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Government Properties Income Trust Announces 2012 Third Quarter Results

Stocks in this article: GOV

Government Properties Income Trust (NYSE: GOV) today announced its financial results for the quarter and nine months ended September 30, 2012.

Results for the Quarter Ended September 30, 2012:

Normalized funds from operations, or Normalized FFO, for the quarter ended September 30, 2012 were $25.6 million, or $0.54 per share, compared to Normalized FFO for the quarter ended September 30, 2011 of $23.0 million, or $0.51 per share.

Net income was $11.8 million, or $0.25 per share, for the quarter ended September 30, 2012, compared to $11.6 million, or $0.26 per share, for the same quarter last year.

GOV’s weighted average number of common shares outstanding was 47.1 million and 45.3 million for the quarters ended September 30, 2012 and 2011, respectively.

A reconciliation of net income determined according to U.S. generally accepted accounting principles, or GAAP, to funds from operations, or FFO, and Normalized FFO for the quarters ended September 30, 2012 and 2011 appears later in this press release.

Results for the Nine Months Ended September 30, 2012:

Normalized FFO for the nine months ended September 30, 2012 were $75.1 million, or $1.60 per share, compared to Normalized FFO for the nine months ended September 30, 2011 of $63.5 million, or $1.51 per share.

Net income was $36.8 million, or $0.78 per share, for the nine months ended September 30, 2012, compared to $32.7 million, or $0.78 per share, for the same period last year.

GOV’s weighted average number of common shares outstanding was 47.1 million and 42.1 million for the nine months ended September 30, 2012 and 2011, respectively.

A reconciliation of net income determined according to GAAP to FFO and Normalized FFO for the nine months ended September 30, 2012 and 2011 appears later in this press release.

Recent Investment Activities:

Since July 1, 2012, GOV has acquired or has entered into an agreement to acquire nine properties for an aggregate purchase price of $166.7 million, excluding acquisition costs, as follows:

  • In July 2012, GOV acquired a previously disclosed office property located in Stockton, CA with 22,012 rentable square feet. This property is 100% leased to the U.S. Government and occupied by the Department of Immigration and Customs Enforcement. The purchase price was $8.3 million, excluding acquisition costs.
  • Also in July 2012, GOV acquired two previously disclosed office properties located in Atlanta, GA and Jackson, MS and an office warehouse property located in Ellenwood, GA with a combined total of 552,571 rentable square feet. These properties are 100% leased to the U.S. Government and occupied by the Department of Homeland Security, Immigration and Customs Enforcement, the Federal Bureau of Investigation and the National Archives and Records Administration. The aggregate purchase price was $88.0 million, excluding acquisition costs.
  • In September 2012, GOV acquired three office properties located in Boise, ID with 180,952 rentable square feet. These properties are 100% leased to the U.S. Government and occupied by the National Resource Center and the Department of Homeland Security. The aggregate purchase price was $40.2 million, excluding acquisition costs.
  • Also in September 2012, GOV acquired an office property located in Kansas City, MO with 86,739 rentable square feet. This property is 100% leased to the U.S. Government and occupied by the Federal Bureau of Investigation. The purchase price was $15.7 million, excluding acquisition costs.
  • In October 2012, GOV entered an agreement to acquire an office property located in Windsor Mill, MD with 78,131 rentable square feet. This property is 100% leased to two tenants, of which 97% is leased to the U.S. Government and occupied by the Centers for Medicare and Medicaid. The contract purchase price is $14.5 million, excluding acquisition costs. This pending acquisition is subject to GOV’s satisfactory completion of diligence and other customary closing conditions; accordingly, GOV can provide no assurance that it will acquire this property.

Recent Financing Activities:

On October 19, 2012, GOV issued 7,500,000 common shares in a public offering at a price of $23.25 per share and raised net proceeds of approximately $166.6 million. The net proceeds from this offering were used to repay amounts outstanding under GOV’s revolving credit facility. GOV also granted the underwriters of the offering a 30-day option to purchase up to an additional 1,125,000 common shares, which option expires on November 15, 2012.

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