10-KPeriod: FY2019

REALTY INCOME CORP Annual Report, Year Ended Dec 31, 2019

Filed February 24, 2020For Securities:O

Summary

Realty Income Corporation's 2019 10-K filing showcases a robust year characterized by significant property acquisitions and continued dividend growth, reinforcing its position as a stable income-generating REIT. The company expanded its geographically diverse portfolio by acquiring 771 properties across the U.S. and U.K., totaling $3.7 billion in investments. This growth was supported by strong leasing results, with an occupancy rate of 98.6% at year-end, and a rent recapture rate of 102.6% on re-leased properties, indicating effective asset management and tenant retention. The company's financial performance reflects consistent growth, with total revenue increasing by 12.3% year-over-year to $1.49 billion and net income available to common stockholders rising by 20.0% to $436.5 million. Funds From Operations (FFO) per share also saw a healthy increase of 5.4%. Realty Income's commitment to shareholder returns is evident in its continued track record of increasing monthly dividends, with a 3.0% increase in dividends paid per share for 2019. The company maintained a conservative capital structure, ending the year with total borrowings representing approximately 24.4% of its market capitalization, supported by investment-grade credit ratings from Moody's, S&P, and Fitch.

Financial Highlights

36 data points
Beta

Revenue

$1.49B

Net Income

$437.48M

29.4% Net Margin

EPS (Diluted)

$1.38

Total Assets

$18.55B

Cash & Equivalents

$54.01M

Free Cash Flow

$1.07B

Financial Statements
Beta
Revenue$1.49B
Operating Expenses$1.08B
Interest Expense$290.99M
Net Income$437.48M
EPS (Basic)$1.38
EPS (Diluted)$1.38
Shares Outstanding (Basic)315.84M
Shares Outstanding (Diluted)316.16M

Key Highlights

  • 1Acquired 771 properties for $3.7 billion in 2019, expanding the portfolio to 6,483 properties across 49 U.S. states and the UK.
  • 2Maintained a high occupancy rate of 98.6% with 6,389 properties leased.
  • 3Achieved a rent recapture rate of 102.6% on re-leased properties, demonstrating effective lease management.
  • 4Reported a 12.3% increase in total revenue to $1.49 billion and a 20.0% increase in net income available to common stockholders to $436.5 million.
  • 5Continued its policy of monthly dividend payments, increasing the dividend five times in 2019 and demonstrating a 51-year history of paying and increasing monthly dividends.
  • 6Maintained a conservative capital structure with total debt at approximately 24.4% of market capitalization, supported by investment-grade credit ratings (A3/A-/BBB+).
  • 7Raised $2.2 billion in equity capital during 2019 through the sale of common stock.

Frequently Asked Questions

Realty Income's strategy is to acquire and manage freestanding, commercial properties that are net-leased to high-quality, long-term commercial tenants. The net lease structure typically requires tenants to be responsible for property operating expenses, providing Realty Income with a predictable and stable income stream that supports its monthly dividend payments.

In 2019, Realty Income demonstrated strong financial performance. Total revenue increased by 12.3% to $1.49 billion, and net income available to common stockholders grew by 20.0% to $436.5 million. The company also saw an increase in Funds From Operations (FFO) per share. This growth was driven by significant property acquisitions and high occupancy rates.

Realty Income is known as 'The Monthly Dividend Company®'. The company has a long-standing policy of paying monthly dividends that are intended to increase over time. In 2019, they increased their dividend five times, reflecting a commitment to returning capital to shareholders and continuing their 'Dividend Aristocrat' status.

The company's portfolio is diversified by tenant, industry, and geography. As of December 31, 2019, it comprised 6,483 properties leased to 301 different commercial tenants across 50 industries, located in 49 U.S. states, Puerto Rico, and the United Kingdom. No single tenant represented 10% or more of total assets, and no single industry accounted for more than 11.9% of rental revenue.