The increase in net income was primarily due to the impact of: (i) additional rental income and mortgage interest income associated with $339 million of new investments made throughout 2011; (ii) $5.3 million in gains on the sale of assets and (iii) $24.7 million net decrease in real estate impairments. These increases were partially offset by: (i) $1.9 million of increased depreciation expense associated with the 2011 new investments; (ii) $2.9 million of increased interest expense associated with the 2011 new investments; and (iii) a $7.1 million charge relating to the tender and redemption of all of the Company’s outstanding $175 million of 7% Senior Notes due 2016.
FIRST QUARTER 2012 HIGHLIGHTS AND OTHER RECENT DEVELOPMENTS
- In April 2012, the Company increased its quarterly common dividend per share to $0.42 from $0.41.
- In March 2012, the Company tendered and/or redeemed all of its $175 million of 7% Senior Notes due 2016.
- In March 2012, the Company issued $400 million aggregate principal amount of its 5.875% Senior Notes due 2024.
FIRST QUARTER 2012 RESULTS
Operating Revenues and Expenses – Operating revenues for the three-month period ended March 31, 2012 were $84.5 million. Operating expenses for the three-month period ended March 31, 2012 totaled $33.1 million and were composed of $27.1 million of depreciation and amortization expense, $4.0 million of general and administrative expense, $1.5 million of stock-based compensation expense, $0.3 million provision for impairments on real estate properties and $0.1 million of expense associated with the December 2011 acquisitions. A reconciliation of these amounts to revenues and expenses reported in accordance with GAAP is provided at the end of this release.Other Income and Expense – Other income and expense for the three-month period ended March 31, 2012 was a net expense of $30.7 million, which was composed of $23.0 million of interest expense, $0.6 million of amortized deferred financing costs and $7.1 million of interest refinancing expense related to the early retirement of a debt obligation in 2012. Funds From Operations – For the three-month period ended March 31, 2012, reportable FFO available to common stockholders was $48.2 million, or $0.46 per common share on 104 million weighted-average common shares outstanding, compared to $39.1 million, or $0.39 per common share on 100 million weighted-average common shares outstanding, for the same period in 2011. The $48.2 million of FFO for the three-month period ended March 31, 2012 includes the impact of $7.1 million of interest refinancing costs, $1.5 million of stock-based compensation expense and $0.1 million of expense associated with December 2011 acquisitions.