-- Funds from Operations ("FFO")
-- 4th quarter - FFO of $0.13 per share for the three months ended
December 31, 2009 compared to $0.24 per share reported in the same
period of the previous year.
-- Full year - FFO of $0.73 per share for the year ended December 31,
2009 compared to $0.97 per share reported in 2008.
-- Weighted average shares and units outstanding
-- 4th quarter - Weighted average shares and units outstanding were
98.5 million and 62.7 million for the fourth quarter of 2009 and
2008, respectively.
-- Full year - Weighted average shares and units outstanding were
76.6 million and 62.8 million in 2009 and 2008, respectively.
-- Same-store Revenue (360 same-store facilities)
-- 4th quarter - Same-store total revenue decreased 5.9% from the
fourth quarter of 2008.
-- Full year - Same-store total revenue decreased 3.6% in 2009 over
2008.
-- Same-store Property Operating Expenses
-- 4th quarter - Same-store property operating expenses decreased 5.1%
when compared to the fourth quarter of 2008.
-- Full year - Same-store property operating expenses decreased 1.3%
from 2008 to 2009.
-- Same-store Net Operating Income ("NOI")
-- 4th quarter - Same-store NOI decreased 6.4% from the fourth quarter
of 2008.
-- Full year - Same-store NOI decreased 5.0% in 2009 over 2008.
-- Realized Annual Rent
-- 4th quarter - Same-store realized annual rent per occupied square
foot decreased to $10.97 or 1.0% over the fourth quarter of 2008.
-- Full year - Same-store realized annual rent per occupied square
foot increased 1.0% over 2008 to $11.11.
-- Same-store Physical Occupancy
-- 4th quarter - Average physical occupancy was 75.5% for the fourth
quarter of 2009 on the same-store facilities compared to 79.8% for
the fourth quarter of 2008.
-- Full year - Average physical occupancy was 76.0% during 2009
compared to 80.1% during 2008 on the same-store facilities.
-- Ending sequential quarterly occupancy declined 50 basis points
(75.2% as of 12/31/09 compared to 75.7% as of 9/30/09) compared to
a decline of 260 basis points in the same period last year (78.8%
as of 12/31/08 compared to 81.5% as of 9/30/08).
Capital Raising Initiatives
"During the fourth quarter we completed the final component of our 2009
capital raising efforts, closing the three-year $450 million secured credit
facility," said U-Store-It President and Chief Investment Officer
Christopher Marr. "Our 2009 capital raising efforts demonstrated our
ability to access capital from multiple sources in a very difficult market
and have significantly transformed our balance sheet and improved our debt
maturity profile. We are well-positioned to evaluate acquisition
opportunities and will do so with a keen focus on our cost of capital,
leverage levels and long-term potential to create value for our
shareholders."
Capital raising efforts during 2009 combined to raise more than $875
million to address maturities, reduce leverage, and position the company
for future growth.
-- Secured Credit Facility
-- Closed on a three-year, $450 million secured credit facility in
December 2009.
-- Common Share Offering
-- Net proceeds of $171 million from secondary public offering and at
the market issuances totaling 34.8 million shares.
-- Joint Venture
-- Closed a $102 million joint venture in August 2009, providing the
Company approximately $51 million and a 50% interest in the
unleveraged joint venture in exchange for its contribution of 22
facilities to the venture.
-- Secured Loans
-- Generated $116.1 million of asset level loans from regional banks
and life companies.
-- Dispositions
-- Closed on the disposition of 19 properties for an aggregate sales
price of $88.9 million.
Funds from Operations
FFO for the fourth quarter of 2009 was $12.7 million, compared to $15.0
million for the fourth quarter of 2008. FFO per share was $0.13 per share
for the fourth quarter of 2009, compared to $0.24 per share for the same
quarter of last year.
FFO for the year ended December 31, 2008 was $55.9 million or $0.73 per
share compared to $61.2 million or $0.97 per share for the year ended
December 31, 2008.
-- General and administrative expenses of approximately $23.2 million to
$24.0 million
-- For 2010, the same-store pool will consist of 364 assets totaling
23.6 million square feet
-- Same-store revenue growth of -1.0% to -3.0% over 2009
-- Same-store expense growth of 2.5% to 3.5% over 2009
-- Same-store net operating income growth of -5.5% to -4.5% over 2009
-- No net impact from acquisition and disposition activity
-- Interest expense on borrowings under our secured credit facility is
based on a 1.5% LIBOR floor
2010 Full Year Guidance Range or Value
-------------------
Earnings (loss) per diluted share allocated to common
shareholders $ (0.18) to $ (0.12)
Plus: real estate depreciation and amortization 0.61 0.61
------- -------
FFO per diluted share $ 0.43 to $ 0.49
======= =======
The Company estimates that its fully-diluted FFO per share for the quarter
ending March 31, 2010 will be between $0.10 and $0.11, and that its
fully-diluted net loss per share for the period will be between $(0.05) and
$(0.04).
1st Quarter 2010 Guidance Range or Value
-------------------
Earnings (loss) per diluted share allocated to common
shareholders $ (0.05) to $ (0.04)
Plus: real estate depreciation and amortization 0.15 0.15
------- -------
FFO per diluted share $ 0.10 to $ 0.11
======= =======
"Our guidance for 2010 reflects the impact of the significant amount of
capital we raised throughout 2009. While we expect to evaluate acquisition
opportunities during 2010, no acquisitions are included in the assumptions
underlying our earnings guidance. To the extent we do find attractive
investment opportunities, we anticipate funding such acquisitions on a
leverage-neutral basis or better," said Chief Financial Officer Tim Martin.
"Our outlook for 2010 assumes the self-storage sector sees a return to
historical seasonal trends, albeit the sector and our portfolio are
starting 2010 with depressed asking rental rates and decreased occupancy
levels. The timing and significance of improving consumer confidence, job
growth and household movements will be primary drivers for improving
fundamentals across the sector."
Conference Call
Management will host a conference call at 11:00 a.m. ET on Friday, February
26, 2010, to discuss financial results for the year and three months ended
December 31, 2009.
A live webcast of the conference call will be available online from the
investor relations page of the Company's corporate website at
www.ustoreit.com. The dial-in numbers are 1-800-860-2442 for domestic
callers and +1 412-858-4600 for international callers. After the live
webcast, the call will remain available on U-Store-It's website for thirty
days. In addition, a telephonic replay of the call will be available until
March 26, 2010. The replay dial-in number is 1-877-344-7529 for domestic
callers and +1 412-317-0088 for international callers. The reservation
number for both is 427075.
Supplemental operating and financial data as of December 31, 2009 is
available on our corporate website under the heading "Investor Relations
and Financial Information."
About the Company
U-Store-It Trust is a self-administered and self-managed real estate
investment trust. The Company provides self-storage solutions across the
country. U-Store-It owns and or manages 374 facilities across the United
States, and operates the U-Store-It Network, which consists of
approximately 725 additional self-storage facilities. The Company's
self-storage facilities, storage space and storage solutions are designed
to offer affordable, easily accessible, secure, and in most locations,
climate-controlled storage space for residential and commercial customers,
as well as boat storage and mini storage. According to the 2009 Self
Storage Almanac, U-Store-It Trust is one of the top four owners and
operators of self-storage facilities in the U.S. For more information,
visit www.ustoreit.com.
-- changes in national and local economic, business, real estate and other
market conditions which, among other things, reduce demand for
self-storage facilities or increase costs of owning and operating
self-storage facilities;
-- competition from other self-storage facilities and storage
alternatives, which could result in lower occupancy and decreased
rents;
-- the execution of our business plan;
-- financing risks, including the risk of over-leverage and the
corresponding risk of default on our mortgage and other debt and
potential inability to refinance existing indebtedness;
-- increases in interest rates and operating costs;
-- counterparty non-performance related to the use of derivative financial
instruments;
-- our ability to maintain our status as a real estate investment trust
("REIT") for federal income tax purposes;
-- acquisition and development risks, including unanticipated costs
associated with the integration and operation of acquisitions;
-- risks of investing through joint ventures, including risks that our
joint venture partners may not fulfill their obligations or may pursue
actions that are inconsistent with our objectives;
-- changes in real estate and zoning laws or regulations;
-- risks related to natural disasters;
-- potential environmental and other liabilities; and
-- other risks identified in Item 1A of our Annual Report on Form 10-K
and, from time to time, in other reports we file with the Securities
and Exchange Commission (the "SEC") or in other documents that we
publicly disseminate.
Given these uncertainties, we caution readers not to place undue reliance
on forward-looking statements. We undertake no obligation to publicly
update or revise these forward-looking statements, whether as a result of
new information, future events or otherwise except as may be required by
securities laws.
U-STORE-IT TRUST AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
December 31, December 31,
2009 2008
-------------- --------------
ASSETS
Storage facilities $ 1,774,542 $ 1,888,123
Less: Accumulated depreciation (344,009) (328,165)
-------------- --------------
Storage facilities, net 1,430,533 1,559,958
Cash and cash equivalents 102,768 3,744
Restricted cash 16,381 16,217
Loan procurement costs, net of amortization 18,366 4,453
Notes receivable, net 20,112 -
Assets held for sale - 2,378
Other assets, net 10,710 10,909
-------------- --------------
Total assets $ 1,598,870 $ 1,597,659
============== ==============
LIABILITIES AND EQUITY
Revolving credit facility $ - $ 172,000
Unsecured term loan - 200,000
Secured term loan 200,000 57,419
Mortgage loans and notes payable 569,026 548,085
Accounts payable, accrued expenses and
other liabilities 33,767 39,410
Distributions payable 2,448 1,572
Deferred revenue 8,449 9,725
Security deposits 456 472
Other liabilities held for sale - 22
-------------- --------------
Total liabilities 814,146 1,028,705
Noncontrolling interests in the Operating
Partnership 45,394 46,026
Commitments and contingencies
Equity
Common shares $.01 par value, 200,000,000
shares authorized, 92,654,979 and
57,623,491 shares issued and outstanding
at December 31, 2009 and
December 31, 2008, respectively 927 576
Additional paid in capital 974,926 801,029
Accumulated other comprehensive loss (874) (7,553)
Accumulated deficit (279,670) (271,124)
-------------- --------------
Total U-Store-It Trust shareholders'
equity 695,309 522,928
-------------- --------------
Noncontrolling interest in subsidiaries 44,021 -
-------------- --------------
Total equity 739,330 522,928
-------------- --------------
Total liabilities and equity $ 1,598,870 $ 1,597,659
============== ==============
U-STORE-IT TRUST AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share data)
Three Months Ended Year Months Ended
-------------------------- --------------------------
December 31, December 31, December 31, December 31,
2009 2008 2009 2008
------------ ------------ ------------ ------------
REVENUES
Rental income $ 49,208 $ 52,580 $ 200,630 $ 208,439
Other property
related income 4,134 4,025 16,659 15,700
------------ ------------ ------------ ------------
Total revenues 53,342 56,605 217,289 224,139
------------ ------------ ------------ ------------
OPERATING EXPENSES
Property operating
expenses 22,315 23,176 93,945 95,156
Depreciation and
amortization 17,387 17,880 70,832 73,751
General and
administrative 5,909 7,151 22,569 24,964
------------ ------------ ------------ ------------
Total operating
expenses 45,611 48,207 187,346 193,871
------------ ------------ ------------ ------------
OPERATING INCOME 7,731 8,398 29,943 30,268
------------ ------------ ------------ ------------
OTHER INCOME (EXPENSE)
Interest:
Interest expense
on loans (10,435) (12,436) (45,269) (52,014)
Loan procurement
amortization
expense (822) (486) (2,339) (1,929)
Interest income 433 28 681 153
Other (20) (94) (33) 94
------------ ------------ ------------ ------------
Total other
expense (10,844) (12,988) (46,960) (53,696)
------------ ------------ ------------ ------------
LOSS FROM
CONTINUING
OPERATIONS (3,113) (4,590) (17,017) (23,428)
DISCONTINUED
OPERATIONS
Income from
discontinued
operations 41 1,059 2,546 6,810
Net gain on
disposition of
discontinued
operations 609 6,296 14,139 19,720
------------ ------------ ------------ ------------
Total
discontinued
operations 650 7,355 16,685 26,530
------------ ------------ ------------ ------------
NET INCOME (LOSS) (2,463) 2,765 (332) 3,102
NET (INCOME) LOSS
ATTRIBUTABLE TO
NONCONTROLLING
INTERESTS
Noncontrolling
interests in the
Operating
Partnership 153 (272) 60 (310)
Noncontrolling
interest in
subsidiaries (492) - (665) -
------------ ------------ ------------ ------------
NET INCOME (LOSS)
ATTRIBUTABLE TO
THE COMPANY $ (2,802) $ 2,493 $ (937) $ 2,792
============ ============ ============ ============
Basic and diluted
loss per share
from continuing
operations
attributable to
common
shareholders $ (0.04) $ (0.07) $ (0.24) $ (0.37)
Basic and diluted
earnings per share
from discontinued
operations
attributable to
common
shareholders $ 0.01 $ 0.11 $ 0.23 $ 0.42
Basic and diluted
earnings (loss)
per share
attributable to
common ------------ ------------ ------------ ------------
shareholders $ (0.03) $ 0.04 $ (0.01) $ 0.05
============ ============ ============ ============
Weighted-average
basic and diluted
shares outstanding 92,422 57,636 70,988 57,621
AMOUNTS
ATTRIBUTABLE TO
THE COMPANY'S
COMMON
SHAREHOLDERS:
Loss from
continuing
operations $ (3,706) $ (4,266) $ (16,754) $ (21,589)
Total discontinued
operations 904 6,759 15,817 24,381
------------ ------------ ------------ ------------
Net income (loss) $ (2,802) $ 2,493 $ (937) $ 2,792
============ ============ ============ ============
Same-store facility results (360 facilities)
(in thousands, except percentage and per square foot data)
Three months ended
--------------------------
December 31, December 31, Percent
2009 2008 Change
------------ ------------ ------------
REVENUES
Net rental income $ 48,134 $ 51,400 -6.4%
Other property related income 3,909 3,924 -0.4%
------------ ------------ ------------
Total revenues 52,043 55,324 -5.9%
------------ ------------ ------------
OPERATING EXPENSES
Property taxes 5,599 5,427 3.2%
Personnel expense 6,020 5,729 5.1%
Advertising 1,156 1,737 -33.4%
Repair and maintenance 897 994 -9.8%
Utilities 2,148 2,440 -12.0%
Property insurance 713 797 -10.5%
Other expenses 3,118 3,577 -12.8%
------------ ------------ ------------
Total operating expenses 19,651 20,701 -5.1%
------------ ------------ ------------
Net operating income (1) $ 32,392 $ 34,623 -6.4%
============ ============ ============
Gross margin 62.2% 62.6%
Period Average Occupancy (2) 75.5% 79.8%
Period End Occupancy (3) 75.2% 78.8%
Total Rentable
square feet 23,254 23,254
Realized annual rent
per occupied square foot (4) $ 10.97 $ 11.08 -1.0%
Scheduled annual rent per
square foot (5) $ 11.39 $ 12.47 -8.7%
Reconciliation of Same-Store Net
Operating Income to Operating
Income
Same-store net operating income
(1) $ 32,392 $ 34,623
Non same-store net operating
income (1) 673 651
Indirect property overhead (2,038) (1,845)
Depreciation (17,387) (17,880)
General and administrative
expense (5,909) (7,151)
------------ ------------
Operating Income $ 7,731 $ 8,398
============ ============
(1) Net operating income (NOI) is a non-GAAP (generally accepted
accounting principles) financial measure that excludes from operating
income the impact of depreciation and general & administrative
expense.
(2) Square feet occupancy represents the weighted average occupancy for
the period.
(3) Represents occupancy at December 31 of the respective year.
(4) Realized annual rent per occupied square foot is computed by dividing
rental income by the weighted average occupied square feet for the
period.
(5) Scheduled annual rent per square foot represents annualized
contractual rents per available square foot for the period.
Same-store facility results (360 facilities)
(in thousands, except percentage and per square foot data)
Twelve months ended
--------------------------
December 31, December 31, Percent
2009 2008 Change
------------ ------------ ------------
REVENUES
Net rental income $ 196,383 $ 204,898 -4.2%
Other property related income 15,935 15,343 3.9%
------------ ------------ ------------
Total revenues 212,318 220,241 -3.6%
------------ ------------ ------------
OPERATING EXPENSES
Property taxes 26,713 26,192 2.0%
Personnel expense 23,798 22,936 3.8%
Advertising 5,983 5,883 1.7%
Repair and maintenance 3,050 3,500 -12.9%
Utilities 9,440 9,913 -4.8%
Property insurance 2,684 2,979 -9.9%
Other expenses 12,329 13,706 -10.0%
------------ ------------ ------------
Total operating expenses 83,997 85,109 -1.3%
------------ ------------ ------------
Net operating income (1) $ 128,321 $ 135,132 -5.0%
============ ============ ============
Gross margin 60.4% 61.4%
Period Average Occupancy (2) 76.0% 80.1%
Period End Occupancy (3) 75.2% 78.8%
Total Rentable
square feet 23,254 23,254
Realized annual rent
per occupied square foot (4) $ 11.11 $ 11.00 1.0%
Scheduled annual rent per
square foot (5) $ 11.72 $ 12.40 -5.4%
Reconciliation of Same-Store Net
Operating Income to Operating
Income
Same-store net operating income
(1) $ 128,321 $ 135,132
Non same-store net operating
income (1) 2,566 1,834
Indirect property overhead (7,543) (7,983)
Depreciation (70,832) (73,751)
General and administrative
expense (22,569) (24,964)
------------ ------------
Operating Income $ 29,943 $ 30,268
============ ============
(1) Net operating income (NOI) is a non-GAAP (generally accepted
accounting principles) financial measure that excludes from operating
income the impact of depreciation and general & administrative
expense.
(2) Square feet occupancy represents the weighted average occupancy for
the period.
(3) Represents occupancy at December 31 of the respective year.
(4) Realized annual rent per occupied square foot is computed by dividing
rental income by the weighted average occupied square feet for the
period.
(5) Scheduled annual rent per square foot represents annualized
contractual rents per available square foot for the period.
Non-GAAP Measure - Computation of Funds From Operations
(in thousands, except per share data)
Three months ended Year ended
-------------------------- --------------------------
December 31, December 31, December 31, December 31,
2009 2008 2009 2008
------------ ------------ ------------ ------------
Net income (loss) $ (2,463) $ 2,765 $ (332) $ 3,102
Add (deduct):
Real estate
depreciation 16,881 18,566 72,022 77,768
Gains on sale of
real estate (609) (6,296) (14,139) (19,720)
Noncontrolling
interests in
subsidiaries
share of FFO (1,066) - (1,643) -
------------ ------------ ------------ ------------
FFO $ 12,743 $ 15,035 $ 55,908 $ 61,150
============ ============ ============ ============
Earnings (loss) per
share attributable
to common
shareholders -
fully diluted $ (0.03) $ 0.04 $ (0.01) $ 0.05
FFO per share and
unit - fully
diluted $ 0.13 $ 0.24 $ 0.73 $ 0.97
Weighted-average
basic and diluted
shares outstanding 92,422 57,636 70,988 57,621
Weighted-average
diluted shares and
units outstanding 98,452 62,730 76,609 62,814
Dividend per common
share and unit $ 0.025 $ 0.025 $ 0.100 $ 0.565
Payout ratio of FFO
(Dividend per
share divided by
FFO per share) 19% 10% 14% 58%
Contact Information: Contact: U-Store-It Trust Timothy M. Martin Chief Financial Officer (610) 293-5700