Carey Diversified LLC Reports Fourth Quarter 1999 Results
FFO Per Share Increases to $0.53
NEW YORK, NY – March 16, 2000 – Carey Diversified LLC (NYSE: CDC), a market leader in the ownership and net-leasing of corporate properties, today reported that Funds From Operations ("FFO") for the three months ended December 31, 1999, was $13.6 million compared to $13.0 million, an increase of 4.4% from the same three-month period in 1998. On a per share basis, FFO was $0.53 per share (basic and diluted), compared to $0.51 per share in the previous year's fourth quarter.
Funds From Operations for the twelve months ended December 31, 1999 increased 7.34% to $52.9 million compared to $49.3 million for the comparable twelve months last year. On a per share basis, FFO increased to $2.07 per share compared to $1.98 per share for the comparable twelve-month period. FFO is the most commonly accepted and reported measure of operating performance for a real estate investment company.
Income for the three-month period ended December 31, 1999 increased 7.3% compared to the same three-month period in 1998, excluding writedowns to fair value. Net income decreased over the quarter ended December 31, 1999, largely as a result of non-cash writedowns of $5.83 million, primarily to account for a decline in the value of units in the operating partnership of Meristar Hospitality Corp., Inc. held by Carey Diversified. While the value of these units, which were received in exchange for equity capital invested in a hotel property, has declined, they are currently worth $4.25 million more than the original equity capital invested in the property.
In December, Carey Diversified's Board of Directors declared a quarterly cash dividend of $0.4175 per common share (on an annualized basis, $1.67 per share), the Company's fourth quarterly dividend this year at this rate and an increase over last year's rate of $1.65. The dividend was payable on January 15, 2000 to shareholders of record on December 15, 1999. Since Carey Diversified became public in January 1998, it has paid out over $84.0 million, or $3.32 per share, in dividends to Carey Diversified's shareholders.
FOURTH QUARTER HIGHLIGHTS
- FFO per diluted share increased 3.9% for the comparable three-month period.
- Dividend payout ratio decreased from 80.9% to 78.8% while strengthening FFO.
- Carey Diversified completed a transaction valued at $11.0 million for a 148,100 square foot distribution/ warehouse facility in Missouri when the Seven Up Bottling Co. of St. Louis, Inc. exercised a purchase option on the property. The facility was originally purchased by the Company in 1987 for $4.7 million.
- Carey Diversified structured an $8.5 million stock-for-property swap for a 67,300 square foot office and call center facility located in Lafayette, Louisiana leased to BellSouth Telecommunications, Inc. under a ten-year lease. In addition, upon closing the transaction, Carey Diversified simultaneously obtained a $6.0 million non-recourse loan on the property.
- In November, Carey Diversified's Board of Directors unanimously approved a merger with W. P. Carey & Co. LLC, a transaction which Carey Diversified's Board believes will be immediately accretive to FFO, provide the Company unique access to capital, allow for enhanced growth, improve and strengthen the Company's credit profile and provide greater potential for future growth.
- In December, Carey Diversified announced a plan to repurchase up to 1,000,000 shares of the Company's stock on the open market over a period not to exceed one year, at the discretion of management. Management believes that shares of Carey Diversified represent a considerable value at current prices.
PERFORMANCE
Commenting on the Company's performance, Francis J. Carey, Chairman and Chief Executive Officer said, "Since its inception as a public company more than two years ago, Carey Diversified has delivered increases in FFO over each year-to-year period. In addition, we have delivered on our commitment to provide both stable and increasing dividends throughout our history. Management remains focused on producing transactions that will continue to enhance long-term shareholder value."
Carey Diversified LLC, a member of the $2.5 billion W. P. Carey Group, is the largest limited liability company traded on the New York Stock Exchange. The Company's portfolio consists of 210 properties totaling more than 20 million square feet. Carey Diversified leases properties to manufacturing, technology, retailing and communications companies, including Federal Express Corp., America West Airlines, Detroit Diesel, Dr Pepper Bottling Company of Texas, Wal-Mart, AT&T, The Gap and more than 70 others. Additional information about Carey Diversified LLC is available on the Company's website at: www.careydiv.com.
On November 30, 1999, the Board of Directors of Carey Diversified, LLC unanimously approved a merger with W. P. Carey & Co, Inc. If approved by the shareholders of Carey Diversified, assets under ownership or management will increase from approximately $800 million to approximately $2.5 billion post merger. The combined business will be renamed W. P. Carey & Co. LLC to capitalize on the strong corporate identity that W. P. Carey has built among its clients and the investment community over the last 26 years. The new entity expects to be listed on the New York Stock Exchange and the Pacific Stock Exchange under the symbol "WPC."
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 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 the company, reference is made to the company's filings with the Securities and Exchange Commission.
