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Agree Realty Corp. Reports Operating Results (10-Q)

November 04, 2009 | About:
10qk

10qk

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Agree Realty Corp. (ADC) filed Quarterly Report for the period ended 2009-09-30.

Agree Realty Corp. is a self-administered self-managed real estateinvestment trust which develops acquires owns and operates properties which are primarily leased to major national and regional retail companies under net leases. Agree Realty Corp. has a market cap of $195.8 million; its shares were traded at around $23.89 with a P/E ratio of 8.7 and P/S ratio of 5.5. The dividend yield of Agree Realty Corp. stocks is 8.5%.

Highlight of Business Operations:

Minimum rental income increased $257,000, or 3%, to $8,596,000 in 2009, compared to $8,339,000 in 2008. The increase was the result of the development of a Walgreens drug store in Shelby Township, Michigan in July 2008, the development of a Walgreens drug store in Silver Springs Shores, Florida in January 2009, the development of a Walgreens drug store in Brighton, Michigan in February 2009 and the development of a Walgreens drug store in Port St John, Florida in June 2009. Our revenue increase from these developments amounted to $414,000. In addition, rental income from our Big Rapids, Michigan shopping center increased by $65,000 as a result of redevelopment activities and rental income decreased ($222,000) as a result of the closing of a Circuit City store in Boynton Beach, Florida and other rent adjustments.

Property operating expenses (shopping center maintenance, snow removal, insurance and utilities) increased $16,000, or 4%, to $410,000 in 2009 compared to $394,000 in 2008. The net increase was the result of: an increase in shopping center maintenance costs of $9,000; an increase in utility costs of $15,000 and a decrease in insurance costs of ($8,000) in 2009 versus 2008.

Minimum rental income increased $1,087,000, or 4%, to $25,538,000 in 2009, compared to $24,451,000 in 2008. The increase was the result of the development of a Walgreens drug store and a bank land lease in Macomb Township, Michigan in March 2008, the development of a Walgreens drug store in Ypsilanti, Michigan in May 2008, the development of a Walgreens drug store in Ocala, Florida in June 2008, the development of a Walgreens drug store in Shelby Township, Michigan in July 2008, the development of a Walgreens drug store in Silver Springs Shores, Florida in January 2009, the development of a Walgreens drug store in Brighton, Michigan in February 2009 and the development of a Walgreens drug store in Port St John, Florida in June 2009. Our revenue increase from these developments amounted to $1,313,000. In addition, rental income from our Big Rapids, Michigan shopping center increased by $181,000 as a result of redevelopment activities and rental income decreased ($407,000) as a result of the closing of a Circuit City store in Boynton Beach, Florida and other rental adjustments.

Property operating expenses (shopping center maintenance, snow removal, insurance and utilities) decreased $146,000, or 11%, to $1,201,000 in 2009 compared to $1,347,000 in 2008. The net decrease was the result of: a decrease in shopping center maintenance costs of ($32,000); a decrease in snow removal costs of ($112,000); an increase in utility costs of $20,000; and a decrease in insurance costs of ($22,000) in 2009 versus 2008.

Our cash flows from operations increased $1,765,000 to $17,387,000 for the nine months ended September 30, 2009, compared to $15,622,000 for the nine months ended September 30, 2008. Cash used in investing activities decreased $8,778,000 to $8,223,000 in 2009, compared to $17,001,000 in 2008. Cash used in financing activities increased $10,464,000 to $9,471,000 in 2009, compared to ($993,000) in 2008.

As of September 30, 2009, we had total mortgage indebtedness of $65,098,472. Of this total mortgage indebtedness, $40,825,734 is fixed rate, self-amortizing debt with a weighted average interest rate of 6.64%. The remaining mortgage debt of $24,272,738 bears interest at 150 basis points over LIBOR or 1.75% as of September 30, 2009 and has a maturity date of July 14, 2013, which can be extended at our option for two additional years. In January 2009, we entered into an interest rate swap agreement that fixes the interest rate during the initial term of the variable-interest mortgage at 3.744%.

Read the The complete Report

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10qk
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