Chateau Communities Reports 2002 Year-End Results.Business Editors/Real Estate Writers GREENWOOD Greenwood. 1 City (1990 pop. 26,265), Johnson co., central Ind.; settled 1822, inc. as a city 1960. A residential suburb of Indianapolis, Greenwood is in a retail shopping area. Manufactures include motor vehicle parts and metal products. VILLAGE, Colo.--(BUSINESS WIRE)--Feb. 27, 2003 Board of Directors Announces Leadership Changes First Quarter Dividend Declared de·clare v. de·clared, de·clar·ing, de·clares v.tr. 1. To make known formally or officially. See Synonyms at announce. 2. To state emphatically or authoritatively; affirm. 3. Chateau Communities, Inc. (NYSE NYSE See: New York Stock Exchange :CPJ CPJ Committee to Protect Journalists CPJ Citizens for Public Justice (Canada) CPJ Center for Public Justice CPJ Critical Path Job CPJ Common Place Journal CPJ Controlled Pipe Joints CPJ Cooperative Programming in Java CPJ Cd Project ), the largest owner and operator of manufactured home communities in the U.S., today released results for the fourth quarter and twelve months ended December December: see month. 31, 2002. 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 quarter, which was adversely affected by a number of one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. events and charges, was $14.9 million, compared to $21.2 million in 2001. 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. basis, FFO per share was $.43, compared to $.61 last year. Net income available to common shareholders was $2.6 million, or $.08 per share, for the quarter. This compares with a net loss of $900,000, or $.03 per share, in 2001. FFO for the year 2002 was $80.2 million, compared to $88.3 million in 2001. On a diluted basis, FFO per share was $2.28, compared to $2.63 in 2001. Net income available to common shareholders was $15.6 million, or $.53 per share, for the year. This compares with net income of $26.3 million, or $.90 per share, in 2001. FFO is a widely used measure of the operating performance of real estate companies and is provided here as a supplemental measure to 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 (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ) net income and earnings per share. A reconciliation of net income to FFO is provided in the financial statement section of the press release. Several factors contributed to FFO results for the quarter and full year, as follows:
-- Year over year, same store net operating income remained flat in the fourth quarter, and increased 3.0% for the full year.
-- In furtherance of the previously announced plan to strengthen the balance sheet and focus on building value at properties that fit the Company's long-term strategic plan, the Company completed the sale of 22 communities over the prior five quarters, resulting in approximately $85 million of net proceeds. These dispositions resulted in dilution of FFO of approximately $2.2 million, or $.06 per share, for the year and $800,000, or $.02 per share, for the quarter.
-- During the fourth quarter, the Company recognized approximately $1.3 million in executive level severance charges.
-- As part of the previously announced plan to streamline operations, certain property, divisional and corporate departments were restructured, resulting in reduction of staff and approximately $1.1 million in severance and related costs incurred in the fourth quarter.
-- The Company recorded a reserve of approximately $1.5 million against inventory of approximately $26 million held by the Company's sales subsidiary, Community Sales Inc. ("CSI"). This non-cash charge arose from the oversupply of used homes and the difficult financing environment for manufactured homes.
-- As previously announced, the Company closed its only retail home sales dealership in the third quarter which resulted in approximately $800,000 of operating losses and one-time closing costs.
-- Two manufactured home retail lenders filed for bankruptcy protection in the fourth quarter. These lenders ceased making monthly rental payments on approximately 800 homes across the portfolio during the quarter. As a result of this occurrence, and continuing economic weakness in certain areas, total revenue producing sites decreased by 1,100 sites in the fourth quarter and 1,600 sites for the year.
Board and Management Changes Pursuant to the previously announced plan to review the Company's leadership in late 2002, the following changes and appointments are effective immediately: -- Rees REES Center for Russian and East European Studies REES Radar Electromagnetic Environment Simulator REES Reactive Electronic Equipment Simulator F. Davis, Jr. has been appointed ap·point tr.v. ap·point·ed, ap·point·ing, ap·points 1. To select or designate to fill an office or a position: appointed her the chief operating officer of the company. 2. Chief Executive Officer and elected to the Board of Directors -- John A. Boll has stepped down as Chairman of the Board -- Steven Ste´ven n. 1. Voice; speech; language. Ye have as merry a steven As any angel hath that is in heaven. - Chaucer. 2. An outcry; a loud call; a clamor. To set steven to make an appointment. J. Sherwood has been appointed as Chairman of the Board -- D. Keith Keith may refer to: People with the given name Keith:
Committee James James, person in the Bible James, in the Gospel of St. Luke, kinsman of St. Jude. The original does not specify the relationship. James, rivers, United States James. M. Hankins will remain as Vice-Chairman vice-chairman n → vicepresidente m vice-chairman vice irreg n → vice-président(e) vice-chairman vice- n of the Board. Additionally, the Company has initiated an executive search for a President/Chief Operating Officer. Mr. Boll stated, "The Company and our industry are facing a number of serious challenges. We believe these leadership changes represent significant positive strides toward positioning the right team to move the Company forward in this difficult environment." Mr. Davis has over eighteen years experience in the manufactured housing Manufactured housing (also known as prefab housing) is a type of housing unit that is largely assembled in factories and then transported to sites of use. In the United States, the term "manufactured home" specifically refers to a house built entirely in a protected industry. He has served in several different capacities with the Company including most recently, as President and Chief Operating Officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. since December 2001. Previously, Mr. Davis served as Executive Vice President of Acquisitions, from August 1993 through November November: see month. , 2001. Mr. Sherwood became a director in 2001. He is the Chairman of CWS CWS Chicago White Sox CWS College World Series CWS Church World Service CWS Child Welfare Services CWS Canadian Wildlife Service CWS Community Water System (EPA) CWS Canada-Wide Standard CWS Compressed Work Schedule Capital Partners LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control , an investment management company headquartered in Newport Beach, California Newport Harbor redirects here. For the MTV reality series, see . Newport Beach, incorporated in 1906, is a city in Orange County, California, 10 miles south of downtown Santa Ana. . In March 1998 Mr. Sherwood engineered the merger of CWS' manufactured housing business with an affiliate of Security Capital Group to form a private real estate investment trust called CWS Communities Trust. In August 2001, CWS Communities merged with Chateau Communities. Mr. Cobb held several senior leadership positions over a 32-year career at KPMG KPMG Klynveld Peat Marwick Goerdeler (accounting firm) KPMG Kaiser Permanente Medical Group KPMG Keiner Prüft Mehr Genau (German) KPMG Kommen Prüfen Meckern Gehen , most recently as National Managing Partner - Financial Services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. . In addition, Mr. Cobb served as Vice-Chairman and Chief Executive Officer of Alamo Rent A Car Alamo Rent A Car is a car rental agency. It is based in Tulsa, Oklahoma, but has branches across the United States, Canada, Mexico, Central America, South America, parts of Africa, Europe, and Australia as well as some locations on various Caribbean islands. , Inc. Mr. Cobb recently completed six years as a Board Member of the Miami branch of the Federal Reserve Bank of Atlanta The Federal Reserve Bank of Atlanta is responsible for the 6th District of the Federal Reserve, which covers Alabama, Florida, Georgia, and parts of Louisiana, Mississippi, and Tennessee. . First Quarter Dividend Declaration The Board of Directors declared a first quarter dividend of $.55 per share on Tuesday Tuesday: see week. , February February: see month. 25, 2003. Mr. Sherwood stated, "Management and the Board understand that dividend payments are very important to shareholders as a key component of long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. returns from owning shares of Chateau. Our goal is to maintain the dividend at the current level, however, we will not maintain the dividend if we determine that our cash flow will be insufficient to cover it over an extended period of time. Conversely con·verse 1 intr.v. con·versed, con·vers·ing, con·vers·es 1. To engage in a spoken exchange of thoughts, ideas, or feelings; talk. See Synonyms at speak. 2. , we do not believe that dividend policy should be reactive reactive /re·ac·tive/ (re-ak´tiv) characterized by reaction; readily responsive to a stimulus. re·ac·tive adj. 1. Tending to be responsive or to react to a stimulus. 2. to periods of short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. disruption disruption /dis·rup·tion/ (dis-rup´shun) a morphologic defect resulting from the extrinsic breakdown of, or interference with, a developmental process. to the market. The Board will continue to actively and responsibly review the Company's dividend policy each quarter." The record date for the dividend will be March 31, 2003, and the distribution date will be April 15, 2003. 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. Teleconference Management will hold a teleconference call Thursday Thursday: see week. , February 27, 2003 at 1:00 p.m. Eastern Standard Time to discuss fourth quarter and year-end 2002 results. To participate, call toll-free 877/434-1281 and request the Chateau Communities teleconference. Callers outside the U.S. may access the call at 706/634-0185. A webcast will be available in listen-only mode at www.chateaucomm.com. An audio replay of the call will be available through Monday Monday: see week. , March 3, 2003. To access the replay, dial toll-free 800/642-1687, reservation #5666964. Callers outside the U.S. may access the replay at 706/645-9291. The webcast will be archived for thirty days, through Tuesday, March 26, 2003, also at www.chateaucomm.com. Supplemental Materials The Company's supplemental information will be available on Monday, March 3, 2003 on Chateau's website at www.chateaucomm.com. Headquartered in Greenwood Village, Colorado Greenwood Village is a city in Arapahoe County, Colorado, United States. As of 2005, the city is estimated to have a total population of 12,817.[3] Geography Greenwood Village is located at (39.615888, -104. , Chateau Communities is a fully integrated, self-administered real estate investment trust (REIT REIT See: Real Estate Investment Trust REIT See real estate investment trust (REIT). ), and the largest owner and operator of manufactured home communities in the U.S. Its portfolio consists of 204 communities, with an aggregate of approximately 68,000 residential homesites and 1,400 park model/RV sites, and 35 managed communities with approximately 7,800 sites. In addition, the Company owns 11 greenfield Greenfield, town (1990 pop. 18,666), seat of Franklin co., NW Mass., at the confluence of the Deerfield and Green rivers, near their junction with the Connecticut; settled 1686, set off from Deerfield and inc. 1753. development communities with approximately 4,600 sites when fully developed. Chateau Communities operates in 36 states. Please visit Chateau Communities at www.chateaucomm.com TABLES TO FOLLOW Any 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. contained in this news release are subject to certain risks and uncertainties including the ability to maintain rental rates and 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 , the ability of manufactured home buyers to obtain financing, the level of repossessions by manufactured home lenders, the pace of acquisitions and dispositions, changes in interest rates and the condition of the capital markets, all of which may affect the Company's ability to achieve its objectives.
CHATEAU COMMUNITIES, INC.
FINANCIAL RESULTS
FOR THE THREE AND TWELVE MONTHS
ENDED DECEMBER 31, 2002 AND 2001
(Amounts in thousands)
Three Months Twelve Months
Ended Ended
---------------- ------------------
2002 2001 2002 2001
------- ------- -------- --------
Rental income $64,412 $63,835 $258,023 $218,310
Interest income 2,969 2,616 11,387 10,085
Management fee and other income (464) 1,570 317 5,005
------- ------- -------- --------
Total revenue 66,917 68,021 269,727 233,400
Property operating and
maintenance 23,436 22,271 83,606 68,282
Real estate taxes 4,170 4,423 17,052 15,155
Administrative 3,251 2,650 13,642 9,881
Severance/closing costs 2,409 - 2,409 -
------- ------- -------- --------
Operating and administrative
expenses 33,266 29,344 116,709 93,318
------- ------- -------- --------
Income before interest and
depreciation 33,651 38,677 153,018 140,082
Interest and related
amortization 16,822 16,006 67,201 47,730
Depreciation and amortization 17,699 21,244 70,170 56,831
------- ------- -------- --------
Income (loss) before gain (loss)
on disposition of properties and
minority interests (870) 1,427 15,647 35,521
Gain (loss) on disposition of
properties 649 (1,503) 1,435 (1,503)
Minority interests of preferred
OP unitholders (1,524) (1,524) (6,094) (6,094)
Minority interests of common OP
unitholders 294 212 (1,829) (3,477)
------- ------- -------- --------
Income (loss) from continuing
operations (1,451) (1,388) 9,159 24,447
------- ------- -------- --------
Discontinued operations
Income from discontinued
operations, net of
minority interests 176 451 1,371 1,809
Impairment/gain on disposition
of properties, net
of minority interests 3,920 - 5,916 -
------- ------- -------- --------
Income from discontinued
operations 4,096 451 7,287 1,809
------- ------- -------- --------
Income before cumulative effect
of accounting change 2,645 (937) 16,446 26,256
Cumulative effect of accounting
change, net of minority
interests - - (845) -
------- ------- -------- --------
Net income available to common
shareholders $ 2,645 $ (937) $ 15,601 $ 26,256
======= ======= ======== ========
CHATEAU COMMUNITIES, INC.
FINANCIAL RESULTS
FOR THE THREE AND TWELVE MONTHS
ENDED DECEMBER 31, 2002 AND 2001
(Amounts in thousands, except per share/OP unit amounts)
Three Months Twelve Months
Ended Ended
---------------- ----------------
2002 2001 2002 2001
------- ------- ------- -------
Earning per common share/OP unit -
basic
-----------------------------------
Income (loss) from continuing
operations $ (0.05) $ (0.05) $ 0.31 $ 0.84
Income from discontinued operations 0.13 0.02 0.25 0.06
------- ------- ------- -------
Income (loss) before cumulative
effect of accounting change 0.08 (0.03) 0.56 0.90
Cumulative effect of accounting
change - - (0.03) -
------- ------- ------- -------
Net income (loss) available to
common shareholders $ 0.08 $ (0.03) $ 0.53 $ 0.90
======= ======= ======= =======
Weighted average common shares -
basic 29,305 28,853 29,247 28,723
======= ======= ======= =======
Earning per common share/OP unit -
diluted
-----------------------------------
Income (loss) from continuing
operations $ (0.05) (0.05) 0.31 0.84
Income from discontinued operations 0.13 0.02 0.25 0.06
------- ------- ------- -------
Income (loss) before cumulative
effect of accounting change 0.08 (0.03) 0.56 0.90
Cumulative effect of accounting
change - - (0.03) -
------- ------- ------- -------
Net income (loss) available to
common shareholders $ 0.08 $ (0.03) $ 0.53 $ 0.90
======= ======= ======= =======
Weighted average common shares -
diluted 29,317 29,050 29,370 28,923
======= ======= ======= =======
Dividends/distributions declared $ 0.550 $ 0.545 $ 2.20 $ 2.18
======= ======= ======= =======
FFO Reconciliation
------------------
Income (loss) available to common
shareholders $ 2,645 $ (937) $15,601 $26,256
Adjustments:
Depreciation and amortization on
rental properties 17,127 20,452 68,203 55,716
Net (gain) loss on disposition of
rental properties (649) 1,503 (1,435) 1,503
Minority interest of common OP unit
holders 521 (193) 3,113 3,768
Cumulative effect of accounting
change - - 1,014 -
Discontinued operations:
Depreciation on rental property (3) 410 787 1,088
Impairment/gain on disposition of
properties (4,701) - (7,096) -
------- ------- ------- -------
FFO $14,940 $21,235 $80,187 $88,331
======= ======= ======= =======
Weighted average common shares/OP
Units outstanding - assuming
dilution 35,120 34,981 35,206 33,546
======= ======= ======= =======
FFO per weighted average common
share/OP Unit - assuming dilution $ 0.43 $ 0.61 $ 2.28 $ 2.63
======= ======= ======= =======
CHATEAU COMMUNITIES, INC.
FINANCIAL INFORMATION
(Dollars in thousands)
Same Store Results Three Months Ended December 31, Growth
------------------ ------------------------------
2002 2001 2002 over 2001
---- ---- --------------
Property revenues $ 63,930 $ 62,653 2.0 %
Property expenses 26,083 24,845 5.0 %
------- ------- -----
Net operating income $ 37,847 $ 37,808 0.1 %
------- ------- =====
Manufactured home communities 196 196
------- -------
Park model/RV communities 3 3
------- -------
Available homesites 67,353 67,064
======= =======
Twelve Months Ended Growth December 31, Growth
---------------------------------------
2002 2001 2002 over 2001
---- ---- --------------
Property revenues $192,758 $187,906 2.6 %
Property expenses 70,268 68,928 1.9 %
------- ------- -----
Net operating income $122,490 $118,978 3.0 %
------- ------- =====
Manufactured home communities 152 152
------- -------
Park model/RV communities 3 3
------- -------
Available homesites 50,765 50,365
======= =======
Summarized Financial Information
--------------------------------
As of December 31,
------------------
Balance sheet information: 2002 2001
---- ----
Rental property, net $1,335,632 $1,401,465
Rental property, before accumulated
depreciation $1,682,215 $1,686,674
Total assets $1,514,988 $1,591,873
Total debt $1,013,809 $1,053,436
Minority interests $ 134,477 $ 144,919
Shareholders' equity $ 301,239 $ 344,954
Common shares outstanding 29,263,416 29,188,440
OP Units outstanding 5,696,686 5,833,263
Property information:
Manufactured home communities 201 214
Park model/RV communities 3 3
Available homesites 68,016 70,723
Occupied homesites 58,388 62,478
Occupancy rate:
Total portfolio 85.8 % 88.3 %
Active Expansion 77.7 % 79.6 %
Stabilized 90.0 % 92.9 %
Greenfield 36.8 % 30.8 %
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