Gladstone Commercial Corporation Reports Results for the First Quarter Ended March 31, 2017
Please note that the limited information that follows in this press release is not adequate to make an informed investment judgment.
Summary Information (dollars in thousands, except share and per share data): | |||||||||||||||||
As of and for the three months ended | |||||||||||||||||
$ Change | % Change | ||||||||||||||||
Operating Data: | |||||||||||||||||
Total operating revenue | $ | 22,314 | $ | 22,009 | $ | 305 | 1.4 | % | |||||||||
Total operating expenses | (17,708 | ) | (1 | ) | (13,733 | ) | (3,975 | ) | 28.9 | % | |||||||
Other expense, net | (250 | ) | (2 | ) | (5,981 | ) | 5,731 | (95.8 | )% | ||||||||
Net income available | $ | 4,356 | $ | 2,295 | $ | 2,061 | 89.8 | % | |||||||||
Less: Dividends attributable to preferred stock | (2,373 | ) | (2,353 | ) | (20 | ) | 0.8 | % | |||||||||
Less: Dividends attributable to senior common stock | (248 | ) | (254 | ) | 6 | (2.4 | )% | ||||||||||
Net income (loss) available (attributable) to common stockholders | $ | 1,735 | $ | (312 | ) | $ | 2,047 | (656.1 | )% | ||||||||
Add: Real estate depreciation and amortization | 9,921 | 9,720 | 201 | 2.1 | % | ||||||||||||
Add: Impairment charge | 3,746 | — | 3,746 | 100.0 | % | ||||||||||||
Less: Gain on sale of real estate | (5,906 | ) | (266 | ) | (5,640 | ) | 2,120.3 | % | |||||||||
Funds from operations available to common stockholders - basic | $ | 9,496 | $ | 9,142 | $ | 354 | 3.9 | % | |||||||||
Add: Convertible senior common distributions | 248 | 254 | (6 | ) | (2.4 | )% | |||||||||||
Funds from operations available to common stockholders - diluted | $ | 9,744 | $ | 9,396 | $ | 348 | 3.7 | % | |||||||||
Funds from operations available to common stockholders - basic | 9,496 | 9,142 | 354 | 3.9 | % | ||||||||||||
Add: Acquisition related expenses | — | (14 | ) | 14 | (100.0 | )% | |||||||||||
Core funds from operations available to common stockholders - basic | $ | 9,496 | $ | 9,128 | $ | 368 | 4.0 | % | |||||||||
Add: Convertible senior common distributions | 248 | 254 | (6 | ) | (2.4 | )% | |||||||||||
Core funds from operations available to common stockholders - diluted | $ | 9,744 | $ | 9,382 | $ | 362 | 3.9 | % | |||||||||
Share and Per Share Data: | |||||||||||||||||
Net income (loss) available (attributable) to common stockholders - basic and diluted | 0.07 | (0.01 | ) | 0.08 | 800.0 | % | |||||||||||
FFO available to common stockholders - basic | 0.38 | 0.38 | — | — | % | ||||||||||||
FFO available to common stockholders - diluted | 0.38 | 0.38 | — | — | % | ||||||||||||
Core FFO available to common stockholders - basic | 0.38 | 0.38 | — | — | % | ||||||||||||
Core FFO available to common stockholders - diluted | 0.38 | 0.38 | — | — | % | ||||||||||||
Weighted average shares of common stock outstanding - basic | 24,963,926 | 24,024,280 | 939,646 | 3.9 | % | ||||||||||||
Weighted average shares of common stock outstanding - diluted | 25,762,314 | 24,824,397 | 937,917 | 3.8 | % | ||||||||||||
Cash dividends declared per common share | $ | 0.375 | $ | 0.375 | $ | — | — | % | |||||||||
Financial Position | |||||||||||||||||
Real estate, before accumulated depreciation | $ | 825,027 | (3 | ) | $ | 833,203 | (4 | ) | $ | (8,176 | ) | (1.0 | )% | ||||
Total assets | $ | 832,977 | $ | 851,742 | $ | (18,765 | ) | (2.2 | )% | ||||||||
Mortgage notes payable, net, borrowings under revolver, net & borrowings under term loan, net | $ | 496,268 | $ | 509,395 | $ | (13,127 | ) | (2.6 | )% | ||||||||
Total stockholders' and mezzanine equity | $ | 307,569 | $ | 310,620 | $ | (3,051 | ) | (1.0 | )% | ||||||||
Properties owned | 95 | (3 | ) | 96 | (4 | ) | (1 | ) | (1.0 | )% | |||||||
Square feet owned | 10,916,338 | (3 | ) | 11,099,338 | (4 | ) | (183,000 | ) | (1.6 | )% | |||||||
Square feet leased | 97.9 | % | 97.9 | % | — | % | — | % | |||||||||
(1) Includes a | |||||||||||||||||
(2) Includes a | |||||||||||||||||
(3) Includes one property classified as held for sale of | |||||||||||||||||
(4) Includes two properties classified as held for sale of | |||||||||||||||||
First Quarter Activity:
- Sold property: Sold one property located in
Franklin, New Jersey for$12.8 million , resulting in a gain on sale of$5.9 million ; - Commenced new leases: Commenced leases in two properties located in
Minneapolis andChicago bringing these properties to full occupancy; - Repaid debt: Repaid
$27.2 million in fixed rate mortgage debt maturing on six properties at a weighted average interest rate of 6.1% with cash on hand and borrowings from our line of credit and repaid$8.2 million of variable rate mortgage debt on one property using proceeds from theFranklin, New Jersey property sale; - Issued Stock under ATM Programs: Issued 119,356 shares of common stock for net proceeds of
$2.4 million , and 89,835 shares of our Series D Preferred Stock for net proceeds of$2.2 million ; and - Paid distributions: Paid monthly cash distributions for the quarter totaling
$0.375 per share on our common stock,$0.4843749 per share on our Series A Preferred Stock,$0.4688 per share on our Series B Preferred Stock,$0.4375 per share on our Series D Preferred Stock, and$0.2625 per share on our senior common stock.
First Quarter 2016 Results: Core FFO available to common shareholders for the three months ended
Net income available to common stockholders for the three months ended
Subsequent to the end of the quarter:
- Expanded property: Continued construction on our
Vance, Alabama property to fund a$7.0 million property expansion that will add 75,000 square feet to this property. This lease resets to a 10-year term upon completion; - Sold property: Sold one property located in
Hazelwood, Missouri for$2.1 million ; - Issued Stock under ATM Programs: Issued 188,697 shares of common stock for net proceeds of
$4.2 million and 68,999 shares of our Series D Preferred Stock for net proceeds of$1.7 million ; and - Declared distributions: Declared monthly cash distributions for April, May and
June 2017 totaling$0.375 per share on our common stock,$0.4843749 per share on our Series A Preferred Stock,$0.46875 per share on our Series B Preferred Stock,$0.4375 per share on our Series D Preferred Stock and$0.2625 per share on our senior common stock.
Comments from Gladstone Commercial's President,
Conference Call:
About
About the Gladstone Companies: Information on the business activities of all the Gladstone family of funds can be found at www.gladstonecompanies.com.
Investor Relations: For Investor Relations inquiries related to any of the monthly distribution-paying Gladstone family of funds, please visit www.gladstone.com.
Non-GAAP Financial Measures:
FFO:
Core FFO: Core FFO is FFO adjusted for certain items that are not indicative of the results provided by the Company's operating portfolio and affect the comparability of the Company's period-over-period performance. These items include the adjustment for gains or losses from early extinguishment of debt and any other non-recurring expense adjustments. Although the Company's calculation of Core FFO differs from NAREIT's definition of FFO and may not be comparable to that of other REITs, the Company believes it is a meaningful supplemental measure of its operating performance. Accordingly, Core FFO should be considered a supplement to net income computed in accordance with GAAP as a measure of our performance.
The Company's presentation of FFO, as defined by NAREIT, or presentation of Core FFO, does not represent cash flows from operating activities determined in accordance with GAAP and should not be considered an alternative to net income as an indication of its performance or to cash flow from operations as a measure of liquidity or ability to make distributions.
The statements in this press release regarding the forecasted stability of Gladstone Commercial's income, its ability, plans or prospects to re-lease its unoccupied properties, and grow its portfolio are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements inherently involve certain risks and uncertainties, although they are based on Gladstone Commercial's current plans that are believed to be reasonable as of the date of this press release. Factors that may cause actual results to differ materially from these forward-looking statements include, but are not limited to, Gladstone Commercial's ability to raise additional capital; availability and terms of capital and financing, both to fund its operations and to refinance its
indebtedness as it matures; downturns in the current economic environment; the performance of its tenants; the impact of competition on its efforts to renew existing leases or re-lease space; and significant changes in interest rates. Additional factors that could cause actual results to differ materially from those stated or implied by its forward-looking statements are disclosed under the caption "Risk factors" of its Form 10-K for the fiscal year ended
CONTACT: Gladstone Commercial Corporation +1-703-287-5893Source:
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