BLOOMFIELD HILLS, Mich.,
July 27, 2015 /PRNewswire/
-- Agree Realty Corporation (NYSE: ADC) (the "Company")
today announced results for the quarter ended June 30, 2015. All per share amounts
included herein are on a diluted per common share basis unless
otherwise stated.
Second Quarter Financial and Operating Highlights:
- Increased rental revenue 35.0% to $16.1
million
- Increased Funds from Operations (FFO) 37.3% to $11.1 million
- Increased FFO per share 14.8% to $0.62 from $0.54
- Increased Adjusted Funds from Operations (AFFO) 33.3% to
$11.0 million
- Increased AFFO per share 12.7% to $0.62 from $0.55
- Acquired 19 retail net lease properties for approximately
$63.5 million
- Completed $100.0 million private
placement of senior unsecured notes
- Increased quarterly dividend by 3.3% to $0.465 per share
Financial Results
Total Rental Revenue
Total rental revenue, which includes minimum rents and
percentage rents, for the three months ended June 30, 2015 increased 35.0% to $16,113,000 compared with total rental revenue of
$11,933,000 for the comparable period
in 2014.
Total rental revenue for the six months ended June 30, 2015 increased 30.8% to $30,677,000 compared with total rental revenue of
$23,456,000 for the comparable period
in 2014.
Funds from Operations
FFO for the three months ended June 30,
2015 increased 37.3% to $11,111,000 compared with FFO of $8,092,000 for the comparable period in 2014.
FFO per share for the three months ended June 30, 2015 increased 14.8% to $0.62 compared with FFO per share of $0.54 for the comparable period in 2014.
FFO for the six months ended June 30,
2015 increased 31.8% to $21,064,000 compared with FFO of $15,978,000 for the comparable period in
2014. FFO per share for the six months ended June 30, 2015 increased 11.3% to $1.18 compared with FFO per share of $1.06 for the comparable period in 2014.
Adjusted Funds from Operations
AFFO for the three months ended June 30,
2015 increased 33.3% to $11,039,000 compared with AFFO of $8,281,000 for the comparable period in
2014. AFFO per share for the three months ended June 30, 2015 increased 12.7% to $0.62 compared with AFFO per share of
$0.55 for the comparable period in
2014.
AFFO for the six months ended June 30,
2015 increased 28.7% to $21,107,000 compared with AFFO of $16,396,000 for the comparable period in
2014. AFFO per share for the six months ended June 30, 2015 increased 9.3% to $1.18 compared with AFFO per share of
$1.08 for the comparable period in
2014.
Net Income
Net income attributable to the Company for the three months
ended June 30, 2015 was $10,264,000, or $0.59 per share, compared with $2,654,000, or $0.18 per share, for the comparable period in
2014.
Net income attributable to the Company for the six months ended
June 30, 2015 was $16,632,000, or $0.95 per share, compared with $8,039,000, or $0.54 per share, for the comparable period in
2014.
Dividend
The Company paid a cash dividend of $0.465 per share on July
14, 2015 to stockholders of record on June 30, 2015. The quarterly dividend
represented payout ratios of 75.0% of both FFO and AFFO.
CEO Comments
"I am extremely pleased with the Company's strong performance
during the quarter," said Joey Agree, President and Chief Executive
Officer. "We delivered record earnings growth while
continuing to execute on unique real estate investment
opportunities that complement our best-in-class net lease
portfolio. Our three external growth platforms, in conjunction with
our active asset management strategy, continue to optimize
long-term value for our shareholders. We are confident that
our distinct approach to retail net lease real estate produces
superior investment opportunities and look forward to building on
our success during the second half of the year."
Portfolio Update
As of June 30, 2015, the Company's
portfolio consisted of 250 properties located in 41 states and
totaling 4.9 million square feet of gross leasable space.
Retail net lease properties contributed approximately 93.7% of
annualized base rent, including 9.5% of which was generated from
properties ground leased to tenants. The remaining rent was
derived from the Company's five remaining community shopping
centers.
The portfolio was approximately 99.4% leased, had a weighted
average remaining lease term of approximately 11.8 years, and
generated approximately 53.4% of annualized base rents from
investment grade tenants.
The table below provides a summary of the Company's portfolio as
of June 30, 2015:
($ in
thousands)
|
|
Number
of
|
|
Annualized
|
|
% of
Ann.
|
|
%
IG
|
|
Wtd.
Avg.
|
Property
Type
|
|
Properties
|
|
Base Rent
(1)
|
|
Base
Rent
|
|
Rated
(2)
|
|
Lease
Term
|
Retail Net
Lease
|
|
219
|
|
$55,511
|
|
84.2%
|
|
52.6%
|
|
12.0 yrs
|
Retail Net Lease
(ground leases)
|
|
26
|
|
6,287
|
|
9.5%
|
|
88.2%
|
|
14.3 yrs
|
Total Retail Net
Lease
|
|
245
|
|
$61,798
|
|
93.7%
|
|
56.2%
|
|
12.2
yrs
|
Community Shopping
Centers
|
|
5
|
|
4,155
|
|
6.3%
|
|
12.7%
|
|
4.9 yrs
|
Total
Portfolio
|
|
250
|
|
$65,953
|
|
100.0%
|
|
53.4%
|
|
11.8
yrs
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Represents annualized straight-line rents as of June 30,
2015.
|
|
|
|
|
(2) Reflects
tenants, or parent entities thereof, with investment grade credit
ratings from S&P, Moody's, Fitch and/or NAIC.
|
|
|
|
|
|
|
|
|
|
|
|
Acquisitions
Total acquisition volume for the second quarter was
approximately $63,518,000. The
Company acquired 19 assets net leased to a diverse group of
retailers, including those operating in the apparel, auto parts,
casual dining, dollar store, financial services, grocery, health
& fitness, pet supply, specialty retail and warehouse club
sectors. These properties are located in 11 states and were
acquired at a weighted-average cap rate of 7.9% and with a
weighted-average remaining lease term of 12.5 years.
Year to date though June 30, 2015,
the Company has acquired 44 assets for an aggregate purchase price
of approximately $123,175,000. These properties were
acquired at a weighted-average cap rate of 8.0% and with a
weighted-average remaining lease term of 12.7 years.
Dispositions
The Company sold three assets for gross proceeds of
approximately $8,150,000 during the
second quarter, including Marshall
Plaza, a Kmart-anchored shopping center in Marshall, Michigan. The Company also
sold a former Border's store in Lawrence,
Kansas, which was the only vacant net lease asset in the
portfolio, as well as an outlot to the Company's Meijer store in
Plainfield, Indiana.
Leasing
During the second quarter, the Company executed new leases or
lease extensions on over 106,000 square feet of space throughout
the portfolio. Material transactions included a 5-year
extension, to October 2020, for a
51,500 square foot JC Penney at Central Michigan Commons, as well
as 10-year extensions, to February
2028 and February 2029, for
Walgreens properties in Waterford,
Michigan and Grand Blanc,
Michigan, respectively. In addition, the Company
signed a 10-year lease with Planet Fitness to occupy 15,400 square
feet of previously vacant space at Central Michigan Commons.
Top Tenants
The following table presents annualized base rents for all
tenants that generated 1.5% or greater of the Company's total
annualized base rent as of June 30,
2015:
($ in
thousands)
|
|
Annualized
|
|
% of
Ann.
|
Tenant /
Concept
|
|
Base Rent
(1)
|
|
Base
Rent
|
Walgreens
|
|
$12,310
|
|
18.7%
|
Wawa
|
|
2,465
|
|
3.7%
|
CVS
|
|
2,463
|
|
3.7%
|
Wal-Mart
|
|
2,039
|
|
3.1%
|
Academy
Sports
|
|
1,982
|
|
3.0%
|
Rite Aid
|
|
1,886
|
|
2.9%
|
Lowe's
|
|
1,846
|
|
2.8%
|
24 Hour
Fitness
|
|
1,759
|
|
2.7%
|
BJ's
Wholesale
|
|
1,709
|
|
2.6%
|
LA Fitness
|
|
1,694
|
|
2.6%
|
Dollar
General
|
|
1,577
|
|
2.4%
|
Taco Bell
(2)
|
|
1,537
|
|
2.3%
|
Kmart
|
|
1,260
|
|
1.9%
|
Burger King
(3)
|
|
1,241
|
|
1.9%
|
Kohl's
|
|
1,180
|
|
1.8%
|
AutoZone
|
|
1,163
|
|
1.8%
|
Dick's Sporting
Goods
|
|
1,089
|
|
1.7%
|
PetSmart
|
|
1,027
|
|
1.6%
|
Total
|
|
$40,227
|
|
61.2%
|
|
|
|
|
|
(1)
Represents annualized straight-line rents as of June 30,
2015.
|
(2)
Franchise restaurants operated by Charter Foods
North.
|
|
(3)
Franchise restaurants operated by Meridian
Restaurants.
|
|
Tenant Sector
The following table presents annualized base rents for the
Company's top retail sectors as of June 30,
2015:
($ in
thousands)
|
|
Annualized
|
|
% of
Ann.
|
Tenant
Sector
|
|
Base Rent
(1)
|
|
Base
Rent
|
Pharmacy
|
|
$16,659
|
|
25.3%
|
Restaurants - Quick
Service
|
|
5,643
|
|
8.6%
|
Apparel
|
|
3,980
|
|
6.0%
|
Warehouse
Clubs
|
|
3,749
|
|
5.7%
|
Health &
Fitness
|
|
3,562
|
|
5.4%
|
Sporting
Goods
|
|
3,378
|
|
5.1%
|
Grocery
Stores
|
|
3,373
|
|
5.1%
|
Convenience
Stores
|
|
2,599
|
|
3.9%
|
Specialty
Retail
|
|
2,496
|
|
3.8%
|
Restaurants - Casual
Dining
|
|
2,432
|
|
3.7%
|
Auto Parts
|
|
1,894
|
|
2.9%
|
Home
Improvement
|
|
1,846
|
|
2.8%
|
Financial
Services
|
|
1,738
|
|
2.6%
|
Dollar
Stores
|
|
1,687
|
|
2.6%
|
General
Merchandise
|
|
1,649
|
|
2.5%
|
Other (2)
|
|
9,268
|
|
14.0%
|
Total
|
|
$65,953
|
|
100.0%
|
|
|
|
|
|
(1)
Represents annualized straight-line rents as of June 30,
2015.
|
(2) Includes
sectors generating less than 2.5% of annualized base
rent.
|
Lease Expiration
The following table presents contractual lease expirations
within the Company's portfolio as of June
30, 2015, assuming that no tenants exercise renewal
options:
(in
thousands)
|
|
|
|
Annualized
Base Rent (1)
|
|
Gross
Leasable Area
|
Year
|
|
Leases
|
|
$
Amount
|
|
% of
Total
|
|
Sq.
Ft.
|
|
% of
Total
|
2015
|
|
3
|
|
$416
|
|
0.6%
|
|
91
|
|
1.8%
|
2016
|
|
6
|
|
448
|
|
0.7%
|
|
50
|
|
1.0%
|
2017
|
|
10
|
|
1,813
|
|
2.7%
|
|
128
|
|
2.6%
|
2018
|
|
14
|
|
1,781
|
|
2.7%
|
|
286
|
|
5.8%
|
2019
|
|
12
|
|
3,668
|
|
5.6%
|
|
344
|
|
6.9%
|
2020
|
|
18
|
|
2,742
|
|
4.2%
|
|
296
|
|
6.0%
|
2021
|
|
17
|
|
4,448
|
|
6.7%
|
|
266
|
|
5.4%
|
2022
|
|
13
|
|
2,672
|
|
4.1%
|
|
262
|
|
5.3%
|
2023
|
|
16
|
|
2,569
|
|
3.9%
|
|
228
|
|
4.6%
|
2024
|
|
23
|
|
4,098
|
|
6.2%
|
|
310
|
|
6.3%
|
Thereafter
|
|
170
|
|
41,298
|
|
62.6%
|
|
2,660
|
|
53.7%
|
Vacant
|
|
|
|
|
|
|
|
29
|
|
0.6%
|
Total
|
|
302
|
|
$65,953
|
|
100.0%
|
|
4,950
|
|
100.0%
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Represents annualized straight-line rents as of June 30,
2015.
|
|
|
|
Capital Markets and Balance Sheet
Capital Markets Activity
On May 6, 2015, the Company
implemented a $100,000,000
at-the-market equity program ("ATM program") by entering into
multiple equity distribution agreements through which the Company
may, from time to time, sell shares of common stock.
During the three months ended June 30,
2015, the Company issued 454,514 shares of common stock
under its ATM program realizing gross proceeds of approximately
$13,900,000. The Company has
approximately $86,100,000 remaining
under the ATM program.
On May 28, 2015, the Company
completed a private placement of $100,000,000 principal amount of senior unsecured
notes. The notes were sold in two series, including
$50,000,000 of 4.16% notes due
May 30, 2025 and $50,000,000 of 4.26% notes due May 30, 2027. The weighted average term of
the notes is 11.0 years and the weighted average interest rate is
4.21%. Proceeds from the issuance were used to repay
borrowings under the Company's unsecured revolving credit facility
and for general corporate purposes.
Balance Sheet Summary
As of June 30, 2015, the Company's
total debt to total market capitalization was 37.2%. Total
market capitalization is calculated as the sum of total debt and
the market value of the Company's outstanding shares of common
stock, assuming conversion of operating partnership units.
For the three and six months ended June
30, 2015, the Company's fully-diluted weighted-average
shares outstanding were 17,587,052 and 17,511,418. The basic
weighted-average shares outstanding for the three and six months
ended June 30, 2014 were 17,539,358
and 17,457,699.
The Company's assets are held by, and all of its operations are
conducted through, Agree Limited Partnership, of which the Company
is the sole general partner. As of June 30, 2015, there were 347,619 operating
partnership units outstanding and the Company held a 98.11%
interest in the operating partnership.
Conference Call/Webcast
Agree Realty Corporation will host a live broadcast of its
second quarter 2015 conference call on Tuesday, July 28, 2015 at 9:00 am EST to discuss its financial and operating
results. The live broadcast will be available online at:
http://www.webcaster4.com/Webcast/Page/408/9383 and also by
telephone at 1-866-363-3979 (USA
Toll Free) and 1-412-902-4206 (International). A replay will
be available shortly after the call until October 28, 2015 at 1-877-344-7529 (USA Toll Free, conference #10068525) or
1-412-317-0088 (International, conference #10068525).
About Agree Realty Corporation
Agree Realty Corporation is primarily engaged in the acquisition
and development of properties net leased to industry leading retail
tenants. The Company currently owns and operates a portfolio
of 253 properties located in 41 states and containing 5.0 million
square feet of gross leasable space. The common stock of
Agree Realty Corporation is listed on the New York Stock Exchange
under the symbol "ADC."
For additional information, visit the Company's home page at
http://www.agreerealty.com.
Forward-Looking Statements
The Company considers portions of the information contained
in this release to be forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934, each as amended. These
forward-looking statements represent the Company's expectations,
plans and beliefs concerning future events. Although these
forward-looking statements are based on good faith beliefs,
reasonable assumptions and the Company's best judgment reflecting
current information, certain factors could cause actual results to
differ materially from such forward–looking statements. Such
factors are detailed from time to time in reports filed or
furnished by the Company with the Securities and Exchange
Commission, including the Company's Form 10-K for the year ended
December 31, 2014. Except as
required by law, the Company assumes no obligation to update these
forward–looking statements, even if new information becomes
available in the future.
Agree Realty
Corporation
Operating Results
(in thousands, except per share amounts)
(Unaudited)
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
June
30,
|
|
June
30,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Revenues:
|
|
|
|
|
|
|
|
|
Minimum
rents
|
|
$ 15,972
|
|
$ 11,791
|
|
$ 30,526
|
|
$ 23,314
|
Percentage
rent
|
|
141
|
|
142
|
|
151
|
|
142
|
Operating cost
reimbursements
|
|
1,098
|
|
947
|
|
2,276
|
|
1,970
|
Other
income
|
|
8
|
|
24
|
|
10
|
|
53
|
Total
Revenues
|
|
17,219
|
|
12,904
|
|
32,963
|
|
25,479
|
Expenses:
|
|
|
|
|
|
|
|
|
Real estate
taxes
|
|
863
|
|
740
|
|
1,626
|
|
1,437
|
Property operating
expenses
|
|
416
|
|
458
|
|
987
|
|
957
|
Land lease
payments
|
|
137
|
|
107
|
|
269
|
|
214
|
General and
administration
|
|
1,744
|
|
1,617
|
|
3,412
|
|
3,209
|
Depreciation and
amortization
|
|
4,117
|
|
2,591
|
|
7,671
|
|
5,105
|
Impairment
charge
|
|
-
|
|
2,800
|
|
-
|
|
2,800
|
Total Operating
Expenses
|
|
7,277
|
|
8,313
|
|
13,965
|
|
13,722
|
Income from
Operations
|
|
9,942
|
|
4,591
|
|
18,998
|
|
11,757
|
Other Income
(Expense)
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
(2,933)
|
|
(1,875)
|
|
(5,394)
|
|
(3,669)
|
Gain on sale of
assets
|
|
3,456
|
|
-
|
|
3,535
|
|
-
|
Loss on debt
extinguishment
|
|
-
|
|
-
|
|
(180)
|
|
-
|
Income Before
Discontinued Operations
|
|
10,465
|
|
2,716
|
|
16,959
|
|
8,088
|
Gain on sale of asset
from discontinued operations
|
|
-
|
|
-
|
|
-
|
|
123
|
Income from
discontinued operations
|
|
-
|
|
-
|
|
-
|
|
15
|
Total Discontinued
Operations
|
|
-
|
|
-
|
|
-
|
|
138
|
Net
Income
|
|
10,465
|
|
2,716
|
|
16,959
|
|
8,226
|
Net income
attributable to non-controlling interest
|
|
201
|
|
62
|
|
327
|
|
187
|
Net Income
Attributable to Agree Realty Corporation
|
|
10,264
|
|
2,654
|
|
16,632
|
|
8,039
|
Other
Comprehensive Income (loss) , Net of $31, ($19), ($8) and
($29)
|
|
|
|
|
|
|
|
|
Attributable to
Non-Controlling Interest
|
|
1,590
|
|
(831)
|
|
(383)
|
|
(1,281)
|
Total
Comprehensive Income Attributable to Agree Realty
Corporation
|
|
$ 11,854
|
|
$ 1,823
|
|
$ 16,249
|
|
$ 6,758
|
|
|
|
|
|
|
|
|
|
Basic Earnings Per
Share
|
|
|
|
|
|
|
|
|
Continuing
operations
|
|
$ 0.59
|
|
$ 0.18
|
|
$ 0.95
|
|
$ 0.54
|
Discontinued
operations
|
|
-
|
|
-
|
|
-
|
|
0.01
|
|
|
$ 0.59
|
|
$ 0.18
|
|
$ 0.95
|
|
$ 0.55
|
Dilutive Earnings
Per Share
|
|
|
|
|
|
|
|
|
Continuing
operations
|
|
$ 0.58
|
|
$ 0.18
|
|
$ 0.95
|
|
$ 0.53
|
Discontinued
operations
|
|
-
|
|
-
|
|
-
|
|
0.01
|
|
|
$ 0.58
|
|
$ 0.18
|
|
$ 0.95
|
|
$ 0.54
|
Weighted Average
Number of Common Shares Outstanding - Basic
|
|
17,539
|
|
14,714
|
|
17,458
|
|
14,710
|
Weighted Average
Number of Common Shares Outstanding - Diluted
|
|
17,587
|
|
14,776
|
|
17,511
|
|
14,769
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Agree Realty
Corporation
Funds from
Operations (in thousands, except per share amounts)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
June
30,
|
|
June
30,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Reconciliation of
Funds from Operations to Net Income: (1)
|
|
|
|
|
|
|
|
|
Net income
|
|
$ 10,465
|
|
$ 2,716
|
|
$ 16,959
|
|
$ 8,226
|
Depreciation of real
estate assets
|
|
2,923
|
|
2,012
|
|
5,478
|
|
3,964
|
Amortization of
leasing costs
|
|
1,150
|
|
29
|
|
2,103
|
|
59
|
Amortization of lease
intangibles
|
|
29
|
|
535
|
|
59
|
|
1,052
|
Gain on sale of
assets
|
|
(3,456)
|
|
-
|
|
(3,535)
|
|
(123)
|
Impairment
charge
|
|
-
|
|
2,800
|
|
-
|
|
2,800
|
Funds from
Operations
|
|
$ 11,111
|
|
8,092
|
|
$ 21,064
|
|
15,978
|
|
|
|
|
|
|
|
|
|
Funds from
Operations Per Share - Diluted
|
|
$ 0.62
|
|
$ 0.54
|
|
$ 1.18
|
|
$ 1.06
|
Weighted Average
Number of Common Shares Outstanding - Diluted
|
|
17,935
|
|
15,123
|
|
17,859
|
|
15,117
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Funds
from Operations (in thousands, except per share
amounts)
(Unaudited)
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
June
30,
|
|
June
30,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Reconciliation of
Adjusted Funds from Operations to Net Income: (1)
|
|
|
|
|
|
|
|
|
Net income
|
|
$ 10,465
|
|
$ 2,716
|
|
$ 16,959
|
|
$ 8,226
|
Cumulative
adjustments to calculate FFO
|
|
646
|
|
5,376
|
|
4,105
|
|
7,752
|
Funds from
Operations
|
|
11,111
|
|
8,092
|
|
21,064
|
|
15,978
|
Straight-line accrued
rent
|
|
(608)
|
|
(316)
|
|
(1,206)
|
|
(604)
|
Deferred revenue
recognition
|
|
(116)
|
|
(116)
|
|
(232)
|
|
(232)
|
Stock based
compensation expense
|
|
521
|
|
515
|
|
1,045
|
|
1,043
|
Amortization of
financing costs
|
|
116
|
|
91
|
|
225
|
|
182
|
Non-Real Estate
Depreciation / Amortization
|
|
15
|
|
15
|
|
31
|
|
29
|
Loss on Debt
Extinguishment
|
|
-
|
|
-
|
|
180
|
|
-
|
Adjusted Funds
from Operations
|
|
$ 11,039
|
|
$ 8,281
|
|
$ 21,107
|
|
$ 16,396
|
|
|
|
|
|
|
|
|
|
Adjusted Funds
from Operations Per Share - Diluted
|
|
$ 0.62
|
|
$ 0.55
|
|
$ 1.18
|
|
$ 1.08
|
|
|
|
|
|
|
|
|
|
Supplemental
Information:
|
|
|
|
|
|
|
|
|
Scheduled principal
repayments
|
|
$ 683
|
|
$ 895
|
|
$ 1,360
|
|
$ 1,801
|
Capitalized
interest
|
|
$
2
|
|
$
58
|
|
$
3
|
|
$ 114
|
Capitalized building
improvements
|
|
$
-
|
|
$
76
|
|
$
-
|
|
$
76
|
|
|
|
|
|
|
|
|
|
(1) Funds from Operations ("FFO") is defined by the
National Association of Real Estate Investment Trusts, Inc.
(NAREIT) to mean net income computed in accordance with U.S.
generally accepted accounting principles (GAAP), excluding gains
(or losses) from sales of property, plus real estate related
depreciation and amortization and any impairment charges on a
depreciable real estate asset, and after adjustments for
unconsolidated partnerships and joint ventures. Management
uses FFO as a supplemental measure to conduct and evaluate the
Company's business because there are certain limitations associated
with using GAAP net income by itself as the primary measure of the
Company's operating performance. Historical cost accounting
for real estate assets in accordance with GAAP implicitly assumes
that the value of real estate assets diminishes predictably over
time. Since real estate values instead have historically
risen or fallen with market conditions, management believes that
the presentation of operating results for real estate companies
that use historical cost accounting is insufficient by itself.
FFO should not be considered as an alternative to net income as
the primary indicator of the Company's operating performance, or as
an alternative to cash flow as a measure of liquidity.
Further, while the Company adheres to the NAREIT definition of FFO,
its presentation of FFO is not necessarily comparable to similarly
titled measures of other REITs due to the fact that all REITs may
not use the same definition.
Adjusted Funds from Operations ("AFFO") is a non-GAAP financial
measure of operating performance used by many companies in the REIT
industry. AFFO further adjusts FFO for certain non-cash items
that reduce or increase net income in accordance with GAAP and for
non-recurring items that are not reflective of ongoing
operations. Management considers AFFO a useful supplemental
measure of the Company's performance, however, AFFO should not be
considered an alternative to net income as an indication of the
Company's performance, or to cash flow as a measure of liquidity or
ability to make distributions. The Company's computation of
AFFO may differ from the methodology for calculating AFFO used by
other equity REITs, and therefore may not be comparable to such
other REITs. Note that, during the year ended December 31, 2014, the Company adjusted its
calculation of AFFO to exclude non-recurring capitalized building
improvements and to include non-real estate related depreciation
and amortization. Management believes that these changes
provide a more useful measure of operating performance in the
context of AFFO.
Agree Realty
Corporation
Consolidated
Balance Sheets (in thousands)
(Unaudited)
|
|
|
|
|
|
|
|
June
30,
|
|
December
31,
|
|
|
2015
|
|
2014
|
Assets:
|
|
|
|
|
Land
|
|
$
209,268
|
|
$
195,091
|
Buildings
|
|
478,807
|
|
393,827
|
Accumulated
depreciation
|
|
(60,456)
|
|
(59,090)
|
Property under
development
|
|
467
|
|
229
|
Net real estate
investments
|
|
628,086
|
|
530,057
|
|
|
|
|
|
Cash and cash
equivalents
|
|
2,871
|
|
5,399
|
Accounts
receivable
|
|
5,693
|
|
4,508
|
Deferred costs, net
of amortization
|
|
65,785
|
|
51,271
|
Other
assets
|
|
2,632
|
|
2,345
|
Total
Assets
|
|
$
705,067
|
|
$
593,580
|
|
|
|
|
|
Liabilities
|
|
|
|
|
Notes
Payable:
|
|
|
|
|
Mortgage notes
payable
|
|
$
102,997
|
|
$
106,762
|
Unsecured revolving
credit facility
|
|
15,000
|
|
15,000
|
Unsecured term
loans
|
|
100,000
|
|
100,000
|
Senior unsecured
notes
|
|
100,000
|
|
-
|
Total Notes
Payable
|
|
317,997
|
|
221,762
|
|
|
|
|
|
Deferred
revenue
|
|
772
|
|
1,004
|
Dividends and
distributions payable
|
|
8,554
|
|
8,048
|
Other
liabilities
|
|
7,117
|
|
6,731
|
Total
Liabilities
|
|
334,440
|
|
237,545
|
|
|
|
|
|
Stockholder's
Equity
|
|
|
|
|
Common stock
(18,053,529 and 17,539,946 shares)
|
|
2
|
|
2
|
Additional paid-in
capital
|
|
402,916
|
|
388,263
|
Deficit
|
|
(32,265)
|
|
(32,585)
|
Accumulated other
comprehensive income (loss)
|
|
(2,443)
|
|
(2,060)
|
Non-controlling
interest
|
|
2,417
|
|
2,415
|
Total
Stockholder's Equity
|
|
370,627
|
|
356,035
|
|
|
$
705,067
|
|
$
593,580
|
|
|
|
|
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/agree-realty-corporation-reports-operating-results-for-the-second-quarter-2015-300119161.html
SOURCE Agree Realty Corporation