CenterPoint Reports Second Quarter 2005 Results; EPS Increases 60% to $0.48 and FFO Per Share Increases 12% to $0.56.OAK BROOK, Ill. -- CenterPoint Centerpoint is used in several senses:
See: New York Stock Exchange :CNT (Carbon NanoTube) See nanotube. ): Highlights: --Healthy Leasing Activity: 62.9% of 2005 Lease Expirations, 43.3% of Total Inventory Addressed --Chicago Industrial Market Remains Active - YTD See Year-to-date. YTD See year to date (YTD). Gross Absorption of 31.5 Million Square Feet --96% of 2005 Acquisition Revenue Closed, Under Contract or Letter of Intent --Development Pipeline Strong; 6 Million Square Feet in Negotiation --Substantial Financial Capacity: 5.8 to 1 Debt Service Coverage, 4.8 to 1 Fixed Charge Coverage --$100 Million of Unsecured Unsecured A loan or equity interest that is given without any guarantee of payment, performance, satisfaction or opportunity for return from the recipient. No property, interest or security is used as collateral in either a guarantee or a pledge. Senior Notes Retired --$20.6 Million of Common Shares Repurchased in Q2 CenterPoint Properties Trust (NYSE:CNT) reported today that earnings per share ("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. ") increased 60.0% for the second quarter 2005 to $0.48 from $0.30 for the same period in 2004. Net income available to common shareholders increased 66.0% to $23.9 million from $14.4 million for the second quarter 2004. 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 ") per share increased 12.0% for the second quarter 2005 to $0.56 from $0.50 for the same period in 2004. CenterPoint defines FFO as: net income available to common shareholders plus real estate depreciation and non-financing amortization, inclusive of inclusive of prep. Taking into consideration or account; including. fee income and gain or losses on industrial property sales (net of accumulated depreciation accumulated depreciation The total amount of depreciation that has been recorded for an asset since its date of acquisition. For example, a computer with a 5-year estimated life that was purchased for $2,000 would have accumulated depreciation of $800 [( ) of the Company and its unconsolidated affiliates. See attached Reporting Definitions and Reconciliation for further explanation of FFO. As previously announced in June June: see month. , second quarter 2005 EPS and FFO per share results include a non-cash charge Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. of approximately $.09 per common share for the vesting Vesting The process by which employees accrue non-forfeitable rights over employer contributions that are made to the employee's qualified retirement plan account. Notes: of the 2002 employee stock grants. These grants vested vested adj. referring to having an absolute right or title, when previously the holder of the right or title only had an expectation. Examples: after 20 years of employment Larry Loyal's pension rights are now vested. (See: vest, vested remainder) on an accelerated basis under the terms of the program because shareholders received a total return of 60% in just over two years. CenterPoint tightened its annual guidance ranges for 2005 and currently expects to report EPS in the range of $2.61 to $2.77 and FFO per share in the range of $2.52 to $2.62. For the third quarter 2005, the Company expects to report EPS in the range of $0.77 to $0.87 and FFO per share in the range of $0.66 to $0.72. "We are pleased with all three legs of our business - leasing, dispositions and investments," remarked Michael Mullen Admiral Michael Glenn Mullen, USN (born October 4 1946), is the 17th and current Chairman of the Joint Chiefs of Staff as of October 1, 2007. Mullen was the 28th Chief of Naval Operations of the United States Navy, relieving ADM Vern Clark on 22 July, 2005. , Chief Executive Officer. "Our steady leasing progress has put us ahead of plan. To date, we have addressed 62.9% of our 2005 expiries and 43.3% of our overall inventory, which includes 2005 scheduled expiries and beginning year 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. , plus acquired vacancy and expiries. We see value in opportunistically acquired vacancy or property on short leases. Market data and our leasing performance confirm healthy tenant activity with stable or improving rents. Gross absorption is near record levels, reflecting solid regional economic performance." "Our disposition activity is largely complete for the year because of our phased portfolio sale to Mirvac Group Mirvac Group (ASX: MGR) is a diversified property investment and management group in Australia with more than $24 billion of assets under control across the investment, development, and hotel and funds management spectrum. . With our focus turned to investment, outlays Outlays Payments on obligations in the form of cash, checks, the issuance of bonds or notes, or the maturing of interest coupons. are pacing our strong 2004 performance. The vast majority of planned revenue from 2005 acquisitions is now complete or in our sights. Demand for build-to-suit developments is solid. We have sizeable pipelines of acquisition and development opportunities, reflecting a strengthening market." "Overall, we are benefiting because business is focused on transportation efficiencies, which has accelerated demand for distribution and manufacturing space in the Chicago Chicago, city, United States Chicago (shĭkä`gō, shĭkô`gō), city (1990 pop. 2,783,726), seat of Cook co., NE Ill., on Lake Michigan; inc. 1837. market. Chicago is the only place where all six Class I railroads A Class I railroad in the United States, or a Class I railway (also Class I rail carrier) in Canada, is one of the largest freight railroads, as classified based on operating revenue. Smaller railroads are classified as Class II and Class III. converge con·verge v. con·verged, con·verg·ing, con·verg·es v.intr. 1. a. To tend toward or approach an intersecting point: lines that converge. b. and it's it's 1. Contraction of it is. 2. Contraction of it has. See Usage Note at its. it's it is or it has it's be ~have the third largest container hub in the world behind Hong Kong Hong Kong (hŏng kŏng), Mandarin Xianggang, special administrative region of China, formerly a British crown colony (2005 est. pop. 6,899,000), land area 422 sq mi (1,092 sq km), adjacent to Guangdong prov. and Singapore Singapore (sĭng`gəpôr, sĭng`ə–, sĭng'gəpôr`), officially Republic of Singapore, republic (2005 est. pop. 4,426,000), 240 sq mi (625 sq km). . Companies are seeking ways to cut trucking costs given the rise in fuel costs, turnover in drivers and industry regulations. As a result, 'long rail, short truck' is the logistics rule. Chicago's central location and manufacturing base, combined with its rail, air, and trucking dominance, are attracting new firms to the market." Leasing Ahead of Plan Year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. , the Company has addressed 4.6 million square feet or 43.3% of total inventory, which includes 2005 expiries, beginning year vacancy and acquired vacancy and expiries. Of 2005 expiries, the Company has addressed 3.5 million square feet or 62.9% of beginning year 2005 expirations. On total leasing activity, year-to-date rents increased 7.8% on a 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. basis and decreased 0.2% on a cash basis. Detailed portfolio activity is available on page 15 of the Company's information supplement. Excluding properties sold, the Company retained 93.5% of its tenants. Year-to-date, 87.6% of the Company's in-service in-service In-service training adjective Referring to any form of on-the-job training noun In-service training of an employee industrial portfolio is leased and occupied compared to 88.0% at the end of the first quarter 2005. As announced in July July: see month. , Sean P
Sean Paul Joseph (born May 7, 1979) known by his stage name Sean P (formerly Sean Paul), is an American rapper and one half (with J-Bo) of the group YoungBloodZ. . Maher Maher may refer to: People Caste
Sean Maher This article or section needs sources or references that appear in reliable, third-party publications. Alone, primary sources and sources affiliated with the subject of this article are not sufficient for an accurate encyclopedia article. commented, "We've we've Contraction of we have. we've have had healthy activity in the first half of 2005 and are on pace to beat our 2004 record level of leasing. Our six regional managers have been active. In addition to executed leases, more than a million square feet of new leases and renewals are under letter of intent. The Chicago industrial In the early 1980s the Chicago-based record label Wax Trax! helped to forge the industrial music genre. At the forefront of this explosion of musical exploration were bands such as Chicago's Ministry, My Life With The Thrill Kill Kult, Die Warzau and Eight and One Half[1] property market remains very active, which should bode bode 1 v. bod·ed, bod·ing, bodes v.tr. 1. To be an omen of: heavy seas that boded trouble for small craft. 2. well for the second half of the year. While our investment strategy has added to our vacancy, we expect occupancy to increase as improved market conditions are reflected in our performance." Strong Investment Pipeline Year-to-date, CenterPoint and affiliates have completed total investments of $206.1 million. Of this total, CenterPoint completed $188.6 million. These investments after stabilizing stabilizing, v to hold a limb motionless in order to ground its energy; a standard isometric resistance technique, it releases tension and lengthens muscle fibers. are expected to produce a weighted average initial cash yield of 9.3% and a weighted average straight-line yield of 9.7%. Second quarter 2005 investments included the acquisition of nine buildings totaling 1.5 million square feet. CenterPoint also purchased 16.7 acres of land, about 15 acres of which is located adjacent to the Mitchell Mitchell, city (1990 pop. 13,798), seat of Davison co., SE S.Dak.; inc. 1881. Mitchell is a trade, distribution, and shipping center for a dairy and livestock area. airport in Milwaukee, Wisconsin For other places with the same name, see Milwaukee (disambiguation). Milwaukee is the largest city within the state of Wisconsin and 25th largest (by population) in the United States. . Acquisitions - 96% of Planned Revenue Closed, Under Contract or Letter of Intent "The most attractive 'value-added' acquisition opportunities have been in one-off (1) One at a time. CD-ROM recorders (CD-R drives) are commonly called one-off machines because they write one CD-ROM at a time. (2) Only once. Software that is written to solve a specific problem only one time is sometimes called a one-off. transactions," stated Jim Clewlow, Chief Investment Officer, "Our goal is to complete investments that offer the highest risk-adjusted yields. We're we're Contraction of we are. we're we are attracted to buildings our franchise can improve or re-tenant on better terms, or those that complement our portfolio. While these are smaller transactions, we're confident we can favorably fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. redeploy re·de·ploy tr.v. re·de·ployed, re·de·ploy·ing, re·de·ploys 1. To move (military forces) from one combat zone to another. 2. the capital generated by our Australian Australian pertaining to or originating in Australia. Australian bat lyssavirus disease see Australian bat lyssavirus disease. Australian cattle dog a medium-sized, compact working dog used for control of cattle. portfolio sale. We've been able to buy more aggressively since the phased sale fixed a low capital cost. We are achieving a sizeable 'spread' between the total return expectations on our acquisitions versus the yield on the assets we disposed dis·pose v. dis·posed, dis·pos·ing, dis·pos·es v.tr. 1. To place or set in a particular order; arrange. 2. ." Development Pipeline Growing CenterPoint and its affiliates currently have eight developments under construction totaling 2.3 million square feet or $103.5 million. These developments include two new projects highlighted below. The Company's development projects are expected to produce a weighted average initial cash yield of 10.4% and a weighted average straight-line yield of 11.1%. CenterPoint completed and delivered two new build-to-suits for sale at CenterPoint Business Center - Gurnee. The 102,028-square-foot building for Herbert Stanley Stanley, town (1991 pop. 1,557), capital of the Falkland Islands, S Atlantic Ocean, on East Falkland island. It is the main port and trading center of the islands. The name is sometimes written as Port Stanley. and 265,000-square-foot facility for Watson Pharmaceutical were completed and sold in the second quarter. On May 31, CenterPoint signed a contract for a 150,000-square-foot built-to-suit for sale at McCook McCook may refer to:
In May 2005, CenterPoint WisPark Venture broke ground on a 301,650-square-foot speculative development at Lakeview There are a number of cities, towns, and regions known as Lakeview: Canada
Michael Murphy Michael Murphy may refer to:
v. short·ened, short·en·ing, short·ens v.tr. 1. To make short or shorter. 2. , garnering premiums for ready-to-go space. We pursued this strategy at O'Hare O'Hare may refer to:
adj. Relating to transportation by more than one means of conveyance, as by truck and rail: intermodal transport. Center and expect to announce transactions shortly. The same strategy underlies the buildings undertaken in our WisPark venture to exploit demand in the I-94 corridor, including our Gurnee and Lakeview parks Lakeview Park is a multi-use stadium in Loughgall, Northern Ireland. It is currently used mostly for football matches and is the home ground of Loughgall F.C.. The stadium holds 3,000. As the name suggests, Lakaview Park is adjacent to a lake. ." 2005 Dispositions Substantially Complete Year-to-date, CenterPoint and its affiliates have completed $279.8 million of dispositions. CenterPoint completed $243.0 million of the total. Proceeds are redeployed into CenterPoint's pipeline of investments and build-to-suit developments. Second quarter 2005 dispositions were highlighted by the sale of $102.5 million of industrial buildings, part of the $392.7 million phased portfolio sale previously announced on April 7, 2005. This first sale included six buildings totaling 2.6 million square feet located in various submarkets of metropolitan Chicago. The assets were sold to the venture created between the Company and JF US Industrial Trust (ASX ASX See: Australian Stock Exchange :JUICA). JF US Industrial Trust is managed by James Fielding James Field (c.1714 – 11 February 1751) was a sailor and boxer in England in the 18th century who was hanged for robbery. He was born in Dublin, and spent most of his early life involved in petty crime. Funds Management Limited, part of the Mirvac Group. CenterPoint retains a 5% promoted interest in the venture and is managing the portfolio for fees. The remaining 35 buildings totaling 7.5 million square feet will be sold in phases, in approximately equal amounts each quarter, through the first quarter of 2006. Jim Clewlow noted, "The Australian portfolio sale satisfies most of our capital needs from asset sales into 2006 and lends great certainty to our capital position. Given the abundant liquidity in the market and the appetite for industrial real estate, cap rates should remain low. Investment capital continues to follow customers who are increasingly looking for Looking for In the context of general equities, this describing a buy interest in which a dealer is asked to offer stock, often involving a capital commitment. Antithesis of in touch with. space in 'hub' locations. Chicago is the dominant 'hub' in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. ." Substantial Financial Capacity At June 30, CenterPoint had a total of $798.9 million of senior debt outstanding producing a debt to total market capitalization Total Market Capitalization The total market value of all of a firm's outstanding securities. of 26.8%. For the second quarter 2005, debt service coverage was 5.8 to 1 and fixed charge coverage was 4.8 to 1. Currently, CenterPoint's total debt bears a weighted average interest rate of 5.0%. In the second quarter 2005, CenterPoint repurchased 504,100 shares, or $20.6 million of the Company's outstanding common, at an average price of $40.85. On April 1, 2005, CenterPoint repaid the $100 million of unsecured senior notes bearing an interest rate of 6.8%. The Company used its $350 million line of credit to pay off the notes. "Despite our growing pipeline, our enhanced liquidity from the Australian sale and our 2004 preferred offering allowed us to retire common equity and the notes which matured in May, lowering our capital costs," noted Paul Fisher Paul Fisher is the name of:
n. A long narrow pillow or cushion. tr.v. bol·stered, bol·ster·ing, bol·sters 1. To support or prop up with or as if with a long narrow pillow or cushion. 2. by our ventures, each of which is available to fund different types of transactions. Our goal has been to position 'buckets' of capital to allow us to make money from the largest possible spectrum of transactions in our marketplace. Larger investment volumes accelerate share value creation." CenterPoint Venture LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control CenterPoint Venture LLC, a joint venture between CenterPoint Properties and CalEast (a joint venture between CalPERS CalPERS California Public Employees' Retirement System and LaSalle Lasalle (ləsăl`) or Ville Lasalle (vēl), city (1991 pop. 73,804), S Que., Canada, SW of Montreal on the St. Lawrence River at the head of the Lachine Rapids. It is a suburb of Montreal. Investment Management) acquires or develops, packages and sells 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. industrial property investment opportunities outside the Company's more "value-added" investment focus. CenterPoint Venture contributed EPS of $0.01 and FFO per share of $0.01 year-to-date. As of June 30, 2005, assets in CenterPoint Venture totaled $136.6 million. In second quarter 2005, CenterPoint Venture acquired one building totaling 59,648 square feet in Bensenville, IL. It also launched the 301,650-square-foot speculative development at Lakeview Corporate Park and purchased 2.9 acres of land in Pleasant Prairie, Wisconsin Pleasant Prairie is a village in Kenosha County, Wisconsin, United States. The population was 16,136 at the 2000 census. It is a fast-growing village on Lake Michigan between Chicago and Milwaukee. in the CenterPoint WisPark Venture. Dividends CenterPoint's Board of Trustees board of trustees Politics The posse of thugs who oversee an institution's administration. See Board of directors. declared a third quarter 2005 dividend of $0.4275 per common share, to be paid July 28, 2005 to shareholders of record July 14, 2005. On an annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. basis, this equates to $1.71 per share for the year 2005. The Board of Trustees also declared a dividend of $0.9375 per share of its 7.50% Series B Convertible Cumulative Redeemable Redeemable Eligible for redemption under the terms of an indenture. Preferred Shares Preferred shares Preferred shares give investors a fixed dividend from the company's earnings and entitle them to be paid before common shareholders. See: Preferred stock. (NYSE:CNTPRB) to be paid September 30, 2005 to shareholders of record September 16, 2005. For the second quarter 2005, the Company's FFO payout ratio Payout Ratio The percentage of earnings paid out in dividends. It is calculated by dividing dividends per share by earnings per share. Notes: The payout ratio indicates how well earnings support the dividend payments: the lower the ratio, the more secure the dividend. was 76%. Chicago Industrial Market Active Based on combined data from Colliers, Bennett & Kahnweiler ("CB&K") and The Polacheck Company, CenterPoint estimates gross absorption in the 1.4-billion-square-foot market was 31.5 million square feet in the first half of 2005 compared to 23.0 million square feet absorbed in the first half 2004. Market-wide vacancy for the second quarter 2005 was approximately 8.9%. In the second quarter, submarkets showing significant gross absorption included the Southwest Suburbs, O'Hare, Elgin I-90 Corridor and I-290 North. Year-to-date, submarkets showing the greatest gross absorption include the Southwest Suburbs, O'Hare and Chicago South. Construction completions for the first half 2005 totaled 7.4 million square feet. CenterPoint Properties Trust CenterPoint is a publicly traded real estate investment trust (REIT REIT See: Real Estate Investment Trust REIT See real estate investment trust (REIT). ) and the largest industrial property company in the 1.4-billion-square-foot Chicago regional market. As of June 30, 2005, the Company owned and operated approximately 38 million square feet and the Company and its affiliates owned or controlled an additional 3,342 acres of land upon which approximately 50 million square feet could be developed. The Company is focused on providing unsurpassed tenant satisfaction and adding value to its shareholders through customer driven management, investment, development and redevelopment of warehouse, distribution, light manufacturing buildings and logistics infrastructure. The first major REIT to focus on the industrial property sector, CenterPoint had a total market capitalization of approximately $3.0 billion as of June 30, 2005. Statements in this 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. under federal securities laws. There can be no assurance that future results will be achieved and actual results could differ materially from forecasts and estimates. Factors that could cause actual results to differ materially are general business and economic conditions, completion of pending acquisitions, competitive market conditions, weather, pricing of debt and equity capital markets and other risks inherent in the real estate business. Such factors and others are listed in the Company's 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 10-Qs. An Investor conference call will be held Wednesday, July 27, 2005 beginning 1:00 p.m. CDT CDT abbr. Central Daylight Time CDT Central Daylight Time CDT n abbr (US) (= Central Daylight Time) → hora de verano del centro; (BRIT , 2:00 p.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 . This call will be broadcast live on www.centerpoint-prop.com . To listen to the webcast, your computer must have either RealAudio or Media Player installed. If you do not have either player, the CenterPoint website will have instructions for installing one at the Pre-event System Test link. An online replay will also be available approximately one hour after the call. A replay of the call will be available after 5:00 p.m. CDT on Wednesday, July 27, 2005. The replay number is 888-266-2081, passcode 631834. Supplemental financial and operating information will be available on the Company's website at www.centerpoint-prop.com after 7:00 p.m. CDT on July 26, 2005. Financial Statements to Follow...
CENTERPOINT PROPERTIES TRUST AND AFFILIATES
CONSOLIDATED BALANCE SHEETS
(in thousands)
June 30, 2005 December 31, 2004
------------------ ------------------
Assets:
Investment in real estate:
Land $209,620 $233,326
Buildings 709,606 881,328
Building improvements 131,456 167,982
Furniture, fixtures, and
equipment 26,131 26,130
Construction in progress 161,117 152,795
------------------ ------------------
1,237,930 1,461,561
Less accumulated
depreciation (153,632) (183,770)
Real estate held for sale,
net of depreciation 264,494 62,360
------------------ ------------------
Net investment in
real estate 1,348,792 1,340,151
Cash and cash equivalents 421 1,496
Restricted cash 54,179 79,297
Tenant accounts receivable, net 29,112 36,949
Mortgage and notes receivable 12,968 75,089
Investment in and advances to
affiliate 11,709 14,202
Prepaid expenses and other
assets 16,584 16,694
Deferred expenses, net 34,266 34,613
------------------ ------------------
$1,508,031 $1,598,491
================== ==================
Liabilities and shareholders'
equity
Mortgage notes payable and
other debt (1) $77,570 $73,109
Senior unsecured debt 450,000 550,000
Tax-exempt debt 142,150 118,900
Line of credit 129,200 131,500
Preferred dividend payable 224 254
Accounts payable 12,482 18,778
Accrued expenses 83,638 86,762
Rents received in advance
and security deposits 10,833 12,224
------------------ ------------------
906,097 991,527
------------------ ------------------
Shareholders' equity:
Preferred equity 108,937 110,687
Common equity 541,193 534,038
Treasury stock (20,612) -
Retained earnings
(deficit) (11,477) (22,031)
Other comprehensive loss (5,894) (6,532)
Unearned compensation -
restricted shares (10,213) (9,198)
------------------ ------------------
601,934 606,964
------------------ ------------------
$1,508,031 $1,598,491
================== ==================
(1) June 30, 2005 and December 31, 2004 balances includes non-recourse
TIF debt of $21,913 and $21,958, respectively
CENTERPOINT PROPERTIES TRUST AND AFFILIATES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
Three Months Ended Six Months Ended
June 30 June 30
----------------------- -----------------------
2005 2004 2005 2004
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
----------- ----------- ----------- -----------
Revenue:
Minimum rents $24,395 $12,455 $48,114 $31,453
Straight-line rents 459 156 859 552
Expense
reimbursements 7,509 5,843 15,979 11,930
Mortgage interest
income 276 339 700 717
Real estate fee
income 53 2,163 5,184 3,395
Build-to-suit for
sale revenue 27,226 - 27,226 -
----------- ----------- ----------- -----------
Total revenue 59,918 20,956 98,062 48,047
Expenses:
Real estate taxes 8,396 5,691 16,246 11,161
Property operating
and leasing 10,715 8,710 19,665 14,636
General and
administrative 4,538 2,467 7,375 4,389
Depreciation and
amortization 9,506 6,726 18,767 13,265
Build-to-suit for
sale construction
costs 25,719 - 25,719 -
Impairment of assets
held for sale - - 694 -
----------- ----------- ----------- -----------
Total expenses 58,874 23,594 88,466 43,451
----------- ----------- ----------- -----------
Other income/(expense)
Interest income 405 333 644 819
Interest expense (7,986) (7,046) (16,225) (14,831)
Amortization of
deferred financing
costs (935) (809) (1,937) (1,675)
----------- ----------- ----------- -----------
Total other
income/
(expenses) (8,516) (7,522) (17,518) (15,687)
----------- ----------- ----------- -----------
Income from continuing
operations before
income taxes
and equity in net
income of affiliate (7,472) (10,160) (7,922) (11,091)
(Provision for)
benefit from income
tax expense 1,164 297 2,093 427
Equity in net income
of affiliate (1) (77) 162 288 783
Gain from sale of
equity interest - - - 5,851
----------- ----------- ----------- -----------
Income from continuing
operations (6,385) (9,701) (5,541) (4,030)
Discontinued
operations:
Gain on sale, net of
tax (2) 25,936 2,543 50,984 9,117
Income from
operations, net of
tax 5,286 22,266 10,780 30,377
----------- ----------- ----------- -----------
Income before gain on
sale of real estate 24,837 15,108 56,223 35,464
Gain on sale of real
estate, net of
tax (2) 654 177 654 177
----------- ----------- ----------- -----------
Net Income 25,491 15,285 56,877 35,641
Preferred dividends (1,588) (837) (3,192) (1,724)
----------- ----------- ----------- -----------
Net income available
to common
shareholders $23,903 $14,448 $53,685 $33,917
=========== =========== =========== ===========
Basic EPS (3):
Income available to
common shareholders
from continuing
operations $(0.15) $(0.22) $(0.17) $(0.12)
Discontinued
operations 0.64 0.53 1.28 0.85
----------- ----------- ----------- -----------
Net income available
to common
shareholders $0.49 $0.31 $1.11 $0.73
=========== =========== =========== ===========
Diluted EPS (3):
Income available to
common shareholders
from continuing
operations (0.15) $(0.21) $(0.16) $(0.12)
Discontinued
operations 0.63 0.51 1.23 0.82
----------- ----------- ----------- -----------
Net income available
to common
shareholders $0.48 $0.30 $1.07 $0.70
=========== =========== =========== ===========
Distributions per
share (3) $0.428 $0.390 $0.855 $0.780
(1) Results of investments accounted on the equity basis include
CenterPoint Venture, LLC, Chicago Manufacturing Campus II, LLC,
Rochelle Development Joint Venture, CenterPoint James Fielding,
LLC
(2) For the quarter ended June 30, 2005 and 2004, gains are attributed
to $147,606 and $11,370 of dispositions, respectively. For the
year ended June 30, 2005 and 2004, gains are attributed to
$242,959 and $42,644 of dispositions, respectively.
(3) The per share amounts have been adjusted to reflect the
two-for-one stock split in June 2004.
CENTERPOINT PROPERTIES TRUST AND AFFILIATES
FUNDS ANALYSIS
(in thousands, except share data)
Three Months Ended Six Months Ended
June 30 June 30
----------------------- -----------------------
2005 2004 2005 2004
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
----------- ----------- ----------- -----------
RECONCILIATION OF NET INCOME TO FUNDS FROM OPERATIONS
Funds from operations
---------------------
Net income available to
common shareholders $23,903 $14,448 $53,685 $33,917
Add back/(deduct):
Depreciation and
amortization, net
of tax:
Continuing
operations 9,051 6,516 17,791 12,847
Discontinued
operations 2,067 3,157 4,882 7,047
Unconsolidated
affiliates 96 196 191 501
Accumulated
depreciation and
amortization of
intangibles on
sold industrial
assets, net of tax (7,029) (355) (17,233) (2,971)
----------- ----------- ----------- -----------
Funds from operations $28,088 $23,962 $59,316 $51,341
=========== =========== =========== ===========
Funds from operations
per share $0.56 $0.50 $1.18 $1.06
=========== =========== =========== ===========
RECONCILIATION OF NET INCOME TO EBITDA
EBITDA
======
Net income available to
common shareholders $23,903 $14,448 $53,685 $33,917
Add back/(deduct):
Preferred dividends 1,588 837 3,192 1,724
Interest incurred,
net 7,581 6,713 15,581 14,012
Depreciation and
amortization 9,506 6,726 18,767 13,265
Amortization of
deferred financing
costs 935 809 1,937 1,675
Provision for
income taxes
expense (benefit) (1,164) (297) (2,093) (427)
Discontinued
operations:
Interest incurred,
net 146 - 338 -
Depreciation and
amortization 2,067 3,157 4,882 7,047
Provision for
income taxes
expense (benefit)
from operations 116 (11) 210 (46)
Provision for
income taxes
expense (benefit)
from gain on sale 486 346 640 346
----------- ----------- ----------- -----------
EBITDA $45,164 $32,728 $97,139 $71,513
=========== =========== =========== ===========
RECONCILIATION OF EBITDA TO DEBT SERVICE COVERAGE
& FIXED CHARGE COVERAGE RATIOS
EBITDA (A) 45,164 32,728 97,139 71,513
Interest incurred, net 7,581 6,713 15,581 14,012
Interest incurred, net
from discontinued
operations 146 - 338 -
----------- ----------- ----------- -----------
Debt service (B) $7,727 $6,713 $15,919 $14,012
=========== =========== =========== ===========
EBITDA to debt service
coverage ratio (A/B) 5.8 4.9 6.1 5.1
Debt service 7,727 6,713 15,919 14,012
Preferred dividends 1,588 837 3,192 1,724
----------- ----------- ----------- -----------
Fixed charge (C) $9,315 $7,550 $19,111 $15,736
=========== =========== =========== ===========
EBITDA to fixed charge
coverage ratio (A/C) 4.8 4.3 5.1 4.5
Annualized FFO return
on common equity
=====================
FFO return on common
equity 20.8% 19.3% 21.9% 20.6%
Capitalized interest $2,161 $1,540 $4,284 $3,548
----------------------------------------------------------------------
Reconciliation of
average shares
outstanding
=================
Basic Shares - GAAP 48,477,132 46,707,416 48,559,043 46,544,728
Add: Stock
options/grants -
common share
equivalents 1,448,494 1,606,164 1,528,694 1,708,804
----------- ----------- ----------- -----------
Diluted shares -
GAAP/FFO 49,925,626 48,313,580 50,087,737 48,253,532
=========== =========== =========== ===========
CENTERPOINT PROPERTIES TRUST AND AFFILIATES
SECOND QUARTER 2005 EARNINGS RELEASE DEFINITIONS
Cash Yield is initial Net Operating Income, excluding straight line
rents, divided by total project cost, adjusted for tax increment
financing.
Debt Service Coverage is EBITDA divided by interest incurred, net.
Debt to Total Market Cap is total debt from the balance sheet divided
by the sum of total debt from the balance sheet plus the market value
of shares outstanding at the end of the period.
EBITDA stands for earnings before interest, income taxes, depreciation
and amortization. Management believes that EBITDA is helpful to
investors as an indication of property operations, because it excludes
costs of financing and non-cash depreciation and amortization amounts.
EBITDA does not represent cash flows from operations as defined by
GAAP, should not be considered by the reader as an alternative to net
income as an indicator of the Company's operating performance, and is
not indicative of cash available to fund all cash flow needs.
Investors are cautioned that EBITDA, as calculated by the Company, may
not be comparable to similarly titled but differently calculated
measurers for other REITs.
FFO Payout Ratio is dividends paid during the period divided into
Funds from Operations for that same period.
FFO Return on Common Equity is calculated as FFO divided by common
equity.
Fixed Charge Coverage is EBITDA divided by the total of interest
incurred, net and preferred dividends.
Funds From Operations (FFO) The National Associations of Real Estate
Investment Trust ("NAREIT") defines funds from operations ("FFO")
(April, 2002 White Paper) as net income excluding gains (or losses)
from sales of property, plus depreciation and amortization. NAREIT
adds, "management of each of its member companies has the
responsibility and authority to publish financial information that it
regards as useful to the financial community." Accordingly,
CenterPoint calculates FFO, inclusive of fee income and industrial
property sales (net of accumulated depreciation) of the Company and
its unconsolidated affiliates. The Company believes that FFO inclusive
of cash gains better reflects recurring funds because the disposition
of stabilized properties, and the recycling of capital and profits
into new "value added" investments, is fundamental to the Company's
business strategy.
Second Generation Costs include all capitalized costs incident to
leasing, operating or improving the company's portfolio excluding
costs budgeted at acquisition or initial development or costs expended
to materially increase the revenue potential of a property. Second
Generation Costs, deducted in calculating FAD, can include leasing
commissions and related costs, tenant specific improvements, or
improvements to land or buildings.
Straight-Line Yield is average NOI, divided by total project cost,
adjusted for tax increment financing.
Weighted Average Straight-Line Yield is calculated as the average NOI,
for the 12 months following stabilization, adjusted for TIF, divided
by total costs.
Weighted Average Initial Cash Yield is calculated as the total NOI,
excluding straight-line rents, for the 12 months following
stabilization, divided by total costs.
Weighted Average Interest Rate is the annual interest expense for the
current outstanding debt (most current interest rate X current debt
outstanding) divided into the current debt outstanding.
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