Wheeler Real Estate Investment Trust, Inc. Announces 2013 First Quarter Financial Results

VIRGINIA BEACH, Va.-- Wheeler Real Estate Investment Trust, Inc. (NASDAQ:WHLR) (“Wheeler” or the “Company”), today reported financial results for the three month period ended March 31, 2013.

2013 First Quarter Summary of Activities

  • Property portfolio occupancy rate of 94.3%
  • The Company signed a contract to purchase Bixby Commons, a 75,000 square foot free-standing retail property located in Bixby, Oklahoma for the purchase price of approximately $10.6 million. Principle tenant is Associated Wholesale Grocers, Inc., and is secured under an initial 20-year lease term.
  • For the three month period, the Company’s Board of Directors declared monthly cash dividends of approximately $0.035 per a share.

2013 First Quarter Financial Highlights

  • Wheeler reported Funds from Operations (“FFO”) for the three month period ended March 31, 2013 of $168,794, or $0.05 per basic and diluted share. Same store total FFO was negative $261,103, primary due to the added corporate general and administrative expenses related to operating as a publicly traded company. While new store total FFO was $429,897 for the period.
  • Total revenue for the first quarter of 2013 was $1.6 million. Same store revenue was $497,772 for the period ended March 31, 2013 and new store revenue was approximately $1.1 million.
  • Property net operating income (“NOI”) was $1.3 million for the quarter ended March 31, 2013. Same store NOI was approximately $397,638, while new store NOI was approximately $919,576.
  • Net loss attributable to Wheeler REIT for common stockholders for the period ended March 31, 2013 was $433,682, or $0.13 per basic and diluted share.
  • Total operating expense was $1.5 million for the first quarter of 2013. New stores operating expenses were $824,391, while same store operating expenses were $723,235 for the period ended March 31, 2013.

Additional “same store” and “new store” information is included in the accompanying tables.

FFO is a non-GAAP financial measure within the meaning of the rules of the Securities and Exchange Commission. See the discussion included in this press release for information regarding non-GAAP financial measures. A reconciliation of non-GAAP financial measures is included in the accompanying financial tables.

Portfolio Summary

Property       Location       Year Built/Renovated       GLA       % Leased
Amscot Building       Tampa, FL       2004       2,500       100%
Harps Food Store       Grove, OK       2012       31,500       100%
Lumber River Village       Lumberton, NC       1985/1997-98/2004       66,781       100%
Monarch Bank       Virginia Beach, VA       2002       3,620       100%
Perimeter Square       Tulsa, OK       1982-1983       58,277       95.7%
Riversedge North       Virginia Beach, VA       2007       10,550       100%
Shoppes at TJ Maxx       Richmond, VA       1982/1999       93,552       90.6%
Surrey Plaza       Hawkinsville, GA       1993       42,680       100%
The Shoppes at Eagle Harbor       Carrollton, VA       2009       23,303       100%
Twin City Crossing       Batesburg-Leesville, SC       1998/2002       47,680       100%
Walnut Hill Plaza       Petersburg, VA       1959/2006/2008       89,907       82.7%
Totals       470,350       94.3%

2013 Dividend Distribution History

Announce Date       Record Date       Pay Date       Amount       Frequency
4/16/2013       4/30/2013       5/31/2013       0.035       Monthly
3/15/2013       3/31/2013       4/30/2013       0.035       Monthly
2/19/2013       3/1/2013       3/31/2013       0.035       Monthly
1/16/2013       2/1/2013       2/28/2013       0.035       Monthly
Total Amount Paid to Shareholders:       $613,989

Acquisition Activity Subsequent to First Quarter 2013

Currently, the Company has entered into assignments of purchase and sale agreements with Wheeler Interest, LLC to assume the contracts of four third-party retail focused properties. Additionally, the Company has entered into purchase and sale agreements to acquire a third-party retailed focused property and an adjoining parcel of vacant land.

The Company has also entered into purchase contacts with five related-party sellers to acquire an additional three shopping centers, one strip center and one free-standing retail building.

Additional information regarding these properties will be available upon filing the Company’s Quarterly Report on Form 10-Q for the period ended March 31, 2013 via the U.S. Securities and Exchange Commission website (www.sec.gov).

About Wheeler Real Estate Investment Trust, Inc.

Headquartered in Virginia Beach, VA, the Company specializes in owning, acquiring, financing, developing, renovating, leasing and managing income producing assets, such as community centers, neighborhood centers, strip centers and free-standing retail properties. Wheeler’s portfolio contains strategically selected properties, primarily leased by nationally and regionally recognized retailers of consumer goods and located in the Mid-Atlantic, Southeast and Southwest regions of the United States.

Additional information about Wheeler and its properties can be found at its corporate website: www.whlr.us.

Financial Information

Additional information about Wheeler, including a copy of Wheeler’s Quarterly Report on Form 10-Q which includes the Company’s consolidated financial statements and Management’s Discussion & Analysis, will be available upon filing via the U.S. Securities and Exchange Commission website (www.sec.gov) or through Wheeler’s website at www.whlr.us.

Forward-Looking Statement

This press release contains forward-looking statements, including discussion and analysis of our financial condition, anticipated capital expenditures required to complete projects, amounts of anticipated cash distributions to the Company’s shareholders in the future and other matters. These forward-looking statements are not historical facts but are the intent, belief or current expectations of management based on its knowledge and understanding of our business and industry. Forward-looking statements are typically identified by the use of terms such as “may,” “will,” “should,” “potential,” “predicts,” “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” or the negative of such terms and variations of these words and similar expressions. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control, are difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements.

Forward-looking statements that were true at the time made may ultimately prove to be incorrect or false. You are cautioned to not place undue reliance on forward-looking statements, which reflect management’s view only as of the date of this press release. The Company undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results. Factors that could cause actual results to differ materially from any forward-looking statements made in this press release include:

  • the imposition of federal taxes if the Company fails to qualify as a REIT in any taxable year or opts to forego an opportunity to ensure REIT status;
  • uncertainties related to the national economy, the real estate industry in general and in our specific markets;
  • legislative or regulatory changes, including changes to laws governing REITs;
  • adverse economic or real estate developments in Virginia, Florida, Georgia, South Carolina, North Carolina or Oklahoma;
  • increases in interest rates and operating costs;
  • inability to obtain necessary outside financing;
  • litigation risks;
  • lease-up risks;
  • inability to obtain new tenants upon the expiration of existing leases;
  • inability to generate sufficient cash flows due to market conditions, competition, uninsured losses, changes in tax or other applicable laws; and
  • the need to fund tenant improvements or other capital expenditures out of operating cash flow.
Wheeler Real Estate Investment Trust
Condensed Consolidated Statements of Income

(in thousands, except for share data)

Three Months Ended March 31,
  2013           2012  
Rental revenues $ 1,393,032 $ 396,732
Other revenues   224,884     133,111  
Total Revenue   1,617,916     529,843  
Property operations 300,702 115,177
Depreciation and amortization 648,132 186,611
Provision for credit losses 15,000 -
Corporate general & administrative   583,792     170,302  
Total Operating Expenses   1,547,626     472,090  
Operating Income (Loss) 70,290 57,753
Interest expense   (549,628 )   (197,904 )
Net Loss (479,338 ) (140,151 )
Less: Net loss attributable to noncontrolling interests   (45,656 )   -  
Net Loss Attributable to Wheeler REIT $ (433,682 ) $ (140,151 )
Loss per share:
Basic and Diluted $ (0.13 )
Weighted-average number of shares:
Basic and Diluted   3,301,502  
Wheeler Real Estate Investment Trust
Consolidated Balance Sheets

(in thousands, except for share data)

March 31,       December 31,
  2013     2012  
Investment properties, at cost $ 46,748,018 $ 46,637,221
Less accumulated depreciation and amortization   3,612,525     3,291,556  
43,135,493 43,345,665
Cash and cash equivalents 1,053,480 2,053,192
Rents and other tenant receivables, net 815,658 761,114
Deferred costs and other assets   6,360,737     6,527,906  
Total Assets $ 51,365,368   $ 52,687,877  
Mortgages and other indebtedness $ 31,821,342 $ 31,843,503
Below market lease intangible, net 3,523,869 3,673,019
Accounts payable, accrued expenses and other liabilities 808,792 938,896
Total Liabilities   36,154,003     36,455,418  
Commitments and contingencies - -
Convertible preferred stock (no par value, 500,000 shares authorized,
no shares issued and outstanding, respectively) - -
Common stock ($0.01 par value, 15,000,000 shares authorized,
3,301,502 and 3,301,502 shares issued and outstanding, respectively) 33,015 33,015
Additional paid-in capital 14,097,453 14,097,453
Accumulated deficit   (6,418,537 )   (5,443,099 )
Total Shareholders' Equity 7,711,931 8,687,369
Noncontrolling interests   7,499,434     7,545,090  
Total Equity   15,211,365     16,232,460  
Total Liabilities and Equity $ 51,365,368   $ 52,687,877  

The following tables provide same store and new store financial information. Same store date includes the results for the three month period ended March 31, 2013 of the following entities that were part of the original REIT formation transaction:

  • The Shoppes at Eagle Harbor
  • Monarch Bank Building
  • Amscot Building
  • Riversedge North
  • Walnut Hill Plaza

New store financial information reflects the activity from the acquisition date to March 31, 2013

  • Lumber River Village (acquired November 16, 2012))
  • Perimeter Square (acquired November 16, 2012)
  • Shoppes at TJ Maxx (acquired November 16, 2012)
  • Harps at Harbor Point (acquired December 14, 2012)
  • Twin City Crossing (acquired December 18, 2012)
  • Surrey Plaza (acquired December 21, 2012)
Wheeler Real Estate Investment Trust
Funds From Operations

Three Months Ended March 31,

      Same Stores      

New Stores




Period Over Period Changes

  2013           2012     2013           2012   2013           2012   $         %  
Net income (loss) $ (385,751 ) $ (140,151 ) $ (93,587 ) $ - $ (479,338 ) $ (140,151 ) $ (339,187 ) (242.02 %)
Depreciation of real estate assets   124,648           186,611     523,484           -   648,132           186,611   461,521         247.32 %
Total FFO $ (261,103 )       $ 46,460   $ 429,897         $ - $ 168,794         $ 46,460   $ 122,334         263.31 %

Funds From Operations (FFO)

Wheeler considers FFO to be an important supplemental measure of its operating performance and believes it is frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO when reporting their results. FFO is intended to exclude GAAP historical cost depreciation and amortization of real estate and related assets, which assumes that the value of real estate assets diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. Because FFO exclude depreciation and amortization unique to real estate, gains and losses from property dispositions and extraordinary items, it provides a performance measure that, when compared year-over-year, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, development activities and interest costs, providing perspective not immediately apparent from net income.


Wheeler Real Estate Investment Trust
Same Store and New Store Operating Income

Three Months Ended March 31,
Same Store       New Store       Total
  2013           2012     2013           2012   2013           2012  
Property revenues $ 497,772 $ 529,843 $ 1,120,144 $ - $ 1,617,916 $ 529,843
Property expenses   100,134     115,177     200,568     -   300,702     115,177  
Property Net Operating Income   397,638     414,666     919,576     -   1,317,214     414,666  
Depreciation and amortization 124,648 186,611 523,484 - 648,132 186,611
Provision for credit losses - - 15,000 - 15,000 -
Corporate general & administrative   498,453     170,302     85,339     -   583,792     170,302  
Total Other Operating Expenses   623,101     356,913     623,823     -   1,246,924     356,913  
Interest expense   160,288     197,904     389,340     -   549,628     197,904  
Net Loss $ (385,751 ) $ (140,151 ) $ (93,587 ) $ - $ (479,338 ) $ (140,151 )

Wheeler Real Estate Investment Trust, Inc.
Robin Hanisch
Corporate Secretary
The Equity Group Inc.
Adam Prior
Senior Vice President
Terry Downs

Source: Wheeler Real Estate Investment Trust, Inc.