DENVER, May 9 /PRNewswire-FirstCall/ -- Archstone-Smith today announced net earnings per share (EPS) of $1.27 for the quarter ended March 31, 2007, compared with $0.58 per share reported for the same period in 2006. Funds from operations (FFO) for the first quarter of 2007 was $0.50 per share, which is the top end of the guidance previously provided by management.
Solid Same-Store Operating Performance Continues to Be Strong
Same-store revenues increased 6.4% in the first quarter of 2007, driven principally by strong revenue growth in Southern California, the San Francisco Bay Area, the New York City metropolitan area and Seattle -- which represent 57% of the company's portfolio. The company's same-store net operating income (NOI) grew 6.8% in the first quarter. "Even with the rent increases we have seen over the past few years, renting an apartment remains a bargain relative to the cost of owning a home in our coastal, supply constrained markets," said R. Scot Sellers, chairman and chief executive officer. "As a result, we continue to expect strong operating performance this year."
Strategic Acquisitions and Dispositions Strengthen Company's Market Position
During the quarter, the company acquired $84.9 million of apartment communities, representing 391 units, and completed the sale of $655.8 million of apartment communities in markets that include Florida, suburban Boston, Phoenix and Minneapolis. The company's dispositions produced cash gains of $224.1 million -- a profit of approximately 51.9% on the company's cost basis -- and generated an unleveraged internal rate of return (IRR) of 20.4%.
Development Pipeline Grows by $540 Million
Archstone-Smith's development pipeline increased $540 million to $4.4 billion with the addition of four new Southern California projects. The company's development pipeline is concentrated in markets that include Manhattan, Southern California, Washington, D.C. and downtown Boston. At the end of the quarter, including joint ventures and Ameriton, the company had 6,291 units with a total expected investment of $1.8 billion, under construction, and 7,946 units, representing a total expected investment of $2.6 billion, in planning. "Archstone-Smith's locally based development professionals continue to identify fantastic new opportunities for our development pipeline, even though finding new development sites in our markets is extremely difficult," said Mr. Sellers. "We expect our development business to create substantial incremental value for our shareholders as we complete and stabilize these exceptionally well-located new development communities."
Ameriton Continues to Deliver Results
Archstone-Smith's first quarter 2007 results include gains from the sale of a wholly-owned operating community and a joint venture community by Ameriton, the company's wholly owned subsidiary, which contributed $5.4 million, or $0.021 per share, to first quarter 2007 EPS, and $4.2 million, or $0.017 per share, to its first quarter FFO. From 2000 through the first quarter of 2007, Ameriton has completed the sale of $1.9 billion of apartment communities, generating a pre-tax unleveraged IRR of 22.3%, excluding joint ventures.
Archstone-Smith's first quarter 2007 results also included $2.1 million of unexpected insurance recoveries related to prior lawsuits, which is included in Other Income on the company's Statement of Earnings.
Archstone-Smith Declares 127th Consecutive Common Share Dividend
The company announced that its Board declared the company's 127th consecutive quarterly common share dividend. The company will pay a dividend of $0.4525 per common share, payable on May 31, 2007 to shareholders of record as of May 16, 2007. On an annualized basis, this represents a dividend of $1.81 per common share.
In addition to historical information, this press release and quarterly supplemental information contain forward-looking statements and information under the federal securities law. These statements are based on current expectations, estimates and projections about the industry and markets in which Archstone-Smith operates, management's beliefs and assumptions made by management. While Archstone-Smith management believes the assumptions underlying its forward-looking statements and information are reasonable, such information is necessarily subject to uncertainties and may involve certain risks, many of which are difficult to predict and are beyond management's control. As such, these statements and information are not guarantees of future performance, and actual operating results may differ materially from what is expressed or forecasted in this press release and supplemental information. In addition, the historical performance described herein is not a guarantee of future performance, which may differ materially from past results. See "Risk Factors" in Archstone-Smith's 2006 Annual Report on Form 10-K for factors which could affect Archstone-Smith's future financial performance.
Contact: H. Andrew Cantor, 800-982-9293 * 303-708-5959
Archstone-Smith
