| Golf Trust of America Inc. Announces 28% Increase in FFO Per Share for Second Quarter
Charleston, SC, August 12, 1998 -- Golf Trust of America, Inc. (AMEX:GTA) a self-administered real estate investment trust, today reported second quarter 1998 Funds from Operations (FFO) per share of $0.55, representing an increase of 28% over the same period in 1997. For the quarter ended June 30, 1998, FFO amounted to $7.2 million versus $3.5 million or $0.43 per share for the quarter ended June 30, 1997.
FFO amounted to $14.1 million, or $1.08 per share, for the six months ended June 30, 1998 versus $6.9 million, or $0.85 per share, for the same period last year, an increase of 27% on a per share basis.
For the quarter ended June 30, 1998, total revenues increased 163% to $10.5 million from $4.0 million for the same quarter last year. For the six months ended June 30, 1998, total revenues amounted to $19.4 million, an increase of 149% over the $7.8 million of total revenues for the same period last year.
Income from operations before minority interest and extraordinary items for the quarter totaled $4.4 million, or $0.34 per share, versus $2.7 million, or $0.33 per share, for the quarter ended June 30, 1997, an increase of 3% on a per share basis. Income from operations before minority interest and extraordinary items for the six months ended June 30, 1998 totaled $9.5 million, or $0.73 per common share, versus $4.8 million or $0.59 per common share for the same period last year, an increase of 24% on a per share basis.
All per share amounts reported include common stock and common stock equivalents (fully diluted) as well as operating partnership (OP) units convertible into common stock. All information for the six months ended June 30, 1997 is based on the actual results of operations from February 12, 1997 to June 30, 1997, and pro forma results of operations for January 1, 1997 to February 11, 1997.
For the second quarter ended June 30, 1998, same store revenues increased 8% and average revenues per round increased 11%, while total rounds played at GTA golf courses were unchanged over the same period in 1997. Thirteen of 35 GTA courses contributed percentage rents in the second quarter. Same store rounds and revenues are computed for the courses GTA had an interest in since April 1, 1997.
During the second quarter of 1998, GTA purchased 5.5 courses for a total investment of approximately $54.0 million. On May 26, 1998, GTA announced the $47.0 million acquisition of the world class Eagle Ridge Inn and Resort, located in Galena, Illinois. The acquisition includes 63 holes of championship golf, the 80-room Eagle Ridge hotel, conference center facilities and other resort related amenities. On June 2, 1998, GTA announced the acquisition of Tierra Del Sol Country Club, an 18-hole upscale golf facility located near Albuquerque, New Mexico for $3.6 million. On June 22, 1998, GTA closed the $4.7 million acquisition of Silverthorn Country Club, an 18-hole upscale, private golf facility located near Tampa in Brooksville, Florida.
As of June 30, 1998, the Company carried total debt of approximately $142.8 million, with a weighted average annual interest rate of 7.3%. The Company had 7.6 million shares of common stock and 5.2 million OP units outstanding as of quarter end. The total of fully diluted weighted average common stock and OP Units was 13.0 million for the quarter.
W. Bradley Blair, II, President and Chief Executive Officer of Golf Trust of America, Inc. stated, "The acquisitions for the second quarter continue to represent GTA's objective of geographical diversity of upscale resort, private and high-end daily fee golf courses. Two of this quarter's acquisitions (Eagle Ridge and Silverthorn) will involve expansion of our strategic partner relationship with Troon Golf /Starwood Capital and Granite Golf, which continue to be valued relationships because of their proven track records in operating golf courses throughout the United States."
The Emerging Issues Task Force ("EITF") of the Financial Accounting Standards Board has enacted a change in accounting rules ("EITF 98-9") that potentially affects recognition of percentage rent received by the Company. Under EITF 98-9, revenues from percentage rent are recognized in the quarterly periods in which the specified target that triggers the percentage rent is achieved. Under the terms of the percentage leases entered into by the Company, percentage rent is payable quarterly based on increases in revenue over a corresponding quarter in a base year. The Company is evaluating, together with its accountants, the adoption of EITF 98-9 and any impact such adoption may have on the Company. Based on the structure of the Company's leases, the Company does not believe EITF 98-9 will have a material affect on the Company's results of operations. Regardless of the application of EITF 98-9, no change in the calculation of FFO will occur and on an annual basis there will be no change in the Company's earnings.
As of June 30, 1998, the Company had an interest in a total of 35 courses. Since its initial acquisition of ten courses in February 1997, GTA has acquired interest in 27 18-hole equivalents, for a total investment in excess of $280.0 million.
To receive Golf Trust of America's latest news and other corporate developments via fax at no cost, call 1-800-PRO-INFO. Use company code GTA.
Certain matters discussed in this press release may constitute forward-looking statements within the meaning of the federal securities laws. Actual results and the timing of certain events could differ materially from those projected in or contemplated by the forward-looking statements due to a number of factors including general economic conditions, competition for golf course acquisitions, the availability of equity and debt financing, interest rates and other risk factors as outlined in the Company's SEC reports, including the prospectus dated November 4, 1997 and the annual report on Form 10-K dated March 31, 1998.
Financial tables to follow.
|
|
Golf Trust of America, Inc.
2nd Quarter 1998 Financial Summary
(in thousands, except per share)
(Unaudited)
|
Income Statement |
For the three
months ended
June 30, 1998 |
For the three
months ended
June 30, 1997 |
|
|
|
Base rent revenue |
$ |
8,110 |
$ |
3,743 |
|
Participating rent revenue |
|
155 |
|
74 |
|
|
|
|
|
|
Mortgage Interest |
$ |
2,183 |
$ |
181 |
|
|
|
|
|
|
Total revenue |
$ |
10,448 |
$ |
3,998 |
|
|
|
|
|
|
Net income before minority interest |
$ |
4,407 |
$ |
2,665 |
|
Depreciation and amortization for
real estate assets |
$ |
2,452 |
$ |
803 |
|
Loss on sale of assets |
$ |
(370) |
$ |
- |
|
|
|
|
|
|
Funds from operations |
$ |
7,229 |
$ |
3,468 |
|
FFO per weighted average share and
OP units - diluted |
$ |
0.55 |
$ |
0.43 |
|
Weighted average number of common
shares and OP units outstanding |
|
13,041 |
|
8,142 |
|
|
|
|
|
|
Distribution declared per share |
$ |
0.44 |
$ |
0.41 |
|
FFO payout ratio - diluted |
|
80% |
|
95% |
|
$ |
|
|
|
|
Net income |
|
2,639 |
$ |
1,292 |
|
Net income per share - diluted |
$ |
0.33 |
$ |
0.32 |
|
Weighted average number of common
shares - diluted |
|
7,928 |
|
4,007 |
|
|
Golf Trust of America, Inc.
2nd Quarter 1998 Financial Summary
(in thousands, except per share data)
|
Income Statement |
For the three
months ended
June 30, 1998 |
For the three
months ended
June 30, 1997 |
|
|
|
(Unaudited) |
(Pro forma) (1) |
|
Base rent revenue |
$ |
14,539 |
$ |
7,504 |
|
Participating rent revenue |
|
520 |
|
109 |
|
|
|
|
|
|
Mortgage Interest |
$ |
4,309 |
$ |
181 |
|
|
|
|
|
|
Total revenue |
$ |
19,368 |
$ |
7,794 |
|
|
|
|
|
|
Net income before minority interest |
$ |
9,506 |
$ |
4,760 |
|
Depreciation and amortization for
real estate assets |
$ |
4,273 |
$ |
2,120 |
|
Loss on sale of assets |
$ |
(370) |
$ |
- |
|
|
|
|
|
|
Funds from operations |
$ |
14,149 |
$ |
6,880 |
|
FFO per weighted average share and
OP units - diluted |
$ |
1.08 |
$ |
0.85 |
|
Weighted average number of common
shares and OP units outstanding |
|
13,041 |
|
8,142 |
|
|
|
|
|
|
Distribution declared per share |
$ |
0.85 |
$ |
0.82 |
|
FFO payout ratio - diluted |
|
79% |
|
96% |
|
$ |
|
|
|
|
Net income |
|
5,720 |
$ |
2,378 |
|
Net income per share - diluted |
$ |
0.72 |
$ |
0.59 |
|
Weighted average number of common
shares - diluted |
|
7,928 |
|
4,007 |
|
