Capital Automotive Reports Record Second Quarter 1999 Results
Sixth Consecutive Quarter of Revenue, FFO and Dividend Growth
FFO per Share Increases 57%
McLEAN, Va., July 26 /PRNewswire/ -- Capital Automotive (Nasdaq: CARS),
the nation's leading specialty finance company for automotive retail real
estate, today announced financial results for the second quarter ended June
30, 1999.
The Company reported funds from operations (FFO) of $10.3 million, or
$0.36 per basic and diluted share, up from $6.9 million or $0.23 per basic and
diluted share, in the same quarter last year. Revenues were $15.9 million for
the quarter, or an 86% increase compared to revenues of $8.5 million in the
second quarter of 1998. Net income was $5.0 million, or $0.23 per basic and
diluted share, compared to $4.7 million or $0.19 per basic and diluted share
in the same quarter last year. FFO results for the quarter are based on basic
and diluted weighted average number of shares and operating partnership units
of 28.5 million. Net income results are based on basic and diluted weighted
average number of shares of 21.6 million. The increase in FFO, revenues and
net income for the quarter were primarily attributable to additional property
investments.
For the six-month period ended June 30, 1999, FFO was $19.8 million, or
$0.70 per basic share and diluted share, up from $9.3 million, or $0.42 per
basic share and $0.41 per diluted share. Total revenues for the six-month
period were $30.7 million compared to $11.9 million for the same period in
1998. Net income for the period was $9.4 million, or $0.43 per basic and
diluted share compared to last quarter of $6.4 million or $0.34 per basic and
diluted share. FFO results for the six-month period are based on basic and
diluted weighted average number of shares and operating partnership units of
28.4 million. Net income results are based on basic and diluted weighted
average number of shares of 21.6 million.
The Company also announced today that its Board of Trustees has declared a
cash dividend of $0.34 per share for the second quarter. The dividend is
payable on August 20, 1999 to shareholders of record as of August 10, 1999.
This is an annualized rate of $1.36 per share and a yield of approximately
10.5% based on the current market price.
Capital Automotive closed on $50 million in property acquisitions in the
second quarter. Consideration for the properties consisted of $4.0 million in
units and $46.0 million in cash. The cash was funded primarily from the
Company's revolving credit facilities. The borrowings under this facility
were subsequently repaid with the proceeds of long-term, financing that closed
in July 1999 from Ford Motor Credit Company. The acquisitions include 13
dealership properties in 5 states, representing 37 franchises. The average
initial lease term was 13.9 years. Cap rates on these transactions were
consistent with the Company's business plan. The Company's portfolio weighted
average initial cap rate remained at 10.6%.
Significant real estate acquisitions during the second quarter included:
-- Two properties from the Auffenberg Automotive Group located in
O'Fallon, IL for $18.6 million. The Auffenberg Automotive Group
operates ten franchises on the properties including Ford,
Chrysler/Plymouth, and Jeep. O'Fallon, IL is approximately 20 miles
east of St. Louis, MO.
-- Six properties from an affiliate of Lithia Motors, Inc. in Medford and
Grants Pass, Oregon for $18.3 million. Lithia Motors operates 18
franchises on the properties including Dodge, Toyota, and Honda.
Lithia Motors, Inc. is one of the Top 15 automotive retailers in the
U.S. when recently completed acquisitions are considered. Lithia
Motors has received multiple awards from various manufacturers for
sales volume achievements and high customer satisfaction levels
including Chrysler Five-Star Certification and Chrysler National
Charger Club, among others. Lithia's current revenue run-rate is
approximately $1.2 billion.
As of June 30, 1999, the Company's portfolio included 154 properties
including 246 automotive franchises in 22 states. These properties total
5.4 million square feet of buildings and improvements on 853 acres of land.
The properties are leased on long-term, triple net leases with an average
initial lease term of 13.2 years. The Company has entered into transactions
with 15 of the top 100 dealer groups -- 14 of which are tenants.
Approximately 55% of the Company's annualized rental revenues are derived from
this group.
Thomas D. Eckert, president and chief executive officer, stated, "We are
extremely pleased by the strength of our operating results in the second
quarter. The quarter was highlighted by the announcement of the definitive
agreement to acquire MMR Holdings for approximately $206 million. We believe
this opportunity is a reflection of our leadership in the industry, and our
ability to partner with the best automotive retailers. We are dedicated to
pursuing opportunities to invest in great commercial locations which are
operated by the best dealership groups."
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