Three months ended Six months ended June 30, June 30, ------------------ ---------------- 2005 2004 2005 2004 ------- ------- ------- ------- Net earnings $10,214 $ 9,367 $21,650 18,524 Depreciation and amortization expense 2,065 1,828 4,014 3,664 Gains on sales of real estate - (146) (72) (146) ------- ------- ------- ------- Funds from operations 12,279 11,049 25,592 22,042 Deferred rental revenue (straight-line rent) (985) (1,115) (1,885) (2,231) ------- ------- ------- ------- Adjusted funds from operations $11,294 $ 9,934 $23,707 $19,811 ======= ======= ======= ======= Diluted per common share amounts: Earnings per share $ .41 $ .38 $ .88 $ .75 Funds from operations per share $ .50 $ .45 $ 1.04 $ .89 Adjusted funds from operations per share $ .46 $ .40 $ .96 $ .80 Diluted weighted average shares outstanding 24,728 24,713 24,721 24,715
IN ADDITION TO MEASUREMENTS DEFINED BY GENERALLY ACCEPTED ACCOUNTING PRINCIPLES ("GAAP"), GETTY ALSO FOCUSES ON FUNDS FROM OPERATIONS ("FFO") AND ADJUSTED FUNDS FROM OPERATIONS ("AFFO") TO MEASURE ITS PERFORMANCE. FFO IS GENERALLY CONSIDERED TO BE AN APPROPRIATE SUPPLEMENTAL NON-GAAP MEASURE OF THE PERFORMANCE OF REITS. FFO IS DEFINED BY THE NATIONAL ASSOCIATION OF REAL ESTATE INVESTMENT TRUSTS AS NET EARNINGS BEFORE DEPRECIATION AND AMORTIZATION, GAINS OR LOSSES ON SALES OF REAL ESTATE, NON-FFO ITEMS REPORTED IN DISCONTINUED OPERATIONS AND EXTRAORDINARY ITEMS. OTHER REITS MAY USE DEFINITIONS OF FFO AND OR AFFO THAT ARE DIFFERENT THAN GETTY'S AND, ACCORDINGLY, MAY NOT BE COMPARABLE. GETTY BELIEVES THAT FFO IS HELPFUL TO INVESTORS IN MEASURING ITS PERFORMANCE BECAUSE FFO EXCLUDES VARIOUS ITEMS INCLUDED IN GAAP NET EARNINGS THAT DO NOT RELATE TO, OR ARE NOT INDICATIVE OF, GETTY'S FUNDAMENTAL OPERATING PERFORMANCE SUCH AS GAINS OR LOSSES FROM PROPERTY SALES AND DEPRECIATION AND AMORTIZATION. IN GETTY'S CASE, HOWEVER, GAAP NET EARNINGS AND FFO INCLUDE THE SIGNIFICANT IMPACT OF DEFERRED RENTAL REVENUE (STRAIGHT-LINE RENT) ON ITS RECOGNITION OF REVENUES FROM RENTAL PROPERTIES, WHICH RESULTS FROM FIXED RENTAL INCREASES SCHEDULED UNDER CERTAIN LEASES WITH ITS TENANTS. IN ACCORDANCE WITH GAAP, THE AGGREGATE MINIMUM RENT DUE OVER THE INITIAL TERM OF THESE LEASES IS RECOGNIZED ON A STRAIGHT-LINE BASIS RATHER THAN WHEN DUE. AS A RESULT, GETTY PAYS PARTICULAR ATTENTION TO AFFO, A SUPPLEMENTAL NON-GAAP PERFORMANCE MEASURE THAT GETTY DEFINES AS FFO LESS STRAIGHT-LINE RENT. IN GETTY'S VIEW, AFFO PROVIDES A MORE ACCURATE DEPICTION OF THE IMPACT OF SCHEDULED RENT INCREASES UNDER THESE LEASES THAN FFO. NEITHER FFO NOR AFFO REPRESENT CASH GENERATED FROM OPERATING ACTIVITIES CALCULATED IN ACCORDANCE WITH GAAP AND THEREFORE SHOULD NOT BE CONSIDERED AN ALTERNATIVE FOR GAAP NET EARNINGS OR AS A MEASURE OF LIQUIDITY. Contact: Thomas J. Stirnweis (516) 478-5403