EX-99 2 ex99-1.txt EX. 99.1 Exhibit 99.1 [GRAPHIC OMITTED] RE: LEXINGTON CORPORATE PROPERTIES TRUST ONE PENN PLAZA SUITE 4015 NEW YORK, NY 10119 FOR FURTHER INFORMATION: AT THE COMPANY: AT FINANCIAL RELATIONS BOARD: Patrick Carroll Diane Hettwer Tim Grace Chief Financial Officer Analyst Inquiries Media Inquiries (212) 692-7200 (312) 640-6760 (312) 640-6667 FOR IMMEDIATE RELEASE TUESDAY, MARCH 1, 2005 LEXINGTON CORPORATE PROPERTIES TRUST ANNOUNCES FOURTH QUARTER AND TWELVE MONTH RESULTS New York, NY - March 1, 2005- Lexington Corporate Properties Trust (NYSE:LXP) ("Lexington"), a real estate investment trust, today announced results for its fourth quarter and twelve months ended December 31, 2004. 2004 and Recent Highlights -------------------------- o Acquired 44 properties for an aggregate investment of $935 million at a GAAP cap rate of 8.9%, including $502 million in joint ventures; o Sold eight non-core properties for $7.0 million in excess of book value; o Expanded equity base by approximately $295 million by issuing common and preferred shares; o Increased institutional equity committed to joint ventures by approximately $145 million; o Obtained $369.9 million of non-recourse mortgage financing at a weighted average fixed interest rate of 5.49% - lowering overall fixed rate borrowing costs from 7.08% to 6.58% for consolidated properties; o Extended leases on ten properties; o Raised dividend to annual rate of $1.44 per common share, the twelfth consecutive annual increase; and o Generated total shareholder return of 18.8%. Quarterly Results Funds from operations were $18.5 million, or $0.34 per diluted share/unit, for the fourth quarter of 2004, after the impact of $3.6 million in impairment charges (including minority interest share of $0.9 million) ($0.07 per diluted share/unit) and $2.9 million in charges due to a tenant bankruptcy ($0.05 per diluted share/unit). This compares to $19.7 million, or $0.45 per diluted share/unit, for the fourth quarter of 2003. Lexington operated with greater cash balances and vacancy than in the prior year and this limited growth in FFO per share before the effect of the charges discussed above. MORE LEXINGTON CORPORATE PROPERTIES TRUST ADD 1 Rental revenue for the quarter totaled $36.5 million, compared to rental revenue of $28.2 million for the same period last year. Net income allocable to common shareholders was $4.9 million in the fourth quarter of 2004, after the impact of the impairment charges and the charges relating to a tenant bankruptcy discussed above, and $1.4 million in gains on sale of properties, or $0.10 per diluted share/unit. This is compared to $10.9 million, after the impact of debt satisfaction gains and $1.0 million on gains on sale of properties, or $0.28 per diluted share/unit, for the same period last year. Twelve Months Results For the twelve months ended December 31, 2004, FFO were $83.6 million, or $1.60 per diluted share/unit, after the impact of $6.7 million in impairment charges (including minority interest share of $1.3 million) ($0.13 per diluted share/unit) and $2.9 million in charges due to a tenant bankruptcy ($0.06 per diluted share/unit). This compares to $64.5 million, or $1.63 per diluted share/unit net of $7.5 million in debt satisfaction charges, ($0.19 per diluted share/unit), for the same period last year. Lexington operated with greater cash balances and vacancy during 2004 which reduced FFO per share excluding the charges previously discussed. Rental revenue for the twelve months ended December 31, 2004, totaled $140.0 million, compared to rental revenue of $105.1 million for the same period last year. Net income allocable to common shareholders was $37.9 million for the twelve months ended December 31, 2004, after the impairment charges and the charges relating to a tenant bankruptcy discussed above and $5.5 million in gains on sale of properties, or $0.80 per diluted share/unit, compared to $30.3 million, after the impact of debt satisfaction charges discussed above and $2.2 million in gains on sale of properties, or $0.88 per diluted share/unit, for the same period last year. Conference Call Management will discuss the financial results on a conference call today at 2:00 p.m. Eastern Time. The toll-free dial in number is 800-218-0204. The replay of the call will be available through March 8, 2005. The toll-free telephone number for the replay is 800-405-2236, passcode 11022822. The conference call can also be accessed on the internet at www.lxp.com and www.fulldisclosure.com. A supplemental reporting package can be accessed at www.lxp.com. Comments From Management Commenting on Lexington's financial results, T. Wilson Eglin, Chief Executive Officer said, "Lexington had numerous accomplishments in 2004. We acquired forty-four properties for $935 million - our busiest year of acquisition volume by a wide margin. We continued to build our balance sheet to support further growth by raising $295 million of equity on terms that we believe were very favorable for shareholders. We also established a third joint venture investment program and obtained $145 million of equity commitments to our joint venture programs. Lexington took advantage of an attractive interest rate environment in 2004 and obtained $369.9 million of non-recourse mortgage financing at a weighted average fixed interest rate of 5.49%. This had the effect of lowering our overall fixed rate borrowing costs by fifty basis points and reducing floating rate debt by $94 million to less than 2% of total debt. In addition, we continued to make good progress on the leasing front by extending leases on ten properties and ended the year with 98.1% occupancy. We also sold eight properties consistent with our objective of reducing our retail property portfolio and exiting smaller markets." MORE LEXINGTON CORPORATE PROPERTIES TRUST ADD 2 Lexington Corporate Properties Trust is a real estate investment trust that owns and manages office, industrial and retail properties net-leased to major corporations throughout the United States and provides investment advisory and asset management services to investors in the net lease area. Lexington common shares closed Monday, February 28, 2005 at $22.02 per share. Lexington pays an annualized dividend of $1.44 per share. Additional information about Lexington is available at www.lxp.com. Lexington believes that funds from operations ("FFO") enhances an investor's understanding of Lexington's financial condition, results of operations and cash flows. Lexington believes that FFO is an appropriate, but limited, measure of the performance of an equity REIT. FFO is defined in the April 2002 "White Paper" issued by the National Association of Real Estate Investment Trusts, Inc. ("NAREIT") as "net income (or loss) computed in accordance with generally accepted accounting principles ("GAAP"), excluding gains (or losses) from sales of property, plus real estate depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures." FFO should not be considered an alternative to net income as an indicator of operating performance or to cash flows from operating activities as determined in accordance with GAAP, or as a measure of liquidity to other consolidated income or cash flow statement data as determined in accordance with GAAP. This release contains certain forward-looking statements which involve known and unknown risks, uncertainties or other factors not under Lexington's control which may cause actual results, performance or achievements of Lexington to be materially different from the results, performance, or other expectations implied by these forward-looking statements. These factors include, but are not limited to, (i) the failure to continue to qualify as a real estate investment trust, (ii) changes in general business and economic conditions, (iii) competition, (iv) increases in real estate construction costs, (v) changes in interest rates, (vi) changes in accessibility of debt and equity capital markets, and (vii) those other factors and risks detailed in Lexington's periodic filings with the Securities and Exchange Commission. Forward-looking statements, which are based on certain assumptions and describe the Company's future plans, strategies and expectations, are generally identifiable by use of the words "believes," "expects," "intends," "anticipates," "estimates," "projects" or similar expressions. Lexington undertakes no obligation to publicly release the results of any revisions to those forward-looking statements which may be made to reflect events or circumstances after the occurrence of unanticipated events. Accordingly, there is no assurance that Lexington's expectations will be realized. Financial Tables Follow ----------------------- This release contains certain forward-looking statements which involve known and unknown risks, uncertainties or other factors not under the Company's control which may cause actual results, performance or achievements of the Company to be materially different from the results, performance, or other expectations implied by these forward-looking statements. These factors include, but are not limited to, those detailed in the Company's periodic filings with the Securities and Exchange Commission. MORE LEXINGTON CORPORATE PROPERTIES TRUST ADD 3 LEXINGTON CORPORATE PROPERTIES TRUST AND CONSOLIDATED SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (dollars in thousands, except per share data)
Three Months Twelve Months Ended Ended December 31, December 31, 2004 2003 2004 2003 ---- ---- ---- ---- Gross revenues: Rental $ 36,452 $ 28,160 $ 140,003 $ 105,057 Advisory fees 1,710 739 4,885 1,429 Tenant reimbursements 2,068 1,059 6,337 4,498 ----------- ----------- ----------- ----------- Total gross revenues 40,230 29,958 151,225 110,984 Expense applicable to revenues: Depreciation and amortization (12,106) (6,856) (38,930) (25,623) Property operating (3,269) (2,084) (10,451) (8,107) General and administrative (3,933) (2,646) (13,939) (9,659) Write off - tenant bankruptcy (2,884) - (2,884) - Non-operating income 711 160 3,276 1,442 Interest and amortization expense (12,230) (8,430) (46,437) (35,793) Debt satisfaction charges - 226 - (7,459) ----------- ----------- ----------- ------------ Income before (provision) benefit for income 6,519 10,328 41,860 25,785 taxes, minority interests and equity in earnings of joint ventures (Provision) benefit for income taxes 635 17 (1,181) (259) Minority interests (693) (1,272) (4,196) (3,569) Equity in earnings of joint ventures 1,811 1,551 7,194 5,707 ----------- ----------- ----------- ----------- Income from continuing operations 8,272 10,624 43,677 27,664 ----------- ----------- ----------- ----------- Discontinued operations, net of minority interest: Income from discontinued operations 38 770 1,102 3,794 Impairment charges (2,671) - (5,447) - Gains on sales of properties 1,410 1,047 5,475 2,191 ----------- ----------- ----------- ----------- Total discontinued operations (1,223) 1,817 1,130 5,985 ------------ ----------- ----------- ----------- Net income 7,049 12,441 44,807 33,649 Dividends attributable to preferred shares - Series B (1,590) (1,590) (6,360) (3,392) Dividends attributable to preferred shares - Series C (585) - (585) - ----------- ----------- ------------ ----------- Net income allocable to common shareholders $ 4,874 $ 10,851 $ 37,862 $ 30,257 Depreciation and amortization 12,020 7,304 39,894 27,634 Minority interests - OP Units (311) 1,334 2,570 4,039 Amortization of leasing commissions 98 206 647 812 Joint venture adjustment - depreciation 2,658 1,084 7,559 3,951 Preferred share dividend - Series C 585 - 585 - Gains on sales of properties (1,410) (1,047) (5,475) (2,191) ------------ ------------ ------------ ------------ Funds from operations2 $ 18,514 $ 19,732 $ 83,642 $ 64,502 =========== =========== =========== =========== Rent below GAAP revenue1 $ 414 $ 772 $ 3,350 $ 3,790 Per share/unit Basic net income $ 0.10 $ 0.28 $ 0.81 $ 0.89 Diluted net income $ 0.10 $ 0.28 $ 0.80 $ 0.88 Funds from operations2-basic $ 0.34 $ 0.45 $ 1.60 $ 1.64 Funds from operations2-diluted $ 0.34 $ 0.45 $ 1.60 $ 1.63
MORE LEXINGTON CORPORATE PROPERTIES TRUST ADD 4 LEXINGTON CORPORATE PROPERTIES TRUST AND CONSOLIDATED SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (dollars in thousands)
12/31/04 12/31/03 -------- -------- Real estate, at cost $ 1,407,872 $ 1,162,395 Accumulated depreciation (180,610) (160,623) Investment in joint ventures 132,738 69,225 Properties held for sale - discontinued 13,216 36,478 operations Intangible assets, net 54,736 14,736 Cash and cash equivalents 146,957 15,923 Deferred expenses, net 7,860 10,013 Rent receivable 4,123 - Rent receivable - deferred 23,923 24,069 Due from affiliates 45,800 - Other assets 40,472 35,195 ---------------- ---------------- $ 1,697,087 $ 1,207,411 ================ ================ Mortgages and notes payable $ 765,144 $ 551,385 Liabilities - discontinued operations 1,688 - Other liabilities 22,388 10,667 Prepaid rent 3,818 2,482 Minority interests 56,759 59,220 Shareholders' equity 847,290 583,657 ---------------- ---------------- $ 1,697,087 $ 1,207,411 ================ ================ Common shares 48,621,273 40,682,001 Preferred shares - Series B 3,160,000 3,160,000 Preferred shares - Series C 2,700,000 - Operating partnership units 5,408,699 5,430,454 ---------------- ---------------- 59,889,972 49,272,455 ================ ================
1 Equal to the difference between rents collected and straight-line rental income recognized under generally accepted accounting principles. 2 The Company believes that Funds From Operations ("FFO") enhances an investor's understanding of the Company's financial condition, results of operations and cash flows. The Company believes that FFO is an appropriate, but limited, measure of the performance of an equity REIT. FFO is defined in the October 1999 "White Paper" issued by the National Association of Real Estate Investment Trusts, Inc. ("NAREIT") as "net income (or loss) computed in accordance with generally accepted accounting principles ("GAAP"), excluding gains (or losses) from sales of property, plus real estate depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures." FFO should not be considered an alternative to net income as an indicator of operating performance or to cash flows from operating activities as determined in accordance with GAAP, or as a measure of liquidity to other consolidated income or cash flow statement data as determined in accordance with GAAP. MORE LEXINGTON CORPORATE PROPERTIES TRUST ADD 5 LEXINGTON CORPORATE PROPERTIES TRUST AND CONSOLIDATED SUBSIDIARIES EARNINGS PER SHARE AND FUNDS FROM OPERATIONS PER SHARE (dollars in thousands, except per share data)
Three Months Ended Twelve Months Ended December 31, December 31, 2004 2003 2004 2003 ---- ---- ---- ---- Earning Per Share ----------------- Basic Income from continuing operations $ 8,272 $ 10,624 $ 43,677 $ 27,664 Less preferred dividends (2,175) (1,590) (6,945) (3,392) ---------- ---------- ---------- ---------- Income allocable to common shareholders from continuing operations - basic 6,097 9,034 36,732 24,272 Total income (loss) from discontinued operations - basic (1,223) 1,817 1,130 5,985 ---------- ---------- ---------- ---------- Net income allocable to common shareholders $ 4,874 $ 10,851 $ 37,862 $ 30,257 ========== ========== ========== ========== Weighted average number of common shares outstanding 48,092,092 38,513,927 46,551,328 34,074,935 ========== ========== ========== ========== Per share data: Income from continuing operations $ 0.13 $ 0.23 $ 0.79 $ 0.71 Income from discontinued operations (0.03) 0.05 0.02 0.18 ---------- ---------- ---------- ---------- Net income $ 0.10 $ 0.28 $ 0.81 $ 0.89 ========== ========== ========== ========== Diluted Income allocable to common shareholders from continuing operations - basic $ 6,097 $ 9,034 $ 36,732 $ 24,272 Adjustments: Incremental income attributed to assumed conversion of dilutive securities - - 4,192 3,569 ---------- ---------- ---------- ---------- Income allocable to common shareholders from continuing operations - diluted 6,097 9,034 40,924 27,841 Total income (loss) from discontinued operations - diluted (1,223) 1,817 691 6,899 ---------- ---------- ---------- ---------- Net income allocable to common shareholders - diluted $ 4,874 $ 10,851 $ 41,615 $ 34,740 ========== ========== ========== ========== Weighted average number of shares used in calculation of basic earnings per share 48,092,092 38,513,927 46,551,328 34,074,935 Add incremental shares representing: Shares issuable upon exercises of employee share options 126,179 218,824 131,415 202,504 Shares issuable upon conversion of dilutive securities - - 5,366,166 5,216,433 ---------- ---------- ---------- ---------- Weighted average number of shares used in calculation of diluted earnings per common share 48,218,271 38,732,751 52,048,909 39,493,872 ========== ========== ========== ========== Per share data: Income from continuing operations - diluted $ 0.13 $ 0.23 $ 0.79 $ 0.70 Income (loss) from discontinued operations - diluted (0.03) 0.05 0.01 0.18 ---------- ---------- ---------- ---------- Net income diluted $ 0.10 $ 0.28 $ 0.80 $ 0.88 ========== ========== ========== ==========
MORE LEXINGTON PROPERTIEST TRUST ADD 6 LEXINGTON CORPORATE PROPERTIES TRUST AND CONSOLIDATED SUBSIDIARIES EARNINGS PER SHARE AND FUNDS FROM OPERATIONS PER SHARE (dollars in thousands, except per share data)
Three Months Ended Twelve Months Ended December 31, December 31, 2004 2003 2004 2003 ---- ---- ---- ---- Funds From Operations --------------------- Basic and Diluted ----------------- Net income allocable to common shareholders Adjustments: $ 4,874 $ 10,851 $ 37,862 $ 30,257 Depreciation and amortization 12,020 7,304 39,894 27,634 Minority interests-OP Units (311) 1,334 2,570 4,039 Amortization of leasing commissions 98 206 647 812 Joint venture adjustment-depreciation 2,658 1,084 7,559 3,951 Preferred dividends-Series C 585 - 585 - Gains on sale of properties (1,410) (1,047) (5,475) (2,191) ------------ ------------ ------------ ------------ Funds from operations $ 18,514 $ 19,732 $ 83,642 $ 64,502 ============ ============ ============ ============ Basic ----- Weighted average shares outstanding-basic EPS 48,092,092 38,513,927 46,551,328 34,074,935 Operating partnership units 5,390,583 5,201,210 5,366,166 5,216,433 Preferred shares - Series C 1,313,116 - 330,073 - ------------ ------------ ------------ ------------ Weighted average shares outstanding-basic FFO 54,795,791 43,715,137 52,247,567 39,291,368 ============ ============ ============ ============ FFO per share $ 0.34 $ 0.45 $ 1.60 $ 1.64 ============ ============ ============ ============ Diluted ------- Weighted average shares outstanding-diluted EPS 48,218,271 38,732,751 52,048,909 39,493,872 Operating partnership units 5,390,583 5,201,210 - - Preferred shares - Series C 1,313,116 - 330,073 - ------------ ------------ ------------ ------------ Weighted average shares outstanding-diluted FFO 54,921,970 43,933,961 52,378,982 39,493,872 ============ ============ ============ ============ FFO per share $ 0.34 $ 0.45 $ 1.60 $ 1.63 ============ ============ ============ ============
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