We got another raise & good earnings/FFO!
Duke Announces Second Quarter Earnings and Increased Dividend
INDIANAPOLIS--
FFO Per Share Up 18.0 Percent In The Second Quarter and
Exceeds 10 Percent for the Eleventh Consecutive Quarter
Common Stock Dividend Increased by 13.3 Percent
Duke Realty Investments, Inc. (NYSE:DRE) reported today that funds from operations ("FFO") were $36.9 million for the second quarter of 1998 versus $24.4 million for the same period in 1997, a 51.2 percent increase. On a per share basis, FFO increased 18.0 percent to $.46 per share in the second quarter 1998 from $.39 per share for the second quarter 1997. This is the Company's eleventh consecutive quarter of double-digit growth in FFO per share. For the first six months of 1998, the Company reported FFO per share of $0.91, an 18.2 percent increase over 1997.
Net income available for common shareholders for the second quarter of 1998 increased to $21.9 million on revenues of $90.1 million up from $14.7 million and $56.7 million, respectively, for the second quarter last year. On a per share basis, second quarter net income available for common shareholders increased 17.4 percent to $.27 per share compared to $.23 per share for the second quarter of 1997. Year to date, net income available for common shareholders increased 16.7 percent to $.56 per share for the first six months of 1998. All per share amounts reported are diluted with basic per share information included in the financial table accompanying this press release.
The Company also announced today that its Board of Directors declared a quarterly dividend of $.34 per share, payable on August 31, 1998, to common shareholders of record on August 14, 1998. The new dividend is an increase of 16 cents per year which is a 13.3 percent increase over the previous amount. The new dividend equals $1.36 per share on an annualized basis. This is Duke's sixth dividend increase since its October 1993 reorganization. Regarding the dividend increase and the Company's second quarter performance, Thomas L. Hefner, Chairman and Chief Executive Officer, stated,
"We are delighted to deliver another quarter of FFO per share
growth at the 18 percent level, our eleventh consecutive
double-digit increase. With our dividend payout ratio
remaining near the minimum necessary to qualify as a REIT, we
are also delighted to give our shareholders another
substantial dividend increase. As we look toward the second
half of 1998, the fundamentals of our business remain very
strong and we are confident that our strong momentum will
continue."
The Board also declared today a dividend of $.56875 per depositary share on Duke's Series A Cumulative Redeemable Preferred Shares (NYSE:DRE.PRA). The dividend is payable August 31, 1998 to shareholders of record on August 17, 1998. Each depositary share represents one tenth of a share of the Company's 9.10 percent Series A Preferred Shares.
The Board also declared today a dividend of $.99875 per depositary share on Duke's Series B Cumulative Step-Up Redeemable Preferred Shares. The dividend is payable September 30, 1998 to shareholders of record on September 16, 1998. Each depositary share represents one tenth of a share of these 7.99 percent Series B Preferred Shares.
Property information at June 30, 1998 was as follows:
-- The Company's 419 in-service properties totaling
48.2 million square feet were 94.4 percent leased.
-- The Company had 4.1 million square feet under development.
The estimated project cost of these properties is $282.1
million on which Duke expects to achieve an 11.3 percent
stabilized return.
-- Including projects under development, the combined portfolio
at the end of the second quarter consisted of 446 properties
totaling approximately 52.4 million square feet that were
90.2 percent leased.
The Company also disclosed the following information for the second quarter of 1998:
-- Duke renewed 84.6 percent of leases up for renewal totaling
1,255,000 square feet of renewals on which it attained a
16.4 percent growth in net effective rents.
-- Same Property Performance for the first six months of 1998
reflects an FFO increase of 5.1 percent and a net operating
income increase of 5.8 percent.
-- In May, the Company completed a $100 million senior unsecured
note offering with a 10-year maturity and a 6.76 percent
effective interest rate. In June, the Company completed a
$50 million senior unsecured note offering with a 30-year
maturity priced to yield 7.29 percent. The Company also
completed two unit investment trust common stock offerings in
April, raising approximately $56 million in total proceeds.
-- The Company increased the size of its unsecured line of credit
from $200 million to $250 million in the second quarter.
-- Development starts in the first six months of 1998
totaled $178.5 million with an expected stabilized return
of 11.3 percent.
-- Acquisitions in the first six months of 1998 totaled
$207.0 million with a stabilized return of 10.1 percent.
-- In April, the Company's senior unsecured debt rating from
Standard and Poor's was upgraded to BBB+ from BBB.
When used in this press release, the word "believes," "expects," "estimates" and similar expressions are intended to identify forward-looking statements. Such statements are subject to certain risks and uncertainties which could cause actual results to differ materially. In particular, among the factors that could cause actual results to differ materially are continued qualification as a real estate investment trust, general business and economic conditions, competition, increases in real estate construction costs, interest rates, accessibility of debt and equity capital markets and other risks inherent in the real estate business including tenant defaults, potential liability relating to environmental matters and liquidity of real estate investments. Readers are advised to refer to the Company's Form 8-K Report as filed with the Securities and Exchange Commission on March 29, 1996 for additional information concerning these risks.
Duke Realty Investments is a fully integrated real estate company that owns interests in a diversified portfolio of 449 industrial, office and retail properties encompassing approximately 53 million square feet. These properties are primarily located in eight Midwestern cities. Duke Realty also owns more than 1,800 acres of land for future development.
The Company is a self-administered real estate investment trust which provides leasing, management, development, construction and other tenant-related services for its own properties and for 7.8 million square feet of properties owned by third parties.
A copy of the Company's second quarter 1998 supplemental materials fact book is available to interested parties upon written request to:
Thomas K. Peck
Vice President, Investor Relations
Duke Realty Investments, Inc.
8888 Keystone Crossing, Suite 1200
Indianapolis, IN 46240
Financial Highlights
(in thousands, except per share data)
__________________ __________________
Three Months Ended Six Months Ended
June 30 June 30
__________________ __________________
Operating Results 1998 1997 1998 1997
______________________________________________________________________ Revenues $90,101 $56,715 $174,677 $111,572
Earnings from rental
operations 30,316 18,373 61,174 37,175
Earnings from service
operations 1,820 1,712 2,715 2,174
Net income - common
shareholders 21,858 14,696 44,120 29,682
Funds from operations 36,933 24,406 71,663 48,123
Per Share:
Funds from operations - Basic $0.46 $0.39 $0.91 $0.77
Funds from operations - Diluted $0.46 $0.39 $0.91 $0.77
Net income - common
shareholders - Basic $0.27 $0.23 $0.56 $0.48
Net income - common
shareholders - Diluted $0.27 $0.23 $0.56 $0.48
Dividend payout ratio 73.9% 76.9% 70.3% 71.4%
Weighted average shares outstanding
Basic 80,080 63,168 78,376 62,400
Diluted 91,830 70,576 90,222 70,081
____________________
June 30 December 31
Balance Sheet Data 1998 1997
______________________________________________________________________
Net real estate investments $2,264,035 $1,954,013
Total assets 2,530,817 2,176,214
Total debt 953,584 720,119
Shareholders' equity 1,340,964 1,234,681
Common shares outstanding at end of period 80,970 76,065
CONTACT: Duke Realty Investments, Inc.
Investor Inquiries: Thomas K. Peck, 317/574-3512
Media Inquiries: Donna H. Coppinger, 317/574-3518
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