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Record Operating Results For Third Quarter And Nine Months Announced By Realty Income

Record Operating Results For Third Quarter And Nine Months Announced By Realty
                                    Income

PR Newswire

ESCONDIDO, Calif., Oct. 31, 2013

ESCONDIDO, Calif., Oct. 31, 2013 /PRNewswire/ --Realty Income Corporation
(Realty Income), The Monthly Dividend Company^® (NYSE: O), today announced
record operating results for the third quarter ended September 30, 2013.
Access to this document is available at www.realtyincome.com. All per share
amounts presented in this press release are on a diluted per common share
basis unless stated otherwise.

(Logo: http://photos.prnewswire.com/prnh/20130507/MM09486LOGO)

COMPANY HIGHLIGHTS:

For the quarter ended September 30, 2013 (as compared to the same quarterly
period in 2012):

  oRevenue increased 70.2% to $199.3 million as compared to $117.1 million
  oNet income available to common stockholders per share was $0.21
  oNormalized FFO available to common stockholders increased 68.5% to $116.1
    million
  oNormalized FFO per share increased 13.5% to $0.59, and includes a non-cash
    $0.02 reduction for accelerated stock vesting from 10 years to 5 years
  oAFFO available to common stockholders increased 72.1% to $117.9 million
  oAFFO per share increased 15.4% to $0.60
  oSame store rents increased 1.3% to $109.6 million
  oPortfolio occupancy increased to 98.1% from 97.0%
  oIssued $750 million of 4.65% senior unsecured notes due 2023
  oInvested $502.7 million in 219 new properties and properties under
    development or expansion
  oIncreased the monthly dividend in September for the 73^rd time and for the
    64^th consecutive quarter
  oDividends paid per common share increased 23.0%

Financial Results

Revenue

Revenue, for the quarter ended September 30, 2013, increased 70.2% to $199.3
million as compared to $117.1million, for the same quarter in 2012. Revenue,
for the nine months ended September 30, 2013, increased 61.5% to $550.4
million as compared to $340.8 million, for the same period in 2012.

Net Income Available to Common Stockholders

Net income available to common stockholders, for the quarter ended September
30, 2013, was $41.1million as compared to $27.0 million for the same quarter
in 2012. Net income per share, for the quarter ended September 30, 2013, was
$0.21as compared to $0.20, for the same quarter in 2012.

Net income available to common stockholders, for the nine months ended
September 30, 2013, was $149.8million as compared to $86.0 million, for the
same period in 2012. Net income per share, for the nine months ended
September30, 2013, was $0.80 as compared to $0.65, for the same period in
2012.

The calculation to determine net income for a real estate company includes
impairments and/or gains from the sales of investment properties. Impairments
and/or gains on property sales vary from quarter to quarter. This variance can
significantly impact net income and period to period comparisons.

FFO Available to Common Stockholders

Funds from Operations (FFO), for the quarter ended September 30, 2013,
increased 82.8% to $115.9million as compared to $63.4 million for the same
quarter in 2012. FFO per share, for the quarter ended September 30, 2013,
increased 22.9% to $0.59 as compared to $0.48, for the same quarter in 2012.

FFO, for the nine months ended September 30, 2013, increased 71.4% to $324.5
million as compared to $189.3million, for the same period in 2012. FFO per
share, for the nine months ended September 30, 2013, increased 21.1% to $1.72
as compared to $1.42, for the same period in 2012.

Normalized FFO Available to Common Stockholders

Normalized Funds from Operations, which is based on FFO adjusted to add back
ARCT merger-related costs, for the quarter ended September 30, 2013, increased
68.5% to $116.1million as compared to $68.9 million, for the same quarter in
2012. Normalized FFO per share, for the quarter ended September 30, 2013,
increased 13.5% to $0.59 as compared to $0.52, for the same quarter in 2012.
Normalized FFO per share during the quarter was reduced by $0.02 per share to
account for the accelerated vesting of restricted shares that occurred on July
1, 2013 from ten-year vesting to five years.

Normalized FFO, for the nine months ended September 30, 2013, increased 73.2%
to $337.4 million as compared to $194.8million, for the same period in 2012.
Normalized FFO per share, for the nine months ended September 30, 2013,
increased 21.8% to $1.79 as compared to $1.47, for the same period in 2012.

AFFO Available to Common Stockholders

Adjusted Funds from Operations (AFFO), for the quarter ended September 30,
2013, increased 72.1% to $117.9million as compared to $68.5 million, for the
same quarter in 2012. AFFO per share, for the quarter ended September 30,
2013, increased 15.4% to $0.60 as compared to $0.52, for the same quarter in
2012.

AFFO, for the nine months ended September 30, 2013, increased 67.6% to $337.4
million as compared to $201.3million, for the same period in 2012. AFFO per
share, for the nine months ended September30, 2013, increased 17.8% to $1.79
as compared to $1.52, for the same period in 2012.

The company considers FFO, normalized FFO, and AFFO to be appropriate
supplemental measures of a Real Estate Investment Trust's (REIT's) operating
performance. Realty Income defines FFO consistent with the National
Association of Real Estate Investment Trust's (NAREIT's) definition, as net
income available to common stockholders, plus depreciation and amortization of
real estate assets, plus impairments of real estate, reduced by gains on sales
of investment properties and extraordinary items. Normalized FFO adds back
merger-related costs for the acquisition of ARCT. AFFO further adjusts
Normalized FFO for unique revenue and expense items, which are not pertinent
to the measurement of the company's ongoing operating performance. See the
reconciliation of net income available to common stockholders to FFO,
normalized FFO and AFFO on page seven.

Dividend Information

In September 2013, Realty Income announced the 64^th consecutive quarterly
dividend increase, which is the 73^rd increase in the amount of the dividend
since the company's listing on the New York Stock Exchange in 1994. The
annualized dividend amount, as of September 30, 2013, was approximately $2.182
per share. The amount of monthly dividends paid per share increased 23.0% to
$0.545, in the third quarter of 2013 from $0.443 per share, for the same
period in 2012. In addition, through September 30, 2013, the company has paid
518 consecutive monthly dividends and over $2.6billion in total dividends
since 1969. Realty Income has a dividend reinvestment and stock purchase
program that can be accessed at www.realtyincome.com. The program is
administered by Wells Fargo Shareowner Services.

Real Estate Portfolio Update

As of September 30, 2013, Realty Income's portfolio of freestanding,
single-tenant properties consisted of 3,866 properties located in 49 states
and Puerto Rico, leased to 200 commercial enterprises doing business in 47
industries. The properties are leased under long-term, net leases with a
weighted average remaining lease term of approximately 10.9 years.

Portfolio Management Activities

The company's portfolio of commercial real estate, owned primarily under 10-
to 20-year net leases, continues to perform well and provide dependable lease
revenue supporting the payment of monthly dividends. As of September30, 2013,
portfolio occupancy was 98.1% with 73 properties available for lease out of a
total of 3,866 properties in the portfolio, as compared to 97.0% portfolio
occupancy for the same period in 2012.

Rent Increases

During the quarter ended September 30, 2013, same store rents, on 2,360
properties under lease, increased 1.3% to $109.6million, as compared to
$108.2million for the same quarter in 2012. For the nine months ended
September30, 2013, same store rents, on 2,360 properties under lease,
increased 1.3% to $328.4million, as compared to $324.2million for the same
period in 2012.

Property Acquisitions

During the third quarter of 2013, Realty Income invested $502.7 million in 219
new properties, and properties under development or expansion, located in 33
states. These properties are 100% leased with a weighted average lease term of
approximately 14.7 years and an initial average lease yield of 7.1%. In
addition, approximately 72% of the revenue generated by these acquisitions is
from investment grade tenants. The tenants occupying the new properties
operate in 15 industries, and the property types consist of 80.7% retail,
18.9% office, and 0.4% industrial and distribution, based on rental revenue.

During the nine months ended September 30, 2013, Realty Income invested
approximately $1.37 billion in 407 new properties and properties under
development or expansion. The new properties are located in 40 states and are
100% leased with an average lease term of approximately 14.1 years and an
initial average lease yield of 7.0%. Approximately 65% of the revenue
generated from the year-to-date 2013 acquisitions is from investment grade
tenants. These property acquisitions are in addition to the $3.2billion
acquisition of 515 properties resulting from Realty Income's acquisition of
American Realty Capital Trust (ARCT), which was completed during the first
quarter of 2013.

Realty Income maintains a $1.5 billion unsecured acquisition credit facility,
which is used to fund property acquisitions in the near term.

Property Dispositions

Realty Income continued to successfully execute its asset disposition program
in the third quarter of 2013. The primary objective of this program is to sell
assets when the company believes that the reinvestment of the sales proceeds
will generate higher returns, enhance the credit quality of the company's real
estate portfolio, increase the average lease length, and/or decrease tenant or
industry concentration.

During the quarter ended September 30, 2013, Realty Income sold 19 properties
for $22.4million, with a gain on sales of $6.2million, as compared to 11
properties sold for $15.8 million, with a gain on sales of $2.0 million,
during the same quarter in 2012.

During the nine months ended September 30, 2013, Realty Income sold 53
properties for $106.1 million, with a gain on sales of $50.5 million, as
compared to 30 properties sold for $34.3 million, with a gain on sales of $6.0
million, during the same period in 2012.

Other Quarterly and Subsequent Activities

Expansion of Unsecured Credit Facility

On October 29, Realty Income announced the expansion of the company's
unsecured acquisition credit facility to $1.5 billion from $1.0 billion. The
company exercised the $500 million accordion expansion of the existing credit
facility with its current bank lending group. All other material business
terms of the credit facility remain unchanged. As of October 29, 2013, the
company had borrowing capacity of approximately $1.4 billion available on the
facility.

Issued 9.775 Million Common Shares

On October 25, Realty Income issued 9.775 million common shares priced at
$40.63 per share. Net proceeds of approximately $378 million were used to
repay a portion of the borrowings under the company's acquisition credit
facility.

Realty Income Names John P. Case to Succeed Tom A. Lewis as Chief Executive
Officer

On September 3, Realty Income announced that its Board of Directors had
appointed John P. Case to the position of chief executive officer of the
company. Mr. Case, who has served as president and chief investment officer,
succeeded Tom A. Lewis, who decided to retire as the company's CEO. Mr. Lewis,
who had been CEO since 1997, will remain at the company until early next year
to assist with the transition, and continues to serve as vice chairman of the
company's Board of Directors. With this appointment, Mr. Case becomes only the
third CEO in Realty Income's 44-year history.

Issued $750 million of $4.65% Senior Unsecured Notes

In July, Realty Income issued $750 million of 4.65% senior unsecured notes due
2023. The public offering price for the notes was 99.775% of the principal
amount for an effective yield to maturity of 4.678%. The net proceeds from the
offering were used to repay all of the borrowings outstanding under the
company's acquisition credit facility and for other general corporate purposes
and working capital, which may include additional acquisitions.

CEO Comments on Operating Results

Commenting on Realty Income's financial results and real estate operations,
Chief Executive Officer, John P. Case said, "We are again pleased to report
successful operating results for the third quarter. The primary drivers of our
performance were: 1) $1.37 billion in new acquisitions during the past nine
months, at an initial average lease yield of 7.0%; 2) the immediately
accretive rental revenue from our acquisition of ARCT for $3.2 billion,
completed in January 2013; and 3) the continued strength of our existing
portfolio, with quarter-end occupancy of 98.1%, and same store rent growth of
1.3%. We also now believe 2013 estimated acquisitions will be approximately
$1.5 billion versus our prior estimate of at least $1.25 billion, as
acquisitions activity remains robust. Additionally, our operating performance
has allowed us to increase the dividends paid year-to-date by 21.6%.

"We also successfully accessed the capital markets during October, issuing
$397 million of common stock in an offering that was upsized by 50% from an
original offering amount of $264 million. Proceeds will be used to repay
borrowings under our credit facility and, as a result, permanently and
accretively finance third quarter acquisitions activity. Furthermore, we
increased the funds available to us under our unsecured acquisition credit
facility to $1.5billion from $1.0 billion. Currently, we have approximately
$1.4 billion available under our credit facility to fund additional property
investment activities."

FFO and AFFO Commentary

Realty Income's FFO and AFFO per share has historically tended to be stable
and fairly predictable because of the long-term leases that are the primary
source of the company's revenue. There are, however, several factors that can
cause FFO and AFFO per share to vary from levels that have been anticipated by
the company. These factors include, but are not limited to, changes in
interest rates and occupancy rates, periodically accessing the capital
markets, the level and timing of property and entity acquisitions and
dispositions, integration of the acquired ARCT properties including the
finalization of purchase price allocations, lease rollovers, the general real
estate market, and the economy.

2013 Earnings Estimates

Normalized FFO is based on FFO adjusted to add back ARCT merger-related costs.
The Normalized 2013 FFO and AFFO estimates are as follows (excluding the costs
associated with the ARCT transaction):

Normalized FFO per share for 2013 should range from $2.38 to $2.42 per share,
an increase of 18% to 20% over the Normalized 2012 FFO per share of $2.02.
Normalized FFO per share for 2013 is based on an estimated net income per
share range of $0.94 to $0.98, plus estimated real estate depreciation of
$1.65 per share, plus ARCT merger-related costs of $0.07 per share, and
reduced by potential estimated gains on sales of investment properties of
$0.28 per share (in accordance with NAREIT's definition of FFO).

AFFO per share for 2013 should range from $2.38 to $2.42per share, an
increase of 16% to 17% over the 2012 AFFO per share of $2.06. This represents
an increase from the prior AFFO per share estimate of $2.35 to $2.41. AFFO
further adjusts Normalized FFO for unique revenue and expense items, which are
not pertinent to the measurement of the company's ongoing operating
performance.

2014 Earnings Estimates

FFO per share for 2014 should range from $2.53 to $2.58 per share, an increase
of 5% to 8% over the 2013 estimated FFO per share of $2.38 to $2.42. FFO per
share for 2014 is based on an estimated net income per share range of $0.88 to
$0.93, plus estimated real estate depreciation of $1.72 per share, and reduced
by potential estimated gains on sales of investment properties of $0.07 per
share (in accordance with NAREIT's definition of FFO).

AFFO per share for 2014 should range from $2.53 to $2.58per share, an
increase of 5% to 8% over the 2013 estimated AFFO per share of $2.38 to $2.42.
AFFO further adjusts FFO for unique revenue and expense items, which are not
pertinent to the measurement of the company's ongoing operating performance.

About Realty Income

Realty Income is The Monthly Dividend Company^®, a New York Stock Exchange
real estate company dedicated to providing shareholders with dependable
monthly income. As of September 30, 2013, the company had paid 518 consecutive
monthly dividends throughout its 44-year operating history. The monthly income
is supported by the cash flows from over 3,800 properties owned under
long-term lease agreements with 200 leading regional and national commercial
enterprises. The company is an active buyer of net-leased properties
nationwide. Additional information about the company can be obtained from the
corporate website at www.realtyincome.com or www.twitter.com/realtyincome.

Forward-Looking Statements

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, tenant financial health,
the availability of capital to finance planned growth, continued volatility
and uncertainty in the credit markets and broader financial markets, property
acquisitions and the timing of these acquisitions, charges for property
impairments, integration of the ARCT acquisition, and the outcome of any legal
proceedings to which the company is a party, as described in the company's
filings with the Securities and Exchange Commission. Consequently,
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.
The company 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.

Note to Editors: Realty Income press releases are available via the internet
at http://www.realtyincome.com/invest/newsroom-library/press-releases.shtml.



CONSOLIDATED STATEMENTS OF INCOME
For the three and nine months ended September 30, 2013 and 2012
(dollars in thousands, except per share amounts - unaudited)
                             Three      Three      Nine       Nine
                             months     months     months     months
                             Ended      Ended      Ended      Ended
                             9/30/13    9/30/12    9/30/13    9/30/12
REVENUE
Rental                     $ 195,429  $ 116,795  $ 543,557  $ 339,598
Other                        3,875      354        6,841      1,211
Total revenue                199,304    117,149    550,398    340,809
EXPENSES
Depreciation and             80,869     37,039     221,603    105,828
amortization
Interest                     49,703     29,720     130,271    87,477
General and administrative   16,628     9,335      40,316     27,775
Property                     5,898      1,532      12,735     5,156
Income taxes                 671        405        2,063      1,215
Merger-related costs         240        5,495      12,875     5,495
Total expenses               154,009    83,526     419,863    232,946
Income from continuing       45,295     33,623     130,535    107,863
operations
Income from discontinued     6,612      3,835      51,115     12,266
operations
Net income                   51,907     37,458     181,650    120,129
Net income attributable to   (336)      -          (422)      -
noncontrolling interests
Net income attributable to   51,571     37,458     181,228    120,129
the Company
Preferred stock dividends    (10,482)   (10,482)   (31,447)   (30,435)
Excess of redemption value
over carrying value of
preferred shares redeemed    -          -          -          (3,696)
Net income available to    $ 41,089   $ 26,976   $ 149,781  $ 85,998
common stockholders
Funds from operations
available to
common stockholders (FFO)  $ 115,906  $ 63,420   $ 324,525  $ 189,283
Normalized funds from
operations available to
common stockholders        $ 116,146  $ 68,915   $ 337,400  $ 194,778
(normalized FFO)
Adjusted funds from
operations available to
common stockholders (AFFO) $ 117,919  $ 68,496   $ 337,439  $ 201,290
Per share information for
common stockholders:
Income from continuing
operations,
basic and diluted          $ 0.18     $ 0.17     $ 0.53     $ 0.56
Net income, basic and      $ 0.21     $ 0.20     $ 0.80     $ 0.65
diluted
FFO:
Basic                      $ 0.59     $ 0.48     $ 1.73     $ 1.43
Diluted                    $ 0.59     $ 0.48     $ 1.72     $ 1.42
Normalized FFO:
Basic                      $ 0.59     $ 0.52     $ 1.80     $ 1.47
Diluted                    $ 0.59     $ 0.52     $ 1.79     $ 1.47
AFFO:
Basic                      $ 0.60     $ 0.52     $ 1.80     $ 1.52
Diluted                    $ 0.60     $ 0.52     $ 1.79     $ 1.52
Cash dividends paid per    $ 0.545    $ 0.443    $ 1.602    $ 1.317
common share



FUNDS FROM OPERATIONS (FFO)
(dollars in thousands, except per share amounts)
                     Three months   Three months  Nine months  Nine months
                     Ended 9/30/13  Ended         Ended        Ended
                                    9/30/12       9/30/13      9/30/12
Net income available
to common            $    41,089    $   26,976    $  149,781   $  85,998
stockholders
Depreciation and
amortization:
      Continuing          80,869        37,039       221,603      105,828
      operations
      Discontinued        396           842          1,463        2,995
      operations
Depreciation
allocated to              (285)         -            (680)        -
noncontrolling
interest
Depreciation of
furniture, fixtures       (76)          (59)         (203)        (195)
and equipment
Provisions for
impairment on             76            667          3,028        667
investment
properties
Gain on sale of
investment
properties,
      discontinued        (6,163)       (2,045)      (50,467)     (6,010)
      operations
FFO available to          115,906       63,420       324,525      189,283
common stockholders
Merger-related costs      240           5,495        12,875       5,495
Normalized FFO
available to common  $    116,146   $   68,915    $  337,400   $  194,778
stockholders
FFO per common
share:
      Basic          $    0.59      $   0.48      $  1.73      $  1.43
      Diluted        $    0.59      $   0.48      $  1.72      $  1.42
Normalized FFO per
common share:
      Basic          $    0.59      $   0.52      $  1.80      $  1.47
      Diluted        $    0.59      $   0.52      $  1.79      $  1.47
Distributions paid
to common            $    106,875   $   59,167    $  298,544   $  175,719
stockholders
Normalized FFO in
excess of
distributions paid
to
      common         $    9,271     $   9,748     $  38,856    $  19,059
      stockholders
Weighted average
number of common
shares
used for computation
per share:
      Basic          195,768,298    132,764,877   187,805,222  132,731,984
      Diluted        196,619,866    132,931,813   188,399,848  132,845,970
We define FFO, a non-GAAP measure, consistent with the National Association of
Real Estate Investment Trust's definition, as net income available to common
stockholders, plus depreciation and amortization of real estate assets, plus
impairments of real estate assets, reduced by gains on sales of investment
properties and extraordinary items. We define normalized FFO, a non-GAAP
measure, as FFO excluding the ARCT merger-related costs.
ADJUSTED FUNDS FROM OPERATIONS (AFFO)
(dollars in thousands, except per share amounts)
Most companies in our industry use a similar measurement to AFFO, but they may
use the term "CAD" (for Cash Available for Distribution) or "FAD" (for Funds
Available for Distribution).
                     Three months   Three months  Nine months  Nine months
                     Ended 9/30/13  Ended         Ended        Ended
                                    9/30/12       9/30/13      9/30/12
Net income available
to common            $    41,089    $   26,976    $  149,781   $  85,998
stockholders
Cumulative
adjustments to            75,057        41,939       187,619      108,780
calculate FFO ^(1)
Normalized FFO
available to common       116,146       68,915       337,400      194,778
stockholders
Amortization of
share-based               6,737         2,230        14,235       7,780
compensation
Amortization of
deferred financing        1,196         611          3,217        1,838
costs ^(2)
Excess of redemption
value over carrying
value
      of Class D
      preferred           -             -            -            3,696
      share
      redemption
Amortization of net       (2,518)       (111)        (6,959)      (279)
mortgage premiums
(Gain) loss on            596           22           (690)        74
interest rate swaps
Capitalized leasing
costs and                 (369)         (521)        (1,143)      (1,218)
commissions
Capitalized building      (2,239)       (1,576)      (4,759)      (3,283)
improvements
Other adjustments         (1,630)       (1,074)      (3,862)      (2,096)
^(3)
Total AFFO available
to common            $    117,919   $   68,496    $  337,439   $  201,290
stockholders
AFFO per common
share:
      Basic          $    0.60      $   0.52      $  1.80      $  1.52
      Diluted        $    0.60      $   0.52      $  1.79      $  1.52
Distributions paid
to common            $    106,875   $   59,167    $  298,544   $  175,719
stockholders
AFFO in excess of
distributions paid
to
      common         $    11,044    $   9,329     $  38,895    $  25,571
      stockholders
^(1)  See FFO and normalized FFO calculation above for reconciling items.
      Includes the amortization of costs incurred and capitalized when our
      notes were issued in March 2003, November 2003, March 2005, September
      2005, September 2006, September 2007, June 2010, June 2011, October 2012
      and July 2013. Additionally, this includes the amortization of deferred
^(2)  financing costs incurred and capitalized in connection with our
      assumption of the mortgages payable and the issuance of our term loan.
      The deferred financing costs are being amortized over the lives of the
      respective mortgages and term loan. No costs associated with our credit
      facility agreements or annual fees paid to credit rating agencies have
      been included.
^(3)  Includes straight-line rent revenue, and the amortization of above and
      below-market leases.



HISTORICAL FUNDS FROM OPERATIONS AND ADJUSTED FUNDS FROM OPERATIONS
(dollars in thousands, except per share amounts)
For the three
months ended      2013         2012         2011         2010         2009
September 30,
Net income
available to   $  41,089    $  26,976    $  34,717    $  25,591    $  27,089
common
stockholders
Depreciation
and               80,904       37,822       31,837       24,132       22,879
amortization
Provisions for
impairment on
Realty Income
investment        76           667          169          84           -
properties
Gain on sales
of investment     (6,163)      (2,045)      (3,149)      (1,919)      (1,814)
properties
FFO               115,906      63,420       63,574       47,888       48,154
Merger-related    240          5,495        -            -            -
costs
Normalized FFO $  116,146   $  68,915    $  63,574    $  47,888    $  48,154
Normalized FFO
per diluted    $  0.59      $  0.52      $  0.50      $  0.46      $  0.47
share
AFFO           $  117,919   $  68,496    $  64,239    $  48,585    $  48,499
AFFO per       $  0.60      $  0.52      $  0.51      $  0.47      $  0.47
diluted share
Cash dividends $  0.545     $  0.443     $  0.435     $  0.431     $  0.427
paid per share
Weighted
average        196,619,866  132,931,813  126,582,609  103,977,023  103,481,892
diluted shares
outstanding
For the nine
months ended      2013         2012         2011         2010         2009
September 30,
Net income
available to   $  149,781   $  85,998    $  97,837    $  74,717    $  77,606
common
stockholders
Depreciation
and               222,183      108,628      87,628       70,814       68,713
amortization
Provisions for
impairment on
Realty Income
investment        3,028        667          378          171          -
properties
Gain on sales
of investment     (50,467)     (6,010)      (4,529)      (4,284)      (4,250)
properties
FFO               324,525      189,283      181,314      141,418      142,069
Merger-related    12,875       5,495        -            -            -
costs
Normalized FFO $  337,400   $  194,778   $  181,314   $  141,418   $  142,069
Normalized FFO
per diluted    $  1.79      $  1.47      $  1.46      $  1.36      $  1.37
share
AFFO           $  337,439   $  201,290   $  184,847   $  143,930   $  144,118
AFFO per       $  1.79      $  1.52      $  1.49      $  1.39      $  1.39
diluted share
Cash dividends $  1.602     $  1.317     $  1.301     $  1.290     $  1.279
paid per share
Weighted
average        188,399,848  132,845,970  124,013,142  103,887,679  103,532,894
diluted shares
outstanding



CONSOLIDATED BALANCE SHEETS
As of September 30, 2013 and December 31, 2012
(dollars in thousands)
                                                 2013          2012
                                                 (unaudited)
ASSETS
Real estate, at cost:
Land                                           $ 2,753,192   $ 1,999,820
Buildings and improvements                       7,002,560     3,920,865
Total real estate, at cost                       9,755,752     5,920,685
Less accumulated depreciation and amortization   (1,051,950)   (897,767)
Net real estate held for investment              8,703,802     5,022,918
Real estate held for sale, net                   17,276        19,219
Net real estate                                  8,721,078     5,042,137
Cash and cash equivalents                        9,960         5,248
Accounts receivable, net                         32,169        21,659
Acquired lease intangible assets, net            955,893       242,125
Goodwill                                         15,739        16,945
Other assets, net                                146,088       115,249
Total assets                                   $ 9,880,927   $ 5,443,363
LIABILITIES AND EQUITY
Distributions payable                          $ 39,359      $ 23,745
Accounts payable and accrued expenses            69,299        70,426
Acquired lease intangible liabilities, net       137,693       26,471
Other liabilities                                38,792        26,059
Lines of credit payable                          468,400       158,000
Mortgages payable, net                           811,058       175,868
Term loan                                        70,000        -
Notes payable                                    3,200,000     2,550,000
Total liabilities                                4,834,601     3,030,569
Stockholders' equity:
Preferred stock and paid in capital              609,363       609,363
Common stock and paid in capital                 5,333,761     2,572,092
Distributions in excess of net income            (932,876)     (768,661)
Total stockholders' equity                       5,010,248     2,412,794
Noncontrolling interests                         36,078        -
Total equity                                     5,046,326     2,412,794
Total liabilities and equity                   $ 9,880,927   $ 5,443,363



Realty Income Performance vs. Major Stock Indices
                             Equity                                                   NASDAQ
           Realty Income     REIT Index ^(1)    DJIA               S&P 500            Composite
           Dividend  Total   Dividend  Total    Dividend  Total    Dividend  Total    Dividend  Total
           yield     return  yield     return   yield     return   yield     return   yield     return
                     ^(2)              ^(3)               ^(3)               ^(3)               ^(4)
10/18 to
           10.5%     10.8%   7.7%      0.0%     2.9%      (1.6%)   2.9%      (1.2%)   0.5%      (1.7%)
12/31/1994
1995       8.3%      42.0%   7.4%      15.3%    2.4%      36.9%    2.3%      37.6%    0.6%      39.9%
1996       7.9%      15.4%   6.1%      35.3%    2.2%      28.9%    2.0%      23.0%    0.2%      22.7%
1997       7.5%      14.5%   5.5%      20.3%    1.8%      24.9%    1.6%      33.4%    0.5%      21.6%
1998       8.2%      5.5%    7.5%      (17.5%)  1.7%      18.1%    1.3%      28.6%    0.3%      39.6%
1999       10.5%     (8.7%)  8.7%      (4.6%)   1.3%      27.2%    1.1%      21.0%    0.2%      85.6%
2000       8.9%      31.2%   7.5%      26.4%    1.5%      (4.7%)   1.2%      (9.1%)   0.3%      (39.3%)
2001       7.8%      27.2%   7.1%      13.9%    1.9%      (5.5%)   1.4%      (11.9%)  0.3%      (21.1%)
2002       6.7%      26.9%   7.1%      3.8%     2.6%      (15.0%)  1.9%      (22.1%)  0.5%      (31.5%)
2003       6.0%      21.0%   5.5%      37.1%    2.3%      28.3%    1.8%      28.7%    0.6%      50.0%
2004       5.2%      32.7%   4.7%      31.6%    2.2%      5.6%     1.8%      10.9%    0.6%      8.6%
2005       6.5%      (9.2%)  4.6%      12.2%    2.6%      1.7%     1.9%      4.9%     0.9%      1.4%
2006       5.5%      34.8%   3.7%      35.1%    2.5%      19.0%    1.9%      15.8%    0.8%      9.5%
2007       6.1%      3.2%    4.9%      (15.7%)  2.7%      8.8%     2.1%      5.5%     0.8%      9.8%
2008       7.3%      (8.2%)  7.6%      (37.7%)  3.6%      (31.8%)  3.2%      (37.0%)  1.3%      (40.5%)
2009       6.6%      19.3%   3.7%      28.0%    2.6%      22.6%    2.0%      26.5%    1.0%      43.9%
2010       5.1%      38.6%   3.5%      27.9%    2.6%      14.0%    1.9%      15.1%    1.2%      16.9%
2011       5.0%      7.3%    3.8%      8.3%     2.8%      8.3%     2.3%      2.1%     1.3%      (1.8%)
2012       4.5%      20.1%   3.5%      19.7%    3.0%      10.2%    2.5%      16.0%    2.6%      15.9%
YTD Q3     5.5%      2.8%    3.7%      3.0%     2.5%      17.7%    2.1%      19.8%    1.3%      24.9%
2013
Compounded Average
Annual Total Return  16.8%             10.7%              9.9%               9.0%               8.8%
^(5)

Note: All of these dividend yields are calculated as annualized dividends
based on the last dividend paid in applicable time period divided by the
closing price as of period end. Dividend yield sources: NAREIT website and
Bloomberg, except for the 1994 NASDAQ dividend yield which was sourced from
Datastream / Thomson Financial.
^(1) FTSE NAREIT US Equity REIT Index, as per NAREIT website.
     Calculated as the difference between the closing stock price as of period
^(2) end less the closing stock price as of previous period, plus dividends
     paid in period, divided by closing stock price as of end of previous
     period. Does not include reinvestment of dividends.
^(3) Includes reinvestment of dividends. Source: NAREIT website and Factset.
^(4) Price only index, does not include dividends. Source: Factset.
     All of these Compounded Average Annual Total Return rates are calculated
     in the same manner: from Realty Income's NYSE listing on October 18, 1994
     through September 30, 2013, and (except for NASDAQ) assuming reinvestment
^(5) of dividends. Past Performance does not guarantee future performance.
     Realty Income presents this data for informational purposes only and
     makes no representation about its future performance or how it will
     compare in performance to other indices in the future.



Property Type Diversification


The following table sets forth certain property type information regarding
Realty Income's property portfolio as of September 30, 2013 (dollars in
thousands):
                                 Approximate  Rental Revenue Percentage
                                              for            of
                     Number of   Leasable     the Quarter    Rental
                                              Ended
Property Type        Properties  Square Feet  September 30,  Revenue
                                              2013^(1)
Retail               3,717       39,346,500   $    152,018   77.6%
Industrial and       76          15,175,400        21,541    11.0
Distribution
Office               47          3,120,300         12,312    6.3
Agriculture          15          184,500           5,202     2.6
Manufacturing        11          3,458,800         4,868     2.5
Totals               3,866       61,285,500   $    195,941   100.0%

     Includes rental revenue for all properties owned by Realty Income at
^(1) September 30, 2013, including revenue from properties reclassified as
     discontinued operations of $535. Excludes revenue of $23 from properties
     owned by Crest.



Tenant Diversification
The largest tenants based on percentage of total portfolio rental revenue at
September 30, 2013 include the following:
FedEx                        5.1%        Rite Aid              2.2%
Walgreens                    5.0%        Dollar General        2.2%
Family Dollar                4.9%        Regal Cinemas         2.1%
LA Fitness                   4.2%        CVS Pharmacy          2.1%
AMC Theatres                 3.1%        The Pantry            1.8%
Diageo                       3.0%        Circle K              1.7%
BJ's Wholesale Clubs         2.9%        Walmart/Sam's Club    1.6%
Northern Tier Energy/Super   2.5%
America



Industry Diversification


The following table sets forth certain information regarding Realty Income's
property portfolio classified according to the business of the respective
tenants, expressed as a percentage of our total rental revenue:
                    Percentage of Rental Revenue^(1)
                    For the
                    Quarter    For the Years Ended
                    Ended
                    September  Dec    Dec    Dec    Dec    Dec    Dec
                    30,        31,    31,    31,    31,    31,    31,
                    2013       2012   2011   2010   2009   2008   2007
Retail industries
Apparel stores      1.8%       1.7%   1.4%   1.2%   1.1%   1.1%   1.2%
Automotive          0.8        1.1    0.9    1.0    1.1    1.0    1.1
collision services
Automotive parts    1.1        1.0    1.2    1.4    1.5    1.6    2.1
Automotive service  2.0        3.1    3.7    4.7    4.8    4.8    5.2
Automotive tire     3.5        4.7    5.6    6.4    6.9    6.7    7.3
services
Book stores         0.1        0.1    0.1    0.1    0.2    0.2    0.2
Child care          2.6        4.5    5.2    6.5    7.3    7.6    8.4
Consumer            0.3        0.5    0.5    0.6    0.7    0.8    0.9
electronics
Convenience stores  11.2       16.3   18.5   17.1   16.9   15.8   14.0
Crafts and          0.5        0.3    0.2    0.3    0.3    0.3    0.3
novelties
Dollar stores       6.3        2.2    -      -      -      -      -
Drug stores         9.3        3.5    3.8    4.1    4.3    4.1    2.7
Education           0.4        0.7    0.7    0.8    0.9    0.8    0.8
Entertainment       0.6        0.9    1.0    1.2    1.3    1.2    1.4
Equipment services  0.1        0.1    0.2    0.2    0.2    0.2    0.2
Financial services  1.5        0.2    0.2    0.2    0.2    0.2    0.2
General merchandise 1.0        0.6    0.6    0.8    0.8    0.8    0.7
Grocery stores      2.9        3.7    1.6    0.9    0.7    0.7    0.7
Health and fitness  6.1        6.8    6.4    6.9    5.9    5.6    5.1
Health care         *          -      -      -      -      -      -
Home furnishings    0.8        1.0    1.1    1.3    1.3    2.4    2.6
Home improvement    1.3        1.5    1.7    2.0    2.2    2.1    2.4
Jewelry             0.1        -      -      -      -      -      -
Motor vehicle       1.5        2.1    2.2    2.6    2.7    3.2    3.1
dealerships
Office supplies     0.4        0.8    0.9    0.9    1.0    1.0    1.1
Pet supplies and    0.8        0.6    0.7    0.9    0.9    0.8    0.9
services
Restaurants -       5.0        7.3    10.9   13.4   13.7   14.3   14.9
casual dining
Restaurants - quick 4.2        5.9    6.6    7.7    8.3    8.2    6.6
service
Shoe stores         0.1        0.1    0.2    0.1    -      -      -
Sporting goods      1.7        2.5    2.7    2.7    2.6    2.3    2.6
Theaters            5.9        9.4    8.8    8.9    9.2    9.0    9.0
Transportation      0.1        0.2    0.2    0.2    0.2    0.2    0.2
services
Wholesale clubs     4.4        3.2    0.7    -      -      -      -
Other               *          0.1    0.1    0.3    1.1    1.2    1.9
Retail industries   78.4%      86.7%  88.6%  95.4%  98.3%  98.2%  97.8%



Industry Diversification (continued)
                   Percentage of Rental Revenue^(1)
                   For the
                   Quarter    For the Years Ended
                   Ended
                   September  Dec     Dec     Dec     Dec     Dec     Dec
                   30,        31,     31,     31,     31,     31,     31,
                   2013       2012    2011    2010    2009    2008    2007
Non-retail
industries
Aerospace          1.4        0.9     0.5     -       -       -       -
Beverages          3.2        5.1     5.6     3.0     -       -       -
Consumer           0.6        0.1     -       -       -       -       -
appliances
Consumer goods     1.1        0.1     -       -       -       -       -
Crafts and         0.1        -       -       -       -       -       -
novelties
Diversified        0.1        0.1     -       -       -       -       -
industrial
Electrical         0.1        -       -       -       -       -       -
utilities
Equipment services 0.5        0.3     0.2     -       -       -       -
Financial services 0.5        0.4     0.3     -       -       -       -
Food processing    1.4        1.3     0.7     -       -       -       -
Government         1.4        0.1     0.1     0.1     0.1     -       -
services
Health care        1.9        *       *       -       -       -       -
Home furnishings   0.2        -       -       -       -       -       -
Home improvement   0.3        -       -       -       -       -       -
Insurance          0.1        *       -       -       -       -       -
Machinery          0.2        0.1     -       -       -       -       -
Other              0.5        -       -       -       -       -       -
manufacturing
Packaging          0.9        0.7     0.4     -       -       -       -
Paper              0.2        0.1     0.1     -       -       -       -
Shoe stores        0.9        -       -       -       -       -       -
Telecommunications 0.7        0.8     0.7     -       -       -       -
Transportation     5.2        2.2     1.6     -       -       -       -
services
Other              0.1        1.0     1.2     1.5     1.6     1.8     2.2
Non-retail         21.6%      13.3%   11.4%   4.6%    1.7%    1.8%    2.2%
industries
Totals             100.0%     100.0%  100.0%  100.0%  100.0%  100.0%  100.0%
          Less
*         than
          0.1%
          Includes rental revenue for all properties owned by Realty Income at
^(1)      the end of each period presented, including revenue from properties
          reclassified as discontinued operations. Excludes revenue from
          properties owned by Crest.



Lease Expirations


The following table sets forth certain information regarding Realty Income's property portfolio regarding the
timing of the lease term expirations (excluding rights to extend a lease at the option of the tenant) on our
3,774 net leased, single-tenant properties as of September 30, 2013 (dollars in thousands):
Total Portfolio                                     Initial Expirations^(3)      Subsequent Expirations^(4)
                                 Rental                       Rental                       Rental
                                 Revenue                      Revenue                      Revenue
                                 for the                      for the                      for the
                                 Quarter    % of             Quarter    % of             Quarter   % of
       Number        Approx.     Ended      Total   Number    Ended      Total   Number    Ended     Total
       of Leases    Leasable    Sept. 30,  Rental  of        Sept. 30,  Rental  of        Sept.     Rental
                                                    Leases                       Leases    30,
Year   Expiring^(1)  Sq. Feet    2013^(2)   Revenue Expiring  2013       Revenue Expiring  2013      Revenue
2013       63        513,900     $ 1,719    1.0%    13        $ 559      0.4%    50        $ 1,160   0.6%
2014       149       1,046,400     3,702    1.9     49          1,668    0.9     100         2,034   1.0
2015       172       933,200       3,969    1.9     67          1,789    0.9     105         2,180   1.0
2016       195       1,167,300     4,504    2.3     119         2,787    1.4     76          1,717   0.9
2017       171       1,973,200     5,689    2.9     45          2,975    1.5     126         2,714   1.4
2018       260       3,358,400     10,535   5.4     162         7,793    4.0     98          2,742   1.4
2019       179       2,865,900     9,905    5.1     159         9,238    4.8     20          667     0.3
2020       110       3,402,100     8,557    4.4     99          8,187    4.2     11          370     0.2
2021       188       5,185,900     13,494   6.9     180         12,983   6.6     8           511     0.3
2022       213       7,155,500     14,518   7.6     205         14,284   7.4     8           234     0.2
2023       350       5,735,100     18,374   9.4     338         17,736   9.1     12          638     0.3
2024       139       2,084,800     7,027    3.6     139         7,027    3.6     -           -       -
2025       288       3,708,300     16,602   8.6     283         16,475   8.5     5           127     0.1
2026       232       3,558,100     12,630   6.6     229         12,547   6.5     3           83      0.1
2027       445       4,183,900     14,176   7.3     443         14,136   7.3     2           40      *
2028 -     620       12,972,100    48,795   25.1    612         48,630   25.0    8           165     0.1
2043
Totals     3,774     59,844,100  $ 194,196  100.0%  3,142     $ 178,814  92.1%   632       $ 15,382  7.9%
*      Less than 0.1%
       Excludes 19 multi-tenant properties and 73 vacant unleased properties, one of which is a multi-tenant
^(1)   property. The lease expirations for properties under construction are based on the estimated date of
       completion of those properties.
       Includes rental revenue of $535 from properties reclassified as discontinued operations and excludes
^(2)   revenue of $1,745 from 19 multi-tenant properties and from 73 vacant and unleased properties at September
       30, 2013. Excludes revenue of $23 from four properties owned by Crest.
^(3)   Represents leases to the initial tenant of the property that are expiring for the first time.
^(4)   Represents lease expirations on properties in the portfolio, which have previously been renewed, extended
       or re-tenanted.



Geographic Diversification


The following table sets forth certain state-by-state information regarding
Realty Income's property portfolio as of September 30, 2013 (dollars in
thousands):
                                                      Rental    Percentage
                                          Approximate Revenue   of
                                                      for
                                                      the
                      Number of   Percent Leasable    Quarter   Rental
                                                      Ended
                                                      September
State                 Properties  Leased  Square Feet 30,       Revenue
                                                      2013^(1)
Alabama   103         97%     782,700     $ 2,662   1.4%
Alaska   2           100     128,500       307     0.2
Arizona   110         96      1,185,600     5,311   2.7
Arkansas   35          94      607,200       1,123   0.6
California   161         100     4,613,600     19,723  10.1
Colorado   69          99      759,100       2,679   1.4
Connecticut   22          95      462,100       2,035   1.0
Delaware   16          100     29,500        418     0.2
Florida   287         99      2,959,400     11,461  5.8
Georgia   206         97      2,661,900     7,949   4.1
Hawaii   --          --      --            --      --
Idaho   13          100     91,800        449     0.2
Illinois   148         100     4,060,000     10,505  5.4
Indiana   100         98      1,012,100     4,739   2.4
Iowa   33          97      2,667,200     3,044   1.6
Kansas   76          99      1,571,200     3,266   1.7
Kentucky   43          98      788,200       2,833   1.4
Louisiana   72          97      806,700       2,409   1.2
Maine                 9           100     126,400       848     0.4
Maryland   32          100     649,900       3,680   1.9
Massachusetts   82          95      723,900       3,107   1.6
Michigan   103         98      939,200       3,179   1.6
Minnesota   155         100     1,152,000     7,366   3.8
Mississippi   95          96      1,282,200     3,115   1.6
Missouri   121         99      2,293,500     7,348   3.8
Montana   2           50      30,000        13      *
Nebraska   27          100     391,000       1,199   0.6
Nevada   20          100     380,700       1,220   0.6
New Hampshire   19          100     295,000       1,256   0.6
New Jersey   63          97      408,800       2,610   1.3
New Mexico   23          100     178,100       537     0.3
New York   80          95      1,970,300     10,021  5.1
North Carolina   126         99      1,181,600     4,494   2.3
North Dakota   7           100     66,000        118     0.1
Ohio   197         97      4,760,300     11,196  5.7
Oklahoma   111         100     1,457,900     3,565   1.8
Oregon   24          100     455,200       1,527   0.8
Pennsylvania   151         99      1,724,400     7,175   3.7
Rhode Island   3           100     21,300        65      *
South Carolina   127         98      868,100       3,919   2.0
South Dakota   11          100     133,500       244     0.1
Tennessee   155         97      2,601,300     5,075   2.6
Texas   388         99      6,606,600     19,278  9.9
Utah   12          100     742,700       1,198   0.6
Vermont   6           100     100,700       444     0.2
Virginia   127         97      2,531,400     6,333   3.2
Washington   37          100     400,800       1,442   0.7
West Virginia   12          100     261,200       877     0.4
Wisconsin   38          95      1,315,300     2,367   1.2
Wyoming   3           100     21,100        63      *
Puerto Rico           4           100     28,300        149     0.1
Totals\Average        3,866       98%     61,285,500  $ 195,941 100.0%
*       Less than
        0.1%
        Includes rental revenue for all properties owned by Realty Income at
^(1)    September 30, 2013, including revenue from properties reclassified as
        discontinued operations of $535. Excludes revenue of $23 from
        properties owned by Crest.



SOURCE Realty Income Corporation

Website: http://www.realtyincome.com
Contact: Tere H. Miller, Vice President, Investor Relations & Corporation
Communications, (760) 741-2111, x1177