PORT WASHINGTON, N.Y.,
Aug. 1, 2019 /PRNewswire/
-- Cedar Realty Trust, Inc. (NYSE: CDR – the "Company") today
reported results for the second quarter ended June 30, 2019. Net income attributable to common
shareholders was $0.03 per diluted
share compared to net income of $0.08
per diluted share for the comparable 2018 period. Other
highlights include:
Highlights
- Funds from operations (FFO) of $0.11 per diluted share
- Same-property net operating income (NOI) including
redevelopments increased 0.2% compared to the same period in
2018
- Signed 37 new and renewal leases for 452,400 square feet in the
quarter
- Acquired Girard Plaza, located in Philadelphia, adjacent to our South Philadelphia shopping center
- Sold Fort Washington Center, located in Fort Washington, Pennsylvania
Financial Results
Net income attributable to common shareholders for the second
quarter of 2019 was $2.7 million or
$0.03 per diluted share, compared to
net income of $7.1 million or
$0.08 per diluted share for the same
period in 2018. The principal differences in the comparative
three-month results are gain on a property sold in 2019 and lease
termination income in 2018. Net income attributable to common
shareholders for the six-month period ended June 30, 2019 was $2.9
million or $0.03 per diluted
share, compared to net loss of ($15.9)
million or ($0.19) per diluted
share. The principal differences in the comparative six-month
results are gain on properties sold in 2019, and impairment charges
related to properties held for sale, lease termination income, and
preferred stock redemption costs in 2018.
NAREIT-defined FFO for the second quarter of 2019 was
$10.2 million or $0.11 per diluted share, compared to $17.6 million or $0.19 per diluted share for the same period in
2018. NAREIT-defined FFO for the six-month period ended
June 30, 2019 was $20.4 million or $0.22 per diluted share, compared to $26.0 million or $0.28 per diluted share for the same period in
2018. Operating FFO for the second quarter of 2019 was $10.2 million or $0.11 per diluted share, compared to $17.6 million or $0.19 per diluted share for the same period in
2018. Operating FFO for the six-month period ended June 30, 2019 was $20.4
million or $0.22 per diluted
share, compared to $29.5 million or
$0.32 per diluted share for the same
period in 2018. The principal difference between the comparative
three and six-month results is lease termination income in 2018.
The principal difference between Operating FFO and NAREIT-defined
FFO is preferred stock redemption costs in 2018.
Portfolio Update
During the second quarter of 2019, the Company signed 37 leases
for 452,400 square feet. On a comparable space basis, the Company
leased 448,000 square feet at a negative lease spread of 2.5% on a
cash basis (new leases increased 9.6% and renewals decreased 3.0%).
During the six-month period ended June 30,
2019, the Company signed 79 leases for 865,600 square feet.
On a comparable space basis, the Company leased 853,900 square feet
at a negative lease spread of 0.5% on a cash basis (new leases
increased 6.3% and renewals decreased 1.2%). The negative renewal
spreads were driven by two anchor renewals executed to maintain
high foot traffic at their respective properties.
Same-property NOI for the second quarter of 2019 decreased 0.6%
excluding redevelopments and increased 0.2% including
redevelopments as compared to the same period in 2018.
Same-property NOI was impacted by two Fallas stores which vacated
in the fourth quarter of 2018. The growth in same-property NOI
including redevelopments was primarily the result of the
substantial completion of our redevelopment of Carman's Plaza.
The Company's total portfolio, excluding properties held for
sale, was 91.5% leased at June 30,
2019, compared to 91.0% at December
31, 2018 and 91.7% at June 30,
2018. The Company's same-property portfolio was 91.4% leased
at June 30, 2019, compared to 91.2%
at December 31, 2018 and 92.1% at
June 30, 2018.
As of June 30, 2019, Carll's
Corner, located in Bridgeton, New
Jersey and Suffolk Plaza, located in Suffolk, Virginia, have been classified as
"real estate held for sale".
Acquisition and Disposition
On June 19, 2019, the Company
purchased Girard Plaza, a shopping center adjacent from its
South Philadelphia property,
located in Philadelphia,
Pennsylvania. The purchase price for the property was
$8.5 million.
On June 26, 2019, the Company sold
Fort Washington Center, located in Fort
Washington, Pennsylvania. The sales price for the property
was $9.0 million, which resulted in a
gain on sale of $2.8 million.
Balance Sheet
Debt
As of June 30, 2019, the Company
had $117.4 million available under
its revolving credit facility and reported net debt to earnings
before interest, taxes, depreciations, and amortization for real
estate (EBITDAre) of 8.3 times. Further, the Company has no debt
maturities until early 2021.
Equity
On December 18, 2018, the
Company's Board of Directors approved a stock repurchase program,
which authorized the purchase of up to $30.0
million of the Company's common stock in the open market or
through private transactions, subject to market conditions, from
time to time, through December 18,
2019. There were no repurchases during the three months
ended June 30, 2019. During the three
months ended March 31, 2019, the
Company repurchased 2,050,000 shares at a weighted average price
per share of $3.34. Since approval of
the plan on December 18, 2018, the
Company has repurchased a total of 2,823,000 shares at a weighted
average price per share of $3.25.
2019 Guidance
The Company updates its previously-announced 2019 guidance as
follows:
|
|
Guidance
|
Net income
attributable to common shareholders per diluted share
|
|
$0.02 -
$0.03
|
NAREIT-defined FFO
per diluted share
|
|
$0.43 -
$0.44
|
Operating FFO per
diluted share
|
|
$0.44 -
$0.45
|
The guidance is based, in part, on the following:
- Lease costs required to be expensed beginning in 2019 of
$2.5 to $3.0
million under new accounting standard
- Same-property NOI growth including redevelopment properties
relatively flat
- Development marketing and community outreach costs at urban
properties of $750,000 reflected in
redevelopment NOI
- Increase in general and administrative costs of $1.5 million from additional personnel related to
urban properties and legal expense in connection with the
termination of former Chief Operating Officer
- Decrease in amortization income from intangible lease
liabilities $2.0 million (inclusive
of $1.5 million related to
terminating a dark anchor in 2018)
- Dispositions of approximately $40
million
The principal differences between NAREIT-defined FFO and
Operating FFO in the above for 2019 is related to
redevelopments.
The following table reconciles the Company's 2019 guidance from
net income attributable to common shareholders per diluted share to
NAREIT-defined FFO per diluted share and Operating FFO per diluted
share:
|
|
Guidance
|
|
|
per diluted
share
|
|
|
Low
|
|
High
|
Net income
attributable to common shareholders
|
|
$0.02
|
|
$0.03
|
Real estate
depreciation and amortization
|
|
$0.44
|
|
$0.44
|
Gain on
sales
|
|
($0.03)
|
|
($0.03)
|
NAREIT-defined
FFO
|
|
$0.43
|
|
$0.44
|
Redevelopment costs
expensed pursuant to GAAP
|
|
$0.01
|
|
$0.01
|
Operating
FFO
|
|
$0.44
|
|
$0.45
|
Non-GAAP Financial Measures
NAREIT-defined FFO is a widely recognized supplemental non-GAAP
measure utilized to evaluate the financial performance of a REIT.
The Company considers NAREIT-defined FFO to be an appropriate
measure of its financial performance because it captures features
particular to real estate performance by recognizing that real
estate generally appreciates over time or maintains residual value
to a much greater extent than other depreciable assets. The Company
also considers Operating FFO to be an additional meaningful
financial measure of financial performance because it excludes
items the Company does not believe are indicative of its core
operating performance, such as acquisition pursuit costs, amounts
relating to early extinguishment of debt and preferred stock
redemption costs, management transition costs and certain
redevelopment costs. The Company believes Operating FFO further
assists in comparing the Company's performance across reporting
periods on a consistent basis by excluding such items.
NAREIT-defined FFO and Operating FFO should be reviewed with GAAP
net income attributable to common shareholders, the most directly
comparable GAAP financial measure, when trying to understand the
Company's operating performance. A reconciliation of net income
(loss) attributable to common shareholders to NAREIT-defined FFO
and Operating FFO for the three and six months ended June 30, 2019 and 2018 is detailed in the
attached schedule.
EBITDAre is a recognized supplemental non-GAAP financial
measure. The Company presents EBITDAre in accordance with the
definition adopted by NAREIT, which generally defines EBITDAre as
net income plus interest expense, income tax expense, depreciation,
amortization, and impairment write-downs of depreciated property,
plus or minus losses and gains on the disposition of depreciated
property, and adjustments to reflect the Company's share of
EBITDAre of unconsolidated affiliates. The Company believes
EBITDAre provides additional information with respect to the
Company's performance and ability to meet its future debt service
requirements. The Company also considers Adjusted EBITDAre to
be an additional meaningful financial measure of financial
performance because it excludes items the Company does not believe
are indicative of its core operating performance, such as
acquisition pursuit and redevelopment costs. The Company believes
Adjusted EBITDAre further assists in comparing the Company's
performance across reporting periods on a consistent basis by
excluding such items. EBITDAre and Adjusted EBITDAre should be
reviewed with GAAP net income, the most directly comparable GAAP
financial measure, when trying to understand the Company's
operating performance. EBITDAre and Adjusted EBITDAre do not
represent cash generated from operating activities and should not
be considered as an alternative to income from continuing
operations or to cash flow from operating activities. The Company's
computation of Adjusted EBITDAre may differ from the computations
utilized by other companies and, accordingly, may not be comparable
to such companies.
Same-property NOI is a widely recognized supplemental non-GAAP
financial measure for REITs. Properties are included in
same-property NOI if they are owned and operated for the entirety
of both periods being compared, except for properties undergoing
significant redevelopment and expansion until such properties have
stabilized, and properties classified as held for sale. Consistent
with the capital treatment of such costs under GAAP, tenant
improvements, leasing commissions and other direct leasing costs
are excluded from same-property NOI. The Company considers
same-property NOI useful to investors as it provides an indication
of the recurring cash generated by the Company's properties by
excluding certain non-cash revenues and expenses, as well as other
infrequent items such as lease termination income which tends to
fluctuate more than rents from year to year. Same property NOI
should be reviewed with consolidated operating income, the most
directly comparable GAAP financial measure.
Supplemental Financial Information Package
The Company has issued "Supplemental Financial Information" for
the period ended June 30, 2019. Such
information has been filed today as an exhibit to Form 8-K and will
also be available on the Company's website at
www.cedarrealtytrust.com.
Investor Conference Call
The Company will host a conference call today, August 1, 2019, at 5:00 PM
(ET) to discuss the quarterly results. The conference call
can be accessed by dialing (877) 705-6003 or
(1) (201) 493-6725 for international participants. A live
webcast of the conference call will be available online on the
Company's website at www.cedarrealtytrust.com.
A replay of the call will be available from 8:00 PM (ET) on
August 1, 2019, until midnight (ET)
on August 15, 2019. The replay
dial-in numbers are (844) 512-2921 or
(1) (412) 317-6671 for international callers. Please use
passcode 13691672 for the telephonic replay. A replay of the
Company's webcast will be available on the Company's website for a
limited time.
About Cedar Realty Trust
Cedar Realty Trust, Inc. is a fully-integrated real estate
investment trust which focuses on the ownership, operation and
redevelopment of grocery-anchored shopping centers in high-density
urban markets from Washington,
D.C. to Boston. The
Company's portfolio (excluding properties treated as "held for
sale") comprises 57 properties, with approximately 8.6 million
square feet of gross leasable area.
For additional financial and descriptive information on the
Company, its operations and its portfolio, please refer to the
Company's website at www.cedarrealtytrust.com.
Forward-Looking Statements
Statements made in this press release that are not strictly
historical are "forward-looking" statements. Forward-looking
statements involve known and unknown risks, uncertainties and other
factors which may cause actual results, performance and outcomes to
differ materially from those expressed or implied in
forward-looking statements. Factors which could cause actual
results to differ materially from current expectations include,
among others: adverse general economic conditions in
the United States and uncertainty
in the credit and retail markets; financing risks, such as the
inability to obtain new financing or refinancing on favorable terms
as the result of market volatility or instability; risks related to
the market for retail space generally, including reductions in
consumer spending, variability in retailer demand for leased space,
tenant bankruptcies, adverse impact of internet sales demand,
ongoing consolidation in the retail sector and changes in economic
conditions and consumer confidence; risks endemic to real estate
and the real estate industry generally; the impact of the Company's
level of indebtedness on operating performance; inability of
tenants to meet their rent and other lease obligations; adverse
impact of new technology and e-commerce developments on the
Company's tenants; competitive risk; risks related to the
geographic concentration of the Company's properties in the
Washington D.C. to Boston corridor; the effects of natural and
other disasters; and the inability of the Company to realize
anticipated returns from its redevelopment activities. Please refer
to the documents filed by Cedar Realty Trust, Inc. with the SEC,
specifically the Company's Annual Report on Form 10-K for the year
ended December 31, 2018, as it may be
updated or supplemented in the Company's Quarterly Reports on Form
10-Q and the Company's other filings with the SEC, which identify
additional risk factors that could cause actual results to differ
from those contained in forward-looking statements.
CEDAR REALTY
TRUST, INC.
|
Condensed
Consolidated Balance Sheets
|
(unaudited)
|
|
|
June
30,
|
|
December
31,
|
|
|
2019
|
|
2018
|
ASSETS
|
|
|
|
|
Real estate, at
cost
|
|
$
1,519,472,000
|
|
$
1,508,682,000
|
Less accumulated
depreciation
|
|
(375,708,000)
|
|
(361,969,000)
|
Real estate,
net
|
|
1,143,764,000
|
|
1,146,713,000
|
Real estate held for
sale
|
|
7,244,000
|
|
11,592,000
|
Cash and cash
equivalents
|
|
2,081,000
|
|
1,977,000
|
Receivables
|
|
21,535,000
|
|
21,977,000
|
Other assets and
deferred charges, net
|
|
41,705,000
|
|
40,642,000
|
TOTAL
ASSETS
|
|
$
1,216,329,000
|
|
$
1,222,901,000
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
Liabilities:
|
|
|
|
|
Mortgage loan
payable
|
|
$
46,848,000
|
|
$
47,315,000
|
Capital lease
obligation
|
|
5,375,000
|
|
5,387,000
|
Unsecured revolving
credit facility
|
|
99,000,000
|
|
100,000,000
|
Unsecured term
loans
|
|
472,486,000
|
|
472,132,000
|
Accounts payable and
accrued liabilities
|
|
47,031,000
|
|
26,142,000
|
Unamortized
intangible lease liabilities
|
|
12,182,000
|
|
13,209,000
|
Total
liabilities
|
|
682,922,000
|
|
664,185,000
|
|
|
|
|
|
Equity:
|
|
|
|
|
Preferred
stock
|
|
159,541,000
|
|
159,541,000
|
Common stock and
other shareholders' equity
|
|
370,434,000
|
|
395,884,000
|
Noncontrolling
interests
|
|
3,432,000
|
|
3,291,000
|
Total
equity
|
|
533,407,000
|
|
558,716,000
|
|
|
|
|
|
TOTAL LIABILITIES
AND EQUITY
|
|
$
1,216,329,000
|
|
$
1,222,901,000
|
|
|
|
|
|
|
CEDAR REALTY
TRUST, INC.
|
|
Condensed
Consolidated Statements of Operations
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
PROPERTY
REVENUES
|
|
|
|
|
|
|
|
|
|
Rental
revenues
|
|
$
35,309,000
|
|
$
37,218,000
|
|
$
71,901,000
|
|
$
74,665,000
|
|
Other
|
|
351,000
|
|
4,132,000
|
|
642,000
|
|
4,253,000
|
|
Total property
revenues
|
|
35,660,000
|
|
41,350,000
|
|
72,543,000
|
|
78,918,000
|
|
PROPERTY OPERATING
EXPENSES
|
|
|
|
|
|
|
|
|
|
Operating,
maintenance and management
|
|
6,162,000
|
|
5,994,000
|
|
14,129,000
|
|
13,788,000
|
|
Real estate and other
property-related taxes
|
|
5,087,000
|
|
5,056,000
|
|
10,297,000
|
|
10,135,000
|
|
Total property
operating expenses
|
|
11,249,000
|
|
11,050,000
|
|
24,426,000
|
|
23,923,000
|
|
|
|
|
|
|
|
|
|
|
|
PROPERTY OPERATING
INCOME
|
|
24,411,000
|
|
30,300,000
|
|
48,117,000
|
|
54,995,000
|
|
|
|
|
|
|
|
|
|
|
|
OTHER EXPENSES AND
INCOME
|
|
|
|
|
|
|
|
|
|
General and
administrative
|
|
5,418,000
|
|
4,276,000
|
|
10,216,000
|
|
8,770,000
|
|
Depreciation and
amortization
|
|
10,346,000
|
|
10,541,000
|
|
20,475,000
|
|
20,595,000
|
|
Gain on
sales
|
|
(2,841,000)
|
|
-
|
|
(2,942,000)
|
|
-
|
|
Impairment
charges
|
|
-
|
|
-
|
|
-
|
|
21,396,000
|
|
Total other expenses
and income
|
|
12,923,000
|
|
14,817,000
|
|
27,749,000
|
|
50,761,000
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING
INCOME
|
|
11,488,000
|
|
15,483,000
|
|
20,368,000
|
|
4,234,000
|
|
|
|
|
|
|
|
|
|
|
|
NON-OPERATING
INCOME AND EXPENSES
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
(5,944,000)
|
|
(5,546,000)
|
|
(11,835,000)
|
|
(10,917,000)
|
|
Total non-operating
income and expense
|
|
(5,944,000)
|
|
(5,546,000)
|
|
(11,835,000)
|
|
(10,917,000)
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME
(LOSS)
|
|
5,544,000
|
|
9,937,000
|
|
8,533,000
|
|
(6,683,000)
|
|
|
|
|
|
|
|
|
|
|
|
Attributable to
noncontrolling interests
|
|
(161,000)
|
|
(160,000)
|
|
(268,000)
|
|
(208,000)
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME (LOSS)
ATTRIBUTABLE TO CEDAR
REALTY TRUST, INC.
|
|
5,383,000
|
|
9,777,000
|
|
8,265,000
|
|
(6,891,000)
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock
dividends
|
|
(2,688,000)
|
|
(2,688,000)
|
|
(5,376,000)
|
|
(5,487,000)
|
|
Preferred stock
redemption costs
|
|
-
|
|
-
|
|
-
|
|
(3,507,000)
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME (LOSS)
ATTRIBUTABLE TO COMMON
SHAREHOLDERS
|
|
$
2,695,000
|
|
$
7,089,000
|
|
$
2,889,000
|
|
$
(15,885,000)
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME (LOSS)
PER COMMON SHARE
ATTRIBUTABLE TO COMMON SHAREHOLDERS:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
0.03
|
|
$
0.08
|
|
$
0.03
|
|
$
(0.19)
|
|
Diluted
|
|
$
0.03
|
|
$
0.08
|
|
$
0.03
|
|
$
(0.19)
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of common shares:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
86,260,000
|
|
88,011,000
|
|
86,420,000
|
|
87,817,000
|
|
Diluted
|
|
86,260,000
|
|
88,166,000
|
|
86,420,000
|
|
87,817,000
|
|
|
|
|
|
|
|
|
|
|
CEDAR REALTY
TRUST, INC.
|
Reconciliation of
Net Income (Loss) Attributable to Common Shareholders
to
|
Funds From
Operations and Operating Funds From Operations
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Net income (loss)
attributable to common shareholders
|
|
$
2,695,000
|
|
$
7,089,000
|
|
$
2,889,000
|
|
$
(15,885,000)
|
Real estate
depreciation and amortization
|
|
10,300,000
|
|
10,490,000
|
|
20,383,000
|
|
20,494,000
|
Limited partners'
interest
|
|
17,000
|
|
27,000
|
|
19,000
|
|
(60,000)
|
Gain on
sales
|
|
(2,841,000)
|
|
-
|
|
(2,942,000)
|
|
-
|
Impairment
charges
|
|
-
|
|
-
|
|
-
|
|
21,396,000
|
Consolidated minority
interests:
|
|
|
|
|
|
|
|
|
Share of
income
|
|
144,000
|
|
133,000
|
|
249,000
|
|
268,000
|
Share of
FFO
|
|
(107,000)
|
|
(120,000)
|
|
(186,000)
|
|
(244,000)
|
Funds From
Operations ("FFO") applicable to diluted common
shares
|
|
10,208,000
|
|
17,619,000
|
|
20,412,000
|
|
25,969,000
|
Adjustments for items
affecting comparability:
|
|
|
|
|
|
|
|
|
Preferred stock
redemption costs
|
|
-
|
|
-
|
|
-
|
|
3,507,000
|
Operating Funds
From Operations ("Operating FFO") applicable to
diluted common shares
|
|
$
10,208,000
|
|
$
17,619,000
|
|
$
20,412,000
|
|
$
29,476,000
|
|
|
|
|
|
|
|
|
|
FFO per diluted
common share:
|
|
$
0.11
|
|
$
0.19
|
|
$
0.22
|
|
$
0.28
|
|
|
|
|
|
|
|
|
|
Operating FFO per
diluted common share:
|
|
$
0.11
|
|
$
0.19
|
|
$
0.22
|
|
$
0.32
|
|
|
|
|
|
|
|
|
|
Weighted average
number of diluted common shares:
|
|
|
|
|
|
|
|
|
Common shares and
equivalents
|
|
90,526,000
|
|
91,929,000
|
|
90,694,000
|
|
91,788,000
|
OP Units
|
|
553,000
|
|
347,000
|
|
553,000
|
|
347,000
|
|
|
91,079,000
|
|
92,276,000
|
|
91,247,000
|
|
92,135,000
|
View original
content:http://www.prnewswire.com/news-releases/cedar-realty-trust-reports-second-quarter-2019-results-300895157.html
SOURCE Cedar Realty Trust, Inc.