EX-99 2 ex-99.htm

 

 

 
  

 

 

Table of Contents

 

  Page
   
Consolidated Balance Sheets 3
   
Consolidated Statements of Income 4
   
Net Income, FFO, Core FFO, AFFO, Adjusted EBITDA and NOI Reconciliations 5
   
Financial Highlights 6
   
Same Property Statistics 7
   
Consolidated Statements of Cash Flows 9
   
Capital Structure and Leverage Ratios 10
   
Debt Maturity 12
   
Property Table by Tenant 13
   
Property Table by State 14
   
Lease Expirations 15
   
Recent Acquisitions 16
   
Property Table 17
   
Definitions 19
   
Press Release Dated August 9, 2017 20

 

The statement of operations and supplemental statement of operations provided in this supplemental information package present funds from operations, core funds from operations, adjusted funds from operations, net operating income (NOI), Same Property NOI, Same Property Cash NOI and Adjusted EBITDA which are REIT industry financial measures that are not calculated in accordance with accounting principles generally accepted in the United States of America. Please see page 19 for a definition of these supplemental performance measures. Please see the supplemental statement of operations reconciliation for a reconciliation of certain captions in the supplemental statement of operations reported in this supplemental information package to the statement of operations as reported in the Company’s filings with the SEC on Form 10-Q.

 

 

 

Consolidated Balance Sheets

 

   June 30, 2017   September 30, 2016 
   (unaudited)     
         
ASSETS          
Real Estate Investments:          
Land  $184,998,116   $165,375,315 
Buildings and Improvements   1,188,576,632    1,005,938,180 
Total Real Estate Investments   1,373,574,748    1,171,313,495 
Accumulated Depreciation   (169,226,861)   (148,830,169)
Real Estate Investments   1,204,347,887    1,022,483,326 
           
Cash and Cash Equivalents   11,749,997    95,749,508 
Securities Available for Sale at Fair Value   100,495,810    73,604,894 
Tenant and Other Receivables   1,148,114    1,444,824 
Deferred Rent Receivable   7,739,322    6,917,431 
Prepaid Expenses   7,358,734    4,830,987 
Capitalized Lease Costs, net of Accumulated Amortization of $3,727,227 and $3,238,516, respectively   4,137,743    4,165,268 
Intangible Assets, net of Accumulated Amortization of $13,103,744 and $12,332,599, respectively   8,608,879    5,816,153 
Financing Costs, net of Accumulated Amortization of $525,660 and $246,678, respectively   969,603    1,245,923 
Other Assets   5,061,923    7,227,571 
TOTAL ASSETS  $1,351,618,012   $1,223,485,885 
           
LIABILITIES AND SHAREHOLDERS’ EQUITY          
           
Liabilities:          
Fixed Rate Mortgage Notes Payable, net of Unamortized Debt          
Issuance Costs  $554,486,956   $477,476,010 
Loans Payable   122,094,940    80,790,684 
Accounts Payable and Accrued Expenses   2,853,438    3,998,771 
Other Liabilities   13,936,503    9,868,572 
Preferred Stock Called for Redemption   -0-    53,493,750 
Total Liabilities   693,371,837    625,627,787 
           
COMMITMENTS AND CONTINGENCIES          
           
Shareholders’ Equity: 7.875% Series B Cumulative Redeemable Preferred Stock, $0.01 Par Value Per Share: -0- and 2,300,000 Shares Authorized, Issued and Outstanding as of June 30, 2017 and September 30, 2016, respectively   -0-    57,500,000 
6.125% Series C Cumulative Redeemable Preferred Stock, $0.01 Par Value Per Share: 12,400,000 and 5,400,000 Shares Authorized as of June 30, 2017 and September 30, 2016, respectively; 8,400,000 and 5,400,000 Shares Issued and Outstanding as of June 30, 2017 and September 30, 2016, respectively   210,000,000    135,000,000 
Common Stock, $0.01 Par Value Per Share: 192,039,750 and 194,600,000 Shares Authorized as of June 30, 2017 and September 30, 2016, respectively; 73,824,161 and 68,920,972 Shares Issued and Outstanding as of June 30, 2017 and September 30, 2016, respectively   738,242    689,210 
Excess Stock, $0.01 Par Value Per Share: 200,000,000 Shares Authorized as of June 30, 2017 and September 30, 2016; No Shares Issued or Outstanding as of June 30, 2017 and September 30, 2016   -0-    -0- 
Additional Paid-In Capital   438,742,799    391,726,621 
Accumulated Other Comprehensive Income   8,765,134    12,942,267 
Undistributed Income   -0-    -0- 
Total Shareholders’ Equity   658,246,175    597,858,098 
TOTAL LIABILITIES & SHAREHOLDERS’ EQUITY  $1,351,618,012   $1,223,485,885 

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 3 of 23

 

 

 

Consolidated Statements of Income

(unaudited)

 

   Three Months Ended   Nine Months Ended 
   6/30/2017   6/30/2016   6/30/2017   6/30/2016 
INCOME:                    
Rental Revenue  $24,400,237   $20,789,914   $71,291,923   $59,465,701 
Reimbursement Revenue   4,208,859    3,324,085    11,806,975    9,874,498 
TOTAL INCOME   28,609,096    24,113,999    83,098,898    69,340,199 
                     
EXPENSES:                    
Real Estate Taxes   3,520,322    2,633,706    9,279,165    7,681,519 
Operating Expenses   1,053,253    981,766    3,635,986    3,316,489 
General & Administrative Expenses   1,786,852    1,542,432    5,307,853    5,099,841 
Acquisition Costs   -0-    135,358    178,526    545,955 
Depreciation   7,318,258    6,096,880    21,449,830    17,478,374 
Amortization of Capitalized Lease Costs and Intangible Assets   451,823    445,404    1,327,376    1,418,375 
TOTAL EXPENSES   14,130,508    11,835,546    41,178,736    35,540,553 
                     
OTHER INCOME (EXPENSE):                    
Dividend and Interest Income   1,899,320    1,486,134    4,630,653    4,050,455 
Gain on Sale of Securities Transactions   1,487,836    272,067    2,293,944    1,159,409 
Interest Expense, including Amortization of Financing Costs   (6,135,381)   (5,805,359)   (18,835,864)   (16,707,613)
TOTAL OTHER INCOME (EXPENSE)   (2,748,225)   (4,047,158)   (11,911,267)   (11,497,749)
                     
NET INCOME   11,730,363    8,231,295    30,008,895    22,301,897 
                     
Less: Preferred Dividends   4,045,787    2,151,758    11,325,583    6,455,274 
Less: Redemption of Preferred Stock   2,467,165    -0-    2,467,165    -0- 
                     
NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS       $   5,217,411           $   6,079,537           $   16,216,147           $   15,846,623    

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 4 of 23

 

 

 

Net Income, FFO, Core FFO, AFFO, Adjusted EBITDA and NOI Reconciliations

(unaudited)

 

   Three Months Ended   Nine Months Ended 
FFO, Core FFO, AFFO  6/30/2017   6/30/2016   6/30/2017   6/30/2016 
Net Income Attributable to Common Shareholders  $5,217,411   $6,079,537   $16,216,147   $15,846,623 
Plus: Depreciation Expense (excluding Corporate Office Capitalized Costs)   7,278,976    6,066,012    21,332,662    17,390,417 
Plus: Amortization of Intangible Assets   262,325    272,009    771,145    915,208 
Plus: Amortization of Capitalized Lease Costs   214,990    198,887    632,707    579,643 
Plus: Loss on Sale of Real Estate Investment   -0-    -0-    95,336    -0- 
FFO Attributable to Common Shareholders   12,973,702    12,616,445    39,047,997    34,731,891 
Plus: Acquisition Costs   -0-    135,358    178,526    545,955 
Plus: Redemption of Preferred Stock   2,467,165    -0-    2,467,165    -0- 
Core FFO Attributable to Common Shareholders   15,440,867    12,751,803    41,693,688    35,277,846 
Plus: Stock Compensation Expense   174,709    99,760    441,054    306,688 
Plus: Depreciation of Corporate Office Capitalized Costs   39,282    30,868    117,167    87,957 
Plus: Amortization of Financing Costs   283,573    240,463    949,470    713,501 
Plus: Non-recurring other expense   -0-    100,000    -0-    500,000 
Less: Gain on Sale of Securities Transactions   (1,487,836)   (272,067)   (2,293,944)   (1,159,409)
Less: Effect of Non-cash U.S. GAAP Straight-line Rent Adjustment   (294,936)   (350,217)   (924,792)   (1,172,053)
Less: Recurring Capital Expenditures   (195,186)   (169,492)   (571,988)   (653,544)
AFFO Attributable to Common Shareholders  $13,960,473   $12,431,118   $39,410,655   $33,900,986 

 

   Three Months Ended   Nine Months Ended 
Adjusted EBITDA  6/30/2017   6/30/2016   6/30/2017   6/30/2016 
Net Income Attributable to Common Shareholders  $5,217,411   $6,079,537   $16,216,147   $15,846,623 
Plus: Preferred Dividends   4,045,787    2,151,758    11,325,583    6,455,274 
Plus: Redemption of Preferred Stock   2,467,165    -0-    2,467,165    -0- 
Plus: Depreciation & Amortization   7,770,081    6,542,284    22,777,206    18,896,749 
Plus: Interest Expense, including Amortization of Financing Costs   6,135,381    5,805,359    18,835,864    16,707,613 
Plus: Acquisition Costs   -0-    135,358    178,526    545,955 
Plus: Net Amortization of Acquired Above and Below Market Lease Revenue   25,492    25,492    76,476    76,476 
Plus: Loss on Sale of Real Estate Investment   -0-    -0-    95,336    -0- 
Less: Gain on Sale of Securities Transactions   (1,487,836)   (272,067)   (2,293,944)   (1,159,409)
Adjusted EBITDA  $24,173,481   $20,467,721   $69,678,359   $57,369,281 

 

   Three Months Ended   Nine Months Ended 
Net Operating Income  6/30/2017   6/30/2016   6/30/2017   6/30/2016 
Net Income Attributable to Common Shareholders  $5,217,411   $6,079,537   $16,216,147   $15,846,623 
Plus: Redemption of Preferred Stock   2,467,165    -0-    2,467,165    -0- 
Plus: Preferred Dividends   4,045,787    2,151,758    11,325,583    6,455,274 
Plus: General & Administrative Expenses   1,786,852    1,542,432    5,307,853    5,099,841 
Plus: Acquisition Costs   -0-    135,358    178,526    545,955 
Plus: Depreciation   7,318,258    6,096,880    21,449,830    17,478,374 
Plus: Amortization of Capitalized Lease Costs and Intangible Assets   451,823    445,404    1,327,376    1,418,375 
Plus: Interest Expense, including Amortization of Financing Costs   6,135,381    5,805,359    18,835,864    16,707,613 
Less: Dividend and Interest Income   (1,899,320)   (1,486,134)   (4,630,653)   (4,050,455)
Less: Gain on Sale of Securities Transactions   (1,487,836)   (272,067)   (2,293,944)   (1,159,409)
Net Operating Income - NOI  $24,035,521   $20,498,527   $70,183,747   $58,342,191 

 

   Three Months Ended   Nine Months Ended 
Components of Net Operating Income consists of:  6/30/2017   6/30/2016   6/30/2017   6/30/2016 
Revenues                    
Rental Revenue  $24,400,237   $20,789,914   $71,291,923   $59,465,701 
Reimbursement Revenue   4,208,859    3,324,085    11,806,975    9,874,498 
Total Rental and Reimbursement Revenue   28,609,096    24,113,999    83,098,898    69,340,199 
                     
Expenses                    
Real Estate Taxes   3,520,322    2,633,706    9,279,165    7,681,519 
Operating Expenses   1,053,253    981,766    3,635,986    3,316,489 
Total Real Estate Taxes and Operating Expenses   4,573,575    3,615,472    12,915,151    10,998,008 
Net Operating Income - NOI  $24,035,521   $20,498,527   $70,183,747   $58,342,191 

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 5 of 23

 

 

 

Financial Highlights

(unaudited)

 

   Three Months Ended   Nine Months Ended 
   6/30/2017   6/30/2016   6/30/2017   6/30/2016 
                 
Weighted Average Common Shares Outstanding                    
Basic   72,881,974    66,337,101    71,264,806    64,613,953 
Diluted   73,053,693    66,462,209    71,422,664    64,703,203 
                     
Net Income Attributable to Common Shareholders  $5,217,411   $6,079,537   $16,216,147   $15,846,623 
                     
Basic  $0.07   $0.09   $0.23   $0.25 
Diluted   0.07    0.09    0.23    0.24 
                     
Net Operating Income – NOI  $24,035,521   $20,498,527   $70,183,747   $58,342,191 
                     
Basic  $0.33   $0.31   $0.98   $0.90 
Diluted   0.33    0.31    0.98    0.90 
                     
Funds From Operations – FFO  $12,973,702   $12,616,445   $39,047,997   $34,731,891 
                     
Basic  $0.18   $0.19   $0.55   $0.54 
Diluted   0.18    0.19    0.55    0.54 
                     
Core Funds From Operations - Core FFO  $15,440,867   $12,751,803   $41,693,688   $35,277,846 
                     
Basic  $0.21   $0.19   $0.59   $0.55 
Diluted   0.21    0.19    0.58    0.55 
                     
Core FFO Excluding Gains on Securities Transactions  $13,953,031   $12,479,736   $39,399,744   $34,118,437 
                     
Basic  $0.19   $0.19   $0.55   $0.53 
Diluted   0.19    0.19    0.55    0.53 
                     
Adjusted Funds From Operations - AFFO  $13,960,473   $12,431,118   $39,410,655   $33,900,986 
                     
Basic  $0.19   $0.19   $0.55   $0.52 
Diluted   0.19    0.19    0.55    0.52 
                     
Dividends Declared per Common Share  $0.16   $0.16   $0.48   $0.48 
                     
Dividend/AFFO Payout Ratio   84.2%               

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 6 of 23

 

 

 

Same Property Statistics

 

   Three Months Ended         
   6/30/2017  6/30/2016   Change   Change % 
                
Total Square Feet / Total Properties   17,917,302 /105     15,124,162/97    2,793,140    18.5%
                       
Occupancy Percentage at Quarter End   99.8%    99.6%  20 bps    0.2%
                       
Same Property Square Feet / Number of Same Properties   13,522,492/89                  
                       
Same Property Occupancy Percentage at Quarter End   99.7%    100.0%   (30) bps    (0.3)%
                       
Same Property Net Operating Income (NOI) (GAAP)  $18,450,772   

$

18,569,091   $(118,319)   (0.6)%
                       
Reversal of Effect of Non-cash U.S. GAAP Straight-line Rent Adjustment   (173,560)    (335,224)    161,664      
Same Property Cash NOI (Cash)  $18,277,212    $18,233,867   $43,345    0.2%

 

Same Property Statistics include all properties owned during the entire periods presented with the exclusion of properties expanded during these periods.

 

The 0.6% decrease, amounting to $118,319 in Same Property NOI, consists of $9,328 attributable to a decrease in Same Property NOI from vacant properties and by a decrease in Same Property NOI from occupied properties of $108,991.

 

The 0.2% increase, amounting to $43,345 in Same Property Cash NOI, consists of $55,624 attributable to an increase in Same Property Cash NOI from occupied properties offset by a decrease in Same Property Cash NOI from vacant properties of $12,279.

 

Reconciliation of Same Property NOI to Total NOI  Three Months Ended         
   6/30/2017   6/30/2016   Change   Change % 
                 
Same Property NOI (GAAP)  $18,450,772   $18,569,091   $(118,319)   (0.6)%
                     
NOI of properties purchased subsequent to October 1, 2015 (twelve properties for fiscal 2017 and three properties for fiscal 2016)   4,046,723    885,335           
                     
NOI of properties expanded subsequent to October 1, 2015 (four properties for fiscal 2017 and 2016)   1,538,026    1,104,282           
                     
NOI of property sold subsequent to October 1, 2015 (one property sold during fiscal 2017)   -0-    (60,181)          
Total NOI  $24,035,521   $20,498,527   $3,536,994    17.3%

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 7 of 23

 

 

 

Same Property Statistics

 

   Nine Months Ended         
   6/30/2017   6/30/2016   Change   Change % 
                 
Total Square Feet / Total Properties   17,917,302/105     15,124,162/97    2,793,140    18.5%
                     
Occupancy Percentage at Quarter End   99.8%   99.6%   20 bps    0.2%
                     
Same Property Square Feet / Number of Same Properties   12,890,600/86                
                     
Same Property Occupancy Percentage at Quarter End   99.7%   100.0%   (30) bps    (0.3)%
                     
Same Property Net Operating Income (NOI) (GAAP)  $51,771,276   $51,575,371   $195,905    0.4%
                     
Reversal of Effect of Non-cash U.S. GAAP Straight-line Rent Adjustment   (495,519)   (1,088,791)   593,272      
Same Property Cash NOI (Cash)  $51,275,757   $50,486,580   $789,177    1.6%

 

Same Property Statistics include all properties owned during the entire periods presented with the exclusion of properties expanded during these periods.

 

The 0.4% increase, amounting to $195,905 in Same Property NOI, consists of $381,807 attributable to an increase in Same Property NOI from filling previously vacant properties offset by a decrease in Same Property NOI from occupied properties of $185,902.

 

The 1.6% increase, amounting to $789,177 in Same Property Cash NOI, consists of $595,276 attributable to an increase in Same Property Cash NOI from filling previously vacant properties and by an increase in Same Property Cash NOI from occupied properties of $193,901.

 

Reconciliation of Same Property NOI to Total NOI

 

  Nine Months Ended         
   6/30/2017   6/30/2016   Change   Change % 
                 
Same Property NOI (GAAP)  $51,771,276   $51,575,371   $195,905    0.4%
                     
NOI of properties purchased subsequent to October 1, 2015 (fifteen properties for fiscal 2017 and six properties for fiscal 2016)   13,834,680    3,613,706           
                     
NOI of properties expanded subsequent to October 1, 2015 (four properties for fiscal 2017 and 2016)   4,691,829    3,274,253           
                     
NOI of property sold subsequent to October 1, 2015 (one property sold during fiscal 2017)   (114,038)   (121,139)          
Total NOI  $70,183,747   $58,342,191   $11,841,556    20.3%

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 8 of 23

 

 

 

Consolidated Statements of Cash Flows

(unaudited)

   Nine Months Ended 
   6/30/2017   6/30/2016 
CASH FLOWS FROM OPERATING ACTIVITIES          
Net Income  $30,008,895   $22,301,897 
Noncash Items Included in Net Income:          
Depreciation & Amortization   23,726,676    19,610,250 
Stock Compensation Expense   441,054    306,688 
Gain on Sale of Securities Transactions   (2,293,944)   (1,159,409)
Loss on Sale of Real Estate Investment   95,336    -0- 
Changes in:          
Tenant, Deferred Rent and Other Receivables   12,479    (1,235,976)
Prepaid Expenses   (2,527,747)   (1,859,791)
Other Assets and Capitalized Lease Costs   71,446    (2,293,188)
Accounts Payable, Accrued Expenses and Other Liabilities   656,824    7,676,175 
NET CASH PROVIDED BY OPERATING ACTIVITIES   50,191,019    43,346,646 
           
CASH FLOWS FROM INVESTING ACTIVITIES          
Purchase of Real Estate and Intangible Assets   (208,390,539)   (141,230,341)
Capital Improvements   (1,208,390)   (19,517,185)
Proceeds on Sale of Real Estate   4,125,819    -0- 
Return of Deposits on Real Estate   2,700,000    1,650,000 
Deposits Paid on Acquisitions of Real Estate   (1,280,000)   (1,100,000)
Proceeds from Sale of Securities Available for Sale   10,693,212    8,165,701 
Purchase of Securities Available for Sale   (39,467,317)   (17,772,994)
NET CASH USED IN INVESTING ACTIVITIES   (232,827,215)   (169,804,819)
           
CASH FLOWS FROM FINANCING ACTIVITIES          
Net Proceeds from Loans Payable   41,304,256    40,812,783 
Proceeds from Fixed Rate Mortgage Notes Payable   137,925,000    92,971,000 
Principal Payments on Fixed Rate Mortgage Notes Payable   (59,936,689)   (26,609,348)
Financing Costs Paid on Debt   (1,650,516)   (1,204,207)
Proceeds from the Exercise of Stock Options   -0-    1,412,050 
Redemption of 7.625% Series A Preferred Stock   (53,493,750)   -0- 
Redemption of 7.875% Series B Preferred Stock   (57,500,000)   -0- 
Proceeds from Underwritten Public Offering of 6.125% Series C Preferred Stock, net of offering costs   71,003,093    -0- 
Proceeds from Issuance of Common Stock in the DRIP, net of Dividend Reinvestments         59,111,167               45,132,315    
Preferred Dividends Paid   (11,044,489)   (6,455,274)
Common Dividends Paid, net of Reinvestments   (27,081,387)   (24,788,097)
NET CASH PROVIDED BY FINANCING ACTIVITIES   98,636,685    121,271,222 
           
NET DECREASE IN CASH AND CASH EQUIVALENTS   (83,999,511)   (5,186,951)
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD   95,749,508    12,073,909 
CASH AND CASH EQUIVALENTS - END OF PERIOD  $11,749,997   $6,886,958 

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 9 of 23

 

 

 

  As of   As of   As of 
Capital Structure and Leverage Ratios  6/30/2017   6/30/2016   9/30/2016 
(unaudited)            
             
Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs  $554,486,956   $434,605,383   $477,476,010 
Loans Payable   122,094,940    125,854,169    80,790,684 
Preferred Stock Called for Redemption   -0-    -0-    53,493,750 
Total Debt   676,581,896    560,459,552    611,760,444 
                
7.625% Series A Cumul. Redeemable Preferred   -0-    53,493,750    -0- 
7.875% Series B Cumul. Redeemable Preferred   -0-    57,500,000    57,500,000 
6.125% Series C Cumul. Redeemable Preferred   210,000,000    -0-    135,000,000 
Total Preferred Stock   210,000,000    110,993,750    192,500,000 
                
Common Stock, Paid-In-Capital & Other   448,246,175    390,257,050    405,358,098 
Total Shareholders’ Equity   658,246,175    501,250,800    597,858,098 
                
Total Book Capitalization   1,334,828,071    1,061,710,352    1,209,618,542 
                
Accumulated Depreciation   169,226,861    142,289,055    148,830,169 
Total Undepreciated Book Capitalization  $1,504,054,932   $1,203,999,407   $1,358,448,711 
                
Shares Outstanding   73,824,161    67,228,175    68,920,972 
Market Price Per Share  $15.05   $13.26   $14.27 
                
Equity Market Capitalization  $1,111,053,623   $891,445,601   $983,502,270 
Total Debt   676,581,896    560,459,552    611,760,444 
Preferred   210,000,000    110,993,750    192,500,000 
Total Market Capitalization  $1,997,635,519   $1,562,898,903   $1,787,762,714 
                
Total Debt  $676,581,896   $560,459,552   $611,760,444 
less: Cash and Cash Equivalents   11,749,997    6,886,958    95,749,508 
Net Debt  $664,831,899   $553,572,594   $516,010,936 
less: Securities Available for Sale at Fair Value (Securities)   100,495,810    82,638,519    73,604,894 
Net Debt Less Securities  $564,336,089   $470,934,075   $442,406,042 
                
Net Debt / Total Undepreciated Book Capitalization   44.2%   46.0%   38.0%
Net Debt / Total Market Capitalization   33.3%   35.4%   28.9%
Net Debt Plus Preferred / Total Market Capitalization   43.8%   42.5%   39.6%
Net Debt Less Securities / Total Undepreciated Book Capitalization   37.5%   39.1%   32.6%
Net Debt Less Securities / Total Market Capitalization   28.3%   30.1%   24.7%
Net Debt Less Securities Plus Preferred / Total Market Capitalization   38.8%   37.2%   35.5%
                
Weighted Average Interest Rate on Fixed Rate Debt   4.21%   4.61%   4.49%

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 10 of 23

 

 

 

Capital Structure and Leverage Ratios continued

(unaudited)

 

                   Fiscal Year 
   Three Months Ended   Nine Months Ended   Ended 
    6/30/2017    6/30/2016    6/30/2017    6/30/2016    9/30/2016 
Net Income  $11,730,363   $8,231,295   $30,008,895   $22,301,897   $32,494,507 
plus: Depreciation & Amortization   7,770,081    6,542,284    22,777,206    18,896,749    26,087,680 
plus: Interest Expense, including Amortization of  Financing Costs   6,135,381    5,805,359    18,835,864    16,707,613    22,953,049 
plus: Acquisition Costs   -0-    135,358    178,526    545,955    730,441 
plus: Net Amortization of Acquired Above and Below Market Lease Revenue   25,492    25,492    76,476    76,476    101,967 
plus: Loss on Sale of Real Estate Investment   -0-    -0-    95,336    -0-    -0- 
less: Gain on Sale of Securities Transactions   (1,487,836)   (272,067)   (2,293,944)   (1,159,409)   (4,398,599)
Adjusted EBITDA  $24,173,481   $20,467,721   $69,678,359   $57,369,281   $77,969,045 
                          
Interest Expense, including Amortization of Financing Costs  $6,135,381   $5,805,359   $18,835,864   $16,707,613   $22,953,049 
Preferred Dividends   4,045,787    2,151,758    11,325,583    6,455,274    9,020,470 
Total Fixed Charges  $10,181,168   $7,957,117   $30,161,447   $23,162,887   $31,973,519 
                          
Interest Coverage   3.9 x    3.5 x     3.7 x     3.4 x    3.4 x 
Fixed Charge Coverage   2.4 x    2.6 x     2.3 x     2.5 x    2.4 x 
                          
Net Debt  $664,831,899   $553,572,594   $664,831,899   $553,572,594   $516,010,936 
Net Debt Less Securities   564,336,089    470,934,075    564,336,089    470,934,075    442,406,042 
Preferred   210,000,000    110,993,750    210,000,000    110,993,750    192,500,000 
Annualized Adjusted EBITDA   96,693,924    81,870,884    92,904,479    76,492,375    77,969,045 
                          
Net Debt / Adjusted EBITDA   6.9 x     6.8 x    7.2 x     7.2 x    6.6 x 
Net Debt Less Securities / Adjusted EBITDA   5.8 x     5.8 x     6.1 x     6.2 x    5.7 x 
Net Debt + Preferred / Adjusted EBITDA   9.0 x     8.1 x     9.4 x    8.7 x    9.1 x 
Net Debt Less Securities + Preferred / Adjusted EBITDA   8.0 x     7.1 x     8.3 x     7.6 x     8.1 x 

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 11 of 23

 

 

 

Debt Maturity

(unaudited)

 

 

           Loans       % of 
Fiscal Year Ended    Mortgages     Payable   Total   Total 
                     
2017    $8,841,593     $-0-   $8,841,593    1.3%
2018     49,428,516      -0-    49,428,516    7.4%
2019     52,952,254      -0-    52,952,254    7.9%
2020     36,963,631      110,000,000    146,963,631    21.9%
2021     37,726,958      -0-    37,726,958    5.6%
Thereafter     375,823,512      -0-    375,823,512    55.9%
                         
Total as of 6/30/2017 (A)  $561,736,464  (B)  $110,000,000   $671,736,464    100.0%
                         
Weighted Average Interest Rate (C)     4.21 %   2.49%   3.90%     
Weighted Average Term     11.47 yrs.      2.93 yrs.    9.94 yrs.      

 

  (A) Mortgages does not include unamortized debt issuance costs of $7,249,508.
  (B) Excludes $12,094,940 of margin debt which is due upon demand and bears an interest rate of 2.05%.
  (C) Weighted average interest rate of 2.49% on Loans Payable and weighted average interest rate of 3.90% on Total includes margin debt.

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 12 of 23

 

 

 

Property Table by Tenant

(unaudited)

 

     Property   Square   Occupied Square   % of Occupied   Annual  

% of Total

Ann.

   Rent Per sf   Undepreciated   Mortgage 
Tenant    Count   Footage   Footage   sf   Rent   Rent   Occup.   Cost   Balance 
                                       
FedEx Ground Package System, Inc.     43    7,700,724    7,700,724    43.0%  $57,025,000    53.9%  $7.41   $774,187,846   $357,317,226 
FedEx Corporation     15    1,423,313    1,423,313    7.9%   6,687,000    6.3%   4.70   $86,858,352    13,961,186 
                                                
Total FedEx     58    9,124,037    9,124,037    50.9%   63,712,000    60.2%   6.98    861,046,198    371,278,412 
                                                
Milwaukee Electric Tool Corporation     1    861,889    861,889    4.8%   3,010,000    2.8%   3.49    36,914,917    23,886,671 
ULTA, Inc.     1    671,354    671,354    3.7%   2,677,000    2.5%   3.99    37,512,071    21,808,660 
Jim Beam Brands Company     1    599,840    599,840    3.3%   2,032,000    1.9%   3.39    28,000,000    17,784,413 
TreeHouse Private Brands, Inc.     1    558,600    558,600    3.1%   2,186,000    2.1%   3.91    26,767,852    16,187,415 
CBOCS Distribution, Inc.     1    381,240    381,240    2.1%   1,433,000    1.4%   3.76    14,215,126    7,501,287 
Best Buy Warehousing Logistics, Inc.     1    368,060    368,060    2.1%   1,660,000    1.6%   4.51    19,600,000    10,032,360 
The Coca-Cola Compan (Western Container Corporation)     2    323,358    323,358    1.8%   1,684,000    1.6%   5.21    20,504,069    5,903,675 
Autoneum North America, Inc.     1    315,560    315,560    1.8%   1,700,000    1.6%   5.39    21,040,396    15,350,000 
Science Applications International     1    302,400    302,400    1.7%   1,476,000    1.4%   4.88    13,374,441    -0- 
International Paper Company     1    280,000    280,000    1.6%   1,337,000    1.3%   4.78    18,294,108    10,112,819 
Bunzl USA Holdings, Inc.     2    268,778    268,778    1.5%   1,468,000    1.4%   5.46    18,379,601    12,839,422 
Woodstream Corporation (B)   1    256,000    256,000    1.4%   910,000    0.9%   3.55    8,885,429    -0- 
United Technologies Corporation     2    244,317    244,317    1.4%   1,896,000    1.8%   7.76    22,587,512    7,419,925 
Anda Pharmaceuticals, Inc.     1    234,660    234,660    1.3%   1,200,000    1.1%   5.11    14,550,000    8,318,812 
UGN, Inc.     1    232,200    232,200    1.3%   1,060,000    1.0%   4.57    12,937,000    7,725,701 
Caterpillar Logistics Services, Inc.     1    218,120    218,120    1.2%   1,169,000    1.1%   5.36    14,868,857    -0- 
Anheuser-Busch, Inc.     1    184,800    184,800    1.0%   810,000    0.8%   4.38    12,578,197    -0- 
Carlisle Tire & Wheel Company     1    179,280    179,280    1.0%   787,000    0.7%   4.39    7,232,986    -0- 
NF&M International Inc.  (A)    1    174,802    174,802    1.0%   833,000    0.8%   4.77    5,389,424    -0- 
Home Depot USA, Inc.     1    171,200    171,200    1.0%   988,000    0.9%   5.77    11,298,367    -0- 
Kellogg Sales Company     3    170,279    170,279    1.0%   982,000    0.9%   5.77    12,175,116    -0- 
Victory Packaging, L.P.     1    148,000    148,000    0.8%   496,000    0.5%   3.35    5,441,876    -0- 
Challenger Lifts, Inc. (Snap-On Inc.)     1    137,500    137,500    0.8%   831,000    0.8%   6.04    11,304,000    7,009,146 
Altec Industries, Inc.  (B)   1    126,880    126,880    0.7%   367,000    0.3%   2.89    4,403,841    -0- 
General Electric Company     1    125,860    125,860    0.7%   1,315,000    1.2%   10.45    19,950,000    12,150,546 
The American Bottling Company (Dr Pepper Snapple)     2    110,080    110,080    0.6%   739,000    0.7%   6.71    10,498,034    1,843,498 
Style Crest, Inc.     1    106,507    106,507    0.6%   381,000    0.4%   3.58    7,238,613    -0- 
Pittsburgh Glass Works, LLC.     1    102,135    102,135    0.6%   427,000    0.4%   4.18    4,245,913    -0- 
Holland 1916 Inc.     1    95,898    95,898    0.5%   345,000    0.3%   3.60    7,397,881    -0- 
National Oilwell Varco, Inc.     1    91,295    91,295    0.5%   750,000    0.7%   8.22    8,083,107    2,800,874 
Joseph T. Ryerson and Son, Inc.     1    89,052    89,052    0.5%   506,000    0.5%   5.68    6,932,916    -0- 
CHEP USA, Inc.     1    83,000    83,000    0.5%   497,000    0.5%   5.99    7,405,447    -0- 
Datatel Resources Corporation  (A)    1    80,856    80,856    0.5%   244,000    0.2%   3.02    2,492,919    -0- 
Sherwin-Williams Company     2    78,887    78,887    0.4%   640,000    0.6%   8.11    7,244,128    -0- 
RGH Enterprises, Inc.     1    75,000    75,000    0.4%   601,000    0.6%   8.01    5,525,600    -0- 
Tampa Bay Grand Prix     1    68,385    68,385    0.4%   293,000    0.3%   4.28    5,677,982    -0- 
Various Tenants at Retail Shopping Center     1    64,220    64,220    0.4%   762,000    0.7%   11.87    3,072,880    -0- 
SOFIVE, Inc.     1    60,400    60,400    0.3%   548,000    0.5%   9.07    4,903,589    1,782,828 
Siemens Real Estate     1    51,130    51,130    0.3%   479,000    0.5%   9.37    4,452,425    -0- 
Rockwell Collins, Inc.     1    38,833    38,833    0.2%   362,000    0.3%   9.32    5,100,000    -0- 
Graybar Electric Company     1    26,340    26,340    0.1%   109,000    0.1%   4.14    1,858,591    -0- 
Tenant Total as of 6/30/17     104    17,881,032    17,881,032    99.8%  $105,702,000    99.9%  $5.91   $1,371,381,409   $(C) 561,736,464 
                                                
Vacant (E)   1    36,270    -0-    0.0%   (D) 94,000    0.1%   -0-    2,182,274    -0- 
Total as of 6/30/17     105    17,917,302    17,881,032    99.8%  $105,796,000    100.0%  $5.91   $1,373,563,683   $561,736,464 
                                                
Acquisitions Subsequent to 6/30/17                                               
FedEx Ground Package System, Inc. (Charlotte, NC MSA)     1    354,482    354,482    1.9%   2,537,000    2.3%   7.16           
Pro Forma Total with Acquisitions Subsequent to 6/30/17     106    18,271,784    18,235,514    99.8%  $108,333,000    100.0%  $5.94           
                                                
Leasing Activity Subsequent to 6/30/17                                               
FBM Gypsum Supply of Illinois, LLC (E)   na    na    36,270    0.3%   172,000    0.2%   4.74           
Pro Forma Total     106    18,271,784    (F) 18,184,284    (F) 99.5%   $108,505,000    100.0%  $5.94           

 

  (A) NF&M International and Datatel Resources are located at one property and therefore are counted as one property in the Property Count total.
  (B) Woodstream Corporation and Altec Industries, Inc. are located at one property and therefore are counted as one property in the Property Count total.
    Other than these two properties indicated in footnotes (A) and (B) and the one retail property, all other properties are single-tenant.
  (C) Does not include unamortized debt issuance costs of $7,249,508.
  (D) Includes rental revenue from property during Fiscal 2017 prior to becoming vacant.
  (E) Entered into a 10.2 year lease agreement through December 31, 2027 with FBM Gypsum Supply of Illinois, LLC. The lease is expected to commence on November 1, 2017, with 2 months of free rent, after which initial annual rent of $159,888, representing $4.40 per square foot, will commence with 2.0% annual increases thereafter.
  (F) Effective July 1, 2017, an 87,500 square foot building leased to FedEx Ground Package System, Inc., located in Ft. Myers, FL, became vacant.

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 13 of 23

 

 

 

Property Table by State

(unaudited)

 

      Property   Square   Occupied Square   % of Total   Annual  

% of Total

Ann.

   Rent Per sf   Undepreciated   Mortgage  
State     Count   Footage   Footage   sf   Rent   Rent   Occup.   Cost   Balance  
Florida      13    1,899,643    1,899,643    10.6%  $13,941,000    13.2%   7.34   $200,246,461 $ 100,861,021  
Texas      10    1,781,967    1,781,967    9.9%   14,182,000    13.4%   7.96    182,082,804   84,960,463  
Kentucky      3    1,295,940    1,295,940    7.2%   5,049,000    4.8%   3.90    66,071,852   40,980,974  
Mississippi      4    1,158,889    1,158,889    6.5%   4,439,000    4.2%   3.83    55,224,199   32,205,483  
Ohio      7    1,032,469    1,032,469    5.8%   6,116,000    5.8%   5.92    72,781,419   22,458,064  
Indiana      2    999,176    999,176    5.6%   4,210,000    4.0%   4.21    61,458,071   33,420,918  
Illinois      9    958,045    958,045    5.3%   6,101,000    5.8%   6.37    82,074,151   9,286,476  
Tennessee      3    891,777    891,777    5.0%   3,077,000    2.9%   3.45    33,856,198   13,583,577  
South Carolina      4    886,675    886,675    4.9%   5,266,000    5.0%   5.94    57,442,797   17,693,184  
Michigan      4    833,054    833,054    4.6%   5,574,000    5.3%   6.69    72,970,157   27,851,798  
Kansas      4    813,043    813,043    4.5%   4,652,000    4.4%   5.72    60,943,937   32,683,990  
Missouri      5    804,397    804,397    4.5%   3,121,000    2.9%   3.88    39,384,765   6,839,422  
North Carolina      3    585,224    585,224    3.3%   3,111,000    2.9%   5.32    45,725,284   19,201,012  
New York      4    568,965    568,965    3.2%   4,204,000    4.0%   7.39    55,232,099   22,826,429  
Pennsylvania      3    504,040    504,040    2.8%   3,043,000    2.9%   6.04    36,840,993   15,888,368  
Virginia      5    407,265    407,265    2.3%   2,442,000    2.3%   6.00    34,507,456   4,982,380  
Colorado      3    363,597    363,597    2.0%   3,040,000    2.9%   8.36    42,058,524   19,815,390  
Oklahoma      3    314,941    314,941    1.8%   2,029,000    1.9%   6.44    25,060,869   11,885,673  
Georgia      3    307,662    307,662    1.7%   1,743,000    1.6%   5.67    22,209,940   616,465  
Arizona      1    283,358    283,358    1.6%   1,352,000    1.3%   4.77    16,824,226   4,721,556  
Wisconsin      2    238,666    238,666    1.3%   1,300,000    1.2%   5.45    15,952,361   3,033,695  
Washington      1    210,445    210,445    1.2%   1,962,000    1.8%   9.32    30,228,547   19,103,335  
Louisiana      1    175,315    175,315    1.0%   1,260,000    1.2%   7.19    18,410,000   11,980,889  
Maryland      1    148,881    148,881    0.8%   1,426,000    1.3%   9.58    14,512,355   -0-  
New Jersey      2    124,620    124,620    0.7%   1,310,000    1.2%   10.51    7,976,469   1,782,828  
Nebraska      1    89,115    89,115    0.5%   446,000    0.4%   5.00    5,944,691   -0-  
Alabama      1    88,653    88,653    0.5%   605,000    0.6%   6.82    6,661,819   641,771  
Minnesota      1    60,398    60,398    0.3%   372,000    0.4%   6.16    5,220,000   2,431,303  
Connecticut      1    54,812    54,812    0.3%   329,000    0.3%   6.00    3,478,966   -0-  
Iowa      1    36,270    -0-    0.3%   94,000    0.1%   -0-    2,182,273   -0-  
Total as of 6/30/17      105    17,917,302    17,881,032    100.0%  $105,796,000    100.0%  $5.91   $1,373,563,683 $ (A) 561,736,464  
                                                  
Acquisitions Subsequent to 6/30/17                                                 
North Carolina      1    354,482    354,482    1.9%   2,537,000    2.3%   7.16            
Pro Forma Total with Acquisitions Subsequent to 6/30/17      106    18,271,784    18,235,514    100%  $108,333,000    100.0%  $5.94            
                                                  
Leasing Activity Subsequent to 6/30/17                                                 
Iowa (B)    na    na    36,270    0.3%   172,000    0.2%   4.74            
Pro Forma Total      106    18,271,784     (C) 18,184,284    100%  $108,505,000    100.0%  $5.94            

 

  (A) Does not include unamortized debt issuance costs of $7,249,508.
  (B) Included in leasing activity subsequent to 6/30/17 is a 36,270 square foot building located in Iowa that the Company has recently entered into a 10.2 year lease agreement that will commence subsequent to June 30, 2017.
  (C) Effective July 1, 2017, an 87,500 square foot building leased to FedEx Ground Package System, Inc., located in Ft. Myers, FL, became vacant.

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 14 of 23

 

 

 

Lease Expirations

(unaudited)

 

      Property   Square   % of Total   Annual   % of Total
Ann.		   Rent Per sf   Lease Exp.
Term in		   Undepreciated     Mortgage 
Fiscal Year     Count   Footage   sf   Rent   Rent   Occup.   Years   Cost     Balance 
                                          
2017      3    231,226    1.3%  $1,365,000    1.3% $5.90    0.1   $16,977,588      3,717,600 
2018  (A)   14    1,359,120    7.6%   8,271,000    7.8%   6.09    0.8    95,995,454      7,568,565 
2019      9    1,370,849    7.7%   7,116,000    6.7%   5.19    1.9    81,544,991      13,502,215 
2020      4    383,449    2.1%   2,116,000    2.0%   5.52    2.9    27,388,231      -0- 
2021  (A)   7    827,110    4.6%   3,705,000    3.5%   4.48    4.1    44,328,993      8,021,541 
2022      7    1,138,320    6.4%   6,376,000    6.0%   5.60    4.7    75,791,836      28,214,645 
2023  (A)   12    1,489,524    8.3%   8,719,000    8.2%   5.85    6.0    109,518,122      26,182,961 
2024      12    1,853,948    10.3%   11,318,000    10.7%   6.10    6.9    139,224,175      50,889,806 
2025  (A)   9    2,404,478    13.4%   12,207,000    11.5%   5.08    7.9    159,801,156      81,194,222 
2026      7    1,126,033    6.3%   8,669,000    8.2%   7.70    9.0    118,951,060      57,971,793 
2027      6    692,879    3.9%   4,591,000    4.3%   6.63    9.9    59,135,444      4,721,556 
2028      1    861,889    4.8%   3,010,000    2.8%   3.49    11.1    36,914,917      23,886,671 
2029      2    262,613    1.5%   1,515,000    1.4%   5.77    12.0    21,954,950      9,286,476 
2030      4    1,044,832    5.8%   7,388,000    7.0%   7.07    12.8    109,198,469      66,923,256 
2031      3    963,269    5.4%   7,110,000    6.7%   7.38    13.8    104,367,000      69,628,543 
2032      4    1,248,673    7.0%   9,278,000    8.8%   7.43    14.7    140,448,291      93,839,199 
2034      1    558,600    3.1%   2,186,000    2.3%   3.91    16.3    26,767,852      16,187,415 
Various tenants at retail shopping center      1    64,220    0.4%   762,000    0.7%   11.87    -0-    3,072,880      -0- 
Vacant  (D)   1    36,270    0.1%    (C) 94,000     0.1%   -0-    -0-    2,182,274      -0- 
Total as of 6/30/17      105    17,917,302    100.0%  $105,796,000    100.0%  $5.91    7.8   $1,373,563,683  (B)  $561,736,464 
                                                   
Acquisitions Subsequent to 6/30/17                                                  
2032      1    354,482    1.9%   2,537,000    2.3%   7.16    14.9             
Pro Forma Total with Acquisitions Subsequent to 6/30/17      106    18,271,784    100.0%  $108,333,000    100.0%  $5.94    7.9             
                                                   
Leasing Activity Subsequent to 6/30/17                                                  
2028  (D)   na    na    0.2%   172,000    0.2%   4.74    10.2             
Pro Forma Total      106    18,271,784    100.0%  $108,505,000    100.0%  $5.94    7.9             

 

  (A)

Included in 2018 is Datatel Resources and included in 2025 is NF&M International which both occupy one property. Included in 2021 is Woodstream Corporation and included in 2023 is Altec Industries which both occupy one property.

Other than these two properties and the one retail property, all other properties are single-tenant.

  (B) Does not include unamortized debt issuance costs of $7,249,508.
  (C) Includes rental revenue from property during Fiscal 2017 prior to becoming vacant.
  (D) Included in leasing activity subsequent to 6/30/17 is a 36,270 square foot building that the Company has recently entered into a 10.2 year lease agreement that will commence subsequent to June 30, 2017.

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 15 of 23

 

 

 

Recent Acquisitions During Fiscal 2017

(unaudited)

 

      City     Fiscal Year  Square   Annual   Rent Per sf   Lease  Purchase   Initial Mortgage 
No  Tenant  (MSA)  State  Acquisition  Footage   Rent   Occup.   Expiration  Price   Balance 
1  FedEx Ground Package System, Inc.  Hamburg (Buffalo)  NY  2017   338,584   $2,309,000   $6.82   3/31/2031  $35,100,000   $23,500,000 
2  FedEx Ground Package System, Inc.  Ft. Myers  FL  2017   213,672    1,365,000    6.39   9/30/2026   21,001,538    14,500,000 
3  FedEx Ground Package System, Inc.  Walker (Grand Rapids)  MI  2017   343,483    2,102,000    6.12   1/31/2032   32,120,000    20,875,000 
4  FedEx Ground Package System, Inc.  Mesquite (Dallas)  TX  2017   351,874    3,194,000    9.08   3/31/2032   50,621,072    32,900,000 
5  Autoneum North America, Inc.  Aiken (Augusta, GA)  SC  2017   315,560    1,700,000    5.39   4/30/2032   21,933,000    15,350,000 
6  FedEx Ground Package System, Inc.  Homestead (Miami)  FL  2017   237,756    2,282,000    9.60   3/31/2032   38,347,933    24,800,000 
7  Bunzl Distribution Oklahoma, Inc.  Oklahoma City  OK  2017   110,361    721,000    6.53   8/31/2024   9,000,000    6,000,000 
   Total as of 6/30/17            1,911,290   $13,673,000   $7.15      $208,123,543   $137,925,000 
                                         
Acquisitions Subsequent to 6/30/17                                     
8  FedEx Ground Package System, Inc.  Concord (Charlotte)  NC  2017   354,482    2,537,000    7.16   5/31/2032   40,598,446    26,184,000 
                2,265,772   $16,210,000   $7.15      $248,721,989   $164,109,000 

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 16 of 23

 

 

 

Property Table

(unaudited)

 

               Fiscal Year       Square   Annual   Rent Per sf  

Lease Exp.

Term in

   Undepreciated   Mortgage 
No  Tenant     City (MSA)  State  Acquisition   Occup.   Footage   Rent   Occup.   Years   Cost   Balance 
1  Milwaukee Electric Tool Corporation     Olive Branch (Memphis, TN)  MS   2013    100.0%   861,889   $3,010,000   $3.49    11.1   $36,914,917   $23,886,671 
 2  ULTA, Inc.     Greenwood (Indianapolis)  IN   2015    100.0%   671,354    2,677,000    3.99    8.1    37,512,071    21,808,660 
 3  Jim Beam Brands Company     Frankfort  KY   2015    100.0%   599,840    2,032,000    3.39    7.6    28,000,000    17,784,413 
 4  TreeHouse Private Brands, Inc.     Buckner (Louisville)  KY   2014    100.0%   558,600    2,186,000    3.91    16.3    26,767,852    16,187,415 
 5  FedEx Corporation     Memphis  TN   2010    100.0%   449,900    1,327,000    2.95    1.9    14,624,554    6,082,290 
 6  Woodstream Corporation  (A)  St. Joseph  MO   2001    100.0%   256,000    910,000    3.55    4.3    8,885,429    -0- 
   Altec Industries, Inc.  (A)  St. Joseph  MO   2001    100.0%   126,880    367,000    2.89    5.7    4,403,841    -0- 
 7  CBOCS Distribution, Inc.     Lebanon (Nashville)  TN   2011    100.0%   381,240    1,433,000    3.76    7.0    14,215,126    7,501,287 
 8  Best Buy Warehousing Logistics, Inc.     Streetsboro (Cleveland)  OH   2012    100.0%   368,060    1,660,000    4.51    4.6    19,600,000    10,032,360 
 9  FedEx Ground Package System, Inc.     Mesquite (Dallas)  TX   2017    100.0%   351,874    3,194,000    9.08    14.8    49,879,790    32,900,000 
 10  FedEx Ground Package System, Inc.     Walker (Grand Rapids)  MI   2017    100.0%   343,483    2,102,000    6.12    14.6    31,654,985    20,789,199 
 11  FedEx Ground Package System, Inc.     Hamburg (Buffalo)  NY   2017    100.0%   338,584    2,309,000    6.82    13.8    34,850,000    22,826,429 
 12  FedEx Ground Package System, Inc.     Concord (Charlotte)  NC   2016    100.0%   330,717    2,234,000    6.76    8.1    33,044,795    19,201,012 
 13  FedEx Ground Package System, Inc.     Indianapolis  IN   2014    100.0%   327,822    1,533,000    4.68    6.8    23,946,000    11,612,258 
 14  FedEx Ground Package System, Inc.     Aiken (Augusta, GA)  SC   2017    100.0%   315,560    1,700,000    5.39    14.8    21,040,396    15,350,000 
 15  FedEx Ground Package System, Inc.     Olathe (Kansas City)  KS   2016    100.0%   313,763    2,196,000    7.00    13.9    31,737,000    21,389,052 
 16  FedEx Ground Package System, Inc.     Davenport (Orlando)  FL   2016    100.0%   310,922    2,605,000    8.38    13.8    37,780,000    25,413,062 
 17  FedEx Ground Package System, Inc.     Fort Worth (Dallas)  TX   2015    100.0%   304,608    2,367,000    7.77    12.8    35,300,832    22,449,369 
 18  Science Applications International     Hanahan (Charleston)  SC   2005    100.0%   302,400    1,476,000    4.88    1.8    13,374,441    -0- 
 19  FedEx Ground Package System, Inc.     Jacksonville  FL   2015    100.0%   297,579    1,999,000    6.72    12.5    30,732,090    17,644,851 
 20  Western Container Corp. (The Coca-Cola Company)     Tolleson (Phoenix)  AZ   2003    100.0%   283,358    1,352,000    4.77    9.8    16,824,226    4,721,556 
 21  International Paper Company     Edwardsville (Kansas City)  KS   2014    100.0%   280,000    1,337,000    4.78    6.2    18,294,108    10,112,819 
 22  NF&M International  (B)  Monaca (Pittsburgh)  PA   1988    100.0%   174,802    833,000    4.77    7.5    5,389,424    -0- 
   Datatel Resources Corp.  (B)  Monaca (Pittsburgh)  PA   1988    100.0%   80,856    244,000    3.02    0.4    2,492,919    -0- 
 23  FedEx Ground Package System, Inc.     Orion  MI   2007    100.0%   245,633    1,908,000    7.77    6.0    22,885,636    -0- 
 24  FedEx Ground Package System, Inc.     Homestead (Miami)  FL   2017    100.0%   237,756    2,282,000    9.60    14.8    37,873,120    24,800,000 
 25  Anda Pharmaceuticals, Inc.     Olive Branch (Memphis, TN)  MS   2012    100.0%   234,660    1,200,000    5.11    5.1    14,550,000    8,318,812 
 26  UGN, Inc.     Monroe (Cincinnati)  OH   2015    100.0%   232,200    1,060,000    4.57    12.7    12,937,000    7,725,701 
 27  FedEx Ground Package System, Inc.     Colorado Springs  CO   2016    100.0%   225,362    1,832,000    8.13    8.6    28,500,000    17,872,072 
 28  Caterpillar Logistics Services, Inc.     Griffin (Atlanta)  GA   2006    100.0%   218,120    1,169,000    5.36    0.4    14,868,857    -0- 
 29  Fedex Ground Package System, Inc.     Ft. Myers  FL   2017    100.0%   213,672    1,365,000    6.39    9.3    20,800,000    14,202,709 
 30  FedEx Ground Package System, Inc.     Burlington (Seattle/Everett)  WA   2016    100.0%   210,445    1,962,000    9.32    13.2    30,228,547    19,103,335 
 31  FedEx Ground Package System, Inc.     Sauget (St. Louis, MO)  IL   2015    100.0%   198,773    1,036,000    5.21    11.9    15,204,950    9,286,476 
 32  Anheuser-Busch, Inc.     Granite City (St. Louis, MO)  IL   2001    100.0%   184,800    810,000    4.38    4.4    12,578,197    -0- 
 33  United Technologies Corporation     Carrollton (Dallas)  TX   2010    100.0%   184,317    1,576,000    8.55    1.5    17,819,203    7,419,925 
 34  FedEx Ground Package System, Inc.     Spring (Houston)  TX   2014    100.0%   181,176    1,581,000    8.73    7.3    19,283,798    8,687,334 
 35  Carlisle Tire & Wheel Company     Edwardsville (Kansas City)  KS   2003    100.0%   179,280    787,000    4.39    0.9    7,232,986    -0- 
 36  FedEx Ground Package System, Inc.     Ft. Mill (Charlotte, NC)  SC   2010    100.0%   176,939    1,415,000    8.00    6.3    15,413,307    1,495,698 
 37  FedEx Ground Package System, Inc.     Covington (New Orleans)  LA   2016    100.0%   175,315    1,260,000    7.19    8.0    18,410,000    11,980,889 
 38  FedEx Ground Package System, Inc.     Livonia (Detroit)  MI   2013    100.0%   172,005    1,194,000    6.94    4.8    13,762,030    7,062,599 
 39  Home Depot USA, Inc.     Montgomery (Chicago)  IL   2004    100.0%   171,200    988,000    5.77    3.0    11,298,367    -0- 
 40  FedEx Ground Package System, Inc.     Tampa  FL   2004    100.0%   170,779    1,624,000    9.51    9.1    19,696,227    6,095,549 
 41  FedEx Ground Package System, Inc.     Edinburg  TX   2011    100.0%   164,207    1,097,000    6.68    9.3    12,039,014    -0- 
 42  FedEx Ground Package System, Inc.     Lindale (Tyler)  TX   2015    100.0%   163,378    725,000    4.44    7.0    9,930,000    6,108,716 
 43  Bunzl Distribution Midcentral, Inc.     Kansas City  MO   2015    100.0%   158,417    747,000    4.72    4.3    9,651,226    6,839,422 
 44  FedEx Ground Package System, Inc.     Oklahoma City  OK   2012    100.0%   158,340    1,048,000    6.62    8.0    12,584,462    4,042,175 
 45  FedEx Ground Package System, Inc.     Waco  TX   2012    100.0%   150,710    1,078,000    7.15    8.2    12,551,368    4,594,245 
 46  FedEx Ground Package System, Inc.     Beltsville (Washington, DC)  MD   2001    100.0%   148,881    1,426,000    9.58    1.1    14,512,355    -0- 
 47  Victory Packaging, L.P.     Fayetteville  NC   1997    100.0%   148,000    496,000    3.35    3.7    5,441,876    -0- 
 48  FedEx Ground Package System, Inc.     El Paso  TX   2006    100.0%   144,149    1,345,000    9.33    6.3    12,431,193    -0- 
 49  FedEx Ground Package System, Inc.     Cocoa  FL   2008    100.0%   144,138    1,112,000    7.71    7.3    14,127,449    4,825,954 
 50  FedEx Ground Package System, Inc.     Cudahy (Milwaukee)  WI   2001    100.0%   139,564    832,000    5.96    10.0    9,382,361    -0- 
 51  Challenger Lifts, Inc (Snap-On Inc.)     Louisville  KY   2016    100.0%   137,500    831,000    6.04    8.9    11,304,000    7,009,146 
 52  FedEx Ground Package System, Inc.     Richfield (Cleveland)  OH   2006    100.0%   131,152    1,493,000    11.38    7.3    16,435,479    2,815,061 
 53  General Electric Company     Imperial (Pittsburgh)  PA   2016    100.0%   125,860    1,315,000    10.45    8.5    19,950,000    12,150,546 
 54  FedEx Ground Package System, Inc.     Wheeling (Chicago)  IL   2003    100.0%   123,000    1,279,000    10.40    9.9    18,537,652    -0- 
 55  FedEx Ground Package System, Inc.     Altoona  PA   2014    100.0%   122,522    651,000    5.31    6.2    9,008,650    3,737,822 
 56  FedEx Corporation     Mechanicsville (Richmond)  VA   2001    100.0%   112,799    541,000    4.80    5.8    7,776,711    -0- 
 57  FedEx Corporation     Orlando  FL   2008    100.0%   110,638    666,000    6.02    0.4    8,554,432    4,161,296 
 58  Bunzl Distribution Oklahoma, Inc.     Oklahoma City  OK   2017    100.0%   110,361    721,000    6.53    7.2    8,728,375    6,000,000 
 59  Style Crest, Inc.     Winston-Salem  NC   2002    100.0%   106,507    381,000    3.58    3.8    7,238,613    -0- 
60  FedEx Ground Package System, Inc.     Cheektowaga (Buffalo)  NY   2000    100.0%   104,981    966,000    9.20    2.2    10,960,823    -0- 

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 17 of 23

 

 

 

Property Table

(unaudited)

 

               Fiscal Year       Square   Annual  

Rent

Per sf

  

Lease Exp.

Term in

   Undepreciated     Mortgage 
No  Tenant     City (MSA)  State  Acquisition   Occup.   Footage   Rent   Occup.   Years   Cost     Balance 
 61  FedEx Ground Package System, Inc.     West Chester Twp (Cincinnati)  OH   1999    100.0%   103,818   $537,000   $5.17    6.2   $5,733,686     $1,884,942 
 62  FedEx Ground Package System, Inc.     Roanoke  VA   2013    100.0%   103,402    755,000    7.30    5.8    10,200,000      4,982,380 
 63  Pittsburgh Glass Works, LLC.     O’ Fallon (St. Louis)  MO   1994    100.0%   102,135    427,000    4.18    1.0    4,245,913      -0- 
 64  FedEx Ground Package System, Inc.     Green Bay  WI   2013    100.0%   99,102    468,000    4.72    5.9    6,570,000      3,033,695 
 65  Holland 1916 Inc.     Liberty (Kansas City)  MO   1998    100.0%   95,898    345,000    3.60    2.0    7,397,881      -0- 
 66  FedEx Corporation     Jacksonville  FL   1999    100.0%   95,883    518,000    5.40    1.9    6,288,763      -0- 
 67  FedEx Corporation     Tampa  FL   2006    100.0%   95,662    603,000    6.30    0.3    7,603,154     $3,717,600 
 68  FedEx Ground Package System, Inc.     Hanahan (Charleston)  SC   2005    100.0%   91,776    675,000    7.35    1.1    7,614,653      847,486 
 69  National Oilwell Varco, Inc.     Houston  TX   2010    100.0%   91,295    750,000    8.22    5.3    8,083,107      2,800,874 
 70  FedEx Corporation     Omaha  NE   1999    100.0%   89,115    446,000    5.00    6.3    5,944,691      -0- 
 71  Joseph T. Ryerson and Son, Inc.     Elgin (Chicago)  IL   2002    100.0%   89,052    506,000    5.68    2.6    6,932,916      -0- 
 72  FedEx Ground Package System, Inc.     Huntsville  AL   2005    100.0%   88,653    605,000    6.82    9.1    6,661,819      641,771 
 73  FedEx Ground Package System, Inc.  (F)  Ft. Myers  FL   2003    100.0%   87,500    433,000    4.95    -0-    5,017,447      -0- 
 74  CHEP USA, Inc.     Roanoke  VA   2007    100.0%   83,000    497,000    5.99    7.7    7,405,447      -0- 
 75  FedEx Corporation     Bedford Heights (Cleveland)  OH   2007    100.0%   82,269    408,000    4.96    1.2    6,872,829      -0- 
 76  RGH Enterprises, Inc.     Halfmoon (Albany)  NY   2012    100.0%   75,000    601,000    8.01    4.4    5,525,600      -0- 
 77  FedEx Corporation     Schaumburg (Chicago)  IL   1997    100.0%   73,500    480,000    6.53    9.8    5,177,940      -0- 
 78  FedEx Corporation     Romulus (Detroit)  MI   1998    100.0%   71,933    370,000    5.14    3.9    4,667,506      -0- 
 79  FedEx Ground Package System, Inc.     Denver  CO   2005    100.0%   69,865    564,000    8.07    1.1    6,354,051      826,660 
 80  Tampa Bay Grand Prix     Tampa  FL   2005    100.0%   68,385    293,000    4.28    3.3    5,677,982      -0- 
 81  FedEx Ground Package System, Inc.     Colorado Springs  CO   2006    100.0%   68,370    644,000    9.42    1.3    7,204,472      1,116,658 
 82  Sherwin-Williams Company     Rockford  IL   2011    100.0%   66,387    479,000    7.22    6.5    5,551,227      -0- 
 83  Kellogg Sales Company     Kansas City  MO   2007    100.0%   65,067    325,000    4.99    1.1    4,800,474      -0- 
 84  Various Tenants at Retail Shopping Center     Somerset  NJ   1970    100.0%   64,220    762,000    11.87     na     3,072,880      -0- 
 85  The American Bottling Company (Dr Pepper Snapple)     Cincinnati  OH   2015    100.0%   63,840    479,000    7.50    12.3    6,750,000      -0- 
 86  FedEx Corporation     Chattanooga  TN   2007    100.0%   60,637    317,000    5.23    5.3    5,016,518      -0- 
 87  SOFIVE, Inc.     Carlstadt (New York, NY)  NJ   2001    100.0%   60,400    548,000    9.07    7.6    4,903,589      1,782,828 
 88  FedEx Ground Package System, Inc.     Stewartville (Rochester)  MN   2013    100.0%   60,398    372,000    6.16    5.9    5,220,000      2,431,303 
 89  United Technologies Corporation     Richmond  VA   2004    100.0%   60,000    320,000    5.33    1.4    4,768,309      -0- 
 90  FedEx Ground Package System, Inc.     Augusta  GA   2005    100.0%   59,358    453,000    7.63    1.0    5,363,304      616,465 
 91  Kellogg Sales Company     Newington (Hartford)  CT   2001    100.0%   54,812    329,000    6.00    2.7    3,478,966      -0- 
 92  Siemens Real Estate     Lebanon (Cincinnati)  OH   2012    100.0%   51,130    479,000    9.37    1.8    4,452,425      -0- 
 93  Kellogg Sales Company     Orangeburg (New York)  NY   1993    100.0%   50,400    328,000    6.51    0.7    3,895,675      -0- 
 94  FedEx Corporation     Charlottesville  VA   1999    100.0%   48,064    329,000    6.85    0.2    4,356,988      -0- 
 95  FedEx Ground Package System, Inc.     Corpus Christi  TX   2012    100.0%   46,253    469,000    10.14    4.2    4,764,500      -0- 
 96  The American Bottling Company (Dr Pepper Snapple)     Tulsa  OK   2014    100.0%   46,240    260,000    5.62    6.7    3,748,035      1,843,498 
 97  The Coca-Cola Company     Topeka  KS   2009    100.0%   40,000    332,000    8.30    4.3    3,679,843      1,182,119 
 98  Rockwell Collins, Inc.     Rockford  IL   2015    100.0%   38,833    362,000    9.32    10.0    5,100,000      -0- 
 99  Vacant  (E)  Urbandale (Des Moines)  IA   1994    0.0%   36,270    (D) 94,000     na      na     2,182,274      -0- 
100  FedEx Corporation     Richland (Jackson)  MS   1994    100.0%   36,000    120,000    3.33    6.8    1,900,691      -0- 
101  FedEx Corporation     Punta Gorda  FL   2007    100.0%   34,624    286,000    8.26    10.0    4,113,265      -0- 
102  FedEx Corporation     Lakeland  FL   2006    100.0%   32,105    155,000    4.83    0.4    1,982,532      -0- 
103  FedEx Corporation     Augusta  GA   2006    100.0%   30,184    121,000    4.01    5.4    1,977,779      -0- 
104  Graybar Electric Company     Ridgeland (Jackson)  MS   1993    100.0%   26,340    109,000    4.14    2.1    1,858,591      -0- 
 105  Sherwin-Williams Company     Burr Ridge (Chicago)  IL   1997    100.0%   12,500    161,000    12.88    4.3    1,692,901      -0- 
   Total as of 6/30/17                 99.8%   17,917,302   $105,796,000   $5.91    7.8   $1,373,563,683   (C) $561,736,464 
                                                       
   Acquisitions Subsequent to 6/30/17                                                   
106  FedEx Ground Package System, Inc.     Concord (Charlotte)  NC   2017    100.0%   354,482    2,537,000    7.16    14.9             
   Pro Forma Total with Acquisitions Subsequent to 6/30/17                 99.8%   18,271,784   $108,333,000   $5.94    7.9             
                                                       
   Leasing Activity Subsequent to 6/30/17                                                   
   FBM Gypsum Supply of Illinois, LLC  (E)  Urbandale (Des Moines)  IA   1994    100.0%   na    172,000    4.74    10.2             
   Pro Forma Total               (F)  99.5%    18,271,784   $108,505,000   $5.94    7.9             

 

  (A) Both tenants occupy one property.
  (B) Both tenants occupy one property.
    Other than these two properties indicated in footnotes (A) and (B) and the one retail property, all other properties are single-tenant.
  (C) Does not include unamortized debt issuance costs of $7,249,508.
  (D) Includes rental revenue from property during Fiscal 2017 prior to becoming vacant.
  (E) Entered into a 10.2 year lease agreement through December 31, 2027 with FBM Gypsum Supply of Illinois, LLC. The lease is expected to commence on November 1, 2017, with 2 months of free rent, after which Initial annual rent of $159,888, representing $4.40 per square foot, will commence with 2.0% annual increases thereafter.
  (F) Effective July 1, 2017, an 87,500 square foot building leased to FedEx Ground Package System, Inc., located in Ft. Myers, FL, became vacant.

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 18 of 23

 

 

 

 

 

 

Definitions

 

Investors and analysts following the real estate industry utilize funds from operations (“FFO”), core funds from operations (“Core FFO”), net operating income (“NOI”), Same Property NOI, Same Property Cash NOI, earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”) and adjusted funds from operations (“AFFO”), variously defined, as supplemental performance measures. While the Company believes net income available to common stockholders, as defined by accounting principles generally accepted in the United States of America (U.S. GAAP), is the most appropriate measure, it considers NOI, Same Property NOI, Same Property Cash NOI, Adjusted EBITDA, FFO, Core FFO and AFFO, given their wide use by and relevance to investors and analysts, appropriate supplemental performance measures. FFO, reflecting the assumption that real estate asset values rise or fall with market conditions, principally adjusts for the effects of U.S. GAAP depreciation and amortization of real estate assets. Core FFO reflects the same assumptions as FFO except that is also adjusts for the effects of acquisitions costs. NOI provides a measure of rental operations, and does not factor in depreciation and amortization and non-property specific expenses such as general and administrative expenses. Adjusted EBITDA provides a tool to further evaluate the ability to incur and service debt and to fund dividends and other cash needs. AFFO provides a supplemental tool to evaluate the Company’s performance. In addition, NOI, Same Property NOI, Same Property Cash NOI, Adjusted EBITDA, FFO, Core FFO and AFFO are commonly used in various ratios, pricing multiples, yields and returns and valuation of calculations used to measure financial position, performance and value. As used herein, the Company calculates the following non-U.S. GAAP measures as follows:

 

FFO, as defined by The National Association of Real Estate Investment Trusts (NAREIT), to be equal to net income applicable to common shareholders, as defined by U.S. GAAP, excluding extraordinary items as defined by U.S. GAAP, gains or losses from sales of previously depreciated real estate assets, impairment charges related to depreciable real estate assets, plus certain non-cash items such as real estate asset depreciation and amortization. FFO includes gains and losses realized on securities investments. NAREIT created FFO as a non-U.S. GAAP supplemental measure of REIT operating performance and is used by industry analysts and investors as a supplemental operating performance measure of a REIT.

 

Core FFO is calculated as FFO plus acquisition costs and costs associated with the Redemption of Preferred Stock.

 

AFFO is calculated as Core FFO plus amortization of financing costs; stock compensation expense, deprecation of corporate office tenant improvements and non-recurring other expenses, less gain on sale of securities transactions; effects of non-cash U.S. GAAP straight-line rent adjustments and recurring capital expenditures. Recurring capital expenditures are defined as all capital expenditures, excluding capital expenditures related to expansions at our current locations or capital expenditures that are incurred in conjunction with obtaining a new lease or a lease renewal.

 

NOI from property operations is calculated as net income attributable to common shareholders, as defined by U.S. GAAP, plus preferred dividends, general & administrative expenses, acquisitions costs, depreciation, amortization of capitalized lease costs & intangible assets and interest expense, including amortization of financing costs, less dividend and interest income and gain on sale of securities transactions. The components of NOI consist of recurring rental and reimbursement revenue, less real estate taxes and operating expenses, such as insurance, utilities, and repairs and maintenance and other expenses.

 

Same Property NOI is calculated as the NOI of all properties owned during the entire periods presented with the exclusion of any properties expanded during the periods presented.

 

Same Property Cash NOI is calculated as the Same Property NOI adjusted to exclude the effect of non-cash U.S. GAAP straight-line rent adjustment for the properties included in the Same Property NOI calculation.

 

Adjusted EBITDA is calculated as net income attributable to common shareholders, as defined by U.S. GAAP, plus preferred dividends, depreciation and amortization, interest expense, including amortization of financing costs, acquisition costs, net amortization of acquired above and below market lease revenue and loss on sale of real estate investment, less gain on sale of securities transactions.

 

FFO, Core FFO, AFFO, NOI, Same Property NOI, Same Property Cash NOI and Adjusted EBITDA, do not represent cash generated from operating activities in accordance with U.S. GAAP and are not necessarily indicative of cash available to fund cash needs, including the repayment of principal on debt and payment of dividends and distributions. FFO, Core FFO, AFFO, NOI, Same Property NOI, Same Property Cash NOI and Adjusted EBITDA should not be considered as substitutes for net income applicable to common shareholders (calculated in accordance with U.S. GAAP) as a measure of results of operations or cash flows (calculated in accordance with U.S. GAAP) as a measure of liquidity. FFO, Core FFO, AFFO, NOI, Same Property NOI, Same Property Cash NOI and Adjusted EBITDA, as currently calculated by the Company, may not be comparable to similarly titled, but variously calculated, measures of other REITs.

 

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 19 of 23

 

 

 

FOR IMMEDIATE RELEASE August 9, 2017
  Contact: Susan Jordan
  732-577-9996

 

MONMOUTH REAL ESTATE REPORTS RESULTS FOR

THE THIRD QUARTER ENDED JUNE 30, 2017

 

FREEHOLD, NJ, August 9, 2017........ Monmouth Real Estate Investment Corporation (NYSE:MNR) reported Net Income Attributable to Common Shareholders of $5,217,000 or $0.07 per diluted share for the three months ended June 30, 2017 as compared to $6,080,000 or $0.09 per diluted share for the three months ended June 30, 2016. This decrease was due to a $2.5 million, or $0.03 per diluted share, non-recurring preferred stock redemption charge. Core Funds from Operations (Core FFO) were $15,441,000 or $0.21 per diluted share for the three months ended June 30, 2017 as compared to $12,752,000 or $0.19 per diluted share for the three months ended June 30, 2016, representing an increase in Core FFO per share of 11%. Adjusted Funds from Operations (AFFO) for the three months ended June 30, 2017 were $13,960,000, or $0.19 per diluted share, versus $12,431,000, or $0.19 per diluted share, for the three months ended June 30, 2016.

 

A summary of significant financial information for the three and nine months ended June 30, 2017 and 2016 is as follows:

 

  

Three Months Ended

June 30,

 
   2017   2016 
Rental Revenue  $24,400,000   $20,790,000 
Reimbursement Revenue  $4,209,000   $3,324,000 
Net Operating Income (NOI) (1)  $24,036,000   $20,499,000 
Total Expenses  $14,131,000   $11,836,000 
Dividend and Interest Income  $1,899,000   $1,486,000 
Gain on Sale of Securities Transactions, net  $1,488,000   $272,000 
Net Income  $11,730,000   $8,231,000 
Net Income Attributable to Common Shareholders  $5,217,000   $6,080,000 
Net Income Attributable to Common Shareholders Per Diluted Common Share  $0.07   $0.09 
Core FFO (1)  $15,441,000   $12,752,000 
Core FFO per Diluted Common Share (1)  $0.21   $0.19 
AFFO (1)  $13,960,000   $12,431,000 
AFFO per Diluted Common Share (1)  $0.19   $0.19 
Dividends Declared per Common Share  $0.16   $0.16 
           
Weighted Avg. Diluted Common Shares Outstanding   73,054,000    66,462,000 

 

  

Nine Months Ended

June 30,

 
   2017   2016 
Rental Revenue  $71,292,000   $59,466,000 
Reimbursement Revenue  $11,807,000   $9,874,000 
Net Operating Income (NOI) (1)  $70,184,000   $58,342,000 
Total Expenses  $41,179,000   $35,541,000 
Dividend and Interest Income  $4,631,000   $4,050,000 
Gain on Sale of Securities Transactions, net  $2,294,000   $1,159,000 
Net Income  $30,009,000   $22,302,000 
Net Income Attributable to Common Shareholders  $16,216,000   $15,847,000 
Net Income Attributable to Common Shareholders Per Diluted Common Share  $0.23   $0.24 
Core FFO (1)  $41,694,000   $35,278,000 
Core FFO per Diluted Common Share (1)  $0.58   $0.55 
AFFO (1)  $39,411,000   $33,901,000 
AFFO per Diluted Common Share (1)  $0.55   $0.52 
Dividends Declared per Common Share  $0.48   $0.48 
           
Weighted Avg. Diluted Common Shares Outstanding   71,423,000    64,703,000 

 

A summary of significant balance sheet information as of June 30, 2017 and September 30, 2016 is as follows:

 

   June 30, 2017   September 30, 2016 
Net Real Estate Investments  $1,204,348,000   $1,022,483,000 
Securities Available for Sale at Fair Value  $100,496,000   $73,605,000 
Total Assets  $1,351,618,000   $1,223,486,000 
Fixed Rate Mortgage Notes Payable, net of Unamortized Debt Issuance Costs  $554,487,000   $477,476,000 
Loans Payable  $122,095,000   $80,791,000 
Total Shareholders’ Equity  $658,246,000   $597,858,000 

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 20 of 23

 

 

 

Michael P. Landy, President and CEO, commented on the results for the third quarter of fiscal 2017,

 

“Monmouth had a very productive quarter that saw a substantial amount of acquisition activity as several properties from our build-to-suit pipeline came on line. During the quarter, we acquired five brand-new Class A built-to-suit properties containing a total of 1.4 million square feet. These five acquisitions were purchased for an aggregate cost of $152.0 million and have a weighted average lease term of 14.4 years. Because four of the five acquisitions did not close until the last week of the quarter, their favorable impact to our earnings was not a factor during the recent quarter but will be apparent going forward.”

 

“During the quarter, we also finished successfully replacing all $111 million of our high dividend Series A and Series B perpetual preferred stock, which had a weighted average coupon of 7.755%, with our new 6.125% Series C perpetual preferred stock. This will result in approximately $1.76 million in annual preferred dividend savings going forward. Our balance sheet has never been stronger and these substantial improvements to our capital structure will benefit Monmouth for many years to come, regardless of what interest rates may do in the future. Net Income during the quarter was impacted by a non-recurring, non-cash $2.5 million preferred redemption charge. During the recent quarter, we generated Core FFO of $0.21 per diluted share representing an 11% increase over the prior year period. Our AFFO per diluted share was $0.19 which is in-line with the prior year period and represents a 6% increase sequentially.”

 

“Additionally, our strong financial performance continued with the following achievements over the quarter:

 

  ● Increased our Gross Revenue by 19% to $30.5 million, compared to $25.6 million in the prior year period,
     
  ● Increased our Net Operating Income by 17% to $24.0 million, compared to $20.5 million in the prior year period,
     
  ● Generated $1.5 million in net realized gains on our securities investments resulting in $2.3 million in cumulative net realized gains thus far in fiscal 2017, in addition to the $8.8 million in unrealized gains held at quarter end,
     
  ● Achieved a total market capitalization of $2.0 billion, and
     
  ● Entered into an At-The-Market Preferred Equity Program (ATM Preferred Stock Program) with FBR Capital Markets & Co. in which the Company may, from time to time, offer and sell additional shares of its 6.125% Series C Preferred Stock. Subsequent to the quarter end through July 25, 2017, the Company sold 627,867 shares under its ATM Preferred Stock Program at a weighted average price of $25.44 per share, and realized net proceeds, after offering expenses, of approximately $15.6 million.”

 

“Our property portfolio continued to deliver strong results as evidenced by the following accomplishments:

 

  ● Increased our current quarter end occupancy rate to 99.8%, an increase of 20 basis points over the prior year period,
     
  ● Increased our weighted average lease maturity by 10% to 7.8 years from 7.1 years in the prior year period,
     
  ● Renewed 10 of the 13 leases set to expire in fiscal 2017, totaling 1.5 million square feet. Nine of the 10 renewed leases, representing 1.3 million square feet, or 83% of the expiring square footage, have a weighted average lease term of 6.5 years, and a weighted average lease rate of $5.61 per square foot on a GAAP basis. This represents a decrease in the weighted average lease rate of 1.2% on a GAAP basis. Subsequent to quarter end, we leased one of the additional three buildings to a new tenant. One of the ten leases, representing 87,500 square feet, was renewed for only eight months because the tenant, FedEx Ground, moved its operations to our newly constructed 214,000 square foot facility, in the same market, in Ft. Myers, FL. The remaining two leases that are still set to expire during fiscal 2017 are currently under discussion.
     
  ●  Our same property occupancy decreased 30 basis points from 100% to 99.7% during the nine month period and our same property NOI increased 0.4% on a GAAP basis and 1.6% on a cash basis.
     
  ●  Subsequent to quarter end, we acquired a brand new Class A built-to-suit property containing 354,000 square feet, in the Charlotte, NC MSA, for a cost of $40.6 million, leased for 15 years to FedEx Ground. This facility will generate $2.5 million in annualized rental revenue, and
     
  ●  Continued to grow our acquisition pipeline to $88.7 million currently, representing 1.04 million square feet. These are all brand new, build-to-suit developments currently under construction and set to come online over the next several quarters.”

 

Mr. Landy further stated, “Monmouth’s strong performance was on full display this recent quarter. Our 1.4 million square feet in new acquisition activity, our sector leading 99.8% occupancy rate, our major enhancements to our strong balance sheet, and our consistent earnings growth, all result in a company that is very well positioned to achieve substantial results going forward. We continue to grow our asset base one high quality acquisition at a time and look forward to building upon our successful track record to date.”

 

Monmouth Real Estate Investment Corporation will host its Third Quarter FY 2017 Financial Results Webcast and Conference Call on Thursday, August 10, 2017 at 10:00 a.m. Eastern Time. Senior management will discuss the results, current market conditions and future outlook.

 

The Company’s Third Quarter FY 2017 financial results being released herein will be available on the Company’s website at www.mreic.reit in the Investor Relations section, under Filings and Reports.

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 21 of 23

 

 

 

To participate in the Webcast, select the 3Q2017 Webcast and Earnings Call “Link to Webcast” on the homepage of the Company’s website at www.mreic.reit, in the Highlights section, which is located towards the bottom of the homepage. Interested parties can also participate via conference call by calling toll free 877-510-5852 (domestically) or 412-902-4138 (internationally).

 

The replay of the conference call will be available at 12:00 p.m. Eastern Time on Thursday, August 10, 2017. It will be available until December 1, 2017, and can be accessed by dialing toll free 877-344-7529 (domestically) and 412-317-0088 (internationally) and entering the passcode 10107965. A transcript of the call and the webcast replay will be available at the Company’s website on the Investor Relations homepage, www.mreic.reit.

 

Monmouth Real Estate Investment Corporation, founded in 1968, is one of the oldest public equity REITs in the U.S. The Company specializes in single tenant, net-leased industrial properties, subject to long-term leases, primarily to investment-grade tenants. Monmouth Real Estate is a fully integrated and self-managed real estate company, whose property portfolio consists of 106 properties containing a total of approximately 18.3 million rentable square feet, geographically diversified across 30 states. In addition, the Company owns a portfolio of REIT securities.

 

Certain statements included in this press release which are not historical facts may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements are based on the Company’s current expectations and involve various risks and uncertainties. Although the Company believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, the Company can provide no assurance those expectations will be achieved. The risks and uncertainties that could cause actual results or events to differ materially from expectations are contained in the Company’s annual report on Form 10-K and described from time to time in the Company’s other filings with the SEC. The Company undertakes no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events, or otherwise.

 

Notes:

 

  (1) Non-U.S. GAAP Information: FFO, as defined by The National Association of Real Estate Investment Trusts (NAREIT), to be equal to net income applicable to common shareholders, as defined by U.S. GAAP, excluding extraordinary items as defined by U.S. GAAP, gains or losses from sales of previously depreciated real estate assets, impairment charges related to depreciable real estate assets, plus certain non-cash items such as real estate asset depreciation and amortization. We define Core FFO as FFO, excluding acquisition costs and costs associated with the Redemption of Preferred Stock. We define AFFO as Core FFO excluding lease termination income, gains or losses on securities transactions, stock based compensation expense, depreciation of corporate office tenant improvements, amortization of deferred financing costs, non-recurring other expense, the effect of non-cash U.S. GAAP straight-line rent adjustments and less recurring capital expenditures. We define recurring capital expenditures as all capital expenditures, excluding capital expenditures related to expansions at our current locations or capital expenditures that are incurred in conjunction with obtaining a new lease or a lease renewal. We define NOI from property operations as net income attributable to common shareholders, as defined by U.S. GAAP, plus preferred dividends, general & administrative expenses, acquisitions costs, depreciation, amortization of capitalized lease costs & intangible assets and interest expense, including amortization of financing costs, less dividend and interest income and gain on sale of securities transactions. The components of NOI consists of recurring rental and reimbursement revenue, less real estate taxes and operating expenses, such as insurance, utilities, and repairs and maintenance and other expenses. Adjusted EBITDA is calculated as net income attributable to common shareholders, as defined by U.S. GAAP, plus preferred dividends; depreciation and amortization; interest expense, including amortization of financing costs; acquisition costs; net amortization of acquired above and below market lease revenue and loss on sale of real estate investment, less gain on sale of securities transactions. FFO, Core FFO and AFFO per diluted common share are defined as FFO, Core FFO and AFFO divided by weighted average diluted common shares outstanding. FFO, Core FFO and AFFO per diluted common share, as well as NOI and Adjusted EBITDA, should be considered as supplemental measures of operating performance used by real estate investment trusts (REITs). FFO, Core FFO and AFFO per diluted common share exclude historical cost depreciation as an expense and may facilitate the comparison of REITs which have different cost basis. However, other REITs may use different methodologies to calculate FFO, Core FFO and AFFO per diluted share and, accordingly, our FFO, Core FFO and AFFO per diluted share may not be comparable to all other REITs. The items excluded from FFO, Core FFO and AFFO per diluted common share are significant components in understanding the Company’s financial performance.

 

FFO, Core FFO and AFFO per diluted common share (A) do not represent cash flow from operations as defined by accounting principles generally accepted in the United States of America; (B) should not be considered as an alternative to net income as a measure of operating performance or to cash flows from operating, investing and financing activities; and (C) are not alternatives to cash flow as a measure of liquidity. FFO, Core FFO and AFFO per diluted common share, as well as NOI, as calculated by the Company, may not be comparable to similarly titled measures reported by other REITs.

 

The following is a reconciliation of the Company’s U.S. GAAP Net Income to the Company’s FFO, Core FFO and AFFO for the three and nine months ended June 30, 2017 and 2016:

 

   Three Months Ended   Nine Months Ended 
    6/30/2017    6/30/2016    6/30/2017    6/30/2016 
Net Income Attributable to Common Shareholders  $5,217,000   $6,079,000   $16,216,000   $15,847,000 
Plus: Depreciation Expense (excluding Corporate Office Capitalized Costs)   7,279,000    6,066,000    21,333,000    17,390,000 
Plus: Amortization of Intangible Assets   263,000    272,000    771,000    915,000 
Plus: Amortization of Capitalized Lease Costs   215,000    199,000    633,000    580,000 
Plus: Loss on Sale of Real Estate Investment   -0-    -0-    95,000    -0- 
FFO Attributable to Common Shareholders   12,974,000    12,616,000    39,048,000    34,732,000 
Plus: Acquisition Costs   -0-    136,000    179,000    546,000 
Plus: Redemption of Preferred Stock   2,467,000    -0-    2,467,000    -0- 
Core FFO Attributable to Common Shareholders   15,441,000    12,752,000    41,694,000    35,278,000 
Plus: Stock Compensation Expense   175,000    100,000    441,000    307,000 
Plus: Depreciation of Corporate Office Capitalized Costs   39,000    31,000    117,000    88,000 
Plus: Amortization of Financing Costs   283,000    240,000    950,000    713,000 
Plus: Non-recurring other expense   -0-    100,000    -0-    500,000 
Less: Gain on Sale of Securities Transactions   (1,488,000)   (272,000)   (2,294,000)   (1,159,000)
Less: Effect of Non-cash U.S. GAAP Straight-line Rent Adjustment   (295,000)   (350,000)   (925,000)   (1,172,000)
Less: Recurring Capital Expenditures   (195,000)   (170,000)   (572,000)   (654,000)
AFFO Attributable to Common Shareholders  $13,960,000   $12,431,000   $39,411,000   $33,901,000 

 

Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 22 of 23

 

 

 

The following are the Cash Flows provided (used) by Operating, Investing and Financing Activities for the nine months ended June 30, 2017 and 2016:

 

   Nine Months Ended 
    6/30/2017    6/30/2016 
           
Operating Activities  $50,191,000   $43,347,000 
Investing Activities   (232,827,000)   (169,805,000)
Financing Activities   98,637,000    121,271,000 

 

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Third Quarter FY 2017 Supplemental of Monmouth Real Estate Investment Corp. Page 23 of 23