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): August 5, 2003
AmREIT
(Exact Name of Registrant as specified in its Governing Instrument)
TEXAS 0-28378 76-0410050
(State or other (Commission file number) (I.R.S. Employer
jurisdiction of Identification
incorporation or Number)
organization)
Eight Greenway Plaza, Suite 824, Houston, Texas 77046
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (713) 850-1400
Not applicable
(Former name or former address, if changed since last report)
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
99.1 Press release dated August 5, 2003.
Item 12. Results of Operations and Financial Condition.
On August 5, 2003, AmREIT (the "Company") issued a press release
announcing its consolidated financial results for the quarter ended June 30,
2003. A copy of the press release is furnished as Exhibit 99.1 to this report.
This information shall not be deemed "filed" for purposes of Section 18 of the
Securities Exchange Act of 1934, as amended, and is not incorporated by
reference into any filing of the Company, whether made before or after the date
hereof, regardless of any general incorporation language in such filing.
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SIGNATURES
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: August 5, 2003
Amreit, Inc.
By: /s/ Chad C. Braun
-----------------------------------------
Chad C. Braun
Chief Financial Officer
Executive Vice President
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AMREIT ANNOUNCES SECOND QUARTER OPERATING RESULTS
HOUSTON, TX (August 5, 2003) - AmREIT (AMEX: AMY), a Texas-based real estate
investment trust announced that its net income available to its class A
shareholders ("EPS") for the second quarter 2003 was $0.075 per class A share,
compared to $0.110 per share for the same period in 2002. AmREIT's EPS for the
six months ended June 30, 2003 was $0.077 compared to $0.188 for the same
period in 2002. Funds from operations ("FFO") for the second quarter of 2003
totaled $0.153 per class A share, compared with $0.164 for the same period in
2002. AmREIT's FFO for the six months ended June 30, 2003 was $0.236 compared
to $0.295 for the same period in 2002. A reconciliation of net income to FFO is
included in the financial tables accompanying this press release.
AmREIT closed on approximately $7.2 million in property acquisitions during the
second quarter and owns a portfolio of 50 single-tenant and multi-tenant
commercial retail properties, located in 20 states, with an economic occupancy
of 98.4% during the second quarter. AmREIT broke ground on its Eckerd
development in the Houston galleria/uptown area, has contracted to purchase a
TGI Friday's restaurant in Hanover, Maryland and has contracted to purchase a
16,395 square foot multi-tenant shopping center in Houston, Texas. The first
significant contribution to earnings from these acquisitions/developments will
take place in the first quarter 2004.
Management expects EPS for the third quarter of 2003 of between $0.08 and $0.09
and for the calendar year 2003 of between $0.23 and $0.25 per share, and
adjusted FFO for the third quarter of 2003 of between $0.16 and $0.17 and for
the calendar year of 2003 of between $0.54 and $0.56. This represents an
increase in adjusted FFO of over 20% when compared to adjusted FFO of $0.42 per
share for 2002. AmREIT updates earnings guidance on a quarterly basis.
AmREIT is an American Stock Exchange listed real estate investment trust
operating in two distinct lines of business. The Investment Sponsorship
division is a sponsor of high quality real estate investment opportunities to
the independent financial planning community. The Company researches,
identifies and participates in quality real estate opportunities and works hand
in hand with the broker-dealer financial services community to sponsor real
estate investment products and services. AmREIT's real estate team focuses on
the development, management, brokerage and ownership of freestanding
credit-tenant leased and multi-tenant shopping centers located contiguous to
major thoroughfares and traffic generators. AmREIT projects have been leased to
parent companies such as Goodyear Tire, Washington Mutual, IHOP, McDonalds,
Memorial Herman Hospital, RadioShack, Sprint, Coldwell Banker, Jack in the Box,
Guaranty Federal, Bennigan's, Chili's, Texas Children's Hospital, and Discount
Tire.
In addition to historical statements included in this press release, certain
statements are included that state the Company's or management's intentions,
hopes, beliefs, expectations or predictions of the future and are considered
"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.
For further information, contact AmREIT's Investor Relations Department at
800-888-4400 or 713-850-1400, or access our web site at www.amreit.com.
Operating Results
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
Revenues: 2003 2002 2003 2002
---- ---- ---- ----
Rental income from
operating leases $ 1,265,235 $ 677,614 $ 2,497,975 $ 1,384,354
Earned income from direct
financing leases 670,608 437,169 1,269,328 628,351
Service fee income 848,863 52,378 1,059,860 531,396
Management fees 52,616 94,276 110,247 185,406
Income from non-consolidated
Affiliates 45,033 1,467 85,338 283,509
Interest and other income 1,991 208,303 3,830 210,331
----------- ------------ ------------ -----------
Total Revenues 2,884,346 1,471,207 5,026,578 3,223,347
Expenses:
General operating and
administrative 785,090 439,962 1,542,219 1,203,523
Legal and professional 545,942 161,998 732,676 371,925
Interest 593,905 410,032 1,145,346 663,680
Depreciation and amortization 209,404 126,822 431,707 253,670
------------- ------------ ------------ -----------
Total Expenses 2,134,341 1,138,814 3,851,948 2,492,798
Income before federal income taxes and
minority interest in income of
consolidated joint ventures
750,005 332,393 1,174,630 730,549
Federal income tax (expense) benefit
for taxable REIT subsidiary
(57,700) 69,000 15,300 (15,000)
Minority interest in income of
consolidated joint venture (43,161) (140,100) (82,949) (271,945)
-------------- ------------ -------------- ------------
Net income 649,144 261,293 1,106,981 443,604
Distributions paid to class B
shareholders (439,124) - (891,667) -
-------------- ------------ -------------- ------------
Net income available to class A
shareholders $ 210,020 $ 261,293 $ 215,314 $ 443,604
Funds From Operations ("FFO"):
Net income $ 649,144 $ 261,293 $ 1,106,981 $ 443,604
Depreciation 228,053 126,822 462,689 253,670
Class B distributions (439,124) - (891,667) -
-------------- ----------- ------------- -----------
FFO available to class A Shares $ 438,073 $ 388,115 $ 678,003 $ 697,274
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Basic Per Share Data:
Net income available to class A
shareholders $ 0.075 $ 0.110 $ 0.077 $ 0.188
FFO - Basic 0.157 0.164 0.244 0.295
Distributions per Class A share 0.111 0.071 0.222 0.140
Distributions per Class B share 0.209 - 0.392 -
Weighted average number of class A
common shares outstanding
2,790,492 2,364,807 2,779,434 2,358,283
Weighted average number of class B
common shares outstanding
2,100,638 - 2,273,849 -
Balance Sheet Highlights
(Unaudited)
As of June 30,
2003 2002
---- ----
Total property, net $ 50,033,640 $ 28,836,524
Net investment in direct financing leases 27,155,700 16,895,057
Total assets 80,440,990 48,365,670
Notes payable 40,996,381 26,429,521
Total liabilities 42,152,009 27,060,210
Minority interest 800,570 5,657,132
Total shareholders' equity 37,488,411 15,651,328
Non-GAAP Financial Disclosure
(Unaudited)
This press release contains certain non-GAAP financial measures that management
believes are useful in evaluating an equity REIT's performance. AmREIT's
definitions and calculations of non-GAAP financial measures may differ from
those used by other equity REIT's, and therefore may not be comparable. The
non-GAAP financial measures should not be considered as an alternative to net
income as an indication of our operating results, or to net cash provided by
operating activities as a measure of our liquidity.
AmREIT considers FFO to be an appropriate measure of performance of an equity
REIT. The National Association of Real Estate Investment Trusts ("NAREIT")
defines FFO as net income computed in accordance with generally accepted
accounting principles ("GAAP"), excluding gains or losses from sales of
property, plus real estate depreciation and amortization, and after adjustments
for unconsolidated partnerships and joint ventures. AmREIT further adjusts FFO
by adding back non-cash charges to earnings related to the issuance of stock in
conjunction with the payment of deferred merger costs, resulting in its adjusted
FFO. The Company considers FFO to be an appropriate supplemental measure of
operating performance because, by excluding gains or losses on dispositions and
excluding depreciation, FFO is a helpful tool that can assist in the comparison
of the operating performance of a company's real estate between periods, or as
compared to different companies. FFO is not defined by GAAP and should not be
considered as an alternative to net income as an indication of our operating
performance or to net cash provided by operating activities as a measure of our
liquidity. FFO and adjusted FFO as disclosed by other REITs may not be
comparable to AmREIT's calculation.
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Projected FFO is calculated in a method consistent with historical FFO, and
AmREIT considers projected FFO to be an appropriate supplemental measure when
compared with projected EPS. A reconciliation of the projected FFO to projected
EPS per share is provided below:
--------------------------------------------------------- ------------------------ -----------------------
3Q2003 Range 2003 Range
--------------------------------------------------------- ------------------------ -----------------------
--------------------------------------------------------- ----------- ------------ ----------- -----------
Low High Low High
--------------------------------------------------------- ----------- ------------ ----------- -----------
--------------------------------------------------------- ----------- ------------ ----------- -----------
Projected net income available to class A shareholders
$ 0.080 $ 0.090 $ 0.230 $ 0.250
--------------------------------------------------------- ----------- ------------ ----------- -----------
--------------------------------------------------------- ----------- ------------ ----------- -----------
Projected depreciation and amortization 0.077 0.077 0.310 0.310
-------- -------- -------- --------
--------------------------------------------------------- ----------- ------------ ----------- -----------
--------------------------------------------------------- ----------- ------------ ----------- -----------
Projected FFO $ 0.157 $ 0.167 $ 0.540 $ 0.560
--------------------------------------------------------- ----------- ------------ ----------- -----------
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