WEBCAST • WPC Second Quarter Financial Results
NEW YORK, NY, August 2, 2005 – Investment firm W. P. Carey & Co. LLC (NYSE: WPC) today reported financial results for the three and six-month periods ended June 30, 2005.
QUARTERLY AND SIX-MONTH RESULTS
-
Net income for the three-month period increased 9% to $16.9 million, up from $15.5 million during the similar period in 2004. Net income for the six-month period decreased to $22.8 million, as compared to $26.6 million during the similar period in 2004. Diluted earnings per share (EPS) for the three-month period increased 7.5% to $0.43, as compared to $0.40 during the same period in 2004. EPS for the six-month period decreased to $0.58, versus $0.69 for the same period in 2004. The increase in net income for the three-month period was largely due to a gain of approximately $9.1 million on the sale of real estate during the quarter. The decreases in net income and EPS for the six-month period were predominantly due to the shift in acquisitions volume to CPA®:16 – Global, resulting in deferral of a portion of fees until the preferred return is achieved; a significant decrease in other operating income; and additional impairment charges of $7.9 million. These declines were partially offset by increased rental income from properties the Company acquired from its affiliate, Carey Institutional Properties, in September 2004 and the gain of approximately $9.1 million on the sale of real estate in 2005.
-
Income from Continuing Operations for the three-month period was $13.2 million, as compared to $19.3 million during the same period in 2004. Total revenues for the three-month period were $42.5 million, as compared to $49.9 million for the same period in 2004. The decline in Income from Continuing Operations for the three-month period was due in large part to a decrease of $7.8 million in fees from the Company’s affiliates resulting primarily from a lower volume of investments on behalf of its CPA® series of income generating real estate funds in the second quarter of 2005, as compared with the prior year period. For the six-month period Income from Continuing Operations was $27.7 million, as compared to $29.5 million for the similar period in 2004. The decline in income for the six-month period was due to the recognition of other operating income of $4.5 million in 2004, versus $972,000 in 2005. This was partially offset by impairment charges of $2.8 million recorded in 2004. Total revenues for the six-month period increased to $86.5 million, up from $83.7 million during the similar period in 2004.
-
Funds from Operations (FFO), as per the attached schedule, which are calculated consistently with the Company’s prior FFO reporting, for the three-month period were $0.64 per diluted share, or $24.8 million, as compared to $0.86 per diluted share, or $33.1 million for the comparable period in 2004. FFO for the six-month period were $1.24 per diluted share, or $48.7 million, down from $1.41 per diluted share, or $54.5 million for the similar period a year ago. These declines were due primarily to the reduction in fees from the Company’s affiliates as described above.
-
Cash Flows from Operating Activities for the six-month period were $30.3 million, as compared to $40.9 million during the similar period in 2004. This decline was due in large part to the prepayment of estimated tax liabilities, as well as an increase in the amount of management fees taken by the Company in stock of its CPA® funds.
-
Total investments for the three-month period by the Company, on behalf of its CPA® funds, were $262 million, as compared to $430 million during the similar period in 2004 (in April 2004, the Company completed a $312 million transaction involving 78 U-Haul self-storage and truck rental facilities). For the three-month period, international transactions accounted for $164 million of the total investment volume, as compared to $32 million during the same period in 2004. Total investments for the six-month period were $627 million, as compared to $494 million in 2004. For the six-month period, international investments accounted for $301 million of the volume in 2005, as compared to $44 million for the similar period in 2004.
-
The Board of Directors raised the cash dividend to $.446 per common share, from $.444 per common share, which was paid on July 15, 2005 to shareholders of record on June 30, 2005.
MANAGEMENT
-
Robert C. Kehoe was appointed Treasurer. Mr. Kehoe has served in W. P. Carey’s Finance Department for the past 18 years and received his MBA in Finance from Pace University.
-
The Company is continuing its search for a new Chief Financial Officer.
Gordon F. DuGan, President and Chief Executive Officer of W. P. Carey & Co. LLC, said, “We are pleased to report that our net income increased nine percent and our earnings per share increased 7.5 percent this quarter. In the face of a competitive environment, we are pleased with the investment volume for the six-months to date. It is worth noting that an increased portion of this volume is taking place outside the United States, specifically Europe. International investment volume for the six-month period rose to $301 million from $44 million in 2004. “We believe that our market presence in the U.S. and our ability to underwrite investments internationally will allow us to continue to find attractive yield investments for our investors. At the same time, we invest for the long-term and will remain disciplined in seeking such opportunities.”
UPCOMING EVENT
-
President and CEO Gordon DuGan will speak at The Wall Street Transcript’s Investing in the REIT Industry Conference at the Harvard Club in New York City at 11:10 AM on Tuesday, August 23, 2005. A live webcast of his presentation, as well as an archived version, will be available at
www.wpcarey.com.
CONFERENCE CALL & WEBCAST
Please call at least 10 minutes prior to register for call.
Time: Tuesday, August 2, 2005 11:00 am (ET)
Call-in number: 1-800-946-0786
(International) 719-457-2662
Webcast: CLICK HERE
Replay: Available after 1:00 PM. Call 1-888-203-1112
(International) 719-457-0820 with the access code 5787456
W. P. CAREY & CO. LLC
Founded in 1973, W. P. Carey & Co. LLC is a global investment firm concerned with assisting corporations with various forms of long-term financing. The Company also provides asset management services to the Corporate Property Associates (CPA®) series of income generating real estate funds. With $3.5 billion in equity capital, the W. P. Carey Group is one of the leading providers of net lease financing for corporate properties worldwide. The Group owns more than 650 commercial and industrial properties worldwide, representing over 90 million square feet, valued at more than $7.2 billion. www.wpcarey.com
Individuals interested in receiving future updates on W. P. Carey via e-mail can register at www.wpcarey.com/alerts.
This press release contains forward-looking statements within the meaning of the Federal securities laws. A number of factors could cause the company’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 commercial 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 the company, reference is made to the company’s filings with the Securities and Exchange Commission.
