UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): April 26, 2004
WEINGARTEN REALTY INVESTORS
(Exact name of Registrant as specified in its Charter)
Texas 1-9876 74-1464203
(State or other jurisdiction of (Commission file number) (I.R.S. Employer
incorporation or organization) Identification Number)
2600 Citadel Plaza Drive, Suite 300, Houston, Texas 77008
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (713) 866-6000
Not applicable
(Former name or former address, if changed since last report)
ITEM 7. EXHIBITS.
99.1 Press Release dated April 26, 2004.
ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
The information under this caption is furnished by Weingarten Realty
Investors (the "Company") in accordance with Securities Exchange Commission
Release No. 33-8216. This information shall not be deemed "filed" for purposes
of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), or incorporated by reference in any filing under the Securities Act of
1933, as amended, or the Exchange Act, except as shall be expressly set forth by
specific reference in such a filing.
On April 26, 2004, the Company issued a press release describing its
results of operations for the first quarter ended March 31, 2004. A copy of the
press release is attached as Exhibit 99.1 to this report. In the earnings
release, the Company used the non-GAAP financial measure of Funds from
Operations ("FFO"). A reconciliation of FFO to the comparable GAAP financial
measure (Net income) is contained in the attached earnings release. Disclosure
regarding the definition of FFO used by the Company and why the Company's
management believes the presentation of FFO provides useful information to
investors is included in the Company's annual report on Form 10-K for the fiscal
year ended December 31, 2003.
PAGE 2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: April 27, 2004
WEINGARTEN REALTY INVESTORS
By: /s/ Joe D. Shafer
--------------------------
Joe D. Shafer
Vice President/Controller
PAGE 3
INDEX TO EXHIBITS
99.1 Press Release dated April 26, 2004.
PAGE 4
NEWS RELEASE
Information: Tracy Pursell
(713) 866-6050
WEINGARTEN REALTY INVESTORS ANNOUNCES
FIRST QUARTER 2004 FFO UP 18.9%
Houston, Texas, April 26, 2004: Weingarten Realty Investors (NYSE:WRI)
announced today the results of its first quarter ended March 31, 2004. All per
share amounts are adjusted for WRI's 3 for 2 share split completed on March 30,
2004:
- Net income available to common shareholders increased to $27.1
million, as compared to $25.0 million in the first quarter 2003, an
increase of 8.4%.
- Funds from Operations (FFO), considered the most meaningful
performance measurement within the REIT industry, increased to $52.2
million for the first quarter of 2004 from $43.9 million for the same
period in 2003, an 18.9% increase. On a diluted per share basis, FFO
increased to $.62 per share as compared to $.56 per share for the same
quarter of the previous year, a 10.7% increase.
- Rental revenues for the first quarter of 2004 were $116.0 million, up
from $96.4 million for the first quarter of 2003, a 20.3% increase.
- Weingarten invested $240.9 million in acquisitions and new development
projects.
- The Company raised $121.1 million through the sale of 3.6 million
common shares at $33.64 per share, and issued $200 million of
medium-term notes with 10-year maturities and an effective weighted
average interest rate of 5.2%.
- Weingarten called for the redemption of its 7.0% Cumulative Redeemable
Preferred C Shares totaling $112.6 million, effective April 1, 2004.
- Occupancy of the overall portfolio was reported at 93.5% for the first
quarter of 2004, up from 91.8% for the first quarter of 2003.
Occupancy for the retail properties was 93.5% at March 31, 2004 as
compared to 92.6% at March 31, 2003, and the industrial portfolio's
occupancy increased to 93.2% from 89.0% for the first quarter of 2003.
- The Company completed a 3 for 2 share split on March 30, 2004 to
shareholders of record on March 16, 2004.
- The Board of Trust Managers declared a dividend of $.415 per common
share for the first quarter of 2004, up from $.39 per common share in
2003, both on a post-split basis. On an annualized basis, this
represents a dividend of $1.66 per share as compared to $1.56 per
share for the prior year, a 6.4% increase. The dividend is payable on
June 15, 2004 to shareholders of record on June 4, 2004. This
represents a common dividend payout ratio of 68.1% of Funds from
Operations.
In announcing the results for the first quarter, Drew Alexander, President and
Chief Executive Officer, attributed the Company's increase in all measures of
performance to its acquisitions and new development projects coming on-line, as
well as to increased rental revenues from the existing portfolio.
Alexander commented, "Weingarten had an extremely successful quarter with
respect to acquisitions, purchasing seven shopping centers totaling 1.5 million
square feet with a total investment of $230.4 million and a projected return of
slightly over 8%. We currently have a number of potential acquisitions in
various stages of due diligence, and, combined with these first quarter
acquisitions, we are very comfortable that we will achieve our 2004 acquisition
plan of $400 million."
Alexander also reported that the Company currently has 13 retail development
properties in various stages of construction. During the first quarter of 2004,
Weingarten invested $10.5 million in these properties, which are currently 86%
leased. Upon completion, these developments will represent an investment of
approximately $129 million and will add 937,000 square feet to the portfolio.
All 13 retail developments are anchored either by a market-dominant supermarket
or a national discount department store such as Target or Wal-Mart, and will
come on-line during the remainder of 2004 and into 2005.
With respect to the existing portfolio, Alexander noted that the Company
completed 264 new leases or renewals totaling 973,000 square feet during the
first quarter 2004, with an average rental rate increase of 8.5% on a same-space
basis from first quarter 2003. Net of capital costs associated with
improvements to the leased spaces, rental rates increased 6.4%.
Alexander further commented with regard to financing activities, "During the
first quarter we issued 3.6 million common shares at $33.64. The net proceeds
of $118 million were primarily used to redeem our 7.0% Cumulative Redeemable
Series C Preferred Shares totaling $112.6 million, which were called on March 2,
2004 and redeemed on April 1, 2004. We also continued our practice of
refinancing short-term, variable-rate debt under our revolving line of credit
with longer-term, fixed-rate debt. During the quarter ended March 31, 2004, we
issued a total of $200 million of 10-year medium-term notes through three
separate transactions with an effective weighted average interest rate of 5.2%.
Although these transactions have a negative impact on our interest expense, we
believe it is prudent to reduce Weingarten's exposure to future interest rate
increases."
Alexander stated, "We are extremely optimistic about the balance of 2004 as we
work to maximize the potential of our existing portfolio, assess acquisition and
development opportunities and evaluate alternative financing opportunities that
will benefit Weingarten over the long-term. Subsequent to March 31, 2004, we
acquired 50% joint venture interests in three shopping centers in McAllen, Texas
totaling 467,900 square feet. In April, we issued an additional $50 million
10-year medium-term note with an effective interest rate of 4.8%, further fixing
favorable longer-term debt in order to pay down our revolver, which resulted in
lowering our variable-rate debt to only 18% of total debt. Leasing activity
remains strong, and we expect occupancy to continue to increase."
The Board of Trust Managers also declared dividends on the Company's 6.75%
Series D Cumulative Redeemable Preferred Shares (NYSE:WRIPrD) of $.421875 per
share, payable on June 15, 2004 to shareholders of record on June 4, 2004.
The Company also announced that it will host a live webcast of its quarterly
conference call on Monday, April 26, 2004 at 10:00 a.m. Central Time. The
webcast can be accessed via the Company's website at www.weingarten.com. A
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replay is also available at the website starting approximately two hours
following the live call or can be heard by calling 877-519-4471, identification
number 4672658 for the following 24 hours.
Weingarten Realty Investors is a Houston, Texas based real estate investment
trust with 337 income-producing and new development properties in 20 states that
span from coast to coast in the southern half of the United States. Included in
the portfolio are 276 neighborhood and community shopping centers and 61
industrial properties aggregating 44.8 million square feet. Weingarten has one
of the most diversified tenant bases of any major REIT in its sector, with the
largest of its 4,900 tenants comprising less than 3% of its rental revenues.
Listed on the New York Stock Exchange, the Company's common shares are traded
under the symbol "WRI". For further information on the Company, please visit
www.weingarten.com.
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STATEMENTS INCLUDED HEREIN THAT STATE THE COMPANY'S OR MANAGEMENT'S INTENTIONS,
HOPES, BELIEFS, EXPECTATIONS OR PREDICTIONS OF THE FUTURE ARE "FORWARD-LOOKING"
STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995 WHICH BY THEIR NATURE, INVOLVE KNOWN AND UNKNOWN RISKS AND UNCERTAINTIES.
THE COMPANY'S ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS COULD DIFFER
MATERIALLY FROM THOSE EXPRESSED AS IMPLIED BY SUCH STATEMENTS. REFERENCE IS
MADE TO THE COMPANY'S REGULATORY FILINGS WITH THE SECURITIES AND EXCHANGE
COMMISSION FOR INFORMATION OR FACTORS, WHICH MAY IMPACT THE COMPANY'S
PERFORMANCE.
FINANCIAL STATEMENTS
WEINGARTEN REALTY INVESTORS
(in thousands, except per share amounts that are reported on a post-split basis)
Three Months Ended
March 31,
STATEMENTS OF CONSOLIDATED INCOME AND 2004 2003
FUNDS FROM OPERATIONS (Unaudited)
------------ ------------
Rental Income $ 116,001 $ 96,383
Interest Income 276 246
Other Income 1,571 1,018
------------ ------------
Total Revenues 117,848 97,647
------------ ------------
Depreciation and Amortization 26,663 21,057
Interest Expense 27,733 19,439
Operating Expense 17,214 14,047
Ad Valorem Taxes 14,527 11,419
General and Administrative Expense 4,026 3,057
------------ ------------
Total Expenses 90,163 69,019
------------ ------------
Operating Income 27,685 28,628
Equity in Earnings of Joint Ventures 1,286 1,038
Income Allocated to Minority Interests (879) (895)
Gain on Sale of Properties 317 9
------------ ------------
Income Before Discontinued Operations 28,409 28,780
------------ ------------
Operating Income From Discontinued Operations 240
Gain on Sale of Properties 871
------------ ------------
Income from Discontinued Operations 1,111
------------ ------------
Net Income 28,409 29,891
Less: Preferred Dividends 1,266 4,922
------------ ------------
Net Income Available to Common Shareholders--Basic $ 27,143 $ 24,969
============ ============
Net Income Per Common Share--Basic $ 0.33 $ 0.32
============ ============
Net Income Available to Common Shareholders--Diluted $ 27,969 $ 25,801
============ ============
Net Income Per Common Share--Diluted $ 0.32 $ 0.32
============ ============
Funds from Operations:
Net Income Available to Common Shareholders $ 27,143 $24,969
Depreciation and Amortization 24,754 19,392
Depreciation and Amortization of Unconsolidated Joint Ventures 657 434
Gain on Sale of Properties (317) (880)
------------ ------------
Funds from Operations--Basic $ 52,237 $ 43,915
============ ============
Funds from Operations Per Common Share--Basic $ 0.63 $ 0.56
============ ============
Funds from Operations--Diluted $ 53,567 $ 45,178
============ ============
Funds from Operations Per Common Share--Diluted $ 0.62 $ 0.56
============ ============
Weighted Average Shares Outstanding--Basic 83,143 78,136
============ ============
Weighted Average Shares Outstanding--Diluted 86,281 81,026
============ ============
March 31, December 31,
2004 2003
CONSOLIDATED BALANCE SHEETS (Unaudited) (Audited)
------------ ------------
Property $ 3,447,492 $ 3,200,091
Accumulated Depreciation (549,714) (527,375)
Investment in Real Estate Joint Ventures 35,671 35,085
Notes Receivable 41,705 36,825
Unamortized Debt and Lease Costs 78,170 70,895
Accrued Rent and Accounts Receivable, net 29,244 40,325
Cash and Cash Equivalents 34,455 20,255
Other Assets 52,152 46,993
------------ ------------
Total Assets $ 3,169,175 $ 2,923,094
============ ============
Debt $ 1,947,070 $ 1,810,706
Preferred Shares Subject to Mandatory Redemption, net 109,378 109,364
Accounts Payable and Accrued Expenses 52,466 78,986
Other 77,558 52,671
------------ ------------
Total Liabilities 2,186,472 2,051,727
------------ ------------
Minority Interest 56,033 49,804
------------ ------------
Preferred Shares of Beneficial Interest 90 90
Common Shares of Beneficial Interest 2,562 2,488
Capital Surplus 1,112,768 993,570
Accumulated Dividends in Excess of Net Income (182,670) (174,234)
Accumulated Other Comprehensive Loss (6,080) (351)
------------ ------------
Total Shareholders' Equity 926,670 821,563
------------ ------------
Total Liabilities and Shareholders' Equity $ 3,169,175 $ 2,923,094
============ ============
Note: Certain reclassifications of prior years' amounts have been made to conform with the
current year presentation.