Lexington Realty Trust Reports Fourth Quarter 2019 Results

2/20/20

NEW YORK, Feb. 20, 2020 (GLOBE NEWSWIRE) -- Lexington Realty Trust (NYSE:LXP), a real estate investment trust focused on single-tenant industrial real estate investments, today announced results for the fourth quarter and year ended December 31, 2019.

Fourth Quarter 2019 Highlights

  • Generated Net Income attributable to common shareholders of $83.6 million, or $0.33 per diluted common share.
  • Generated Adjusted Company Funds From Operations available to all equityholders and unitholders - diluted (“Adjusted Company FFO”) of $52.4 million, or $0.20 per diluted common share.
  • Raised net proceeds of approximately $71.0 million by issuing approximately 6.6 million common shares through the ATM program.
  • Disposed of 10 properties for an aggregate gross sale price of $172.7 million.
  • Acquired six industrial properties for an aggregate cost of $264.1 million.
  • Invested an aggregate of approximately $15.0 million in three new industrial development projects.
  • Completed 2.2 million square feet of new leases and lease extensions.
  • Declared a quarterly common share/unit dividend/distribution of $0.105 per share/unit, an increase of 2.4%.
  • Increased industrial portfolio to 81.5% of gross real estate assets.

Full Year 2019 Highlights

  • Generated Net Income attributable to common shareholders of $273.2 million, or $1.15 per diluted common share.
  • Generated Adjusted Company FFO of $196.6 million, or $0.80 per diluted common share.
  • Disposed of 22 properties for an aggregate gross sale price of $621.6 million.
  • Acquired 17 industrial properties for an aggregate cost of $703.8 million.
  • Invested an aggregate of $18.5 million in industrial development projects.
  • Increased total gross book value attributable to industrial assets from 71.2% to 81.5%.
  • Satisfied $199.2 million of secured debt at a weighted-average interest rate of 4.4%.
  • Extended the maturity of the revolving credit facility to 2023 and 2021 term loan to 2025, lowered the applicable margin rate and increased the commitment on the revolving credit facility, and swapped the LIBOR portion of the term loan interest rate to obtain a current fixed interest rate of 2.732% per annum.
  • Completed 6.4 million square feet of new leases and lease extensions, raising renewal Base Rents by 7.5%.

Subsequent Events

  • Acquired four industrial properties for an aggregate gross cost of approximately $195.0 million.

Adjusted Company FFO is a non-GAAP financial measure. It and certain other non-GAAP financial measures are defined and reconciled later in this press release.

T. Wilson Eglin, Chief Executive Officer and President of Lexington Realty Trust, commented “Our excellent fourth quarter execution raised overall 2019 investment activity to more than $700 million of high-quality industrial assets. Further, property sales exceeded $620 million, and leasing volume was approximately six million square feet. Adding to our growth opportunities, we invested approximately $15 million during the quarter in three new development projects. We were also active on the capital markets front during the quarter, raising net proceeds of $71 million through our ATM program.

We continue to focus on becoming a single-tenant industrial REIT, having made tremendous progress thus far in repositioning our portfolio. At year-end, our industrial exposure represented nearly 82% of gross book value, and we are well-positioned to grow our industrial portfolio to 90% or more of gross book value by year-end 2020. As a result of all of these positive developments, we announced early in the fourth quarter an increase in our annualized dividend to $0.42 per share, with the intent of raising it steadily each year moving forward, subject to Board approval.”

FINANCIAL RESULTS

Revenues

For the quarter ended December 31, 2019, total gross revenues were $83.0 million, compared with total gross revenues of $88.2 million for the quarter ended December 31, 2018. The decrease was primarily attributable to a decrease in revenue due to property sales, partially offset by 2019 and 2018 property acquisitions.

Net Income Attributable to Common Shareholders

For the quarter ended December 31, 2019, net income attributable to common shareholders was $83.6 million, or $0.33 per diluted share, compared with net income attributable to common shareholders for the quarter ended December 31, 2018 of $23.8 million, or $0.10 per diluted share.

Adjusted Company FFO

For the quarter ended December 31, 2019, Lexington generated Adjusted Company FFO of $52.4 million, or $0.20 per diluted share, compared to Adjusted Company FFO for the quarter ended December 31, 2018 of $53.7 million, or $0.22 per diluted share.

Dividends/Distributions

As previously announced, during the fourth quarter of 2019, Lexington declared its quarterly common share/unit dividend/distribution for the quarter ended December 31, 2019 of $0.105 per common share/unit, an increase of 2.4%, which was paid on January 15, 2020 to common shareholders/unitholders of record as of December 31, 2019. Lexington previously declared a dividend of $0.8125 per share on its Series C Cumulative Convertible Preferred Stock (“Series C Preferred”) for the quarter ended December 31, 2019, which was paid February 18, 2020 to Series C Preferred shareholders of record as of January 31, 2020.

BALANCE SHEET/CAPITAL MARKETS

In the fourth quarter of 2019, Lexington issued approximately 6.6 million common shares under its ATM program raising net proceeds of approximately $71.0 million.

In the fourth quarter of 2019, Lexington satisfied $22.0 million of non-recourse debt. In addition, Lexington assumed $41.9 million of non-recourse debt in connection with the acquisition of a property in the Phoenix, Arizona market. The non-recourse debt has a fixed interest rate of 4.29% and matures in 2031.

As of December 31, 2019, Lexington did not have an outstanding balance under its unsecured revolving credit facility.

2020 EARNINGS GUIDANCE

Lexington estimates that its net income attributable to common shareholders per diluted common share for the year ended December 31, 2020 will be within an expected range of $0.95 to $0.98. Lexington estimates that its Adjusted Company FFO for the year ended December 31, 2020 will be within an expected range of $0.74 to $0.77 per diluted common share. This guidance is forward looking, excludes the impact of certain items and is based on current expectations.

ABOUT LEXINGTON REALTY TRUST

Lexington Realty Trust (NYSE: LXP) is a publicly traded real estate investment trust (REIT) focused on single-tenant industrial real estate investments across the United States. Lexington seeks to expand its industrial portfolio through acquisitions, build-to-suit transactions, sale-leaseback transactions, development projects and other transactions, including acquisitions. For more information, including Lexington's Quarterly Supplemental Information package, or to follow Lexington on social media, visit www.lxp.com.