Arden Realty, Inc. Reports First Quarter 2002 FFO of $0.71 Per Share.Business Editors LOS LOS Length of stay, see there ANGELES--(BUSINESS WIRE)--May 8, 2002 Arden Ar·den An unincorporated city of north-central California, a residential suburb of Sacramento. Population: 101,400. Arden, Elizabeth 1884?-1966. Realty realty n. a short form of "real estate." (See: real estate) REALTY. An abstract of real, as distinguished from personalty. Realty relates to lands and tenements, rents or other hereditaments. Vide Real Property. , Inc. (NYSE NYSE See: New York Stock Exchange :ARI ARI Acute respiratory infection, see there ), a Los Angeles-based office real estate investment trust, today reported Funds From Operations Funds From Operations (FFO) Used by real estate and other investment trusts to define the cash flow from trust operations; earnings with depreciation and amortization added back. (FFO FFO See: Funds from operations ) for the first quarter of 2002 of $47.1 million or $.71 per share on a fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. basis, compared with FFO of $49.0 million or $.74 per share on a fully diluted basis for the first quarter of 2001. Revenues for the first quarter of 2002 were $102.8 million compared with $104.0 million for the first quarter of 2001. Net income for the first quarter of 2002 was $21.4 million or $.33 per share on a fully diluted basis compared with $24.1 million or $.38 per share on a fully diluted basis for the first quarter of 2001. Adjusting FFO for non-cash compensation expense, the amortization of prepaid pre·pay tr.v. pre·paid, pre·pay·ing, pre·pays To pay or pay for beforehand. pre·pay  ment n. financing costs, straight-line straight-lineadj. 1. Lying in a straight line. 2. Relating to a device whose linkage produces or copies motion in straight lines. 3. rents and providing a reserve for recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. capital expenditures, tenant improvements and leasing commissions resulted in Funds Available for Distribution (FAD FAD - ["FAD, A Simple and Powerful Database Language", F. Bancilon et al, Proc 13th Intl Conf on VLDB, Brighton, England, Sep 1987]. ) for the first quarter of 2002 of $38.0 million or $.57 per share on a fully diluted basis, compared with FAD of $40.3 million or $.61 per share on a fully diluted basis for the first quarter of 2001. A dividend of $.505 per share was declared de·clare v. de·clared, de·clar·ing, de·clares v.tr. 1. To make known formally or officially. See Synonyms at announce. 2. To state emphatically or authoritatively; affirm. 3. for the first quarter of 2002. Total debt was approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $1.23 billion, representing approximately 39.0% of total market capitalization Total Market Capitalization The total market value of all of a firm's outstanding securities. at March 31, 2002. Arden Realty, Inc. will host a conference call to discuss first quarter 2002 operating results on May 9, 2002, at 1:00 p.m. Eastern time. A live webcast (listen only mode) of the conference call will be available at this time. A hyperlink A predefined linkage between one object and another. See hypertext. hyperlink - anchor to the live webcast will be available from the Investor Information section of the Company's website at http://www.ardenrealty.com or at http://www.companyboardroom.com. A replay of the conference call may be heard by calling (800) 642-1687 (U.S.) or (706) 645-9291 (International), access code 3783695, from 3:00 p.m. Eastern time on Thursday Thursday: see week. , May 9, 2002 through 3:00 p.m. Eastern time on Thursday, May 23, 2002. During this period, an on-demand On-Demand refers to a service or feature which addresses the user's need for instant gratification and immediacy of use. In most cases the value proposition for an on-demand service is wrapped up in the fact that the user or consumer of the service avoids a significant up-front webcast replay of the call will also be available from the Investor Information section of our website at http://www.ardenrealty.com or at http://www.companyboardroom.com. Financial schedules follow. A detailed analysis of the quarter's results can be obtained by viewing the Supplemental Operating and Financial Data available in the Investor Information section (Financial Reports) of the Company's website at www.ardenrealty.com, or by calling the Company contact listed below. Arden Realty, Inc. is a self-administered, self-managed REIT REIT See: Real Estate Investment Trust REIT See real estate investment trust (REIT). which owns, manages, leases, develops, renovates and acquires commercial office properties located in Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, . As of March 31, 2002, the Company's portfolio contained 132 properties and approximately 18.2 million rentable square feet and two properties with approximately 566,000 rentable square feet under development. Statements in this press release which are not historical may be deemed forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Although the Company believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained at·tain v. at·tained, at·tain·ing, at·tains v.tr. 1. To gain as an objective; achieve: attain a diploma by hard work. 2. . Factors that could cause actual results to differ materially from the Company's expectations include the availability and cost of capital for future investments, competition within the industry, real estate and economic conditions, and other risks detailed from time to time in the Company's SEC filings.
ARDEN REALTY, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands)
March 31, December 31,
2002 2001
(unaudited)
Assets
Investment in real estate:
Commercial properties $ 2,793,001 $ 2,674,381
Less: Accumulated
depreciation and amortization (327,524) (293,385)
2,465,477 2,380,996
Properties under development 142,648 133,012
Properties held for disposition, net 15,812 108,972
Net investment in real estate 2,623,937 2,622,980
Cash and cash equivalents 7,012 37,041
Restricted cash 21,596 18,768
Rent and other receivables 7,288 9,685
Mortgage notes receivable, net of
discount 13,321 13,495
Deferred rent 40,546 38,989
Prepaid financing costs, expenses
and other assets, net 19,259 20,485
Total assets $ 2,732,959 $ 2,761,443
Liabilities and Stockholders' Equity
Mortgage loans payable $ 572,731 $ 573,452
Unsecured lines of credit 163,350 180,350
Unsecured senior notes, net of
discount 497,776 497,681
Accounts payable and accrued
expenses 40,958 43,002
Security deposits 19,763 19,683
Dividends payable 32,524 31,408
Total liabilities 1,327,102 1,345,576
Minority interest 76,691 78,661
Stockholders' equity:
Common stock 644 641
Additional paid-in capital 1,341,594 1,345,698
Deferred compensation (13,072) (9,133)
Total stockholders' equity 1,329,166 1,337,206
Total liabilities and
stockholders' equity $ 2,732,959 $ 2,761,443
ARDEN REALTY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
For the Three Months Ended
March 31,
2002 2001
Revenue:
Revenues from rental operations:
Scheduled cash rents $ 87,336 $ 85,106
Straight-line rents 1,650 2,361
Tenant reimbursements 6,950 5,550
Parking, net of expenses 5,150 5,305
Other rental operations 1,178 4,799
102,264 103,121
Interest and other income 540 861
Total revenue 102,804 103,982
Expenses:
Property expenses:
Repairs and maintenance 9,445 9,008
Utilities 7,848 7,392
Real estate taxes 7,378 7,414
Insurance 1,660 1,216
Ground rent 68 1,151
Property administrative 3,827 3,661
Total property expenses 30,226 29,842
General and administrative 2,960 2,866
Interest 21,397 21,158
Depreciation and amortization 26,383 24,146
Income before gain and
minority interest 21,838 25,970
Gain on sale of properties 1,192 --
Income before minority interest 23,030 25,970
Minority interest (1,677) (1,897)
Net income $ 21,353 $ 24,073
Net income per share:
Basic $ 0.33 $ 0.38
Diluted(1) $ 0.33 $ 0.38
Weighted average common shares:
Basic 64,201 63,654
Diluted 64,683 63,899
(1) Excluding the gain on sale of properties of $1.2 million for the
three months ended March 31, 2002, Net Income Per Share - Diluted
would have been $0.31.
ARDEN REALTY, INC.
CALCULATION OF FUNDS FROM OPERATIONS
AND FUNDS AVAILABLE FOR DISTRIBUTION
(in thousands, except per share amounts)
(unaudited)
For the Three Months Ended
March 31,
2002 2001
Funds From Operations:(1)
Net income $ 21,353 $ 24,073
Plus -
Depreciation and amortization of
real estate assets 26,383 24,146
Minority interest 1,677 1,897
Less -
Gain on sale of properties (1,192) --
Income allocated to Preferred Operating
Partnership Units (1,078) (1,078)
Funds From Operations(2) $ 47,143 $ 49,038
Funds Available for Distribution:(3)
Funds From Operations $ 47,143 $ 49,038
Add-
Non-cash compensation expense 245 425
Amortization of prepaid financing costs 937 866
Less-
Straight-line rent adjustment (1,650) (2,361)
Capital expenditure, tenant improvement
and leasing commission reserve (8,700) (7,700)
Funds Available for Distribution $ 37,975 $ 40,268
Per share:
Funds From Operations - Diluted $ 0.71 $ 0.74
Funds Available for Distribution - Diluted $ 0.57 $ 0.61
Dividends declared $ 0.505 $ 0.49
Weighted average shares and Operating
Partnership Units outstanding - Diluted 66,488 66,066
(1) The White Paper on Funds from Operations approved by the Board of
Governors of NAREIT in October 1999 (the "White Paper") defines Funds
from Operations as net income (loss) computed in accordance with GAAP,
excluding extraordinary items, as defined by GAAP, and gains and
losses from sales of depreciable operating property plus real estate
related depreciation and amortization and after adjustments for
unconsolidated partnerships and joint ventures. We compute funds from
operations in accordance with standards established by the White Paper
which may differ from the standards used by other real estate
investment trusts, or REITS, and accordingly, our funds from
operations may not be comparable to other REITS.
(2) Includes $245,000 and $425,000 in non-cash compensation expense
for the three months ended March 31, 2002, and March 31, 2001,
respectively.
(3) Funds Available for Distribution is defined as FFO excluding
non-cash compensation expense, amortization of prepaid financing
costs, straight-line rents and less a reserve for capital
expenditures, tenants improvements and leasing commissions.
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