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) August 9, 2005
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ONE LIBERTY PROPERTIES, INC.
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(Exact name of Registrant as specified in charter)
Maryland 001-09279 13-3147497
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(State or other (Commission file No.) (IRS Employer
jurisdiction of I.D. No.)
incorporation)
60 Cutter Mill Road, Suite 303, Great Neck, New York 11021
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code 516-466-3100
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 2.02. Results of Operations and Financial Condition
On August 9, 2005 registrant issued a press release announcing its results of
operations for the quarter ended June 30, 2005. The press release is attached as
an exhibit to this Form 8-K.
Item 9.01 Financial Statements and Exhibits
(a) Financial Statements of Businesses Acquired. Not Applicable.
(b) Pro Forma Financial Information. Not Applicable.
(c) Exhibits.
99.1 Press release issued August 9, 2005.
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ONE LIBERTY PROPERTIES, INC.
Date: August 9, 2005 By: /s/ Simeon Brinberg
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Simeon Brinberg
Senior Vice President
EXHIBIT 99.1
ONE LIBERTY PROPERTIES, INC.
60 CUTTER MILL ROAD, SUITE 303
GREAT NECK, NY 11021
Telephone No.: 516-466-3100
Facsimile No.: 516-466-3132
www.onelibertyproperties.com
ONE LIBERTY PROPERTIES, INC.
ANNOUNCES RESULTS OF OPERATIONS
FOR THE QUARTER AND SIX MONTHS ENDED JUNE 30, 2005
Great Neck, New York - August 9, 2005 - One Liberty Properties, Inc. (NYSE: OLP)
today announced it had rental income for the three months ended June 30, 2005 of
$7,174,000, and net income of $13,283,000, or $1.35 per share on a diluted
basis. Net income for the quarter ended June 30, 2005 includes a gain on sale of
air rights of $10,248,000, or $1.04 per share, and the Company's equity in
earnings of unconsolidated joint ventures of $743,000. Net income for the three
months ended June 30, 2005 also includes income of $802,000, or $.08 per share,
of which $212,000 is income from discontinued operations relating to a property
which has been sold and $590,000 is the net gain on the sale of such property.
This compares with rental income, net income and net income per share on a
diluted basis of $5,616,000, $2,221,000, and $.23 per share, respectively, for
the three months ended June 30, 2004. Net income for the quarter ended June 30,
2004 includes the Company's equity in earnings of unconsolidated joint ventures
of $295,000. Net income for the quarter ended June 30, 2004 also includes income
of $307,000 from discontinued operations relating to a property which has been
sold, or $.03 per share. The weighted average number of common shares
outstanding on a diluted basis was 9,845,000 and 9,736,000 for the three months
ended June 30, 2005 and June 30, 2004, respectively.
The Company also reported rental income of $13,884,000 and net income of
$16,006,000, or $1.63 per share on a diluted basis, for the six months ended
June 30, 2005. Net income for the six months ended June 30, 2005 includes a gain
on sale of air rights of $10,248,000, or $1.04 per share, and the Company's
equity in earnings of unconsolidated joint ventures of $1,851,000. Net income
for the six months ended June 30, 2005 also includes income of $914,000, or $.09
per share, of which $324,000 is from discontinued operations relating to a
property which has been sold and $590,000 is the net gain on the sale of such
property. This compares with rental income, net income and net income per share
on a diluted basis of $10,654,000, $4,466,000, and $.46 per share, respectively,
for the six months ended June 30, 2004. Net income for the six months ended June
30, 2004 includes the Company's equity in earnings of unconsolidated joint
ventures of $970,000. Net income for the six months ended June 30, 2004 also
includes income of $685,000 from discontinued operations relating to a property
which has been sold, or $.07 per share. The weighted average number of common
shares outstanding on a diluted basis was 9,824,000 and 9,712,000 for the six
months ended June 30, 2005 and June 30, 2004, respectively.
One Liberty also reported that funds from operations for the three months ended
June 30, 2005 was $14,489,000, compared to $3,624,000 for the three months ended
June 30, 2004. Funds from operations for the six months ended June 30, 2005 was
$19,010,000 compared to $7,157,000 for the six months ended June 30, 2004. Funds
from operations, calculated in accordance with the NAREIT definition, adds back
to net income depreciation of properties, One Liberty's share of depreciation in
unconsolidated joint ventures and amortization of capital leasing expenses, and
deducts from net income the net gain on sale of a property. In accordance with
the NAREIT definition of funds from operations, the funds from operations
reported by One Liberty include in both the June 30, 2005 three and six month
periods, the $10,248,000 gain recognized by One Liberty on the sale of the air
rights, which One Liberty anticipates will be tax deferred because it expects to
enter into a 1031 tax deferred exchange and use the sale proceeds to acquire an
additional property or properties.
Commenting on the results of operations and the funds from operations, Fredric
H. Gould, President and Chief Executive Officer of One Liberty, noted that
rental income increased by $1.6 million, or 27.7%, quarter over quarter and by
$3.2 million, or 30.3%, six months over six months due primarily to rental
income earned on twelve properties acquired by One Liberty between March 2004
and February 2005.
On the expense side, total operating expenses increased by $1,218,000, or 64.9%,
quarter over quarter, and $1,789,000, or 47.7%, six months over six months,
resulting primarily from an increase in depreciation and amortization due to the
ownership of additional properties, an increase in general and administrative
expenses, an increase in real estate expenses and a $469,000 provision for
valuation adjustment of real estate. Mr. Gould reported that general and
administrative expenses increased by $236,000, or 31.6%, quarter versus quarter,
and $251,000, or 15.7%, six months versus six months, due to several factors
including an increase in professional fees resulting from compliance with
Sarbanes-Oxley, increases in executive compensation and support personnel due to
One Liberty's increased level of business activities and amortization of
restricted stock awards.
Mr. Gould noted that One Liberty's equity in earnings of unconsolidated joint
ventures increased by $448,000, or 151.9%, quarter over quarter and by $881,000,
or 90.8%, six months over six months, primarily due to income earned from two
joint ventures organized in the second half of 2004 and $296,000 received by One
Liberty representing its portion of rent arrears paid to one of its movie
theater joint ventures in the first quarter of 2005.
Interest expense increased by $447,000, or 21.6%, quarter over quarter, and $1.1
million, or 26.5%, six months over six months as a result of an increase in
interest on mortgages payable as a result of mortgages placed on ten properties
between September 2004 and June 2005, the assumption of mortgages in connection
with the purchase of two properties, penalties incurred in connection with the
prepayment of two mortgages which had above market interest rates and an
increase in interest on the line of credit in connection with borrowings made to
facilitate property acquisitions.
In reviewing the results of operations, Mr. Gould commented that One Liberty
purchased six properties for a total consideration of approximately $24,700,000
in two transactions that closed in January and February 2005, respectively. Mr.
Gould noted that in June 2005 it closed on the sale of unused developmental
"air" rights relating to its Brooklyn, New York property, which resulted in a
gain of $10,248,000, and in May 2005 it sold a property in Florida which
resulted in gain of $590,000.
One Liberty Properties is a real estate investment trust and invests primarily
in improved commercial real estate under long term net lease.
Certain information contained in this press release, including information with
respect to factors which may improve our future results of operations and future
acquisitions, together with other statements and information publicly
disseminated by One Liberty Properties, Inc. is forward looking within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities and Exchange Act of 1934, as amended. We intend such
forward looking statements to be covered by the safe harbor provision for
forward looking statements contained in the Private Securities Litigation Reform
Act of 1995 and include this statement for the purpose of complying with these
safe harbor provisions. Information regarding certain important factors that
could cause actual outcomes or other events to differ materially from any such
forward looking statements will appear in the Company's Form 10-K for the year
ended December 31, 2004. You should not rely on forward looking statements since
they involve known and unknown risks, uncertainties and other factors which are,
in some cases, beyond our control and which could materially affect actual
results, performance or achievements.
Contact: Simeon Brinberg
(516) 466-3100
ONE LIBERTY PROPERTIES, INC. (NYSE: OLP)
(Amounts in Thousands, Except Per Share Data)
Three Months Ended Six Months Ended
June 30, June 30,
2005 2004 2005 2004
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Revenues
Rental income - Note 1 $ 7,174 $ 5,616 $13,884 $10,654
------- ------- ------- -------
Operating expenses:
Depreciation and amortization 1,419 1,042 2,801 1,969
General and administrative 982 746 1,852 1,601
Real estate expenses 147 88 265 182
Leasehold rent 77 - 154 -
Provision for valuation adjustment of real estate 469 - 469 -
------- ------- ------- -------
Total operating expenses 3,094 1,876 5,541 3,752
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Operating income 4,080 3,740 8,343 6,902
Other income and expenses:
Equity in earnings of unconsolidated joint ventures 743 295 1,851 970
Interest and other income 60 61 81 153
Interest:
Expense (2,519) (2,072) (5,117) (4,044)
Amortization of deferred financing costs (130) (110) (313) (201)
Net gain on sale of air rights 10,248 - 10,248 -
(Loss) gain on sale available-for-sale securities (1) - (1) 1
------- ------- ------ ------
Income from continuing operations 12,481 1,914 15,092 3,781
Income from discontinued operations 212 307 324 685
Net gain on sale of discontinued operations 590 - 590 -
------- ------- ------- -------
Net income $13,283 $ 2,221 $16,006 $ 4,466
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Net income per common share (basic and diluted):
Income from continuing operations $ 1.27 $ .20 $ 1.54 $ .39
Income from discontinued operations .08 .03 .09 .07
------- ------- ------- -------
Net income per common share $ 1.35 $ .23 $ 1.63 $ .46
======= ======= ======= =======
Funds from operations * $14,489 $ 3,624 $19,010 $ 7,157
======= ======= ======= =======
Funds from operations per common share-diluted** $ 1.47 $ .37 $ 1.94 $ .74
======= ======= ======= =======
Weighted average number of
common shares outstanding:
Basic 9,841 9,721 9,818 9,691
===== ===== ===== =====
Diluted 9,845 9,736 9,824 9,712
===== ===== ===== =====
Note 1 - Rental income includes straight line rent accruals of $521 and $369 for
the six and three months ended June 30, 2005 and $416 and $220 for the six and
three months ended June 30, 2004, respectively.
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* Funds from operations is summarized in the following table:
Net income (a) $13,283 $ 2,221 $16,006 $ 4,466
Add: depreciation of properties 1,459 1,138 2,919 2,161
Add: our share of depreciation in unconsolidated
joint ventures 319 252 639 504
Add: amortization of capitalized leasing expenses 18 13 36 26
Deduct: net gain on sale of real estate (590) - (590) -
Funds from operations (a)(b) $14,489 $ 3,624 $19,010 $7,157
** Funds from operations per common share is summarized
in the following table:
Net income (a) $ 1.35 $ .23 $ 1.63 $ .46
Add: depreciation of properties .15 .12 .30 .23
Add: our share of depreciation in unconsolidated
joint ventures .03 .02 .07 .05
Add: amortization of capitalized leasing expenses - - - -
Deduct: net gain on sale of real estate (.06) - (.06) -
------- ------- ------- ------
Funds from operations per common share (a)(b) $ 1.47 $ .37 $ 1.94 $ .74
======= ======= ======= ======
(a) Includes net gain on sale of air rights of $10,248, or $1.04, for the six
and three months ended June 30, 2005.
(b) We believe that FFO is a useful and a standard supplemental measure of the
operating performance for equity REITs and is used frequently by securities
analysts, investors and other interested parties in evaluating equity
REIT's, many of which present FFO when reporting their operating results.
FFO is intended to exclude GAAP historical cost depreciation and
amortization of real estate assets, which assures that the value of real
estate assets diminish predictability over time. In fact, real estate
values have historically risen and fallen with market conditions. As a
result, we believe that FFO provides a performance measure that when
compared year over year, should reflect the impact to operations from
trends in occupancy rates, rental rates, operating costs, interest costs
and other matters without the inclusion of depreciation and amortization,
providing a perspective that may not be necessarily apparent from net
income. We also consider FFO to be useful to us in evaluating potential
property acquisitions.
FFO does not represent net income or cash flows from operations as defined
by GAAP. You should not consider FFO to be an alternative to net income as a
reliable measure of our operating performance; nor should you consider FFO
to be an alternative to cash flows from operating, investing or financing
activities (as defined by GAAP) as measures of liquidity.
FFO does not measure whether cash flow is sufficient to fund all of our cash
needs, including principal amortization, capital improvements and
distributions to stockholders. FFO does not represent cash flows from
operating, investing or financing activities as defined by GAAP.