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This press release contains forward-looking statements within the meaning of the Federal securities laws. Examples of such forward-looking statements include, but are not limited to, the statements made by Mr. Bond. A number of factors could cause W. P. Carey's actual results, performance or achievement to differ materially from those anticipated. Among those risks, trends and uncertainties are the general economic climate; the supply of and demand for office and industrial properties; interest rate levels; the availability of financing; and other risks associated with the acquisition and ownership of properties, including risks that the tenants will not pay rent, or that costs may be greater than anticipated. For further information on factors that could impact W. P. Carey, reference is made to W. P. Carey's filings with the Securities and Exchange Commission.
W. P. CAREY INC. Financial Highlights (Unaudited) (in thousands, except per share amounts)
These financial highlights include the non-GAAP financial measure, funds from operations -- as adjusted ("AFFO"). A description of this non-GAAP financial measure and a reconciliation to the most directly comparable GAAP measure is provided on the following pages.
Three Months Ended March 31, ------------------------- 2013 2012 ------------ ------------Net income $ 14,181 $ 12,290 ============ ============AFFO from real estate ownership (a) $ 62,956 $ 28,833AFFO from investment management 9,299 11,236 ------------ ------------Total AFFO $ 72,255 $ 40,069 ============ ============Per Share (Diluted) Net income $ 0.20 $ 0.30 ============ ============ AFFO from real estate ownership (a) $ 0.90 $ 0.71 AFFO from investment management 0.13 0.28 ------------ ------------ Total AFFO $ 1.03 $ 0.99 ============ ============(a) Effective April 1, 2012, we include distributions of Available Cashreceived from the operating partnerships of the Managed REITs and deferredrevenue earned from our special member interest in CPA®:16 - Global'soperating partnership in our Real Estate Ownership segment. Results ofoperations for the prior period have been reclassified to conform to thecurrent period presentation.
W. P. CAREY INC. Consolidated Balance Sheets (Unaudited) (in thousands) March 31, December 31, 2013 2012 ------------- -------------AssetsInvestments in real estate: Real estate, at cost $ 2,373,912 $ 2,334,488 Operating real estate, at cost 98,690 99,703 Accumulated depreciation (150,207) (136,068) ------------- -------------Net investments in properties 2,322,395 2,298,123Net investments in direct financing leases 364,078 376,005Assets held for sale 1,505 1,445Equity investments in real estate and the Managed REITs 564,092 565,626 ------------- -------------Net investments in real estate 3,252,070 3,241,199Cash 111,564 123,904Due from affiliates 34,625 36,002Goodwill 328,474 329,132In place lease, net 468,132 447,278Above-market rent, net 267,845 279,885Other intangible assets, net 10,484 10,200Other assets, net 136,420 141,442 ------------- ------------- Total assets $ 4,609,614 $ 4,609,042 ============= =============Liabilities and EquityLiabilities:Non-recourse debt $ 1,695,335 $ 1,715,397Senior credit facility 298,000 253,000Accounts payable, accrued expenses and other liabilities 317,520 265,132Income taxes, net 20,847 24,959Distributions payable 57,128 45,700 ------------- ------------- Total liabilities 2,388,830 2,304,188 ------------- -------------Redeemable noncontrolling interest 7,404 7,531 ------------- -------------Redeemable securities - related party - 40,000 ------------- -------------Equity:W. P. Carey stockholders' equity:Common stock 69 69Preferred stock (None issued) - -Additional paid-in capital 2,184,387 2,175,820Distributions in excess of accumulated earnings (218,191) (172,182)Deferred compensation obligation 13,411 8,358Accumulated other comprehensive loss (9,414) (4,649)Less, treasury stock at cost (20,270) (20,270) ------------- ------------- Total W. P. Carey stockholders' equity 1,949,992 1,987,146Noncontrolling interests 263,388 270,177 ------------- ------------- Total equity 2,213,380 2,257,323 ------------- ------------- Total liabilities and equity $ 4,609,614 $ 4,609,042 ============= ============= W. P. CAREY INC. Consolidated Statements of Income (Unaudited) (in thousands, except share and per share amounts) Three Months Ended March 31, -------------------------- 2013 2012 ------------ ------------Revenues Lease revenues: Rental income $ 65,785 $ 14,652 Interest income from direct financing leases 9,512 2,126 ------------ ------------ Total lease revenues 75,297 16,778 Asset management revenue from affiliates 10,015 15,602 Structuring revenue from affiliates 6,342 7,638 Dealer manager fees 1,223 3,787 Reimbursed costs from affiliates 11,968 18,737 Other real estate income 8,541 5,772 ------------ ------------ 113,386 68,314 ------------ ------------Operating Expenses General and administrative 28,973 26,909 Reimbursable costs 11,968 18,737 Depreciation and amortization 30,876 6,463 Property expenses 5,152 2,072 Other real estate expenses 2,734 2,499 Impairment charge 3,279 - ------------ ------------ 82,982 56,680 ------------ ------------Other Income and Expenses Other interest income 370 503 Net income from equity investments in real estate and the Managed REITs 10,656 13,986 Other income and (expenses) 1,091 306 Interest expense (26,906) (7,280) ------------ ------------ (14,789) 7,515 ------------ ------------ Income from continuing operations before income taxes 15,615 19,149 Benefit from (provision for) income taxes 1,233 (1,695) ------------ ------------ Income from continuing operations 16,848 17,454 ------------ ------------Discontinued Operations (Loss) income from operations of discontinued properties (148) 120 Loss on sale of real estate (931) (181) Gain on extinguishment of debt 70 - Impairment charge - (5,724) ------------ ------------ Loss from discontinued operations, net of tax (1,009) (5,785) ------------ ------------Net Income 15,839 11,669 Net (income) loss attributable to noncontrolling interests (1,708) 578 Less: Net income attributable to redeemable noncontrolling interest 50 43 ------------ ------------Net Income Attributable to W. P. Carey $ 14,181 $ 12,290 ============ ============Basic Earnings Per Share Income from continuing operations attributable to W. P. Carey $ 0.21 $ 0.44 Loss from discontinued operations attributable to W. P. Carey (0.01) (0.14) ------------ ------------ Net income attributable to W. P. Carey $ 0.20 $ 0.30 ============ ============Diluted Earnings Per Share Income from continuing operations attributable to W. P. Carey $ 0.21 $ 0.44 Loss from discontinued operations attributable to W. P. Carey (0.01) (0.14) ------------ ------------ Net income attributable to W. P. Carey $ 0.20 $ 0.30 ============ ============Weighted Average Shares Outstanding Basic 68,967,209 40,037,496 ============ ============ Diluted 69,975,293 40,487,652 ============ ============Amounts Attributable to W. P. Carey Income from continuing operations, net of tax $ 15,190 $ 18,075 Loss from discontinued operations, net of tax (1,009) (5,785) ------------ ------------ Net income attributable to W. P. Carey $ 14,181 $ 12,290 ============ ============ W. P. CAREY INC.Reconciliation of Net Income to Funds From Operations -- as adjusted (AFFO) (Unaudited) (in thousands, except share and per share amounts) Three Months Ended March 31, -------------------------- 2013 2012 ------------ ------------Real Estate OwnershipNet income from real estate ownership attributable to W. P. Carey (a) $ 16,692 $ 9,093 ------------ ------------ Adjustments: Depreciation and amortization of real property 29,687 6,147 Impairment charges 3,279 5,724 Loss (gain) on sale of real estate, net 931 181 Proportionate share of adjustments to equity in net income of partially-owned entities to arrive at FFO 3,154 1,040 Proportionate share of adjustments for noncontrolling interests to arrive at FFO (4,267) (434) ------------ ------------ Total adjustments 32,784 12,658 ------------ ------------FFO (as defined by NAREIT) - Real Estate Ownership 49,476 21,751 ------------ ------------ Adjustments: Loss on extinguishment of debt 74 - Other gains, net (270) - Other depreciation, amortization and non- cash charges 800 (211) Stock-based compensation 174 - Deferred tax expense (1,025) (652) Realized losses on foreign currency, derivatives and other (b) 52 - Amortization of deferred financing costs 511 464 Straight-line and other rent adjustments (2,169) (1,115) Above- and below-market rent intangible lease amortization, net (b) 7,256 - Merger expenses 111 2,103 Proportionate share of adjustments to equity in net income of partially-owned entities to arrive at AFFO 278 (413) AFFO adjustments to equity earnings from equity investments 9,249 6,926 Proportionate share of adjustments for noncontrolling interests to arrive at AFFO (1,561) (20) ------------ ------------ Total adjustments 13,480 7,082 ------------ ------------AFFO - Real Estate Ownership $ 62,956 $ 28,833 ============ ============Investment ManagementNet (loss) income from investment management attributable to W. P. Carey (a) $ (2,511) $ 3,197 ------------ ------------FFO (as defined by NAREIT) - Investment Management $ (2,511) $ 3,197 ------------ ------------ Adjustments: Other depreciation, amortization and non- cash charges 262 258 Stock-based compensation 8,975 5,260 Deferred tax expense 2,253 2,236 Realized gains on foreign currency 2 - Amortization of deferred financing costs 318 285 ------------ ------------ Total adjustments 11,810 8,039 ------------ ------------AFFO - Investment Management $ 9,299 $ 11,236 ============ ============Total CompanyFFO (as defined by NAREIT) $ 46,965 $ 24,948 ============ ============FFO (as defined by NAREIT) per diluted share $ 0.67 $ 0.62 ============ ============AFFO $ 72,255 $ 40,069 ============ ============AFFO per diluted share $ 1.03 $ 0.99 ============ ============Diluted weighted average shares outstanding 69,975,293 40,487,652 ============ ============(a) Effective April 1, 2012, we include distributions of Available Cashreceived from the operating partnerships of the Managed REITs and deferredrevenue earned from our special member interest in CPA®:16 - Global'soperating partnership in our Real Estate Ownership segment. Results ofoperations for the prior period have been reclassified to conform to thecurrent period presentation.(b) These adjustments are significant and recurring subsequent to the Mergerand were not included in the AFFO calculation for the three months endedMarch 31, 2012.
