Capital Automotive Reports Record First Quarter Results; Ninth Consecutive Quarter of Revenue, FFO and Dividend Growth
Revenues and FFO per Share for the Quarter Increased 70% and 29%,
respectively, compared to the same Quarter Last Year
McLEAN, Va., April 26 /PRNewswire/ -- Capital Automotive (Nasdaq: CARS),
the nation's leading specialty finance company for automotive retail real
estate, today announced financial results for the first quarter ended March
31, 2000.
For the first quarter, the Company reported funds from operations (FFO) of
$12.9 million, or $0.44 per basic and diluted share, up from $9.6 million or
$0.34 per basic and diluted share in the same quarter last year. FFO is
calculated using the revised definition from NAREIT's October 1999 White
Paper, which includes straight-lined rents, which resulted in an increase in
rents totaling $510,000 or $0.02 per share for the first quarter of 2000(A).
Revenues were $25.2 million for the quarter, or a 70% increase compared to
revenues of $14.8 million in the first quarter of 1999. Net income was
$6.4 million, or $0.30 per basic and diluted share, compared to $4.4 million
or $0.20 per basic and diluted share in the same quarter last year.
The Company also announced today that its Board of Trustees has declared a
cash dividend of $0.365 per share for the first quarter. The dividend is
payable on May 19, 2000 to shareholders of record as of May 10, 2000. The
first quarter dividend is the ninth consecutive increase in the quarterly
dividend and represents an annualized rate of $1.46 per share.
Capital Automotive closed on approximately $13.0 million in property
acquisitions in the first quarter, including two properties that are leased to
an existing tenant utilizing a floating cap rate. Under this lease program,
rental payments are adjusted monthly based upon a spread over the 30 day
LIBOR. The tenant has the ability to fix the lease rate during the initial
lease term. Consistent with the Company's financing strategy, the floating
rent lease is match funded with long-term floating rate debt.
The Company repurchased 900,000 common shares during the first quarter, at
an average share price of $10.96. This repurchase was partially funded by the
sale of two properties for $5.0 million, which resulted in a gain on sale of
the assets of approximately $294,000, or 6%. Of the 6.0 million common shares
that are authorized for repurchase under the Company's common share repurchase
program, the Company has repurchased 4.1 million through March 31, 2000.
During the quarter, the Company executed an agreement for a $100 million
revolving credit facility from General Motors Acceptance Corporation ("GMAC").
As of March 31, 2000, there were no amounts outstanding. Proceeds will be
used to fund future acquisitions on a short-term basis and will be repaid with
the issuance of long-term debt. The credit facility will bear interest at 225
basis points over LIBOR. The term of the agreement is one year and is
renewable annually.
The Company's debt to assets (total assets plus accumulated depreciation)
ratio was 53% as of March 31, 2000, with approximately 95% of the debt being
long-term, fixed rate, non-recourse debt. The Company's policy is to limit
debt to approximately 65% of assets. In addition, it is the Company's policy
generally to match the average duration of its leases with long-term debt to
minimize interest rate risk. Virtually all of the Company's debt is secured
financing with an average remaining debt term of 12.1 years versus an average
remaining lease term of 12.0 years.
Thomas D. Eckert, president and chief executive officer, stated, "We are
very pleased with the operating results of our first quarter, which continue
to reflect the success of our long-term strategy. Our timely share repurchase
combined with growing investment spreads continue to maximize our return on
invested capital and enhance shareholder value. The completion of the GMAC
revolving credit agreement adds acquisition capacity as well as credibility to
our Company. We remain confident in the growth and future prospects of the
Company."
As of March 31, 2000, the Company's portfolio included 230 properties with
an asset value of $944.2 million consisting of 351 automotive franchises in
27 states. These properties total 8.1 million square feet of buildings and
improvements on 1,302 acres of land. Approximately 71% of the Company's
properties are located in the top 50 automobile markets in the country. The
properties are leased under long-term, triple-net leases with an average
initial lease term of 13.3 years. The Company has entered into transactions
with 15 of the top 100 dealer groups in the country, 14 of which are tenants.
Approximately 66% of the Company's annualized rental revenues are derived from
this group of tenants. As of March 31, 2000, the Company's weighted average
initial cap rate is 10.5%. |
