Saul Centers, Inc. Reports Fourth Quarter 2021 Earnings
Saul Centers, Inc. (NYSE: BFS) reported a positive operational performance for the quarter ended December 31, 2021, with total revenue rising to $60.2 million, up from $58.3 million in 2020. Net income increased significantly to $15.9 million compared to $11.7 million a year earlier. The company's mixed-use development, The Waycroft, achieved a 97.1% leasing rate. For the year, total revenue grew to $239.2 million, with net income reaching $61.6 million. Funds From Operations (FFO) increased to $25.5 million for the quarter and $100.7 million for the year, demonstrating strong cash flow.
- Total revenue for 2021 Quarter increased 3.3% to $60.2 million.
- Net income for the 2021 Quarter rose to $15.9 million, a 35.9% increase.
- Same property revenue up 3.4% and same property operating income up 5.6% for the 2021 Quarter.
- FFO available to common stockholders increased to $25.5 million ($0.78 per share) in 2021 Quarter.
- The Waycroft's occupancy reached 97.1%.
- Mixed-Use same property operating income decreased 11.5% for the year.
- Commercial portfolio leasing dropped slightly from 92.5% to 92.0%.
BETHESDA, Md., Feb. 24, 2022 /PRNewswire/ -- Saul Centers, Inc. (NYSE: BFS), an equity real estate investment trust ("REIT"), announced its operating results for the quarter ended December 31, 2021 ("2021 Quarter"). Total revenue for the 2021 Quarter increased to
Same property revenue increased
For the year ended December 31, 2021 ("2021 Period"), total revenue increased to
Same property revenue increased
As of December 31, 2021,
Funds From Operations ("FFO") available to common stockholders and noncontrolling interests (after deducting preferred stock dividends and extinguishment of issuance costs upon redemption of preferred shares) increased to
FFO available to common stockholders and noncontrolling interests (after deducting preferred stock dividends and extinguishment of issuance costs upon redemption of preferred shares) increased
On March 11, 2020, the World Health Organization declared a novel strain of coronavirus ("COVID-19") a pandemic, and on March 13, 2020, the United States declared a national emergency with respect to COVID-19. As a result, the COVID-19 pandemic is negatively affecting almost every industry directly or indirectly.
The actions taken by federal, state and local governments to mitigate the spread of COVID-19 by ordering closure of nonessential businesses and ordering residents to generally stay at home, and subsequent phased re-openings, have resulted in many of our tenants announcing mandated or temporary closures of their operations and/or requesting adjustments to their lease terms. Overall, there remains significant uncertainty around the long-term economic impact of the COVID-19 pandemic, which could have a material and adverse effect on or cause disruption to our business or financial condition, results from operations, cash flows and the market value and trading price of our securities.
While the Company's grocery store, pharmacy, bank and home improvement store tenants have generally remained fully open throughout the COVID-19 pandemic, many restaurants have operated with reduced hours and/or limited indoor seating, supplemented with delivery and curbside pick-up, and most health, beauty supply and services, fitness centers, and other non-essential businesses have re-opened, some with limited customer capacity. As of February 18, 2022, payments by tenants of contractual base rent and operating expense and real estate tax recoveries totaled approximately
When taking into account the amount of time elapsed since the due date of the payment, we continue to experience sequential improvement in our collection rates. The following table summarizes the Company's consolidated total collections of the first quarter, second quarter, third quarter, fourth quarter and January 2022 rent billings as of February 18, 2022:
Retail | Office | Residential | Total | |
2021 First Quarter | 99 % | 100 % | 99 % | 99 % |
2021 Second Quarter | 99 % | 100 % | 99 % | 99 % |
2021 Third Quarter | 99 % | 100 % | 99 % | 99 % |
2021 Fourth Quarter | 98 % | 100 % | 99 % | 99 % |
January 2022 | 97 % | 99 % | 99 % | 97 % |
Although we are and will continue to be actively engaged in rent collection efforts related to uncollected rent, and we continue to work with certain tenants who have requested rent deferrals, we can provide no assurance that such efforts or our efforts in future periods will be successful, particularly in the event that the COVID-19 pandemic and restrictions intended to prevent its spread continue for a prolonged period. As of January 31, 2022, approximately
With cash balances of over
Saul Centers is a self-managed, self-administered equity REIT headquartered in Bethesda, Maryland. Saul Centers currently operates and manages a real estate portfolio comprised of 61 properties which includes (a) 57 community and neighborhood Shopping Centers and Mixed-Use properties with approximately 9.8 million square feet of leasable area and (b) four land and development properties. Approximately
Safe Harbor Statement
Certain matters discussed within this press release may be deemed to be forward-looking statements within the meaning of the federal securities laws. For these statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Although the Company believes the expectations reflected in the forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. These factors include, but are not limited to, the risk factors described in our Annual Report on Form 10-K filed on February 24, 2022, and include the following: (i) general adverse economic and local real estate conditions, (ii) the inability of major tenants to continue paying their rent obligations due to bankruptcy, insolvency or a general downturn in their business, (iii) financing risks, such as the inability to obtain equity, debt or other sources of financing or refinancing on favorable terms to the Company, (iv) the Company's ability to raise capital by selling its assets, (v) changes in governmental laws and regulations and management's ability to estimate the impact of such changes, (vi) the level and volatility of interest rates and management's ability to estimate the impact thereof, (vii) the availability of suitable acquisition, disposition, development and redevelopment opportunities, and risks related to acquisitions not performing in accordance with our expectations, (viii) increases in operating costs, (ix) changes in the dividend policy for the Company's common and preferred stock and the Company's ability to pay dividends at current levels, (x) the reduction in the Company's income in the event of multiple lease terminations by tenants or a failure by multiple tenants to occupy their premises in a shopping center, (xi) impairment charges, (xii) unanticipated changes in the Company's intention or ability to prepay certain debt prior to maturity and (xiii) an epidemic or pandemic (such as the outbreak and worldwide spread of COVID-19), and the measures that international, federal, state and local governments, agencies, law enforcement and/or health authorities implement to address it, which may (as with COVID-19) precipitate or exacerbate one or more of the above-mentioned and/or other risks, and significantly disrupt or prevent us from operating our business in the ordinary course for an extended period. Given these uncertainties, readers are cautioned not to place undue reliance on any forward-looking statements that we make, including those in this press release. Except as may be required by law, we make no promise to update any of the forward-looking statements as a result of new information, future events or otherwise. You should carefully review the risks and risk factors included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 24, 2022.
Saul Centers, Inc. | |||
Consolidated Balance Sheets | |||
(In thousands) | |||
December 31, | |||
(Dollars in thousands, except per share amounts) | 2021 | 2020 | |
Assets | |||
Real estate investments | |||
Land | $ 511,529 | $ 511,482 | |
Buildings and equipment | 1,566,686 | 1,543,837 | |
Construction in progress | 205,911 | 69,477 | |
2,284,126 | 2,124,796 | ||
Accumulated depreciation | (650,113) | (607,706) | |
1,634,013 | 1,517,090 | ||
Cash and cash equivalents | 14,594 | 26,856 | |
Accounts receivable and accrued income, net | 58,659 | 64,917 | |
Deferred leasing costs, net | 24,005 | 26,872 | |
Other assets | 15,490 | 9,837 | |
Total assets | $ 1,746,761 | $ 1,645,572 | |
Liabilities | |||
Mortgage notes payable | $ 941,456 | $ 827,603 | |
Term loan facility payable | 99,233 | 74,791 | |
Revolving credit facility payable | 103,167 | 103,913 | |
Construction loan payable | — | 144,607 | |
Dividends and distributions payable | 21,672 | 19,448 | |
Accounts payable, accrued expenses and other liabilities | 25,558 | 24,384 | |
Deferred income | 25,188 | 23,293 | |
Total liabilities | 1,216,274 | 1,218,039 | |
Equity | |||
Preferred stock, 1,000,000 shares authorized: | |||
Series D Cumulative Redeemable, 30,000 shares issued and outstanding | 75,000 | 75,000 | |
Series E Cumulative Redeemable, 44,000 shares issued and outstanding | 110,000 | 110,000 | |
Common stock, | 238 | 235 | |
Additional paid-in capital | 436,609 | 420,625 | |
Partnership units in escrow | 39,650 | — | |
Distributions in excess of accumulated earnings | (256,448) | (241,535) | |
Total Saul Centers, Inc. equity | 405,049 | 364,325 | |
Noncontrolling interests | 125,438 | 63,208 | |
Total equity | 530,487 | 427,533 | |
Total liabilities and equity | $ 1,746,761 | $ 1,645,572 |
Saul Centers, Inc. | |||||||
Consolidated Statements of Operations | |||||||
(In thousands, except per share amounts) | |||||||
Three Months Ended December 31, | Year Ended December 31, | ||||||
2021 | 2020 | 2021 | 2020 | ||||
(unaudited) | |||||||
Revenue | |||||||
Rental revenue | $ 58,881 | $ 57,115 | $ 234,515 | $ 220,281 | |||
Other | 1,359 | 1,169 | 4,710 | 4,926 | |||
Total revenue | 60,240 | 58,284 | 239,225 | 225,207 | |||
Expenses | |||||||
Property operating expenses | 8,461 | 7,994 | 32,881 | 28,857 | |||
Real estate taxes | 6,625 | 7,534 | 28,747 | 29,560 | |||
Interest expense, net and amortization of deferred debt costs | 10,865 | 12,508 | 45,424 | 46,519 | |||
Depreciation and amortization of deferred leasing costs | 12,420 | 13,532 | 50,272 | 51,126 | |||
General and administrative | 6,019 | 5,318 | 20,252 | 19,107 | |||
Total expenses | 44,390 | 46,886 | 177,576 | 175,169 | |||
Gain on sale of property | — | 278 | — | 278 | |||
Net Income | 15,850 | 11,676 | 61,649 | 50,316 | |||
Noncontrolling interests | |||||||
Income attributable to noncontrolling interests | (3,607) | (2,253) | (13,260) | (9,934) | |||
Net income attributable to Saul Centers, Inc. | 12,243 | 9,423 | 48,389 | 40,382 | |||
Preferred stock dividends | (2,799) | (2,798) | (11,194) | (11,194) | |||
Net income available to common stockholders | $ 9,444 | $ 6,625 | $ 37,195 | $ 29,188 | |||
Per share net income available to common stockholders | |||||||
Basic | $ 0.40 | $ 0.28 | $ 1.57 | $ 1.25 | |||
Diluted | $ 0.40 | $ 0.28 | $ 1.57 | $ 1.25 | |||
Weighted Average Common Stock: | |||||||
Common stock | 23,765 | 23,437 | 23,655 | 23,356 | |||
Effect of dilutive options | 22 | — | 7 | 1 | |||
Diluted weighted average common stock | 23,787 | 23,437 | 23,662 | 23,357 |
Reconciliation of net income to FFO available to common stockholders and noncontrolling interests (1) | ||||||||
Three Months Ended | Year Ended December 31, | |||||||
(In thousands, except per share amounts) | 2021 | 2020 | 2021 | 2020 | ||||
Net income | $ 15,850 | $ 11,676 | $ 61,649 | $ 50,316 | ||||
Subtract: | ||||||||
Gain on sale of property | — | (278) | — | (278) | ||||
Add: | ||||||||
Real estate depreciation and amortization | 12,420 | 13,532 | 50,272 | 51,126 | ||||
FFO | 28,270 | 24,930 | 111,921 | 101,164 | ||||
Subtract: | ||||||||
Preferred stock dividends | (2,799) | (2,798) | (11,194) | (11,194) | ||||
FFO available to common stockholders and noncontrolling interests | $ 25,471 | $ 22,132 | $ 100,727 | $ 89,970 | ||||
Weighted average shares and units: | ||||||||
Basic | 32,795 | 31,368 | 32,029 | 31,266 | ||||
Diluted (2) | 33,762 | 31,368 | 33,098 | 31,267 | ||||
Basic FFO per share available to common stockholders and noncontrolling interests | $ 0.78 | $ 0.71 | $ 3.14 | $ 2.88 | ||||
Diluted FFO per share available to common stockholders and noncontrolling interests. | $ 0.75 | $ 0.71 | $ 3.04 | $ 2.88 |
(1) | The National Association of Real Estate Investment Trusts (NAREIT) developed FFO as a relative non-GAAP financial measure of |
(2) | Beginning March 5, 2021, fully diluted shares and units includes 1,416,071 limited partnership units that were held in escrow related to |
Reconciliation of total revenue to same property revenue (3) | ||||||||
(in thousands) | Three Months Ended | Year Ended December 31, | ||||||
2021 | 2020 | 2021 | 2020 | |||||
Total revenue | $ 60,240 | $ 58,284 | $ 239,225 | $ 225,207 | ||||
Less: Acquisitions, dispositions and development properties | — | — | (15,596) | (4,790) | ||||
Total same property revenue | $ 60,240 | $ 58,284 | $ 223,629 | $ 220,417 | ||||
Shopping Centers | $ 42,746 | $ 41,618 | $ 169,681 | $ 161,854 | ||||
Mixed-Use properties | 17,494 | 16,666 | 53,948 | 58,563 | ||||
Total same property revenue | $ 60,240 | $ 58,284 | $ 223,629 | $ 220,417 | ||||
Total Shopping Center revenue | $ 42,746 | $ 41,618 | $ 169,681 | $ 161,854 | ||||
Less: Shopping Center acquisitions, dispositions and development properties | — | — | — | — | ||||
Total same Shopping Center revenue | $ 42,746 | $ 41,618 | $ 169,681 | $ 161,854 | ||||
Total Mixed-Use property revenue | $ 17,494 | $ 16,666 | $ 69,544 | $ 63,353 | ||||
Less: Mixed-Use acquisitions, dispositions and development properties | — | — | (15,596) | (4,790) | ||||
Total same Mixed-Use revenue | $ 17,494 | $ 16,666 | $ 53,948 | $ 58,563 |
(3) Same property revenue is a non-GAAP financial measure of performance that improves the comparability of reporting periods by |
Reconciliation of net income to same property operating income (4) | ||||||||
Three Months Ended | Year Ended December 31, | |||||||
(In thousands) | 2021 | 2020 | 2021 | 2020 | ||||
Net income | $ 15,850 | $ 11,676 | $ 61,649 | $ 50,316 | ||||
Add: Interest expense, net and amortization of deferred debt costs | 10,865 | 12,508 | 45,424 | 46,519 | ||||
Add: Depreciation and amortization of deferred leasing costs | 12,420 | 13,532 | 50,272 | 51,126 | ||||
Add: General and administrative | 6,019 | 5,318 | 20,252 | 19,107 | ||||
Less: Gain on sale of property | — | (278) | — | (278) | ||||
Property operating income | 45,154 | 42,756 | 177,597 | 166,790 | ||||
Less: Acquisitions, dispositions and development properties | — | — | (9,312) | (1,271) | ||||
Total same property operating income | $ 45,154 | $ 42,756 | $ 168,285 | $ 165,519 | ||||
Shopping Centers | $ 34,050 | $ 32,460 | $ 133,897 | $ 126,656 | ||||
Mixed-Use properties | 11,104 | 10,296 | 34,388 | 38,863 | ||||
Total same property operating income | $ 45,154 | $ 42,756 | $ 168,285 | $ 165,519 | ||||
Shopping Center operating income | $ 34,050 | $ 32,460 | $ 133,897 | $ 126,656 | ||||
Less: Shopping Center acquisitions, dispositions and development properties | — | — | — | — | ||||
Total same Shopping Center operating income | $ 34,050 | $ 32,460 | $ 133,897 | $ 126,656 | ||||
Mixed-Use property operating income | $ 11,104 | $ 10,296 | $ 43,700 | $ 40,134 | ||||
Less: Mixed-Use acquisitions, dispositions and development properties | — | — | (9,312) | (1,271) | ||||
Total same Mixed-Use property operating income | $ 11,104 | $ 10,296 | $ 34,388 | $ 38,863 |
(4) Same property operating income is a non-GAAP financial measure of performance that improves the comparability of reporting periods |
View original content:https://www.prnewswire.com/news-releases/saul-centers-inc-reports-fourth-quarter-2021-earnings-301490190.html
SOURCE Saul Centers, Inc.
FAQ
What were Saul Centers' earnings for the quarter ended December 31, 2021?
How did the total revenue perform for Saul Centers in 2021?
What is the status of The Waycroft development as of December 31, 2021?
What is the Funds From Operations (FFO) for Saul Centers for the year ended December 31, 2021?