Camden Property Trust Announces Third Quarter 2003 Operating Results.Business Editors/Real Estate Writers HOUSTON--(BUSINESS WIRE)--Nov. 6, 2003 Camden Property Trust (NYSE NYSE See: New York Stock Exchange :CPT CPT See: Carriage Paid To ) announced that its 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 third quarter of 2003 totaled $0.76 per 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. share or $32.8 million, as compared to $0.83 per diluted share or $36.7 million reported for the same period in 2002. On a year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. basis, Camden's nine-month FFO totaled $2.25 per diluted share or $96.8 million in 2003, compared to $2.56 per diluted share or $114.3 million in 2002. Net income ("EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. ") for the third quarter of 2003 was $0.14 per diluted share compared to $0.24 per diluted share for the same period in 2002. For the nine months ended Sept. 30, 2003, EPS totaled $0.49 per diluted share compared to $0.84 per diluted share in 2002. A reconciliation of net income to FFO is included in the financial tables accompanying ac·com·pa·ny v. ac·com·pa·nied, ac·com·pa·ny·ing, ac·com·pa·nies v.tr. 1. To be or go with as a companion. 2. this press release. Physical occupancy Gaining or having physical possession of real property subject to, or in the absence of, legal right or title. In a fire insurance policy, for example, the term occupancy levels averaged 94.4% during the third quarter of 2003 as compared to 92.4% in the second quarter of 2003 and 92.8% in the third quarter of 2002. For the 42,137 apartment homes included in "same-property" results, third quarter 2003 revenues decreased 1.3% while operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. increased 6.8%, producing a 6.4% decline in same-property net operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. ("NOI NOI Net Operating Income NOI Notice of Intent NOI Nation of Islam NOI Notice of Inquiry NOI Neuro Orthopaedic Institute NOI New Organizing Institute NOI Notice of Interest NOI No Offense Intended NOI National Olympiad in Informatics ") compared to the third quarter of 2002. On a sequential One after the other in some consecutive order such as by name or number. basis, third quarter 2003 same property NOI decreased 2.4% compared to second quarter 2003, with revenues increasing 0.6% and expenses increasing 5.1% compared to the prior quarter. On a year-to-date basis, 2003 same property NOI declined 6.1%, with a revenue decrease of 2.0% and expense growth of 4.6% compared to the same period in 2002. A reconciliation of net income to net operating income and same-property net operating income is included in the financial tables accompanying this press release. The Company completed construction at Camden Tuscany Tuscany (tŭs`kənē), Ital. Toscana, region (1991 pop. 3,538,619), 8,876 sq mi (22,989 sq km), N central Italy, bordering on the Tyrrhenian Sea in the west and including the Tuscan Archipelago. in San Diego San Diego (săn dēā`gō), city (1990 pop. 1,110,549), seat of San Diego co., S Calif., on San Diego Bay; inc. 1850. San Diego includes the unincorporated communities of La Jolla and Spring Valley. Coronado is across the bay. , Calif., and Camden Sierra (company, games) Sierra - (Or "Sierra On-Line") A computer game developer founded in the early 1980s by Ken and Roberta Willams in the small mountain town of Oakhurst California. Sierra was named after the local mountian range, 15 miles from the famous Yosemite National Park. at Otay Ranch ranch, large farm devoted chiefly to raising and breeding cattle, horses, sheep, and goats. The cattle ranch was introduced from Latin America to Texas and the plains of the W United States and Canada. in Chula Vista Chula Vista (ch  `lə), city (1990 pop. 135,163), San Diego co., S Calif., on San Diego Bay; inc. 1911. , Calif., during
the quarter. Camden Tuscany is now 96% leased and 94% occupied oc·cu·py tr.v. oc·cu·pied, oc·cu·py·ing, oc·cu·pies 1. To fill up (time or space): a lecture that occupied three hours. 2. To dwell or reside in. 3. , and Camden Sierra at Otay Ranch is 82% leased and 82% occupied. Camden Oak Crest in Houston Houston, city (1990 pop. 1,630,553), seat of Harris co., SE Tex., a deepwater port on the Houston Ship Channel; inc. 1837. Economy The fourth largest city in the nation and the largest in the entire South and Southwest, Houston is a port of entry; continued its lease-up during the quarter, and the community is currently 76% leased and 77% occupied. Camden Harbor harbor: see port. View in Long Beach, Calif., is currently 36% leased and 34% occupied; construction should be completed in 2004. Camden reconfirmed its expected range for 2003 EPS between $0.66 and $0.72 per diluted share, and 2003 FFO between $3.07 and $3.13 per diluted share. For 2003, 12 research analysts have contributed FFO estimates on CPT to First Call ranging from $3.03 to $3.11 per diluted share, for a consensus average of $3.07 per diluted share. The Company also provided initial estimates for 2004 EPS between $0.58 and $0.78 per diluted share, and 2004 FFO between $3.10 and $3.30 per diluted share. The 2004 guidance is based on projections of same-property NOI growth between -2.0% and 2.0%. For 2004, 11 research analysts have contributed FFO estimates on CPT to First Call ranging from $3.10 to $3.32 per diluted share, for a consensus average of $3.24 per diluted share. Camden updates its earnings guidance to the market on a quarterly basis. A reconciliation of expected net income to expected FFO is included in the financial tables accompanying this press release. The Company will hold a conference call on Friday Friday: see Sabbath; week. Friday young Indian rescued by Crusoe and kept as servant and companion. [Br. Lit.: Robinson Crusoe] See : Servant , Nov. 7, 2003 at 10:00 a.m. CST CST abbr. 1. Central Standard Time 2. convulsive shock treatment CST Central Standard Time Noun 1. to review its third quarter results and discuss its outlook for future performance. To participate in the call, please dial 800-884-5695 (domestic) or 617-786-2960 (international) by 9:50 a.m. CST and request the Camden Property Trust Third Quarter Earnings Call, Conference Passcode #99642317, or join the live webcast of the conference call by accessing the Investor Relations Investor relations The process by which the corporation communicates with its investors. section of the Company's Web site at www.camdenliving.com. Supplemental financial information is available in the Investor Relations section of the Company's Web site or by calling Camden's Investor Relations Department at 800-922-6336. In addition to historical information, this press release 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. under the federal securities law. These statements are based on current expectations, estimates and projections about the industry and markets in which Camden operates, management's beliefs, and assumptions made by management. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties which are difficult to predict. Camden Property Trust is a real estate company engaged in the ownership, development, acquisition, management and disposition Act of disposing; transferring to the care or possession of another. The parting with, alienation of, or giving up of property. The final settlement of a matter and, with reference to decisions announced by a court, a judge's ruling is commonly referred to as disposition, regardless of of multifamily apartment communities. Camden owns interests in and operates 144 properties containing 51,344 apartment homes in the Sunbelt Sunbelt Region, south and southwestern U.S. It is characterized by a warm climate, rapid population growth since 1970, and relatively conservative voting patterns. Comprising 15 states, it extends from Virginia and Florida in the southeast through Nevada in the southwest, and Midwestern Mid·west or Middle West A region of the north-central United States around the Great Lakes and the upper Mississippi Valley. It is generally considered to include Ohio, Indiana, Illinois, Michigan, Wisconsin, Minnesota, Iowa, Missouri, Kansas, and markets from Florida Florida, state, United States Florida (flôr`ĭdə, flŏr`–), state in the extreme SE United States. A long, low peninsula between the Atlantic Ocean (E) and the Gulf of Mexico (W), Florida is bordered by Georgia and to California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). . Upon completion of one property under development, the Company's portfolio will increase to 51,882 apartment homes in 145 properties. For additional information, please contact Camden's Investor Relations Department at 800-922-6336 or 713-354-2787 or access our Web site at http://www.camdenliving.com.
OPERATING RESULTS
(In thousands, except per share and property data amounts)
(Unaudited) Three Months Ended Nine Months Ended
September 30, September 30,
------------------------- -----------------------
OPERATING DATA 2003 2002 2003 2002
-------------- ------------ ------------ ------------ ----------
Revenues
Rental income $93,490 $92,644 $274,984 $273,916
Other property
income 8,588 8,092 24,632 23,009
------------ ------------ ------------ ----------
Total property
income 102,078 100,736 299,616 296,925
------------ ------------ ------------ ----------
Development and
construction fees 1,521 864 4,114 3,024
Management fees 423 417 1,288 1,310
Other income 802 2,212 3,447 6,420
------------ ------------ ------------ ----------
Total revenues 104,824 104,229 308,465 307,679
Expenses
Property operating
and maintenance 31,361 28,649 88,905 81,610
Real estate taxes 11,203 10,113 33,448 30,881
Property management 2,533 2,499 7,494 7,220
Fee and asset
management 598 560 3,229 1,602
General and
administrative 3,878 3,893 11,926 10,190
Other expenses - 1,074 1,389 2,252
Losses related to
early retirement of
debt - 234 - 234
Interest 18,584 18,075 55,459 52,662
Amortization of
deferred financing
costs 658 544 1,923 1,530
Depreciation 26,353 25,595 78,699 75,241
------------ ------------ ------------ ----------
Total expenses 95,168 91,236 282,472 263,422
------------ ------------ ------------ ----------
Income from
continuing
operations before
gain on sale of
properties, equity
in income of joint
ventures and
minority interests 9,656 12,993 25,993 44,257
Gain on sale of
properties 89 3 2,171 287
Equity in income of
joint ventures 4 35 3,152 388
Income allocated to
minority interests
Distributions on
units convertible
into perpetual
preferred shares (3,218) (3,218) (9,654) (9,654)
Income allocated
to units
convertible into
common shares (593) (276) (1,482) (1,207)
------------ ------------ ------------ ----------
Income from
continuing
operations 5,938 9,537 20,180 34,071
Income from
discontinued
operations - 698 - 2,263
------------ ------------ ------------ ----------
Net income $5,938 $10,235 $20,180 $36,334
============ ============ ============ ==========
FUNDS FROM
OPERATIONS
-----------
Net income $5,938 $10,235 $20,180 $36,334
Real estate
depreciation from
continuing
operations 25,844 25,102 77,129 73,802
Real estate
depreciation from
discontinued
operations - 536 - 1,605
Adjustments for
unconsolidated
joint ventures 529 555 1,588 1,668
(Gain) on sale of
properties (89) (3) (2,171) (287)
(Gain) on sale of
properties held
in joint ventures - - (1,436) (37)
Income allocated
to units
convertible into
common shares 593 276 1,482 1,207
------------ ------------ ------------ ----------
Funds from
operations -
diluted $32,815 $36,701 $96,772 $114,292
============ ============ ============ ==========
PER SHARE DATA
--------------
Net income - basic $0.15 $0.25 $0.51 $0.89
Net income -
diluted 0.14 0.24 0.49 0.84
Funds from
operations -
diluted 0.76 0.83 2.25 2.56
Cash distributions 0.64 0.64 1.91 1.91
Weighted average
number of common
and common
equivalent shares
outstanding:
Basic 39,290 40,645 39,224 40,843
Diluted 41,465 44,346 41,170 44,681
FFO - diluted 43,343 44,346 43,050 44,681
PROPERTY DATA
-------------
Total operating
properties (end
of period) (a) 144 146 144 146
Total operating
apartment homes
in operating
properties (end
of period) (a) 51,344 52,376 51,344 52,376
Total operating
apartment homes
(weighted
average) 46,581 47,216 46,237 46,582
Total operating
apartment homes -
excluding
discontinued
operations
(weighted
average) 46,581 45,892 46,237 45,258
(a) Includes joint venture investments.
Note: Please refer to the following pages for definitions and
reconciliations of all non-GAAP financial measures presented in this
document.
BALANCE SHEETS
(In thousands)
(Unaudited) Sep 30, Jun 30, Mar 31, Dec 31, Sep 30,
2003 2003 2003 2002 2002
-------------------------------------------------------
ASSETS
Real estate
assets, at
cost
Land $397,006 $396,527 $392,794 $386,246 $381,818
Buildings and
improvements 2,462,252 2,437,833 2,392,936 2,348,702 2,364,457
-------------------------------------------------------
2,859,258 2,834,360 2,785,730 2,734,948 2,746,275
Accumulated
depreciation (575,459) (549,769) (524,165) (498,776) (497,556)
-------------------------------------------------------
Net
operating
real
estate
assets 2,283,799 2,284,591 2,261,565 2,236,172 2,248,719
Properties
under
development,
including
land 236,529 242,682 264,259 285,636 204,857
Investment in
joint
ventures 9,994 10,247 10,919 15,386 15,846
Investment in
third party
development
properties - - - - 49,283
-------------------------------------------------------
Total real
estate
assets 2,530,322 2,537,520 2,536,743 2,537,194 2,518,705
Accounts
receivable -
affiliates 7,141 6,736 6,444 5,843 5,588
Notes
receivable
Affiliates - - 1,800 1,800 1,800
Other 24,419 21,632 17,664 17,614 3,000
Other assets,
net (a) 39,367 40,641 43,143 41,827 43,530
Cash and cash
equivalents 2,341 1,550 1,945 405 1,652
Restricted cash 4,058 4,258 4,365 4,216 6,461
-------------------------------------------------------
Total
assets $2,607,648 $2,612,337 $2,612,104 $2,608,899 $2,580,736
=======================================================
LIABILITIES AND
SHAREHOLDERS'
EQUITY
Liabilities
Notes payable
Unsecured $1,248,852 $1,236,681 $1,208,513 $1,177,347 $1,116,063
Secured 232,953 240,711 248,481 249,669 271,477
Accounts
payable 24,025 34,580 36,978 36,189 27,010
Accrued real
estate taxes 31,444 20,822 12,782 26,827 30,502
Accrued
expenses and
other
liabilities 51,266 44,226 51,397 48,144 46,773
Distributions
payable 30,698 30,663 30,639 30,541 31,177
-------------------------------------------------------
Total lia-
bilities 1,619,238 1,607,683 1,588,790 1,568,717 1,523,002
Commitments and
contingencies - - - - -
Minority
interests
Units
convertible
into
perpetual
preferred
shares 149,815 149,815 149,815 149,815 149,815
Units
convertible
into common
shares 47,382 48,354 49,621 50,914 51,997
-------------------------------------------------------
Total
minority
interests 197,197 198,169 199,436 200,729 201,812
Shareholders'
equity
Common shares
of
beneficial
interest 481 480 479 479 479
Additional
paid-in
capital 1,321,103 1,320,045 1,318,649 1,314,592 1,314,556
Distributions
in excess of
net income (281,256) (261,577) (241,960) (224,756) (237,607)
Unearned
restricted
share awards (12,667) (15,477) (16,282) (13,714) (15,048)
Treasury
shares, at
cost (236,448) (236,986) (237,008) (237,148) (206,458)
-------------------------------------------------------
Total
share-
holders'
equity 791,213 806,485 823,878 839,453 855,922
-------------------------------------------------------
Total lia-
bilities
and share-
holders'
equity $2,607,648 $2,612,337 $2,612,104 $2,608,899 $2,580,736
=======================================================
(a) includes
net deferred
charges of: $8,691 $9,268 $9,925 $10,190 $8,340
NON-GAAP FINANCIAL MEASURES
DEFINITIONS & RECONCILIATIONS
(In thousands, except per share amounts)
(Unaudited)
This document contains certain non-GAAP financial measures that
management believes are useful in evaluating an equity REIT's
performance. Camden's definitions and calculations of non-GAAP
financial measures may differ from those used by other REITs, and thus
may not be comparable. The non-GAAP financial measures should not be
considered as an alternative to net income as an indication of our
operating performance, or to net cash provided by operating activities
as a measure of our liquidity.
FFO
---
The National Association of Real Estate Investment Trusts ("NAREIT")
currently defines FFO as net income computed in accordance with
generally accepted accounting principles ("GAAP"), excluding gains or
losses from sales of property, plus real estate depreciation and
amortization, and after adjustments for unconsolidated partnerships
and joint ventures. Camden's definition of diluted FFO also assumes
conversion at the beginning of the period of all dilutive convertible
securities, including minority interests, which are convertible into
common equity. The Company considers FFO to be an appropriate
supplemental measure of operating performance because, by excluding
gains or losses on dispositions and excluding depreciation, FFO can
help one compare the operating performance of a company's real estate
between periods or as compared to different companies. A
reconciliation of net income to FFO is provided below:
Three Months Nine Months
Ended Ended
September 30, September 30,
------------------ -------------------
2003 2002 2003 2002
--------- -------- --------- ---------
Net income $5,938 $10,235 $20,180 $36,334
Real estate depreciation from
continuing operations 25,844 25,102 77,129 73,802
Real estate depreciation from
discontinued operations - 536 - 1,605
Adjustments for unconsolidated
joint ventures 529 555 1,588 1,668
(Gain) on sale of properties (89) (3) (2,171) (287)
(Gain) on sale of properties
held in joint ventures - - (1,436) (37)
Income allocated to units
convertible into common shares 593 276 1,482 1,207
--------- -------- --------- ---------
Funds from operations -
diluted $32,815 $36,701 $96,772 $114,292
========= ======== ========= =========
Weighted average number of
common and common equivalent
shares outstanding:
EPS diluted 41,465 44,346 41,170 44,681
FFO diluted 43,343 44,346 43,050 44,681
Net income per common share -
diluted $0.14 $0.24 $0.49 $0.84
FFO per common share - diluted $0.76 $0.83 $2.25 $2.56
Expected FFO
------------
Expected FFO is calculated in a method consistent with historical FFO,
and is considered an appropriate supplemental measure of expected
operating performance when compared to expected net income (EPS). A
reconciliation of the ranges provided for expected net income per
diluted share to expected FFO per diluted share is provided below:
2003 Range 2004 Range
Low High Low High
--------- -------- --------- ---------
Expected net income per share -
diluted $0.66 $0.72 $0.58 $0.78
Expected real estate
depreciation 2.39 2.39 2.42 2.42
Expected adjustments for
unconsolidated joint ventures 0.05 0.05 0.05 0.05
Expected income allocated to
units convertible into common
shares 0.05 0.05 0.05 0.05
Expected (gain) on sale of
properties held in joint
ventures (0.03) (0.03) 0.00 0.00
Expected (gain) on sale of
properties (0.05) (0.05) 0.00 0.00
--------- -------- --------- ---------
Expected FFO per share - diluted $3.07 $3.13 $3.10 $3.30
Net Operating Income (NOI)
--------------------------
NOI is defined by the Company as total property income less property
operating and maintenance expenses less real estate taxes. The Company
considers NOI to be an appropriate supplemental measure of operating
performance to net income because it reflects the operating
performance of our communities without allocation of corporate level
property management overhead or general and administrative costs. A
reconciliation of net income to net operating income is provided
below:
Three Months Nine Months
Ended Ended
September 30, September 30,
------------------ -------------------
2003 2002 2003 2002
--------- -------- --------- ---------
Net income $5,938 $10,235 $20,180 $36,334
Development and construction
fees (1,521) (864) (4,114) (3,024)
Management fees (423) (417) (1,288) (1,310)
Other income (802) (2,212) (3,447) (6,420)
Property management expense 2,533 2,499 7,494 7,220
Fee and asset management expense 598 560 3,229 1,602
General and administrative
expense 3,878 3,893 11,926 10,190
Other expenses - 1,074 1,389 2,252
Losses related to early
retirement of debt - 234 - 234
Interest expense 18,584 18,075 55,459 52,662
Amortization of deferred
financing costs 658 544 1,923 1,530
Depreciation 26,353 25,595 78,699 75,241
Gain on sale of properties (89) (3) (2,171) (287)
Equity in income of joint
ventures (4) (35) (3,152) (388)
Distributions on units
convertible into perpetual
preferred shares 3,218 3,218 9,654 9,654
Income allocated to units
convertible into common shares 593 276 1,482 1,207
Income from discontinued
operations - (698) - (2,263)
--------- -------- --------- ---------
Net Operating Income (NOI) $59,514 $61,974 $177,263 $184,434
"Same Property" net operating
income $52,256 $55,803 $158,602 $168,862
Non-"Same Property" net
operating income 5,710 4,463 16,166 10,625
Development and Lease-Up net
operating income 1,523 - 2,337 -
Dispositions / Other net
operating income 25 1,708 158 4,947
--------- -------- --------- ---------
Net Operating Income (NOI) $59,514 $61,974 $177,263 $184,434
EBITDA
------
EBITDA is defined by the Company as earnings before interest, taxes,
depreciation and amortization, including net operating income from
discontinued operations, excluding equity in income of joint ventures,
gain on sale of real estate assets, and income allocated to minority
interests. The Company considers EBITDA to be an appropriate
supplemental measure of operating performance to net income because it
represents income before non-cash depreciation and the cost of debt,
and excludes gains or losses from property dispositions. A
reconciliation of net income to EBITDA is provided below:
Three Months Nine Months
Ended Ended
September 30, September 30,
------------------ -------------------
2003 2002 2003 2002
--------- -------- --------- ---------
Net income $5,938 $10,235 $20,180 $36,334
Interest expense 18,584 18,075 55,459 52,662
Losses related to early
retirement of debt - 234 - 234
Amortization of deferred
financing costs 658 544 1,923 1,530
Depreciation 26,353 25,595 78,699 75,241
Distributions on units
convertible into perpetual
preferred shares 3,218 3,218 9,654 9,654
Income allocated to units
convertible into common shares 593 276 1,482 1,207
Real estate depreciation from
discontinued operations - 536 - 1,605
Gain on sale of properties (89) (3) (2,171) (287)
Equity in income of joint
ventures (4) (35) (3,152) (388)
--------- -------- --------- ---------
EBITDA $55,251 $58,675 $162,074 $177,792
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