U.S. Restaurant Properties, Inc. Announces 1st Quarter Results

Apr 30, 2001, 01:00 ET from U.S. Restaurant Properties, Inc.

    DALLAS, April 30 /PRNewswire/ -- U.S. Restaurant Properties, Inc.
 (NYSE:   USV) today reported revenues, funds from operations ("FFO") and a net
 loss for the three months ended March 31, 2001, of $18.77 million,
 $342 thousand and $19.9 million, respectively.  Cash available for
 distribution ("CAD"), adjusted for non-recurring items totaled $0.34 per
 share.  Net income and FFO were affected by several unusual items, including
 the following:
 
      --   Costs associated with the common stock investment by Lone Star Funds
           which included a $813 thousand severance payment to the former Chief
           Executive Officer Fred Margolin;
 
      --   Amortization of initial costs of collateralizing the $175 million
           bridge loan provided by Bank of America on January 9, 2001, totaling
           $1.7 million;
 
      --   Asset impairment charge of $15.9 million primarily related to the
           assessment of the value of certain properties within our gas
           station/convenience store holdings;
 
      --   An increase in bad debt reserves of $1.1 million, primarily related
           to an assessment of straight line rent and certain loans; and
 
      --   Losses totaling $1.69 million related to an interest rate swap
           purchased as a hedge in 2000, as a result of the implementation of
           the new Financial Accounting Standard No. 133 addressing the
           accounting for derivatives.
 
     These items resulted in charges of approximately $21.19 million to income.
 Revenues remained consistent, increasing by approximately $318 thousand over
 fourth quarter 2000.
     Consistent with a plan to reduce the proportion of gas station properties,
 the Company designated its Hawaii gas station wholesale and retail operations
 as held for sale.
     The performance of the restaurant portfolio, which represents over 83% of
 revenues, continues to be solid.  Collection performance was strong.
 Occupancy and renewal results continue their historical pattern -- more than
 96% of restaurant properties are under lease and approximately 82% of
 properties with leases expiring are renewed or sold at full value to the
 tenant.
     The Company's earnings results conference call is scheduled for Tuesday,
 May 1, 2001, at 11:00 a.m. CDT.  Interested parties may dial in and listen to
 comments by Chairman of the Board David West by calling (800) 982-3472 or
 (703) 871-3022.  Brokers and analysts may participate in a question and answer
 session by calling (800) 982-3654 or (703) 871-3021.  The conference call will
 also be simultaneously webcast at www.StreetFusion.com.  The replay can be
 heard until midnight May 3, 2001 by dialing (888) 266-2081 and entering
 passcode # 5130208 or can be viewed at StreetFusion's website through
 May 31, 2001.
     U.S. Restaurant Properties, Inc. is a non-taxed financial services and
 real estate company dedicated to acquiring, managing and financing branded
 chain restaurants such as Burger King(R), Arby's(R), Chili's(R) and Pizza
 Hut(R) and selected service retail properties.  The company currently owns or
 finances 841 properties located in 48 states.
     Certain statements in this release constitute "forward-looking statements"
 and involve risks, uncertainties and other factors which may cause the actual
 performance of U.S. Restaurant Properties, Inc. to be materially different
 from the performance expressed or implied by such statements.  These risks
 include interest rates and other general economic conditions, income
 fluctuations in U.S. households and the general health of the fast food,
 casual dining, and service station industries, as well as the risks and
 uncertainties detailed in the Company's periodic reports and registration
 statements filed with the Securities and Exchange Commission.
     For further information, call Investor Relations at 972-387-1487,
 ext. 147.
 
 
                        U.S. RESTAURANT PROPERTIES, INC.
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
          (Dollars and shares in thousands, except per share amounts)
                                  (Unaudited)
 
                                                        Three Months Ended
                                                            March 31,
                                                       2001           2000
     Revenues:
       Rental income                                  $17,332        $18,071
       Interest income                                  1,346          1,418
       Amortization of unearned income
        on direct financing leases                         95            183
         Total revenues                                18,773         19,672
 
     Expenses:
       Rent                                               154            262
       Depreciation and amortization                    6,030          6,324
       General and administrative                       3,359          2,454
       Provision for doubtful accounts                  1,148            750
       Loss on lease resolution                           ---          1,367
       Interest expense                                 9,104          7,698
       Termination of management contract (A)             ---         (1,031)
       Impairment of long-lived assets                 15,929            ---
       Loss on interest rate swap agreement             1,690            ---
         Total expenses                                37,414         17,824
 
     Income (loss) before gain (loss) on sale
      of property, Minority interests and
      extraordinary item                              (18,641)         1,848
 
     Gain (loss) on sale of property                       66           (340)
 
     Income (loss) before minority interests
      and extraordinary item                          (18,575)         1,508
 
     Minority interests                                (1,004)        (1,099)
 
     Net income (loss) before extraordinary item      (19,579)           409
     Loss on early extinguishment of debt                (340)           ---
 
     Net income (loss)                                (19,919)           409
 
     Dividends on preferred stock                      (1,776)        (1,776)
 
     Net loss allocable to common stockholders       $(21,695)       $(1,367)
 
     Earnings per share (basic and diluted)            $(1.24)        $(0.09)
 
     Weighted average shares outstanding
      (basic and diluted)                              17,532         15,388
 
 
     (A)   This non-cash income item relates to the effect of the decline in
           the stock price of the 825,000 shares of Common Stock due to the
           former shareholders of QSV, the former general partner of U.S.
           Restaurant Properties Master L.P., the predecessor to the Company,
           for the three month period ended March 31, 2000.  These shares were
           issued on December 29, 2000
 
 
                        U.S. RESTAURANT PROPERTIES, INC.
                           FUNDS FROM OPERATIONS (A)
          (Dollars and shares in thousands, except per share amounts)
                                  (Unaudited)
 
                                                         Three Months Ended
                                                             March 31,
                                                       2001            2000
 
     Net income (loss)                               $(19,919)          $409
     Preferred stock dividends                         (1,776)        (1,776)
 
     Net loss allocable to common stock               (21,695)        (1,367)
     Depreciation and amortization                      5,999          6,288
     Loss (gain) on sale                                  (66)           340
     Impairment of long-lived assets                   15,929            ---
 
     Extraordinary loss                                   340            ---
 
     Less adjustments allocable to minority interest     (165)          (510)
     FFO (Basic)                                         $342        $ 4,751
     Income allocable to minority interest               (165)           (70)
     Adjustments allocable to minority interest           165            510
     Preferred stock dividends                            ---            ---
 
     FFO (Diluted)                                       $342        $ 5,191
 
     Weighted average shares outstanding (Basic)       17,532         15,388
     Dilutive effect of OP units                          134          1,295
     Dilutive effect of options                             6             23
     Dilutive effect of contingent OP units               ---            825
     Dilutive effect of guaranteed stock                  153            154
     Dilutive effect of preferred stock                   ---            ---
 
     Weighted average shares outstanding
      (Diluted)(B)                                     17,825         17,685
 
     FFO (Basic) per share                              $0.02          $0.31
     FFO (Diluted) per share                            $0.02          $0.29
 
     (A)   Funds from operations (FFO) is computed in accordance with the
           National Policy Bulletin issued by NAREIT dated November 8, 1999.
 
     (B)   FFO per share is calculated by dividing FFO by the weighted average
           number of shares/units outstanding for the period, on a fully
           diluted basis.  Weighted average shares/units outstanding (fully
           diluted) includes shares of the Company's Common Stock issued and
           outstanding, as well as Common Stock Equivalents in the form of
           Operating Partnership units, stock options, preferred stock and
           stock price guarantees to the extent they are dilutive.  For the
           three months ended March 31, 2001 and 2000, all Common Stock
           Equivalents were dilutive except preferred stock.
 
 
                        U.S. RESTAURANT PROPERTIES, INC.
                        CASH AVAILABLE FOR DISTRIBUTION
          (Dollars and shares in thousands, except per share amounts)
                                  (Unaudited)
 
                                                         Three Months Ended
                                                             March 31,
                                                        2001           2000
 
     Cash Available for Distribution (CAD):
 
     FFO (Basic)                                         $342        $ 4,751
     Amortization of debt issue costs                   2,003            312
     Termination of management contract                   ---         (1,031)
     Income allocable to minority interest               (165)           (70)
     Adjustments allocable to minority interest           165            510
     Straight-line rent adjustment                       (663)          (867)
     Loss on interest rate swap agreement               1,690            ---
 
     Corporate asset depreciation                          31             36
     Bad debt reserves                                  1,148             75
                                                          750
     Direct financing lease receipts                      224            371
     CAD, including non-recurring items                $4,775        $ 4,762
     Non-recurring items
     Severance packages                                   813            ---
 
     Unconsummated capital transaction and system
      implementation costs                                458            ---
 
     CAD, adjusted for non-recurring items             $6,046        $ 4,762
 
     Weighted average shares outstanding (Basic)       17,532         15,388
     Dilutive effect of OP units                          134          1,295
 
     Shares applicable to CAD                          17,666         16,683
 
     CAD per share, including non-recurring items       $0.27          $0.29
 
     CAD per share, adjusted for
     non-recurring items                                $0.34          $0.29
 
 
                        U.S. RESTAURANT PROPERTIES, INC.
                           SUPPLEMENTARY INFORMATION
 
     New York Stock Exchange symbol - Common Stock                       USV
                                    - Preferred Stock                 USV_pa
 
     Annualized dividend rate per share of Common Stock
      (payable May 15, 2001)                                           $1.32
 
     Common Stock price per share as of market close,
      March 30, 2001                                                  $11.00
 
     Dividend yield on Common Stock (annualized dividend
      divided by price per share at March 30, 2001)                    12.00%
 
     Total shares of Common Stock issued and outstanding
      March 31, 2001                                              17,886,156
 
     Total Convertible Operating Partnership Units
      outstanding at March 31, 2001                                  134,344
 
     Annualized dividend rate per share of Series A
      Cumulative Convertible Preferred Stock
      (payable June 15, 2001)                                          $1.93
 
     Preferred Stock price per share as of market close,
      March 30, 2001                                                  $16.50
 
     Dividend yield on Preferred Stock
      (annualized dividend divided by price per share at
       March 30, 2001)                                                 11.70%
 
     Total shares of Preferred Stock issued and
      outstanding March 31, 2001                                   3,679,938
 
     Number of core business properties at March 31, 2001                842
 
     Outstanding debt at March 31, 2001                         $361,736,000
 
     Cash and cash equivalents at March 31, 2001                $ 14,525,000
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X60085565
 
 

SOURCE U.S. Restaurant Properties, Inc.
    DALLAS, April 30 /PRNewswire/ -- U.S. Restaurant Properties, Inc.
 (NYSE:   USV) today reported revenues, funds from operations ("FFO") and a net
 loss for the three months ended March 31, 2001, of $18.77 million,
 $342 thousand and $19.9 million, respectively.  Cash available for
 distribution ("CAD"), adjusted for non-recurring items totaled $0.34 per
 share.  Net income and FFO were affected by several unusual items, including
 the following:
 
      --   Costs associated with the common stock investment by Lone Star Funds
           which included a $813 thousand severance payment to the former Chief
           Executive Officer Fred Margolin;
 
      --   Amortization of initial costs of collateralizing the $175 million
           bridge loan provided by Bank of America on January 9, 2001, totaling
           $1.7 million;
 
      --   Asset impairment charge of $15.9 million primarily related to the
           assessment of the value of certain properties within our gas
           station/convenience store holdings;
 
      --   An increase in bad debt reserves of $1.1 million, primarily related
           to an assessment of straight line rent and certain loans; and
 
      --   Losses totaling $1.69 million related to an interest rate swap
           purchased as a hedge in 2000, as a result of the implementation of
           the new Financial Accounting Standard No. 133 addressing the
           accounting for derivatives.
 
     These items resulted in charges of approximately $21.19 million to income.
 Revenues remained consistent, increasing by approximately $318 thousand over
 fourth quarter 2000.
     Consistent with a plan to reduce the proportion of gas station properties,
 the Company designated its Hawaii gas station wholesale and retail operations
 as held for sale.
     The performance of the restaurant portfolio, which represents over 83% of
 revenues, continues to be solid.  Collection performance was strong.
 Occupancy and renewal results continue their historical pattern -- more than
 96% of restaurant properties are under lease and approximately 82% of
 properties with leases expiring are renewed or sold at full value to the
 tenant.
     The Company's earnings results conference call is scheduled for Tuesday,
 May 1, 2001, at 11:00 a.m. CDT.  Interested parties may dial in and listen to
 comments by Chairman of the Board David West by calling (800) 982-3472 or
 (703) 871-3022.  Brokers and analysts may participate in a question and answer
 session by calling (800) 982-3654 or (703) 871-3021.  The conference call will
 also be simultaneously webcast at www.StreetFusion.com.  The replay can be
 heard until midnight May 3, 2001 by dialing (888) 266-2081 and entering
 passcode # 5130208 or can be viewed at StreetFusion's website through
 May 31, 2001.
     U.S. Restaurant Properties, Inc. is a non-taxed financial services and
 real estate company dedicated to acquiring, managing and financing branded
 chain restaurants such as Burger King(R), Arby's(R), Chili's(R) and Pizza
 Hut(R) and selected service retail properties.  The company currently owns or
 finances 841 properties located in 48 states.
     Certain statements in this release constitute "forward-looking statements"
 and involve risks, uncertainties and other factors which may cause the actual
 performance of U.S. Restaurant Properties, Inc. to be materially different
 from the performance expressed or implied by such statements.  These risks
 include interest rates and other general economic conditions, income
 fluctuations in U.S. households and the general health of the fast food,
 casual dining, and service station industries, as well as the risks and
 uncertainties detailed in the Company's periodic reports and registration
 statements filed with the Securities and Exchange Commission.
     For further information, call Investor Relations at 972-387-1487,
 ext. 147.
 
 
                        U.S. RESTAURANT PROPERTIES, INC.
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
          (Dollars and shares in thousands, except per share amounts)
                                  (Unaudited)
 
                                                        Three Months Ended
                                                            March 31,
                                                       2001           2000
     Revenues:
       Rental income                                  $17,332        $18,071
       Interest income                                  1,346          1,418
       Amortization of unearned income
        on direct financing leases                         95            183
         Total revenues                                18,773         19,672
 
     Expenses:
       Rent                                               154            262
       Depreciation and amortization                    6,030          6,324
       General and administrative                       3,359          2,454
       Provision for doubtful accounts                  1,148            750
       Loss on lease resolution                           ---          1,367
       Interest expense                                 9,104          7,698
       Termination of management contract (A)             ---         (1,031)
       Impairment of long-lived assets                 15,929            ---
       Loss on interest rate swap agreement             1,690            ---
         Total expenses                                37,414         17,824
 
     Income (loss) before gain (loss) on sale
      of property, Minority interests and
      extraordinary item                              (18,641)         1,848
 
     Gain (loss) on sale of property                       66           (340)
 
     Income (loss) before minority interests
      and extraordinary item                          (18,575)         1,508
 
     Minority interests                                (1,004)        (1,099)
 
     Net income (loss) before extraordinary item      (19,579)           409
     Loss on early extinguishment of debt                (340)           ---
 
     Net income (loss)                                (19,919)           409
 
     Dividends on preferred stock                      (1,776)        (1,776)
 
     Net loss allocable to common stockholders       $(21,695)       $(1,367)
 
     Earnings per share (basic and diluted)            $(1.24)        $(0.09)
 
     Weighted average shares outstanding
      (basic and diluted)                              17,532         15,388
 
 
     (A)   This non-cash income item relates to the effect of the decline in
           the stock price of the 825,000 shares of Common Stock due to the
           former shareholders of QSV, the former general partner of U.S.
           Restaurant Properties Master L.P., the predecessor to the Company,
           for the three month period ended March 31, 2000.  These shares were
           issued on December 29, 2000
 
 
                        U.S. RESTAURANT PROPERTIES, INC.
                           FUNDS FROM OPERATIONS (A)
          (Dollars and shares in thousands, except per share amounts)
                                  (Unaudited)
 
                                                         Three Months Ended
                                                             March 31,
                                                       2001            2000
 
     Net income (loss)                               $(19,919)          $409
     Preferred stock dividends                         (1,776)        (1,776)
 
     Net loss allocable to common stock               (21,695)        (1,367)
     Depreciation and amortization                      5,999          6,288
     Loss (gain) on sale                                  (66)           340
     Impairment of long-lived assets                   15,929            ---
 
     Extraordinary loss                                   340            ---
 
     Less adjustments allocable to minority interest     (165)          (510)
     FFO (Basic)                                         $342        $ 4,751
     Income allocable to minority interest               (165)           (70)
     Adjustments allocable to minority interest           165            510
     Preferred stock dividends                            ---            ---
 
     FFO (Diluted)                                       $342        $ 5,191
 
     Weighted average shares outstanding (Basic)       17,532         15,388
     Dilutive effect of OP units                          134          1,295
     Dilutive effect of options                             6             23
     Dilutive effect of contingent OP units               ---            825
     Dilutive effect of guaranteed stock                  153            154
     Dilutive effect of preferred stock                   ---            ---
 
     Weighted average shares outstanding
      (Diluted)(B)                                     17,825         17,685
 
     FFO (Basic) per share                              $0.02          $0.31
     FFO (Diluted) per share                            $0.02          $0.29
 
     (A)   Funds from operations (FFO) is computed in accordance with the
           National Policy Bulletin issued by NAREIT dated November 8, 1999.
 
     (B)   FFO per share is calculated by dividing FFO by the weighted average
           number of shares/units outstanding for the period, on a fully
           diluted basis.  Weighted average shares/units outstanding (fully
           diluted) includes shares of the Company's Common Stock issued and
           outstanding, as well as Common Stock Equivalents in the form of
           Operating Partnership units, stock options, preferred stock and
           stock price guarantees to the extent they are dilutive.  For the
           three months ended March 31, 2001 and 2000, all Common Stock
           Equivalents were dilutive except preferred stock.
 
 
                        U.S. RESTAURANT PROPERTIES, INC.
                        CASH AVAILABLE FOR DISTRIBUTION
          (Dollars and shares in thousands, except per share amounts)
                                  (Unaudited)
 
                                                         Three Months Ended
                                                             March 31,
                                                        2001           2000
 
     Cash Available for Distribution (CAD):
 
     FFO (Basic)                                         $342        $ 4,751
     Amortization of debt issue costs                   2,003            312
     Termination of management contract                   ---         (1,031)
     Income allocable to minority interest               (165)           (70)
     Adjustments allocable to minority interest           165            510
     Straight-line rent adjustment                       (663)          (867)
     Loss on interest rate swap agreement               1,690            ---
 
     Corporate asset depreciation                          31             36
     Bad debt reserves                                  1,148             75
                                                          750
     Direct financing lease receipts                      224            371
     CAD, including non-recurring items                $4,775        $ 4,762
     Non-recurring items
     Severance packages                                   813            ---
 
     Unconsummated capital transaction and system
      implementation costs                                458            ---
 
     CAD, adjusted for non-recurring items             $6,046        $ 4,762
 
     Weighted average shares outstanding (Basic)       17,532         15,388
     Dilutive effect of OP units                          134          1,295
 
     Shares applicable to CAD                          17,666         16,683
 
     CAD per share, including non-recurring items       $0.27          $0.29
 
     CAD per share, adjusted for
     non-recurring items                                $0.34          $0.29
 
 
                        U.S. RESTAURANT PROPERTIES, INC.
                           SUPPLEMENTARY INFORMATION
 
     New York Stock Exchange symbol - Common Stock                       USV
                                    - Preferred Stock                 USV_pa
 
     Annualized dividend rate per share of Common Stock
      (payable May 15, 2001)                                           $1.32
 
     Common Stock price per share as of market close,
      March 30, 2001                                                  $11.00
 
     Dividend yield on Common Stock (annualized dividend
      divided by price per share at March 30, 2001)                    12.00%
 
     Total shares of Common Stock issued and outstanding
      March 31, 2001                                              17,886,156
 
     Total Convertible Operating Partnership Units
      outstanding at March 31, 2001                                  134,344
 
     Annualized dividend rate per share of Series A
      Cumulative Convertible Preferred Stock
      (payable June 15, 2001)                                          $1.93
 
     Preferred Stock price per share as of market close,
      March 30, 2001                                                  $16.50
 
     Dividend yield on Preferred Stock
      (annualized dividend divided by price per share at
       March 30, 2001)                                                 11.70%
 
     Total shares of Preferred Stock issued and
      outstanding March 31, 2001                                   3,679,938
 
     Number of core business properties at March 31, 2001                842
 
     Outstanding debt at March 31, 2001                         $361,736,000
 
     Cash and cash equivalents at March 31, 2001                $ 14,525,000
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X60085565
 
 SOURCE  U.S. Restaurant Properties, Inc.