Catellus Announces Third Quarter Earnings, Approval of 840-Acre Fremont Business Park and New Credit Facility.SAN FRANCISCO--(BUSINESS WIRE)--Oct. 30, 1996--Catellus Development Corp. (NYSE NYSE See: New York Stock Exchange :CDX CDX Companion Dog Excellent (AKC Obedience Title) CDX Cyber-Defense Exercise CDX Central Data Exchange CDX Community Development Exchange (UK community development organization) CDX Commercial Data Exchange ), reported net income of $2.8 million for the quarter ended September September: see month. 30, 1996, the same as the third quarter last year. After preferred dividends preferred dividend n. a payment of a corporation's profits to holders of preferred shares of stock. (See: preferred stock) and a redemption premium redemption premium See call premium. , the net loss to common stockholders was $3.8 million, or ($.05) per share, versus a loss of $3.2 million, or ($.04) per share in the third quarter of 1995. For the nine months ended September 30, 1996, net income was $13.3 million compared to $11.3 million for the same period in 1995. After preferred dividends and a redemption premium, the net loss to common stockholders for the nine months ended September 30, 1996 was $5.2 million, or ($.07) per share, versus a net loss of $6.6 million, or ($.09) per share for the same period in 1995. "The third quarter was another successful quarter for Catellus
Catellus was a legendary king of the Britons as accounted by Geoffrey of Monmouth. He was the son of King Gerennus and was succeeded by his son Millus. ," said Nelson C. Rising, president and chief executive officer. "At the beginning of the year, we set a fourth-quarter goal of achieving positive operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before before non-strategic land sales, but after fixed charges and re-tenanting costs. For the third quarter and nine months of 1996, we generated positive results of $5.3 million and $12.4 million, respectively, as compared to deficits of $2.4 million and $8.0 million for the third quarter and nine months of 1995." "This significant improvement was one of our key objectives for the year. Reaching it has allowed us to restructure and improve our credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities and position the company for further growth," continued Rising. Highlights of the Quarter Ended September 30, 1996: --Non-strategic land sales -- Non-strategic land sales totaled $12.9 million for the quarter, with sales prices averaging 110% of their December December: see month. 31, 1995 current value. The non-strategic land sales resulted in pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta earnings of $1.3 million. A total of $82.9 million of non-strategic land assets has been sold following the announcement of the company's goal to sell $100 million of non-strategic land assets by December 31, 1996. In addition, the company had a backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. of open contracts to sell an additional $16.7 million of non-strategic land at September 30, 1996. --Increased management and fee income -- Management and fee income for the third quarter increased to $1.2 million from $589,000 in 1995. This increase was due largely to income from the Burlington Burlington, town, Canada Burlington, town (1991 pop. 129,575), SE Ont., Canada, on Lake Ontario. First settled (1798) by Mohawk Loyalist Joseph Brandt, Burlington's economy was built on the shipment of wheat, lumber, and quarried rock by waterway. Northern Santa Fe Santa Fe, city, Argentina Santa Fe, city (1991 pop. 341,000), capital of Santa Fe prov., NE Argentina, a river port near the Paraná, with which it is connected by canal. management contract combined with "design-build Design-build (or design/build, and abbreviated D-B or D/B accordingly) is a construction project delivery system where, in contrast to traditional "design-bid-build" (or "design-tender"), the design and construction aspects are contracted for with a single " fees from the Metropolitan Water District's corporate headquarters at Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. Union Station. --New $240 million revolving line of credit Revolving line of credit A bank line of credit on which the customer pays a commitment fee and can take and repay funds at will. Normally a revolving LOC involves a firm commitment from the bank for a period of several years. -- The company has entered into a new credit facility with a multi-bank lending group headed by Bank of America
Bank of America (NYSE: BAC TYO: 8648 ) is the largest commercial bank in the United States in terms of deposits, and the largest company of its kind in the world. which replaces five previous credit lines. This new consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: line provides for less restrictive terms with increased borrowing capacity and allows for greater flexibility in funding new development. --Preferred stock redemption The liberation of an estate in real property from a mortgage. Redemption is the process by which land that has been mortgaged or pledged is bought back or reclaimed. It is accomplished through a payment of the debt owed or a fulfillment of the other conditions. -- The redemption of 950,000 shares of the Series A $3.75 Cumulative Convertible Preferred Stock Convertible Preferred Stock Preferred stock that includes an option for the holder to convert the preferred shares into a fixed number of common shares, usually anytime after a predetermined date. Also known as "convertible preferred shares". was completed during the third quarter resulting in the redemption of 53% and conversion of 47% of the shares impacted by the redemption. This led to a $738,000 decrease in preferred dividends paid for the quarter and an increase in common shareholder's equity of $20.8 million. --Debt reduction --- The company reduced principal on existing debt by $7.2 million and had $44.6 million of new borrowings which funded the construction of pre-leased industrial buildings and the redemption of 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. . This brings total debt reduction since the beginning of 1995 to $122.0 million. The company made $92.3 million of new borrowings, mostly to finance pre-leased industrial buildings and redeem redeem v. to buy back, as when an owner who had mortgaged his/her real property pays off the debt. The term also refers to paying the amount due and all charges after a foreclosure (due to failure to make payments when due) has begun. a portion of its preferred stock, bringing the net debt reduction to $29.7 million. Development Activity: --Industrial development -- The company added 900,000 square feet of industrial development (in the form of signed leases and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. construction starts) bringing the total for the nine months ended September 30, 1996 to 2.7 million square feet, just 300,000 square feet from the previously announced goal for 1996 of three million square feet of signed leases and/or construction starts. In addition, 785,000 square feet of industrial space was completed during the second quarter, bringing construction completed during the year to 987,000 square feet. Mixed-Use Development Mixed-use development refers to the practice of allowing more than one type of use in a building or set of buildings. In planning zone terms, this can mean some combination of residential, commercial, industrial, office, institutional, or other land uses. : --Pacific Commons, Fremont Fremont (frē`mŏnt). 1 City (1990 pop. 173,339), Alameda co., W Calif., on San Francisco Bay; inc. 1956. Long an agricultural center, with champagne vineyards founded (1870) by Leland Stanford, it still ships fruits and vegetables. , CA -- Final approval was received from the City of Fremont for the company's 840-acre mixed-use mixed-use adj. Containing or zoned for commercial and residential facilities or development: a 40-story mixed-use tower; a mixed-use parcel of land. business-park, Pacific Commons Pacific Commons Almost 1 million square feet of retail is located at the intersection of Interstate 880 and Auto Mall Parkway and includes retailers such as Lowe's Home Improvement, Costco, Kohl's Department Store, Linens-N-Things, Office Depot, Party America, DSW Shoes, Justice . The project is now the largest undeveloped land site approved for business-park development in Silicon Valley. The site was approved for 7.8 million square feet of research and development, office, light industrial and corporate campus space with 700,000 square feet of power center retail. Construction is expected to begin in the spring of 1997. Job growth in the Silicon Valley is in excess of 4% compared to 2% for the nation; vacancy VACANCY. A place which is empty. The term is principally applied to cases where an office is not filled. 2. By the constitution of the United States, the president has the power to fill up vacancies that may happen during the recess of the senate. rates continue to fall and rents are on the increase. --Mission Bay, San Francisco San Francisco (săn frănsĭs`kō), city (1990 pop. 723,959), coextensive with San Francisco co., W Calif., on the tip of a peninsula between the Pacific Ocean and San Francisco Bay, which are connected by the strait known as the Golden , CA -- The company reached an agreement in principle with the City of San Francisco
The agreement in principle contemplates up to 3,000 residential units, of which 20% will be affordable, a retail/entertainment complex of up to 350,000 square feet, as well as neighborhood and community-serving retail of up to 250,000 square feet. The vacancy rate for rental RENTAL. A roll or list of the rents of an estate containing the description of the lands let, the names of the tenants, and other particulars connected with such estate. This is the same as rent roll, from which it is said to be corrupted. apartments in San Francisco is below 2%. The proposed entertainment retail site is adjacent to the site for the new San Francisco Giants The San Francisco Giants are a Major League Baseball team based in San Francisco, California that currently play in the National League West Division. New York Giants history Early days and the John McGraw era ballpark approved by the voters in the spring of 1996. The final approvals of phase one are expected in early to mid- mid- pref. Middle: midbrain. 1998. --Residential development -- Construction began on the company-owned 220-unit affordable housing project in Emeryville, California Emeryville is a small city located in Alameda County, California , in the United States. It is located in a corridor between the cities of Berkeley and Oakland, extending to the shore of San Francisco Bay. , which will be largely funded by $16.5 million in tax-exempt bonds Tax-exempt bond A bond usually issued by municipal, county, or state governments whose interest payments are not subject to federal and, in some cases, state and local income tax. tax-exempt bond See municipal bond. . A contract was signed for the sale of 100 residential lots at the company-owned 350-lot Union City project, which is expected to close by year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. . In addition, two residential projects totaling 172 units were opened for sale during the quarter -- Newport Newport, town, England Newport, town (1991 pop. 19,758), Isle of Wight, S England. It is also a port and the commercial center of the island, with agricultural markets and light industries (plastics, soft drinks, and woodworking). In the 17th cent. Coast and the third village in the Rowland Row·land , F(rank) Sherwood Born 1927. American chemist who shared a 1995 Nobel Prize for his work on the chemical processes involved in the formation and decomposition of ozone. Heights community of Ridgemoor. --Development property sales -- A total of $6.8 million in development property sales closed during the quarter, which resulted in pre-tax earnings of $2.7 million. The company expects quarter-to-quarter variability of net income to continue. The company's results, particularly on a quarterly basis, may vary significantly as a result of, among other things, the timing and level of property sales, changes in the timing of distributions from joint ventures and differences in the timing of completed construction. Catellus Development Corporation Catellus Development Corporation is a real estate landowner that was spun off of the real estate holdings of Santa Fe and Southern Pacific Railroad. They are one of the largest landowners in California. is a full service real estate company that owns, manages and develops real estate for its own account and others. As of September 30, 1996, the company's portfolio includes 16.3 million square feet of income producing properties, 5,400 acres of land leases, interests in nine joint ventures and 851,000 acres of land. The statements contained herein which are not historical facts are 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. based on economic forecasts, strategic plans and other factors, which, by their nature involve risk and uncertainties. In particular, among the factors that could cause actual results to differ materially are the following: business conditions and general economy; competitive facts; political decisions affecting land use permits, interest rates and other risks inherent in the real estate business. For further information on factors which could impact the company and the statements, reference is made to the company's filings with the Securities and Exchange Commission. -0-
CATELLUS DEVELOPMENT CORPORATION
CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per share data)
Three months ended Nine months ended
September 30, September 30,
1996 1995 1996 1995
(Unaudited) (Unaudited)
Rental revenues $ 29,619 $ 27,179 $ 89,671 $ 80,910
Property operating costs (12,078) (9,683) (35,437) (28,531)
Gain on sales of property 4,076 1,703 21,090 8,902
Equity in earnings of
joint ventures 1,172 565 4,418 4,917
Management and development
fee income 1,182 589 1,995 1,572
General and administrative
expense (1,661) (2,783) (5,718) (9,222)
Interest expense (10,536) (6,414) (32,316) (19,554)
Depreciation and
amortization (7,550) (6,765) (22,654) (20,629)
Litigation, environmental
and restructuring 50 (643) 950 (2,177)
Other, net 375 913 439 2,693
Income before income taxes 4,649 4,661 22,438 18,881
Income taxes 1,897 1,905 9,155 7,624
Net income 2,752 2,756 13,283 11,257
Less:
Preferred stock dividends (5,215) (5,953) (17,121) (17,859)
Premium on redemption of
preferred stock (1,334) -- (1,334) --
Net loss applicable
to common stockholders $ (3,797) $ (3,197) $ (5,172) $ (6,602)
Net loss per share
of common stock $ (0.05) $ (0.04) $ (0.07) $ (0.09)
Average number of common
shares outstanding 75,002 72,967 74,251 72,967
CATELLUS DEVELOPMENT CORPORATION
CONSOLIDATED BALANCE SHEET
(In thousands)
September 30, December 31,
1996 1995
(Unaudited)
Assets
Properties $1,215,892 $1,191,679
Less accumulated depreciation (204,377) (184,228)
========== ==========
1,011,515 1,007,451
Other assets and deferred charges 48,058 44,530
Notes receivable 4,462 7,550
Accounts receivable, less allowances 11,077 10,330
Cash and cash equivalents 21,632 27,743
Total $1,096,744 $1,097,604
Liabilities and stockholders' equity
Mortgage and other debt $ 500,862 $ 496,180
Accounts payable and accrued expenses 42,119 33,913
Deferred credits and other liabilities 39,371 34,367
Deferred income taxes 99,033 90,270
Total liabilities $ 681,385 $ 654,730
Stockholders' equity
Preferred stock 275,000 322,500
Common stock -- 76,959 and 72,967
shares issued at September 30, 1996
and December 31, 1995 769 730
Paid-in capital 219,285 196,525
Accumulated deficit (79,695) (76,881)
Total stockholders' equity 415,359 442,874
Total $1,096,744 $1,097,604
CATELLUS DEVELOPMENT CORPORATION
ADDITIONAL INFORMATION
(In thousands)
Three months Nine months
ended ended
Sept. 30, Sept. 30,
1996 1995 1996 1995
(Unaudited) (Unaudited)
Income (deficit) from property
operations, development and
management activities after
adjustment for general and
administrative expense, fixed
charges and leasing costs
Property operations, development
and management activities
Rental revenues $29,619 $27,179 $89,671 $80,910
Property operating costs (12,078) (9,683) (35,437) (28,531)
Distributions from joint ventures,
net 2,491 1,363 6,195 4,000
Management and development fee
income 1,182 589 1,995 1,572
Gain on sale of development
properties 2,747 0 9,315 0
======= ======= ======= =======
23,961 19,448 71,739 57,951
General and administrative
expenses (1,661) (2,783) (5,718) (9,222)
Fixed charges - interest and
dividends
Total interest costs, net of
interest income (10,436) (11,597) (32,016) (33,959)
Preferred dividends (5,215) (5,953) (17,121) (17,859)
Add back non-cash components of
interest expense 1,093 717 2,839 2,173
======= ======= ======= =======
(14,558) (16,833) (46,298) (49,645)
Leasing costs
Depreciation on tenant
improvements (1,637) (1,639) (5,127) (5,179)
Amortization of lease
commissions (785) (609) (2,194) (1,872)
======= ======= ======= =======
(2,422) (2,248) (7,321) (7,051)
======= ======= ======= =======
$ 5,320 $(2,416) $12,402 $(7,967)
Interest costs and preferred
stock dividends
Interest costs
Total interest costs $10,790 $12,351 $33,134 $36,863
Interest capitalized (254) (5,937) (818) (17,309)
Interest expensed $10,536 $ 6,414 $32,316 $19,554
Preferred stock dividends $ 5,215 $ 5,953 $17,121 $17,859
CATELLUS DEVELOPMENT CORPORATION
ADDITIONAL INFORMATION
Three months Nine months
ended ended
Sept. 30, Sept. 30,
1996 1995 1996 1995
(Unaudited) (Unaudited)
Additional Information (continued)
Property operating income by property type (1)
(in thousands)
Income producing properties
Industrial buildings $10,406 $ 9,854 $30,849 $30,135
Office buildings 3,644 4,187 12,266 12,601
Retail buildings 2,238 2,313 6,693 6,458
Land development 743 661 2,311 1,458
Ground leases 1,623 1,646 5,034 4,510
18,654 18,661 57,153 55,162
Land holding costs
Developable properties (591) (372) (1,167) (440)
Natural resources (170) (369) (490) (859)
Properties held for sale (352) (424) (1,262) (1,484)
(1,113) (1,165) (2,919) (2,783)
Total $17,541 $17,496 $54,234 $52,379
(1) Represents rental revenue less property operating costs.
Net Debt End of
Debt reduction Debt New (Reduction) Period
program (in millions) Repayment Borrowings Addition Debt
Debt at 01/01/95 $530.6
1995 $68.5 $34.0 $(34.5) 496.1
First quarter 1996 8.9 3.9 (5.0) 491.1
Second quarter 1996 37.4 9.8 (27.6) 463.5
Third quarter 1996 7.2 44.6 37.4 500.9
Program to date $ 122.0 $ 92.3 $ (29.7)
CATELLUS DEVELOPMENT CORPORATION
ADDITIONAL INFORMATION
(In thousands, except square feet data)
As of or for the
Three months ended Nine months ended
September 30, September 30,
1996 1995 1996 1995
(Unaudited) (Unaudited)
Additional Information
(continued)
Development
Construction and completion
Under construction,
beginning of period 1,562,636 567,854 641,128 337,136
Construction starts 689,200 201,600 1,812,308(a) 469,318
Completion (784,925) (450,854) (986,525) (487,854)
Under construction,
end of period 1,466,911 318,600 1,466,911 318,600
Development under
contract, not started 844,600 844,600(a)
(a) 1996 Development Goal (3 million square feet) 2,656,908
Sales
Closed sales
Non-strategic land $12,934 $3,349 $35,800 $ 15,070
Development properties 6,750 - 27,428 -
Ground leases - - 7,500 -
Total $19,684 $3,349 $70,728 $15,070
September 30, December 31,
Backlog - sales under contract 1996 1995
Non-strategic land $16,687 $23,585
Developed properties 11,678 13,600
Ground leases - 7,500
Total $ 28,365 $44,685
CATELLUS DEVELOPMENT CORPORATION
ADDITIONAL INFORMATION
(In thousands)
September 30,
1996 1995
Additional Information (continued) (Unaudited)
Buildings owned and leasing statistics
(at quarter-end)
Industrial buildings
Square feet owned 12,411 11,022
Square feet leased 11,998 10,549
Percent leased 96.7% 95.7%
Office buildings
Square feet owned 1,682 1,687
Square feet leased 1,484 1,537
Percent leased 88.2% 91.1%
Retail buildings
Square feet owned 928 840
Square feet leased 871 742
Percent leased 93.8% 88.3%
Land development(1)
Square feet owned 1,232 100
Square feet leased 1,127 100
Percent leased 91.5% 100.0%
Total
Square feet owned 16,253 13,649
Square feet leased 15,480 12,928
Percent leased 95.2% 94.7%
(1) Increase due to the inclusion of Mission Bay which was
previously excluded due to capitalization of revenue and expenses.
CONTACT: Catellus Development Corporation Steve Wallace Steve Wallace may refer to
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