2012 Operating Results And Increased 2013 Guidance Announced By National Retail Properties, Inc.

   2012 Operating Results And Increased 2013 Guidance Announced By National
                           Retail Properties, Inc.

PR Newswire

ORLANDO, Fla., Feb. 7, 2013

ORLANDO, Fla., Feb. 7, 2013 /PRNewswire/ --National Retail Properties, Inc.
(NYSE: NNN), a real estate investment trust, today announced operating results
for the quarter and year ended December31, 2012. Highlights include:

Operating Results:

  oRevenues and net earnings, FFO, Recurring FFO and AFFO available to common
    stockholders and diluted per share amounts:

                                  Quarter Ended         Year Ended
                                  December 31,          December 31,
                                  2012       2011       2012        2011
                                  (in thousands, except per share data)
Revenues                          $ 88,899   $ 72,959   $ 331,752   $ 259,939
Net earnings available to common  $ 35,901   $ 25,874   $ 121,489   $ 85,540
stockholders
Net earnings per common share     $ 0.32     $ 0.26     $ 1.11      $ 0.96
FFO available to common           $ 50,994   $ 41,038   $ 193,589   $ 139,665
stockholders
FFO per common share              $ 0.46     $ 0.42     $ 1.77      $ 1.57
Recurring FFO available to common $ 51,088   $ 40,051   $ 189,666   $ 139,258
stockholders
Recurring FFO per common share    $ 0.46     $ 0.41     $ 1.74      $ 1.57
AFFO available to common          $ 54,164   $ 42,729   $ 200,746   $ 150,815
stockholders
AFFO per common share             $ 0.48     $ 0.43     $ 1.84      $ 1.70

  oPortfolio occupancy was 97.9% at December31, 2012, as compared to 97.9%
    at September30, 2012, and 97.4% at December31, 2011

2012 Highlights:

  oIncreased recurring FFO per share 10.8% from $1.57 in 2011 to $1.74 in
    2012
  oDividend yield at December 31, 2012 of 5.0%
  oDividends per share increased to $1.56 marking the 23rd consecutive year
    of annual dividend increases - one of only four equity REITs and one of
    only 104 public companies with 23 or more consecutive annual dividend
    increases
  oMaintained high occupancy levels at 97.9% with weighted average remaining
    lease term of 12 years
  oInvested $707.2 million in 232 properties with an aggregate 2,955,000
    square feet of gross leasable area
  oSold 34 properties for $81.1 million producing $11.0 million of gains on
    sale (not included in FFO)
  oExpanded unsecured bank credit facility to $500 million while extending
    the term to October 2016 and reducing the interest rate to LIBOR + 117.5
    basis points
  oIssued $325.0 million principal amount of 3.80% senior unsecured notes due
    2022 generating net proceeds of $317.1 million
  oPaid off $123.2 million principal amount of 3.95% convertible senior notes
    due 2026 and the remaining $15.5 million principal amount of 3.95% notes
    were paid off in January 2013.
  oRaised $183.1 million in net proceeds from the issuance of 6,383,942
    common shares and $277.6 million from the issuance of preferred equity
  oOver 99% of properties are not encumbered with secured mortgage debt
  oGenerated annual total return to shareholders of 24.6% for 2012 and an
    average annual total return of 13.3% for the past 20 years
  oIn January 2013, Fitch Ratings upgraded NNN's unsecured debt rating to
    BBB+ and Moody's Investors Service revised NNN's rating outlook to
    positive

Investments and Dispositions for the quarter ended December31, 2012:

  oInvestments:

       o$254.7 million in property investments, including the acquisition of
         108 properties with an aggregate 907,000 square feet of gross
         leasable area

  oDispositions:

       o16 properties with net proceeds of $49.0 million producing $6.5
         million of gains on sales (not included in FFO)

National Retail Properties announced an increase in 2013 FFO guidance from a
range of $1.77 to $1.81 to a range of $1.81 to $1.85 per share before any
impairment expense. 2013 AFFO is estimated to be $1.89 to $1.93 per share.
The FFO guidance equates to net earnings before any gains or losses from the
sale of real estate of $1.09 to $1.13 per share plus $0.72 per share of
expected real estate depreciation and amortization. The guidance is based on
current plans and assumptions and subject to risks and uncertainties more
fully described in this press release and the company's reports filed with the
Securities and Exchange Commission.

Craig Macnab, Chief Executive Officer, commented: "The continuing strong
results in 2012 are testament to the strength of our business model and
balance sheet combined with the expertise of our talented associates who make
it all happen. Over the past two years, NNN has grown per share results by 20%
while improving our balance sheet credit metrics and maintaining very high
occupancy levels. These results have perpetuated NNN's elite 23 year record of
increased annual dividends which is the foundation of NNN's strong total
shareholder returns for many years. Finally, 2013 is off to a good start as
evidenced by our increased guidance."

National Retail Properties invests primarily in high-quality retail properties
subject generally to long-term, net leases. As of December31, 2012, the
company owned 1,622 properties in 47 states with a gross leasable area of
approximately 19.2 million square feet. For more information on the company,
visit www.nnnreit.com.

Management will hold a conference call on February7, 2013, at 10:30 a.m. ET
to review these results. The call can be accessed on the National Retail
Properties web site live at http://www.nnnreit.com. For those unable to
listen to the live broadcast, a replay will be available on the company's web
site. In addition, a summary of any earnings guidance given on the call will
be posted to the company's web site.

Statements in this press release that are not strictly historical are
"forward-looking" statements. Forward-looking statements involve known and
unknown risks, which may cause the company's actual future results to differ
materially from expected results. These risks include, among others, general
economic conditions, local real estate conditions, changes in interest rates,
increases in operating costs, the preferences and financial condition of our
tenants, the availability of capital, risks related to our status as a REIT
and the profitability of the company's taxable subsidiary. Additional
information concerning these and other factors that could cause actual results
to differ materially from those forward-looking statements is contained from
time to time in the company's Securities and Exchange Commission ("SEC")
filings, including, but not limited to, the company's Annual Report on Form
10-K. Copies of each filing may be obtained from the company or the SEC.
Such forward-looking statements should be regarded solely as reflections of
the company's current operating plans and estimates. Actual operating results
may differ materially from what is expressed or forecast in this press
release. National Retail Properties undertakes no obligation to publicly
release the results of any revisions to these forward-looking statements that
may be made to reflect events or circumstances after the date these statements
were made.

The reported results are preliminary and not final and there can be no
assurance that the results will not vary from the final information filed on
Form 10-K with the SEC for the year ended December31, 2012. In the opinion
of management, all adjustments considered necessary for a fair presentation of
these reported results have been made.

Funds From Operations, commonly referred to as FFO, is a relative non-GAAP
financial measure of operating performance of an equity REIT in order to
recognize that income-producing real estate historically has not depreciated
on the basis determined under GAAP. FFO is defined by the National
Association of Real Estate Investment Trusts ("NAREIT") and is used by the
company as follows: net earnings (computed in accordance with GAAP) plus
depreciation and amortization of assets unique to the real estate industry,
excluding gains (or including losses) on the disposition of certain assets,
the company's share of these items from the company's unconsolidated
partnerships and any impairment charges on a depreciable real estate asset.

FFO is generally considered by industry analysts to be the most appropriate
measure of performance of real estate companies. FFO does not necessarily
represent cash provided by operating activities in accordance with GAAP and
should not be considered an alternative to net earnings as an indication of
the company's performance or to cash flow as a measure of liquidity or ability
to make distributions. Management considers FFO an appropriate measure of
performance of an equity REIT because it primarily excludes the assumption
that the value of the real estate assets diminishes predictably over time, and
because industry analysts have accepted it as a performance measure. The
company's computation of FFO may differ from the methodology for calculating
FFO used by other equity REITs, and therefore, may not be comparable to such
other REITs. A reconciliation of net earnings (computed in accordance with
GAAP) to FFO, as defined by NAREIT, is included in the financial information
accompanying this release. AFFO should not be considered an alternative to
net earnings, as an indication of the company's performance or to cash flow as
a measure of liquidity or ability to make distributions.

Adjusted Funds From Operations ("AFFO") is a non-GAAP financial measure of
operating performance used by many companies in the REIT industry. AFFO
further adjusts FFO for certain non-cash items that reduce or increase net
income in accordance with GAAP. Management considers AFFO a useful
supplemental measure of the company's performance. The company's computation
of AFFO may differ from the methodology for calculating AFFO used by other
equity REITs, and therefore, may not be comparable to such other REITs. A
reconciliation of net earnings (computed in accordance with GAAP) to AFFO is
included in the financial information accompanying this release.

The company has determined that there are earnings from discontinued
operations in each of its segments, real estate held for investment and real
estate held for sale. All property dispositions from the company's held for
investment segment are classified as discontinued operations. In addition,
certain properties in the company's held for sale segment that have generated
revenues before disposition are classified as discontinued operations. The
results of operations for prior periods for these properties now classified as
discontinued operations have been restated to reflect the results in earnings
from discontinued operations for comparability purposes. These adjustments
resulted in a decrease in the company's reported total revenues and total and
per share earnings from continuing operations and an increase in the company's
earnings from discontinued operations. However, the company's total and per
share FFO and net earnings available to common stockholders are not affected.



National Retail Properties, Inc.

(in thousands, except per share data)

(unaudited)


                                  Quarter Ended         Year Ended
                                  December 31,          December 31,
                                  2012       2011       2012        2011
Income Statement Summary
Revenues:
Rental and earned income          $ 84,385   $ 68,542   $ 315,226   $ 244,618
Real estate expense               3,477      3,055      11,443      9,914
reimbursement from tenants
Interest and other income from    428        583        2,410       2,302
real estate transactions
Interest income on commercial     609        779        2,673       3,105
mortgage residual interests
                                  88,899     72,959     331,752     259,939
Retail operations:
Revenues                          —          11,436     19,008      45,139
Operating expenses                —          (10,920)   (18,543)    (43,096)
Net                               —          516        465         2,043
Operating expenses:
General and administrative        8,903      8,554      32,182      28,814
Real estate                       4,632      4,849      17,069      16,832
Depreciation and amortization     20,281     15,612     74,140      56,926
Impairment – commercial mortgage  94         628        2,812       1,024
residual interests valuation
Impairment losses and other       1,115      (1,615)    8,411       (1,431)
charges, net of recoveries
                                  35,025     28,028     134,614     102,165
Other expenses (revenues):
Interest and other income         (318)      (429)      (2,232)     (1,511)
Interest expense                  20,597     19,585     82,502      74,845
                                  20,279     19,156     80,270      73,334
Gain on disposition of real       —          297        —           297
estate
Income tax benefit (expense)      (104)      (521)      7,086       (779)
Equity in earnings of             —          153        4,074       474
unconsolidated affiliate
Earnings from continuing          33,491     26,220     128,493     86,475
operations
Earnings from discontinued        7,156      1,465      13,444      5,941
operations
Earnings including                40,647     27,685     141,937     92,416
noncontrolling interests
Loss (earnings) attributable to
noncontrolling interests:
Continuing operations             43         (123)      129         (11)
Discontinued operations           (27)       8          (51)        (80)
                                  16         (115)      78          (91)
Net earnings attributable to NNN  40,663     27,570     142,015     92,325
Series C preferred stock          —          (1,696)    (1,979)     (6,785)
dividends
Series D preferred stock          (4,762)    —          (15,449)    —
dividends
Excess of redemption value over
carrying value of preferred       —          —          (3,098)     —

 shares redeemed
Net earnings available to common  $ 35,901   $ 25,874   $ 121,489   $ 85,540
stockholders
                                  December 31,          December 31,
                                  2012       2011       2012        2011
Weighted average common shares
outstanding:
Basic                             109,393    97,605     106,965     88,100
Diluted                           112,013    98,671     109,118     88,837
Net earnings per share available
to common stockholders:
Basic:
Continuing operations             $ 0.26     $ 0.25     $ 1.00      $ 0.90
Discontinued operations           0.07       0.01       0.13        0.06
Net earnings                      $ 0.33     $ 0.26     $ 1.13      $ 0.96
Diluted:
Continuing operations             $ 0.26     $ 0.25     $ 0.99      $ 0.89
Discontinued operations           0.06       0.01       0.12        0.07
Net earnings                      $ 0.32     $ 0.26     $ 1.11      $ 0.96



National Retail Properties, Inc.

(in thousands, except per share data)

(unaudited)


                                  Quarter Ended         Year Ended
                                  December 31,          December 31,
                                  2012       2011       2012        2011
Funds From Operations (FFO)
Reconciliation:
Net earnings available to common  $ 35,901   $ 25,874   $ 121,489   $ 85,540
stockholders
Real estate depreciation and
amortization:
Continuing operations             20,223     15,239     74,016      52,638
Discontinued operations           111        313        957         1,405
Joint venture real estate         —          44         112         178
depreciation
Joint venture gain on             —          —          (2,341)     —
disposition of real estate
Gain on disposition of real       (6,510)    (432)      (10,956)    (527)
estate
Impairment losses - real estate   1,269      —          10,312      431
Total FFO adjustments             15,093     15,164     72,100      54,125
FFO available to common           $ 50,994   $ 41,038   $ 193,589   $ 139,665
stockholders
FFO per share:
Basic                             $ 0.47     $ 0.42     $ 1.81      $ 1.59
Diluted                           $ 0.46     $ 0.42     $ 1.77      $ 1.57
Recurring Funds from Operations
Reconciliation:
Net earnings available to common  $ 35,901   $ 25,874   $ 121,489   $ 85,540
stockholders
Total FFO adjustments             15,093     15,164     72,100      54,125
FFO available to common           50,994     41,038     193,589     139,665
stockholders
Excess of redemption value over
carrying value of preferred       —          —          3,098       —

 share redemption
Impairment losses and other       94         (987)      2,614       (407)
charges, net of recoveries
Income tax benefit                —          —          (7,671)     —
Joint venture disposition fee     —          —          (1,964)     —
and promote income
Total Recurring FFO adjustments   94         (987)      (3,923)     (407)
Recurring FFO available to        $ 51,088   $ 40,051   $ 189,666   $ 139,258
common stockholders
Recurring FFO per share:
Basic                             $ 0.47     $ 0.41     $ 1.77      $ 1.58
Diluted                           $ 0.46     $ 0.41     $ 1.74      $ 1.57
                                  Quarter Ended         Year Ended
                                  December 31,          December 31,
                                  2012       2011       2012        2011
Adjusted Funds From Operations
(AFFO) Reconciliation:
Net earnings available to common  $ 35,901   $ 25,874   $ 121,489   $ 85,540
stockholders
Total FFO adjustments             15,093     15,164     72,100      54,125
Total Recurring FFO adjustments   94         (987)      (3,923)     (407)
Recurring FFO available to        51,088     40,051     189,666     139,258
common stockholders
Straight-line accrued rent        160        108        (897)       54
Net capital lease rent            402        404        1,623       1,595
adjustment
Below market rent amortization    (627)      (615)      (2,492)     (1,106)
Stock based compensation expense  2,375      2,121      8,131       6,390
Capitalized interest expense      (336)      (366)      (1,540)     (1,213)
Convertible debt interest         1,102      1,026      4,291       5,837
expense (non-cash portion)
Joint venture disposition fee     —          —          1,964       —
and promote income
Total AFFO adjustments            3,076      2,678      11,080      11,557
AFFO available to common          $ 54,164   $ 42,729   $ 200,746   $ 150,815
stockholders
AFFO per share:
Basic                             $ 0.50     $ 0.44     $ 1.88      $ 1.71
Diluted                           $ 0.48     $ 0.43     $ 1.84      $ 1.70
Other Information:
Percentage rent                   $ 620      $ 644      $ 1,192     $ 1,120
Amortization of debt costs        $ 78       $ 351      $ 2,584     $ 4,141
Scheduled debt principal
amortization (excluding           $ 256      $ 283      $ 1,187     $ 1,098
maturities)
Non-real estate depreciation      $ 62       $ 27       $ 143       $ 168
expense



National Retail Properties, Inc.

(in thousands)
(unaudited)


Earnings from Discontinued Operations: NNN classified the revenues and
expenses related to leasehold interests which expired and properties which
generated revenue and were sold or generated revenue and were held for sale as
of December 31, 2012, as discontinued operations. The following is a summary
of the earnings from discontinued operations.
                       Quarter Ended                Year Ended
                       December 31,                 December 31,
                       2012           2011          2012           2011
Revenues:
Rental and earned      $   1,427      $  2,027      $  7,504       $  9,567
income
Real estate expense
reimbursement from     147            163           527            632
tenants
Interest and other
income from real       5              3             44             47
estate transactions
                       1,579          2,193         8,075          10,246
Expenses:
General and            15             11            26             22
administrative
Real estate            213            272           997            1,201
Depreciation and       128            336           1,046          1,495
amortization
Impairment losses -    154            —             1,901          431
real estate
Interest               350            357           1,422          1,382
                       860            976           5,392          4,531
Gain on disposition    6,510          284           10,956         424
of real estate
Income tax expense     (73)           (36)          (195)          (198)
Earnings from
discontinued
operations
including              7,156          1,465         13,444         5,941
noncontrolling

 interests
Loss (earnings)
attributable to        (27)           8             (51)           (80)
noncontrolling
interests
Earnings from
discontinued           $   7,129      $  1,473      $  13,393      $  5,861
operations
attributable to NNN



National Retail Properties, Inc.

(in thousands)

(unaudited)


                                                    December31,  December31,

                                                    2012          2011
Balance Sheet Summary
Assets:
Cash and cash equivalents                           $ 2,076       $ 2,082
Receivables, net of allowance                       3,112         2,763
Investment in unconsolidated affiliate              —             4,358
Mortgages, notes and accrued interest receivable    27,770        33,428
Real estate:
Accounted for using the operating method, net of
                                                    3,769,817     3,224,288
 accumulated depreciation and amortization
Accounted for using the direct financing method     23,217        26,518
Real estate held for sale                           41,773        36,936
Commercial mortgage residual interests              13,096        15,299
Accrued rental income, net of allowance             25,458        25,187
Other assets                                        81,707        64,184
Total assets                                        $ 3,988,026   $ 3,435,043
Liabilities:
Line of credit payable                              $ 174,200     $ 65,600
Mortgages payable, net of unamortized premium       10,602        23,171
Notes payable - convertible, net of unamortized     236,500       355,371
discount
Notes payable, net of unamortized discount          1,165,662     894,967
Other liabilities                                   103,477       92,058
Total liabilities                                   1,690,441     1,431,167
Stockholders' equity of NNN                         2,296,285     2,002,498
Noncontrolling interests                            1,300         1,378
Total equity                                        2,297,585     2,003,876
Total liabilities and equity                        $ 3,988,026   $ 3,435,043
Common shares outstanding                           111,555       104,755
Gross leasable area, Property Portfolio (square     19,168        16,428
feet)



NNN Retail Properties Fund I LLC

(in thousands)

(unaudited)


In September 2007, the company entered into a joint venture, NNN Retail
Properties Fund I LLC, with an affiliate of Crow Holdings Realty Partners IV,
L.P. The company owns a 15 percent equity interest, and the following summary
represents the Balance Sheet and Income Statement Summary for the joint
venture. The company's investment in the joint venture is included in the
company's Balance Sheet Summary under "Investment in unconsolidated
affiliate."



The joint venture sold all 21 convenience store properties it owned in the
third quarter of 2012 for approximately $87.5 million. The investors' $33.3
million total equity investment produced approximately $61.6 million of total
cash distributions from operations and net sale proceeds over the life of the
joint venture.


                           December31,                  December31,

                           2012                          2011
Assets:
Cash and cash              $       253                   $     307
equivalents
Receivables                —                             200
Real estate                —                             70,911
Other assets               —                             402
                           $       253                   $     71,820
Liabilities:
Notes payable              $       —                     $     42,700
Other liabilities          228                           65
Total liabilities          228                           42,765
Members' equity            25                            29,055
Total liabilities and      $       253                   $     71,820
equity



                                   Quarter Ended   Year Ended
                                   December 31,    December 31,
                                   2012  2011      2012       2011
Revenues:
Rental income                      $ —   $ 1,565   $ 4,158    $ 6,261
Expenses:
General and administrative         —     73        441        332
Real estate                        —     4         25         18
Depreciation and amortization      —     339       833        1,444
Interest                           —     192       506        1,558
                                   —     608       1,805      3,352
Gain on disposition of real estate —     —         15,609     —
Net earnings                       $ —   $ 957     $ 17,962   $ 2,909



National Retail Properties, Inc.

Property Portfolio


Top 20 Lines of Trade
                                                          As of December 31,
     Line of Trade                                        2012^(1)  2011 ^(2)
1.   Convenience stores                                   19.8   %  24.6   %
2.   Restaurants - full service                           10.7   %  9.4    %
3.   Automotive service                                   7.6    %  4.9    %
4.   Automotive parts                                     5.6    %  6.5    %
5.   Restaurants - limited service                        5.2    %  3.6    %
6.   Theaters                                             4.7    %  5.0    %
7.   Sporting goods                                       4.0    %  4.8    %
8.   Health and fitness                                   3.7    %  2.6    %
9.   Wholesale clubs                                      3.4    %  4.0    %
10.  Home improvement                                     3.0    %  2.1    %
11.  Drug stores                                          3.0    %  3.2    %
12.  Consumer electronics                                 3.0    %  3.5    %
13.  Recreational vehicle dealers, parts and accessories  2.7    %  2.3    %
14.  Travel plazas                                        2.2    %  2.5    %
15.  Family entertainment centers                         2.1    %  1.9    %
16.  Books                                                1.8    %  2.0    %
17.  Grocery                                              1.7    %  2.1    %
18.  Home furnishings                                     1.6    %  0.8    %
19.  General merchandise                                  1.5    %  1.1    %
20.  Financial services                                   1.4    %  1.3    %
     Other                                                11.3   %  11.8   %
     Total                                                100.0  %  100.0  %



Top 10 States
   State            % of Total^(1)      State          % of Total^(1)
1. Texas            21.8     %      6.  California     4.3      %
2. Florida          9.2      %      7.  Indiana        4.2      %
3. Illinois         5.7      %      8.  Pennsylvania   3.7      %
4. Georgia          4.7      %      9.  Virginia       3.5      %
5. North Carolina   4.7      %      10. Ohio           3.3      %



^(1) Based on the annualized base rent for all leases in place as of
       December31, 2012.
^(2) Based on the annualized base rent for all leases in place as of
       December31, 2011.



National Retail Properties, Inc.

Property Portfolio


Top Tenants (>2.0%)
                            Properties  % of Total ^(1)
 Susser                     86          5.4%
 Pantry                     84          5.0%
 Mister Car Wash            75          4.8%
 7-Eleven                   68          4.7%
 AMC Theatre                15          3.9%
 LA Fitness                 16          3.6%
 BJ's Wholesale Club        7           3.4%
 Best Buy                   19          2.9%
 Camping World              20          2.7%
 Gander Mountain            9           2.5%
 Road Ranger                27          2.3%
 Pull-A-Part                20          2.3%
 Bloomin' Brands (Outback)  34          2.2%
 Pep Boys                   17          2.1%



Lease Expirations^(2)
                             Gross                                          Gross
      % of       # of        Leasable                % of       # of
      Total^(1)  Properties  Area ^(3)               Total^(1)  Properties  Leasable
                                                                            Area ^ (3)
2013  1.7%       32          566,000     2019        2.9%       46          766,000
2014  2.6%       41          552,000     2020        3.4%       96          905,000
2015  2.3%       33          630,000     2021        4.8%       98          867,000
2016  1.8%       29          523,000     2022        7.5%       93          1,070,000
2017  3.9%       46          1,008,000   2023        3.5%       42          830,000
2018  4.3%       55          1,173,000   Thereafter  61.3%      969         9,624,000



^(1) Based on the annual base rent of $354,836,000, which is the annualized
       base rent for all leases in place as of December31, 2012.
^(2) As of December 31, 2012, the weighted average remaining lease term is
       12 years.
^(3) Square feet.





SOURCE National Retail Properties, Inc.

Website: http://www.nnnreit.com
Contact: Kevin B. Habicht, Chief Financial Officer, +1-407-265-7348
 
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