CBL & Associates Properties Reports Second Quarter Results; FFO Per Share Increases 16%; Same-Center NOI Up 6.7%; Total Portfolio Occupancy Increases to 94.3%.Business Editors CHATTANOOGA Chattanooga (chăt'ən  `gə), city (1990 pop. 152,466), seat of Hamilton co., E Tenn., on both sides of the Tennessee River near the Georgia line; inc. 1839. , Tenn.--(BUSINESS WIRE)--July 26, 2000
CBL Cbl cobalamin. & Associates Properties, Inc. (NYSE NYSE See: New York Stock Exchange :CBL) today announced results for the second quarter ended June June: see month. 30, 2000. 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. Total funds from operations (FFO FFO See: Funds from operations ) increased 17.6% to $32,292,000 for the second quarter ended June 30, 2000, from $27,458,000 in the second quarter of 1999. FFO per share increased 16.0% on a 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. , fully converted basis in the second quarter to $0.87 from $0.75 per share in the prior-year period. Total FFO increased 19.2% to $64,416,000 for the first six months of 2000 from $54,026,000 in the first six months of 1999. FFO per share increased 19.0% on a diluted, fully converted basis in the first six months to $1.75 from $1.47 per share in the prior-year period. The Company's FFO calculation does not include gains on sales of outparcels, which are allowed by the National Association of Real Estate Investment Trusts' (NAREIT NAREIT National Association of Real Estate Investment Trusts ) definition of FFO. Gains on outparcel sales in the second quarter were $1,925,000, or $0.05 per diluted, fully converted share. Had this item been included, FFO for the second quarter of 2000 would have increased to a total of $0.92 from the $0.87 per share as reported. Gains on sales for five assets sold during the quarter were $3,834,000, or $0.10 per share. Total proceeds from these sales were $13,100,000. Straight-line straight-line adj. 1. Lying in a straight line. 2. Relating to a device whose linkage produces or copies motion in straight lines. 3. rents were $947,000, or less than $0.03 per share, for the second quarter and $1,988,000, or $0.05 per share, for the six months ended June 30, 2000. Effective January January: see month. 1, 2000, NAREIT clarified FFO to include all operating results, 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. and non-recurring - except those results defined as "extraordinary items" as defined under generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting . The Company implemented this clarification in the first quarter of 2000 and no longer adds back to FFO the write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of development costs charged to net income. Results for the second quarter ended June 30, 1999 were restated to reflect a reduction in FFO of $146,000, or less than $0.01 per diluted, fully converted share. For the first six months of 1999, the FFO reduction was $888,000, or $0.02 per diluted, fully converted share. FINANCIAL HIGHLIGHTS Net income increased 18.7% in the second quarter of 2000 to $15,358,000 from $12,939,000 in the second quarter of 1999. Revenues increased 17.1% in the second quarter to $86,857,000 from $74,191,000 in the prior-year period. Net income increased 18.5% in the first half of 2000 to $29,708,000 from $25,068,000 in the first half of 1999. Revenues increased 17.6% in the first six months to $174,866,000 from $148,739,000 in the comparable period a year ago. CBL's chairman and chief executive officer, Charles Charles, archduke of Austria Charles, 1771–1847, archduke of Austria; brother of Holy Roman Emperor Francis II. Despite his epilepsy, he was the ablest Austrian commander in the French Revolutionary and Napoleonic wars; however, he was handicapped by B. Lebovitz, said, "We are very pleased with our results for the second quarter which represents our eleventh In music or music theory an eleventh is the note eleven scale degrees from the root of a chord and also the interval between the root and the eleventh. Since there are only seven degrees in a diatonic scale the eleventh degree is the same as the subdominant and the interval consecutive quarter of double-digit dou·ble-dig·it adj. Being between 10 and 99 percent: double-digit inflation. FFO growth. Increases in occupancy, rents, specialty income and cost recovery all contributed to the 16% increase in FFO per share this quarter. We are outpacing last year's internal growth by continuing to maximize the franchise value we have created with our properties." Mr. Lebovitz added, "Our continued focus on internal growth is exhibited in the expansion and renovation currently underway at Asheville Asheville (ăsh`vəl, –vĭl), city (1990 pop. 61,607), seat of Buncombe co., W N.C., on the French Broad and Swannanoa rivers and on a plateau in the Blue Ridge Mts.; inc. 1797. Mall in Asheville, NC and Meridian Mall There are several malls called Meridian Mall. These include:
1 Village (1990 pop. 28,086), Cook co., NE Ill., a suburb of Chicago, near the Ind. line; inc. 1893. Among the city's industries are meatpacking, food processing, and the manufacture of metal products. 2 City (1990 pop. , MI. Both of these projects are excellent opportunities for our development, leasing and management expertise to join together in creating additional asset value. We also completed this quarter the 38,000-square-foot expansion of Sand Lake Corners in Orlando Orlando, city, United States Orlando (ôrlăn`dō), city (1990 pop. 164,693), seat of Orange co., central Fla., in a lake region; inc. 1875. In a citrus fruit and farm area, it is one of the world's most visited vacation spots. , FL and began construction for the overall redevelopment of the 625,000-square-foot Parkway Place Parkway Place is an upscale shopping mall in Huntsville, Alabama. The mall opened on October 16, 2002, on the site of the older Parkway City Mall, which was torn down to allow for the construction of the newer facility. Mall in Huntsville Huntsville, town, Canada Huntsville, town (1991 pop. 14,997), SE Ont., Canada, on the Muskoka River. It has lumber mills and a woodworking plant, but it is sustained mainly by its year-round tourist trade. , AL. We will continue to pursue external and internal growth opportunities that will further enhance shareholder value." CURRENT DEVELOPMENT PIPELINE (opening dates) -- Coastal Way Shopping Center shopping center, a concentration of retail, service, and entertainment enterprises designed to serve the surrounding region. The modern shopping center differs from its antecedents—bazaars and marketplaces—in that the shops are usually amalgamated into - Spring Hill, FL - August 2000 -- Chesterfield Chesterfield, city (1991 pop. 73,352) and district, Derbyshire, central England. An important industrial center, Chesterfield produces mining equipment, railroad cars, metal products, glass, and pottery. Crossing - Richmond Richmond, cities, United States Richmond. 1 City (1990 pop. 87,425), Contra Costa co., W Calif., on San Pablo Bay, an inlet of San Francisco Bay; inc. 1905. , VA - October 2000 -- Gunbarrel Pointe pointe n. In ballet, dancing that is performed on the tips of the toes. [From French pointe (des pieds), point (of the feet), tiptoe; see point.] - Chattanooga, TN - October 2000 -- Asheville Mall expansion - Asheville, NC - November 2000 -- Meridian Mall expansion - Lansing, MI - November 2000 -- Creekwood Crossing - Bradenton, FL - April 2001 -- The Lakes Mall - Muskegon, MI - August 2001 -- Parkway Place - Huntsville, AL - October 2002
OPERATIONAL HIGHLIGHTS June 30,
--------------------
2000 1999
---- ----
Total portfolio occupancy 94.3% 93.5%
Stabilized and acquired malls 92.5% 92.0%
New malls 84.5% 82.8%
Total malls 91.5% 91.2%
Associated centers 91.9% 91.7%
Community centers 98.2% 96.6%
Comparable mall shop sales increase 1.8% 5.0%
Average base rents per square foot at June 30, 2000 were $20.86 for stabilized sta·bi·lize v. sta·bi·lized, sta·bi·liz·ing, sta·bi·liz·es v.tr. 1. To make stable or steadfast. 2. malls; $18.87 for new malls; $9.81 for associated centers; and $8.77 for community centers. As of June 30, 2000, the Company's total consolidated and unconsolidated debt was $1.413 billion, with a weighted average interest rate of 7.34% and a debt to total market capitalization Total Market Capitalization The total market value of all of a firm's outstanding securities. ratio of 59.0%. The EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become to interest coverage ratio for the second quarter of 2000 was 2.64 compared with 2.61 for the prior-year period. Conventional fixed rate debt as of June 30, 2000 was $776.3 million, with a weighted average interest rate of 7.41%. Through the execution of swap agreements, the Company has fixed the interest rates on $443 million of variable rate debt on operating properties at a weighted average interest rate of 7.1%. An additional $50 million of interest rate caps and a permanent loan commitment of $74.5 million leaves $69.3 million of variable rate debt exposure, all of which is associated with construction properties. DIVIDENDS In a previous announcement, CBL's board of directors declared a regular quarterly cash dividend of $0.51 per share for the second quarter for the Company's Common Stock. The dividend, which equates to an annual dividend of $2.04 per share compared with $1.95 per share in 1999, was paid on July 18, 2000, to shareholders of record on June 30, 2000. The Board also declared a quarterly cash dividend of $0.5625 per share for the Company's 9% Series A Cumulative Redeemable Redeemable Eligible for redemption under the terms of an indenture. Preferred Stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. for the second quarter. The Preferred Stock dividend, which equates to an annual dividend of $2.25 per share, was paid on June 30, 2000, to shareholders of record on June 15, 2000. INVESTOR CONFERENCE CALL The Company will provide an online Web simulcast and rebroadcast of its 2000 second quarter earnings release conference call. The live broadcast of CBL's quarterly conference call will be available online at www.cblproperties.com, www.streetevents.com, www.streetfusion.com, and www.vcall.com on July 27, 2000, beginning at 10:00 a.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT . The online replay will follow shortly after the call and continue through August 26, 2000. CBL & Associates Properties, Inc. is a real estate investment trust that owns regional malls and community shopping centers, primarily in the Southeast and select markets in the Northeast and Midwest. The Company has a portfolio of 137 properties in 25 states totaling 35.6 million square feet, including 1.8 million square feet of non-owned shopping centers managed for third parties. The Company has under construction eight new projects totaling approximately 2.6 million square feet, including two malls, one associated center, three community centers and two expansions. The Company can be found on the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at www.cblproperties.com. Information included herein contains "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 federal securities laws. Such statements are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual events, financial and otherwise, may differ materially from the events and results discussed in the forward-looking statements. The reader is directed to the Company's various filings with the Securities and Exchange Commission, including without limitation the Company's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. and the "Management's Discussion and Analysis Management's discussion and analysis (MD&A) A report from management to shareholders that accompanies the firm's financial statements in the annual report. It explains the period's financial results and enables management to discuss topics that may not be apparent in the financial of Financial Condition and Results of Operations" incorporated by reference therein, for a discussion of such risks and uncertainties.
CBL & ASSOCIATES PROPERTIES, INC.
(in thousands, except per share amounts)
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
Three Months Ended Six Months Ended
June 30, June 30,
-------------- --------------
2000 1999 2000 1999
---- ---- ---- ----
Funds from operations -
operating partnership units
fully converted $32,292 $27,458 $64,416 $54,026
Funds from operations
applicable to REIT
shareholders $21,780 $18,512 $43,426 $36,411
Funds from operations per
share - diluted $0.87 $0.75 $1.75 $1.47
Dividend declared per share $0.5100 $0.4875 $1.0200 $0.9750
=====================================================================
Revenues:
Minimum rents $56,375 $48,690 $111,676 $96,552
Percentage rents 1,080 1,670 5,931 4,902
Other rents 648 594 1,929 1,408
Tenant reimbursements 26,048 20,981 50,758 41,655
Management, development
and leasing fees 1,402 969 2,028 2,009
Interest and other 1,304 1,287 2,544 2,213
------- ------- ------- -------
Total revenues 86,857 74,191 174,866 148,739
------- ------- ------- -------
Expenses:
Property operating 13,238 11,682 26,929 23,165
Depreciation and amortization 15,159 12,890 29,764 25,566
Real estate taxes 7,767 6,332 14,872 13,287
Maintenance and repairs 4,786 4,208 9,908 8,270
General and administrative 4,184 3,531 9,090 7,357
Interest 23,504 19,665 47,090 39,436
Other 4 146 31 888
------- ------- ------- -------
Total expenses 68,642 58,454 137,684 117,969
------- ------- ------- -------
Income from operations 18,215 15,737 37,182 30,770
Gain on sales of real
estate assets 5,759 3,767 9,330 8,568
Equity in earnings of
unconsolidated affiliates 896 806 1,651 1,741
Minority interest in earnings:
Operating partnership (7,412) (5,457) (14,358) (12,115)
Shopping center properties (346) (297) (726) (662)
------- ------- ------- -------
Income before extraordinary
item 17,112 14,556 33,079 28,302
Extraordinary loss on
extinguishment of debt (137) -- (137) --
------- ------- ------- -------
Net income 16,975 14,556 32,942 28,302
Preferred dividends (1,617) (1,617) (3,234) (3,234)
------- ------- ------- -------
Net income available to
common shareholders $15,358 $12,939 $29,708 $25,068
======= ======= ======= =======
Basic per share data:
Income before extraordinary
item $0.62 $0.53 $1.20 $1.02
======= ======= ======= =======
Net income $0.62 $0.53 $1.20 $1.02
======= ======= ======= =======
Weighted average common
shares outstanding 24,827 24,629 24,790 24,602
Diluted per share data:
Income before extraordinary
item $0.62 $0.53 $1.20 $1.01
======= ======= ======= =======
Net income $0.61 $0.53 $1.19 $1.01
======= ======= ======= =======
Weighted average and
potential dilutive common
shares outstanding 24,995 24,629 24,905 24,835
CBL & ASSOCIATES PROPERTIES, INC.
(In thousands)
SUMMARIZED BALANCE SHEET INFORMATION (UNAUDITED)
June 30, December 31,
2000 1999
---- ----
Cash, cash equivalents and cash in escrow $23,710 $7,074
Total assets 2,067,599 2,018,838
Mortgage and other notes payable 1,389,560 1,360,753
Minority interest 179,171 170,750
Shareholders' equity 441,456 419,887
FUNDS FROM OPERATIONS CALCULATION
Three Months Ended Six Months Ended
June 30, June 30,
------------- -------------
2000 1999 2000 1999
---- ---- ---- ----
Income from operations $18,215 $15,737 $37,182 $30,770
Add: Depreciation and amortization
from consolidated properties 15,159 12,890 29,764 25,566
Income from operations of
unconsolidated affiliates 896 806 1,651 1,741
Depreciation and amortization
from unconsolidated affiliates 591 430 905 820
Less: Preferred dividends (1,617) (1,617) (3,234) (3,234)
Minority investors' share of
income from operations in
nine properties (346) (297) (726) (662)
Minority investors' share of
depreciation and amortization
in nine properties (246) (226) (490) (458)
Depreciation and amortization
of non-real estate assets and
finance costs (360) (265) (636) (517)
------- ------- ------- -------
Total funds from operations $32,292 $27,458 64,416 54,026
======= ======= ======= =======
Basic per share data:
Funds from operations $0.88 $0.75 $1.75 $1.48
======= ======= ======= =======
Weighted average common
shares outstanding with
operating partnership
units fully converted 36,809 36,530 36,773 36,503
======= ======= ======= =======
Diluted per share data:
Funds from operations $0.87 $0.75 $1.75 $1.47
======= ======= ======= =======
Weighted average and
potential dilutive common
shares outstanding with
operating partnership
units fully converted 36,977 36,772 36,887 36,736
======= ======= ======= =======
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