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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): January 21, 1998
CAPSTONE CAPITAL CORPORATION
(Exact Name of Registrant as Specified in Charter)
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<CAPTION>
MARYLAND 1-11345 63-1115479
<S> <C> <C>
(State of Incorporation) (Commission File Number) (I.R.S. Employer
Identification No.)
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1000 URBAN CENTER DRIVE, SUITE 630
BIRMINGHAM, ALABAMA 35242
(Address of Principal Executive Offices / Zip Code)
(205) 967-2092
(Registrant's telephone number, including area code)
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Item 5. Other Events
On January 21, 1998, Capstone Capital Corporation (the
"Company") issued a press release (the "Press Release") containing its
operating results for the fourth quarter and year ended December 31, 1997. The
Press Release is included as an exhibit to this Report and is incorporated
herein by reference. The operating results stated in the Press Release are
subject to year end audit adjustments.
This Report may contain statements that may be deemed to be
"forward-looking" within the meaning of Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Such forward-looking statements reflect the Company's best judgment
based on the factors currently known. Such statements are subject to certain
risks and uncertainties that could cause actual results to differ materially
from those in the statements included in this Report. Readers are cautioned not
to place undue reliance on these forward-looking statements which speak only as
of the date hereof. Readers are also urged to review carefully and consider the
various disclosures made by the Company which attempt to advise interested
parties of the factors which affect the Company's business, including the
disclosures made in other periodic reports on Forms 10-K, 10-Q and 8-K filed
with the Securities and Exchange Commission.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits
(a) Financial Statements of Business Acquired.
None.
(b) Pro Forma Financial Information.
None.
(c) Exhibits.
99.1 Press Release dated January 21, 1998 relating to
operating results for the fourth quarter and year
ended December 31, 1997
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SIGNATURE
Pursuant to the requirements of the Securities and Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
CAPSTONE CAPITAL CORPORATION
Date: January 21, 1998 By:/s/ John W. McRoberts
-------------------------
John W. McRoberts
President and Chief Executive Officer
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EXHIBIT INDEX
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Exhibit
Number Description
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99.1 Press Release dated January 21, 1998 relating to operating
results for the fourth quarter and year ended December 31,
1997
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EXHIBIT 99.1
For: Capstone Capital Corporation
Contact: Malcolm E. McVay
Chief Financial Officer
205-967-2092
FOR IMMEDIATE RELEASE Edward Bisno/Jill Ruja
Media Contact: David Sassoon
Morgen-Walke Associates
212-850-5600
CAPSTONE CAPITAL CORPORATION ANNOUNCES
RECORD FOURTH QUARTER AND YEAR-END RESULTS
-INVESTMENT PORTFOLIO MORE THAN DOUBLES IN 1997-
-INCREASES DIVIDEND TO $0.485 PER SHARE-
-16.24% OF 1997 COMMON DIVIDENDS ARE RETURN OF CAPITAL-
Birmingham, Alabama, January 21, 1998 - Capstone Capital Corporation
(NYSE: CCT) today announced record operating results for the fourth quarter and
year ended December 31, 1997. The Company also announced that their investment
portfolio has grown 102% from $354.5 million to $716.0 million during 1997. In
addition, Capstone's Board of Directors has approved a $0.005 per share
increase in its quarterly cash dividend to $0.485 per share. The dividend is
payable on February 16, 1998 to shareholders of record on February 2, 1998.
Revenues for the quarter ended December 31, 1997 increased 76% to
$17.6 million, compared to $10.0 million for the fourth quarter of 1996. Net
income available to common stockholders for the period increased 42% to $7.8
million, or $0.47 per share basic and $0.46 per share diluted compared to $5.5
million, or $0.43 per share basic and $0.41 per share diluted, for the year ago
quarter. Funds from operations for the quarter were $9.2 million, or $0.55 per
share basic and $0.53 per share diluted, a 38% increase over the $6.5 million,
or $0.51 per share basic and $0.49 per share diluted, for the 1996 fourth
quarter.
-more-
For the twelve month period, revenues increased 59% to $57.2 million,
compared to the $36.0 million the Company reported for the twelve months of
1996. Net income available to
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common stockholders for the period increased 47% to $27.8 million, or $1.76 per
share basic and $1.75 per share diluted, over the $18.9 million, or $1.71 per
share basic and $1.68 per share diluted, for the similar period a year ago.
Funds from operations for the twelve month period increased 49% to $33.6
million, or $2.13 per share basic and $2.10 per share diluted, compared to
$22.6 million, or $2.04 per share basic and $1.97 per share diluted, reported
for the comparable period a year ago.
Additionally, the Company announced that 16.242% of common
stockholders' 1997 dividends are a return of capital; therefore, not currently
subject to federal or state income tax as ordinary income.
John W. McRoberts, President and Chief Executive Officer, commented,
"1997 marks a year of significant milestones for Capstone Capital as we have
more than doubled the size of our investment portfolio. In addition, we have
added key personnel to support our growth, successfully completed our first
development projects, and had our credit rating upgraded."
Capstone Capital Corporation is a self-administered real estate
investment trust (REIT) which currently owns, leases and provides mortgage
financing for 152 healthcare related properties located in 28 states that are
diversified as to operator, facility type and healthcare segment.
(Table to Follow)
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CAPSTONE CAPITAL CORPORATION
FINANCIAL HIGHLIGHTS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
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QUARTER ENDED TWELVE MONTHS ENDED
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12/31/97 12/31/96 12/31/97 12/31/96
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Revenues:
Rental Income $13,420 $ 9,038 $46,161 $31,960
Mortgage interest income and other income 4,129 914 11,018 3,992
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Total Revenues 17,549 9,952 57,179 35,952
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Expenses:
General and administrative 774 454 2,902 1,677
Depreciation and amortization 2,840 1,696 9,484 6,315
Interest 4,381 2,210 14,769 8,812
Property operations 682 136 1,143 234
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Total expenses 8,677 4,496 28,298 17,038
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Net income 8,872 5,456 28,881 18,914
Less: Preferred stock dividends paid -1,109 0 -1,109 0
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Net income available to common stockholders $ 7,763 $ 5,456 $27,772 $18,914
======= ======= ======= =======
Funds from operations $ 9,179 $ 6,519 $33,635 $22,633
======= ======= ======= =======
Per share amounts (basic):
Net income $ 0.47 $ 0.43 $ 1.76 $ 1.71
Funds from operations $ 0.55 $ 0.51 $ 2.13 $ 2.04
Per share amounts (diluted):
Net income $ 0.46 $ 0.41 $ 1.75 $ 1.68
Funds from operations $ 0.53 $ 0.49 $ 2.10 $ 1.97
Dividends per share (1) $ 0.485 $ 0.465 $ 1.910 $ 1.825
Weighted Average Shares Outstanding:
Basic 16,843 12,719 15,760 11,086
Diluted 17,106 14,014 16,346 13,159
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(1) Dividends per share are those declared with respect to such period
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