Operating Results Announced by National Retail Properties, Inc.

ORLANDO, Fla., Feb. 17, 2011 /PRNewswire/ -- National Retail Properties, Inc. (NYSE: NNN), a real estate investment trust, today announced operating results for the quarter and year ended December 31, 2010.  Highlights include:

Operating Results:

• Revenues, net earnings, FFO and AFFO available to common stockholders:

• Investment Portfolio occupancy was 96.9% at December 31, 2010, as compared to 97.1% at September 30, 2010, and 96.4% at December 31, 2009

2010 Highlights:

• Generated FFO per share excluding impairments of $1.45 per share and AFFO per share of $1.59 per share
• Dividends per share increased to $1.51 marking the twenty first consecutive year of annual dividend increases - one of only 114 public companies with 21 or more consecutive annual dividend increases
• Invested $256.6 million in 194 properties
• Sold 18 properties for $58.8 million producing $1.7 million of gains on sale (not included in FFO)
• Balance sheet and occupancy remained strong at sector leading levels
• Total return to shareholders rose to 33.0% for 2010 and the average annual total return for the past 15 years rose to 13.6%

Investments and Dispositions for the quarter ended December 31, 2010:

• Investments:
  • $128.7 million in the Investment Portfolio, including acquiring 159 properties with an aggregate 1.3 million square feet of gross leasable area
• Dispositions:
  • One Investment property with an aggregate 20,000 square feet of gross leasable area, with net proceeds of $3.2 million, resulting in a gain of $122,000

Investments and Dispositions for the year ended December 31, 2010:

• Investments:
  • $256.1 million in the Investment Portfolio, including acquiring 194 properties with an aggregate 1.7 million square feet of gross leasable area
• Dispositions:
  • 14 Investment properties with an aggregate 100,000 square feet of gross leasable area, with net proceeds of $16.0 million, resulting in a gain of $1.1 million
  • Four Inventory properties with net proceeds of $42.8 million

Capital transactions for the quarter ended December 31, 2010:

• Issued 130,018 shares of common stock generating $3,472,000 of net proceeds pursuant to the Dividend Reinvestment and Stock Purchase Plan

Craig Macnab, Chief Executive Officer, commented: "2010's results were in line with our expectations and do not include the high level of lease termination fee income and gains from debt repurchases reported in 2009.  While the acquisition pace in 2010 started slower than originally anticipated, acquisitions totaling $217.0 million in the second half of the year have positioned NNN well for a solid start to 2011's operating results.  As has been the case for years, our occupancy and balance sheet have remained very strong."

National Retail Properties invests primarily in high-quality retail properties subject generally to long-term, net leases.  As of December 31, 2010, the company owned 1,195 Investment Properties in 46 states with a gross leasable area of approximately 13.0 million square feet.  For more information on the company, visit www.nnnreit.com.

Management will hold a conference call on February 17, 2011, 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 availability of capital, 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 December 31, 2010.  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, and the company's share of these items from the company's unconsolidated partnerships.

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.

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 calculation used by other equity REITs and therefore may not be comparable to such other REITs.  A reconciliation of net earnings to AFFO is included in 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.

SOURCE National Retail Properties, Inc.