BNP Residential Properties, Inc. Announces Fourth Quarter and 2002 Operating Results.Business Editors CHARLOTTE, N.C.--(BUSINESS WIRE)--Feb. 18, 2003 BNP BNP B-type natriuretic peptide, brain natriuretic peptide Physiology A 32-residue peptide hormone produced predominantly in the ventricles, secreted in response to fluid overload–eg, CHF. See Atrial natriuretic peptide. Residential Properties, Inc. (AMEX AMEX See: American Stock Exchange : BNP) today announced operating results for the quarter and year ended December December: see month. 31, 2002. Overview: BNP Residential Properties, Inc. is a real estate investment trust focused on owning and operating apartment communities. We own and operate 18 apartment communities containing a total of 4,427 apartments and provide third-party management services for 12 apartment communities containing a total of 2,784 apartments. In addition to our apartment properties, we own 42 restaurant properties, which are leased on a triple net basis to a restaurant operator. We operate in the states of North Carolina North Carolina, state in the SE United States. It is bordered by the Atlantic Ocean (E), South Carolina and Georgia (S), Tennessee (W), and Virginia (N). Facts and Figures Area, 52,586 sq mi (136,198 sq km). Pop. , South Carolina South Carolina, state of the SE United States. It is bordered by North Carolina (N), the Atlantic Ocean (SE), and Georgia (SW). Facts and Figures Area, 31,055 sq mi (80,432 sq km). Pop. (2000) 4,012,012, a 15. and Virginia Virginia, state, United States Virginia, state of the south-central United States. It is bordered by the Atlantic Ocean (E), North Carolina and Tennessee (S), Kentucky and West Virginia (W), and Maryland and the District of Columbia (N and NE). . BNP Residential Properties, Inc. is structured as an UpREIT or umbrella umbrella, a small canopy used as a protection against the sun in China, Egypt, and elsewhere in remote antiquity. It was often an emblem of rank. During the Middle Ages the umbrella became almost extinct in Europe; its usefulness was not rediscovered until the late partnership real estate investment trust. The Company is the sole general partner and owns a controlling interest controlling interest The ownership of a quantity of outstanding corporate stock sufficient to control the actions of the firm. Controlling interest often involves ownership of significantly less than 51% of a firm's outstanding stock because many owners fail in BNP Residential Properties Limited Partnership, the operating partnership. All of the Company's operations are conducted through the operating partnership. Operating Results: See Tabular tab·u·lar adj. 1. Having a plane surface; flat. 2. Organized as a table or list. 3. Calculated by means of a table. tabular resembling a table. Information Below Results of Operations For the Year ended December 31, 2002 Funds From Operations Funds From Operations (FFO) Used by real estate and other investment trusts to define the cash flow from trust operations; earnings with depreciation and amortization added back. : The Company believes that FFO FFO See: Funds from operations is an additional meaningful measure of operating performance. FFO equals net income (computed in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ) before minority interest and extraordinary item, plus depreciation, less cumulative preferred Noun 1. cumulative preferred - preferred stock whose dividends if omitted accumulate until paid out cumulative preferred stock preference shares, preferred shares, preferred stock - stock whose holders are guaranteed priority in the payment of dividends but dividends. However, this information will necessarily be different from comparable information provided by other companies and should not be used as an alternative to the operating and other financial information as determined under accounting principles generally accepted in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . The computation Computation is a general term for any type of information processing that can be represented mathematically. This includes phenomena ranging from simple calculations to human thinking. of FFO can be found at the bottom of the attached Consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: Statements of Operations. Funds from operations of the operating partnership totaled $10.1 million in 2002, a decrease of 6.8% compared to $10.8 million in 2001. Funds from operations per share was $1.33 for 2002 as compared to $1.46 for 2001. Net Income: Net income was $1.2 million in 2002 compared to $2.2 million in 2001. Net income per common share was $0.16 per share for 2002 as compared to $0.39 per share in 2001. Revenues: Total revenue in 2002 was $38.2 million, an increase of 5.2% compared to 2001. Apartment related revenue (apartment rental RENTAL. A roll or list of the rents of an estate containing the description of the lands let, the names of the tenants, and other particulars connected with such estate. This is the same as rent roll, from which it is said to be corrupted. revenue plus revenue from apartment management and investment activities) accounted for 89.5% of total revenue in 2002. Restaurant rental revenue was 10.5% of total revenue in 2002. Apartments: Apartment rental revenue in 2002 was $32.9 million, an increase of 6.6% compared to 2001. The increase is primarily attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to the acquisition of three apartment communities during 2002. Average economic occupancy Gaining or having physical possession of real property subject to, or in the absence of, legal right or title. In a fire insurance policy, for example, the term occupancy for all apartments was 92.8% in 2002 compared to 93.9% in 2001. Average monthly revenue per occupied oc·cu·py tr.v. oc·cu·pied, oc·cu·py·ing, oc·cu·pies 1. To fill up (time or space): a lecture that occupied three hours. 2. To dwell or reside in. 3. unit for all apartments was $733 in 2002 compared to $744 in 2001. On a same units basis, apartment revenue decreased by 3.0% for 2002. The decrease in same unit apartment revenue was the result of a decline in both average economic occupancy and average revenue per occupied unit. On a same units basis, average economic occupancy was 92.8% in 2002 compared to 93.9% in 2001. Average monthly revenue per occupied unit for the same store units was $730 compared to $744 in 2001. Restaurants: Restaurant rental income Noun 1. rental income - income received from rental properties income - the financial gain (earned or unearned) accruing over a given period of time in 2002 was $4.0 million, essentially unchanged from 2001. Same store sales Same Store Sales A statistic used in retail industry analysis. It compares sales of stores that have been open for a year or more. Notes: This statistic allows investors to determine what portion of new sales has come from sales growth and what portion from the opening of at our restaurant properties decreased by 2.6% in 2002. For both 2002 and 2001, restaurant rental income was the minimum rent required under the lease. We do not expect to receive more than the minimum rent for the foreseeable fore·see tr.v. fore·saw , fore·seen , fore·see·ing, fore·sees To see or know beforehand: foresaw the rapid increase in unemployment. future. Other Income: Management fee income for 2002 was $1.1 million, an increase of 107.1%. This increase is attributable to a significant increase in the number of managed properties in the fourth quarter of 2001 and early 2002. Interest and other income declined from approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $813,000 in 2001 to approximately $158,000 in 2002. The decline in interest and other income was primarily attributable to our having received both a substantial payment of participation interest (approximately $350,000) from our interest in a rehabilitation rehabilitation: see physical therapy. project at one of the managed apartment properties and a tax refund Tax refund Money back from the government when too much tax has been paid or withheld from a salary. (approximately $140,000)in 2001. Expenses: Total expenses, including non-cash charges Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. for depreciation and amortization, were $36.5 million in 2002, an increase of 9.9% compared to 2001. Apartment operations expense (the direct costs of on-site on-site adj. Done or located at the site, as of a particular activity: on-site monitoring of a production run; an on-site film shoot. operations) was $12.7 million in 2002, an increase of 13.4% compared to 2001. The increase reflects the addition of three apartment communities during 2002 as well as significant increases in taxes and insurance. Apartment operations expense represented 38.6% of related apartment rental income compared to 36.2% in 2001. On a same units basis, apartment operations expense increased 3.7% in 2002. Apartment administrative expense (the costs associated with oversight
Oversight may refer to:
Operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. for restaurant properties are insignificant because the restaurant properties' triple-net lease arrangement requires the lessee One who rents real property or Personal Property from another. A lessee of land is a tenant. Cross-references Landlord and Tenant. lessee n. the person renting property under a written lease from the owner (lessor). to pay virtually all of the expenses associated with the restaurant properties. Corporate administration expense was $2.0 million in 2002, an increase of 7.8% compared to 2001. Depreciation and amortization totaled $9.1 million in 2002, an increase of 12.9% compared to 2001. This increase was primarily attributable to the acquisition of three apartment communities during 2002. Interest expense was $11.5 million in 2002, an increase of 3.2% compared to 2001. This increase was primarily attributable to the acquisition of three apartment communities during 2002. Dividend: The Company paid dividend distributions totaling $1.24 per share during 2002 and 2001. For 2002, 80.6% of the distribution was classified as non-taxable non-taxable adj → nicht steuerpflichtig non-taxable adj non-taxable income → reddito non imponibile return of capital and 19.4% was ordinary taxable dividend income. The Company paid preferred dividend preferred dividend n. a payment of a corporation's profits to holders of preferred shares of stock. (See: preferred stock) distributions totaling $1.10 per share during 2002. There were no preferred dividends paid in 2001. For the Quarter ended December 31, 2002 Funds from Operations: Funds from operations of the operating partnership for the fourth quarter of 2002 totaled $2.2 million, a decrease of 19.6% compared to the fourth quarter of 2001. Funds from operations per share was $0.28 for the fourth quarter of 2002 compared to $0.36 for the fourth quarter of 2001. Net income: Net loss for the fourth quarter of 2002 was $116,359 compared to net income of $532,769 in the fourth quarter of 2001. On a per common share basis, the Company showed a net loss of $0.04 per share for the fourth quarter of 2002, as compared to net income of $0.09 per share in the fourth quarter of 2001. Revenues: Total revenue for the fourth quarter of 2002 was $10.2 million, an increase of 14.3% compared to the same period in 2001. Apartment rental revenue during the fourth quarter was $8.9 million, an increase of 16.7% compared to 2001. This increase was primarily attributable to the acquisition of three apartment communities in 2002. Average economic occupancy for all apartments was 92.0% for the fourth quarter of 2002 compared to 93.1% during the fourth quarter of 2001. Average monthly revenue per occupied unit for all apartments was $728 in the fourth quarter of 2002 compared to $741 in 2001. On a same units basis, apartment revenue decreased by 3.8% in the fourth quarter of 2002 as compared to the fourth quarter of 2001. This decrease was the result of a decline in both average economic occupancy and average revenue per occupied unit. On a same units basis, average economic occupancy was 92.1% for the fourth quarter of 2002 compared to 93.1% in the fourth quarter of 2001. Average monthly revenue per occupied unit for the same store units was $721 in the fourth quarter of 2002 compared to $741 in 2001. Restaurant rental income for the fourth quarter of 2002 and 2001 was the minimum rent required by the lease, $1.0 million. Same store sales at our restaurants decreased by 3.7% in the fourth quarter of 2002. Expenses: Total expenses, including non-cash charges for depreciation and amortization, were $10.4 million for the fourth quarter of 2002, an increase of 26.2% compared to 2001. Apartment operations expense was $3.6 million for the fourth quarter of 2002, an increase of 26.8% compared to 2001. The increase reflects the addition of three apartment communities during 2002 as well as significant increases in taxes and insurance. Apartment operations expense represented 40.9% of related apartment rental income for the fourth quarter of 2002 compared to 37.7% in 2001. On a same units basis, apartment operations expense increased by 5.7% for the fourth quarter of 2002 as compared to the fourth quarter of 2001. Apartment administrative expense increased by 18.0% for the fourth quarter of 2002 compared to 2001. The increase was primarily attributable to the acquisition of three apartment communities during 2002. Interest expense for the quarter was $3.2 million in 2002, an increase of 27.9% compared to 2001. This increase was primarily attributable to the acquisition of three apartment communities during 2002. Dividend: The Company paid dividend distributions totaling $0.31 per share during the fourth quarters of both 2002 and 2001. The Company paid preferred dividend distributions totaling $0.275 per share during the fourth quarter of 2002. There were no preferred dividends paid in 2001. President's Statement: Scott Wilkerson Wilkerson is a surname, and may refer to
tr. & intr.v. weak·ened, weak·en·ing, weak·ens To make or become weak or weaker. weak  en·er n. significantly
throughout 2002. While we believe in the long-term Long-termThree or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. prospects of our apartment markets, we do not anticipate any significant improvement in the near future. As a consequence, we have announced that our first quarter common stock dividend, which will be paid on February February: see month. 17, 2003, will be reduced to $0.25 per share. Our position has always been that we would pay the highest dividend that is reasonably prudent. Given current market conditions and the near-term near-term adj. Of, for, or involving a short period of time in the near future. outlook, we came to the conclusion that reducing our dividend to a more sustainable level was warranted. While it is unpleasant to announce a dividend reduction, we believe that this reduction is in the best long-term interest of the Company and our shareholders." Additional Information: More information may be obtained by calling our corporate offices at (704) 944-0100 or on our web site at www.bnproperties.com. Information requests may be e-mailed to the investor relations Investor relations The process by which the corporation communicates with its investors. department at investor.relations@bnproperties.com. Forward Looking Statement Disclosure: This press release includes forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. concerning the company's operations, economic performance and financial condition, including, in particular, forward-looking statements regarding future operations and performance. Such statements are subject to various risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors identified in our annual report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ending December 31, 2001.
BNP Residential Properties, Inc.
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Consolidated Statements of Operations and Funds from Operations
All amounts in thousands, except per share data
Three months ended Year ended
December 31 December 31
2002 2001(1) 2002 2001(1)
--------------- -----------------
Revenues
Apartment rental income $8,896 $7,620 $32,890 $30,867
Restaurant rental income 1,005 1,005 4,021 4,053
Management fee income 256 218 1,095 529
Interest and other income 27 69 158 813
------- ------- -------- --------
10,185 8,913 38,164 36,262
Expenses
Apartment operations 3,642 2,872 12,682 11,182
Apartment administration 434 367 1,364 1,107
Depreciation and amortization 2,557 2,052 9,050 8,018
Corporate administration 505 396 1,994 1,849
Interest 3,241 2,535 11,452 11,100
------- ------- -------- --------
10,378 8,222 36,542 33,257
------- ------- -------- --------
Income/(loss) before minority
interest and extraordinary item (193) 690 1,622 3,005
Minority interest in operating
partnership 77 (158) (300) (690)
------- ------- -------- --------
Income/(loss) before extraordinary
item (116) 533 1,321 2,315
Extraordinary item - - (73) (100)
------- ------- -------- --------
Net income/(loss) (116) 533 1,248 2,215
Cumulative preferred dividend (126) (3) (323) (3)
------- ------- -------- --------
Income/(loss) available to Common
Shareholders $(242) $530 $925 $2,212
======= ======= ======== ========
Income/(loss) before minority
interest and extraordinary item $(193) $690 $1,622 $3,005
less cumulative preferred dividend (126) (3) (323) (3)
add depreciation 2,481 2,001 8,794 7,828
------- ------- -------- --------
Funds from operations - Operating
Partnership 2,162 2,689 10,093 10,831
less minority interest in funds from
operations (523) (616) (2,380) (2,490)
------- ------- -------- --------
Funds from operations available to
common shareholders - basic $1,639 $2,073 $7,713 $8,341
======= ======= ======== ========
Per common share amounts - basic:
Income/(loss) before
extraordinary item $(0.02) $0.09 $0.23 $0.40
======= ======= ======== ========
Income/(loss) available to common
shareholders $(0.04) $0.09 $0.16 $0.39
======= ======= ======== ========
Funds from operations $0.28 $0.36 $1.33 $1.46
======= ======= ======== ========
Per common share amounts - diluted:
Income/(loss) before
extraordinary item $(0.03) $0.09 $0.21 $0.40
======= ======= ======== ========
Income/(loss) available to common
shareholders $(0.04) $0.09 $0.16 $0.39
======= ======= ======== ========
Funds from operations $0.28 $0.36 $1.33 $1.46
======= ======= ======== ========
Weighted average shares and units
outstanding:
Preferred B shares and units 455 10 293 2
======= ======= ======== ========
Common shares 5,820 5,736 5,787 5,717
Operating Partnership minority
units 1,844 1,706 1,786 1,706
------- ------- -------- --------
Common shares and minority
units 7,664 7,442 7,573 7,423
======= ======= ======== ========
(1) 2001 amounts have been adjusted to exclude amortization of
management intangible
We provide the following information to analysts and other members
of the financial community for use in their detailed analyses:
Three months ended Year ended
December 31 December 31
2002 2001(1) 2002 2001(1)
--------------- -----------------
Numerators:
------------------------------------
For basic per common share amounts -
Income/(loss) before
extraordinary item $(116) $533 $1,321 $2,315
Extraordinary item - loss on
early extinguishment of debt - - (73) (100)
Cumulative preferred dividend (126) (3) (323) (3)
------- ------- -------- --------
Income/(loss) available to common
shareholders - basic $(242) $530 $925 $2,212
======= ======= ======== ========
Income/(loss) before minority
interest and extraordinary item $(193) $690 $1,622 $3,005
Depreciation 2,481 2,001 8,794 7,828
Cumulative preferred dividend (126) (3) (323) (3)
Minority interest in FFO (523) (616) (2,380) (2,490)
------- ------- -------- --------
Funds from operations available
to Common shareholders - basic $1,639 $2,073 $7,713 $8,341
======= ======= ======== ========
For diluted per common share amounts
- Income/(loss) before minority
interest and extraordinary item $(193) $690 $1,622 $3,005
Cumulative preferred dividend (126) (3) (323) (3)
Extraordinary item - loss on
early extinguishment of debt
(including minority share) - - (95) (129)
------- ------- -------- --------
Income/(loss) available to common
shareholders - diluted $(319) $688 $1,204 $2,873
======= ======= ======== ========
Income/(loss) before minority
interest and extraordinary item $(193) $690 $1,622 $3,005
Depreciation 2,481 2,001 8,794 7,828
Cumulative preferred dividend (126) (3) (323) (3)
------- ------- -------- --------
Funds from operations available
to Common shareholders -
diluted $2,162 $2,689 $10,093 $10,831
======= ======= ======== ========
Denominators:
------------------------------------
For basic per common share amounts
- Weighted average common shares
outstanding 5,820 5,736 5,787 5,717
Effect of potentially dilutive
securities:
Convertible Preferred shares (2) - - - -
Convertible Operating
Partnership units 1,844 1,706 1,786 1,706
Stock options (3) 4 5 8 3
------- ------- -------- --------
For diluted per share amounts -
Adjusted weighted average common
shares and assumed conversions 7,668 7,447 7,581 7,426
======= ======= ======== ========
(1) 2001 amounts have been adjusted to exclude amortization of
management intangible
(2) Convertible Preferred shares are antidilutive.
(3) Includes only dilutive stock options.
BNP Residential Properties, Inc.
----------------------------------------------------------------------
Consolidated Balance Sheets
December 31 December 31
2002 2001
------------- -------------
(Unaudited)
Assets
Real estate investments at cost:
Apartment properties $275,712,863 $221,589,470
Restaurant properties 39,158,921 39,158,921
------------- -------------
314,871,784 260,748,391
Less accumulated depreciation (49,448,825) (40,751,890)
------------- -------------
265,422,959 219,996,501
Cash and cash equivalents 884,316 1,417,616
Other current assets 3,024,683 1,693,374
Notes receivable, net of reserve 100,000 100,000
Intangible related to acquisition of
management operations, net 1,115,088 1,115,088
Deferred financing costs, net 1,175,684 1,062,069
------------- -------------
Total assets $271,722,730 $225,384,648
------------- -------------
Liabilities and Shareholders' Equity
Deed of trust and other notes payable $211,584,935 $162,330,222
Accounts payable and accrued expenses 1,272,451 997,768
Deferred revenue and security deposits 1,313,239 1,349,155
Deferred credit for interest defeasance,
net 333,376 500,032
------------- -------------
214,504,001 165,177,177
Minority interest in Operating
Partnership 17,947,493 18,173,557
Shareholders' equity:
Preferred stock, $.01 par value,
10,000,000 shares authorized,
454,545 shares issued and
outstanding at December 31, 2002,
227,273 shares issued and
outstanding at December 31, 2001 5,000,000 2,500,000
Common stock, $.01 par value,
100,000,000 shares authorized,
5,831,077 shares issued and
outstanding at December 31, 2002,
5,744,873 shares issued and
outstanding at December 31, 2001 58,311 57,449
Additional paid-in capital 70,724,671 69,872,958
Distributions in excess of net
income (36,511,746) (30,396,493)
------------- -------------
Total shareholders' equity 39,271,236 42,033,914
------------- -------------
Total liabilities and shareholders'
equity $271,722,730 $225,384,648
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