Forest City Enterprises Posts Record Second Quarter, First Half EBDT.CLEVELAND--(BUSINESS WIRE)--Sept. 8, 1997--Forest City Enterprises, Inc. (NYSE NYSE See: New York Stock Exchange :FCEA FCEA Federal Contested Elections Act and NYSE:FCEB FCEB Fingal County Enterprise Board (Ireland) ) today reported record Earnings Before Depreciation, Amortization and Deferred Taxes (EBDT) for both the second quarter and six months ended July 31, 1997. For the second quarter, EBDT increased 13 percent to $24.7 million, or $1.69 per share, compared to $21.8 million, or $1.66 per share, in the year ago period. EBDT in the first six months grew 41 percent, to $53.2 million, or $3.83 per share, from $37.8 million, or $2.86 per share, in the first half of 1996. Per share EBDT in both the second quarter and six months reflects the sale of 1,955,000 new Class A Common Shares on May 20, 1997, which resulted in proceeds to the company of $76 million. Weighted average shares outstanding were 14,663,226 in the 1997 second quarter, compared to 13,112,421 in the year ago period. For the six months, weighted average shares outstanding were 13,900,457, compared to 13,198,522 in the 1996 period. During the second quarter, 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 , net of tax, more than doubled to $4.8 million, or $0.33 per share, from $2.3 million, or $0.17 per share, in the 1996 second quarter. For the first half, operating earnings, net of tax, increased to $15.0 million, or $1.08 per share, from $1.3 million, or $0.10 per share a year ago. Second quarter results also included an extraordinary gain, net of tax, of $3.1 million, or $0.21 per share, from the adjustment of an income tax estimate related to the sale of Toscana, a 563-unit apartment complex in Irvine, California Irvine is an incorporated city in Orange County, California, United States. It is a planned city, mainly developed by the Irvine Company since the 1960s. Formally incorporated on December 28 1971, the 69.7 square mile (180.5 km²) city has a population of 202,079 (as of 2007). . During the second quarter, Forest City also incurred a loss of $1.9 million, net of tax, or $0.13 per share, related to the sale of the company's land investment in Woodridge, located in suburban Chicago. Six months results include the impact of the Toscana sale and litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. settlement, which caused a loss on disposition of property of $21.5 million after tax, and an extraordinary gain of $14.2 million after tax. Approximately $7 million of the $15 million increase in first half EBDT was a result of the Toscana transactions. Consolidated total revenues grew to $293.1 million in the 1997 first half from $277.5 million during the first six months of 1996. Consolidated total revenues in the second quarter declined slightly to $142.0 million from $148.5 million in the 1996 second quarter due to the timing of land sales. Pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma per share results, computed as if all new shares were outstanding at the beginning of each period, include EBDT of $1.64 in the 1997 second quarter, compared to $1.45 in the 1996 second quarter. For the first six months, pro forma per share EBDT was $3.53, compared to $2.49 a year ago. Pro forma per share operating earnings, net of tax, were $0.32 in the 1997 second quarter, compared to $0.15 in the year ago period, and $1.00 in the six months, compared to $0.09 a year ago. Reported and pro forma per share amounts in both years reflect a 3 for 2 stock split of both Class A and Class B shares, which was effective February 17, 1997. "We do not expect EBDT for the second half of 1997 to grow at the rate experienced in the first half," said Charles A. Ratner, president and chief executive officer of the commercial and residential real estate development company. "However, we are enjoying another outstanding year, in terms of financial performance, the pace of development activity and the conception of new projects that will maintain our momentum in the future and allow us to achieve our 18th consecutive year of record EBDT," he said. Regular Quarterly Dividend Declared The company's Board of Directors declared a regular quarterly dividend of $0.06 per share on both Class A and Class B shares, payable December 15, 1997, to shareholders of record December 1, 1997. $231 Million in Financing Completed in First Half During the first half, Forest City completed $231 million in financing, including $133 million in refinancing Refinancing An extension and/or increase in amount of existing debt. , $57 million in financing for new development projects and $41 million in mortgages for acquired properties. Additionally, during the first half, the company purchased interest rate cap protection for its variable rate debt portfolios of $73.5 million, $253.6 million and $320.6 million for the fiscal years ending January 31, 1998, 1999 and 2000, respectively. Stock Sale Boosts Development Pace "The additional capital and financial flexibility generated from the proceeds of our secondary stock offering in May have helped us continue our aggressive development pace," said Mr. Ratner. Projects Under Construction Accelerate During the second quarter, construction began on 42nd Street, the $90 million, 400,000-square-foot entertainment, restaurant and retail complex in Manhattan. "In recognition of the pivotal role this project will play in New York's Times Square redevelopment effort, several leading public officials attended groundbreaking ceremonies in August 1997, including New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of State Governor George Pataki George Elmer Pataki (born June 24, 1945) is an American politician who was the 57th Governor of New York serving from January 1995 until January 1, 2007. He is a member of the Republican Party and was seen as a possible 2000 and 2008 Presidential candidate. and New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. Mayor Rudolph W. Giuliani," Mr. Ratner said. He said that the 42nd Street complex builds on Forest City's entertainment retailing expertise, as reflected in the Showcase entertainment center on the Strip in Las Vegas Las Vegas (läs vā`gəs), city (1990 pop. 258,295), seat of Clark co., S Nev.; inc. 1911. It is the largest city in Nevada and the center of one of the fastest-growing urban areas in the United States. . With the recent opening of the Coca-Cola Museum and Ethel M Chocolates, Showcase is now fully leased, Mr. Ratner noted. Another project beginning construction in the second quarter is The Grand, a 552-unit luxury high-rise apartment building in North Bethesda, Maryland Bethesda is an urbanized, but unincorporated, area in southern Montgomery County, Maryland, just Northwest of Washington, D.C. It takes its name from a church located there, the Bethesda Presbyterian Church, built in 1820 and rebuilt in 1850, which in turn took its name from . Mr. Ratner said that when this project is completed, Forest City will have ownership interests in five projects with 2,164 rental apartment units in the metropolitan Washington, D.C. area. Construction also started on the third phase of Big Creek Big Creek can refer to:
Its current mayor is Martin K. Zanotti, who was appointed mayor in 2000, upon the retirement of long-time mayor Paul W. Cassidy. , which will have more than 500 units when completed. Construction continued on an office building and three urban retailing centers in the New York boroughs, an apartment complex in San Jose, California San Jose (IPA: /ˌsænhoʊˈzeɪ/) is the third-largest city in California, and the tenth-largest in the United States. It is the county seat of Santa Clara County. , and a regional mall expansion in Redondo Beach Redondo Beach (rĭdŏn`dō), city (1990 pop. 60,167), Los Angeles co., S Calif., on the Pacific Ocean; inc. 1892. Once a commercial port for Los Angeles, it is a residential and resort city with a protected harbor and an excellent marina. , California, all of which are scheduled to open later this year. The office, Nine MetroTech, is a 315,000-square-foot structure in Brooklyn that will house the New York City Fire Department The New York City Fire Department or the Fire Department of New York (FDNY) has the responsibility for protecting the citizens and property of New York City's five boroughs from fires and fire hazards, providing emergency medical services, technical rescue as well as headquarters. Urban retail centers in New York include Gun Hill Road, a 147,000-square-foot facility in the Bronx; Northern Boulevard, a 218,000-square-foot center in Queens and Grand Avenue, a 100,000-square-foot center, also in Queens. The initial phase of The Enclave enclave /en·clave/ (en´klav) tissue detached from its normal connection and enclosed within another organ. en·clave n. A detached mass of tissue enclosed in tissue of another kind. , a 633-unit apartment complex in San Jose San Jose, city, United States San Jose (sănəzā`, săn hōzā`), city (1990 pop. 782,248), seat of Santa Clara co., W central Calif.; founded 1777, inc. 1850. , is on schedule for opening in the 1997 fourth quarter. A theater and restaurant complex at South Bay Galleria South Bay Galleria, formerly named Galleria at South Bay, is a mall in Redondo Beach outside of Los Angeles, California. It is anchored by Macy's, Mervyns and Nordstrom, as well as a 16-screen AMC Theatres multiplex. in Redondo Beach, California, is also scheduled to open in the fourth quarter. Construction also continued on a mixed use facility in Cambridge, Massachusetts This article is about the city of Cambridge in Massachusetts. For the English university town, see Cambridge, England. For other places, see Cambridge (disambiguation). Cambridge, Massachusetts is a city in the Greater Boston area of Massachusetts, United States. and on an urban retail center in New York City scheduled for opening early in 1998. In Cambridge, University Cambridge, University of Autonomous institution of higher learning in Cambridge, Cambridgeshire, England. Its beginnings lie in an exodus of scholars from the University of Oxford in 1209. Park at MIT MIT - Massachusetts Institute of Technology is a 172,000-square-foot office, retail, hotel and parking complex. The New York center is Richmond Avenue Richmond Avenue is an integral north-south thoroughfare on Staten Island. Measuring approximately 7.0 miles (11.27 kilometres), the road runs from the community of Graniteville to the south shore community of Eltingville. , a 76,000 square foot facility in Staten Island Staten Island (1990 pop. 378,977), 59 sq mi (160 sq km), SE N.Y., in New York Bay, SW of Manhattan, forming Richmond co. of New York state and the borough of Staten Island of New York City. . Acquisitions Enhance Portfolio "Forest City continued its successful property acquisition program in the second quarter," Mr. Ratner said. Second quarter acquisitions included Museum Towers, a 286-unit luxury high-rise apartment building in Philadelphia located near to the company's existing One Franklintown high-rise. The purchase, financed through 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. , brings the company's total downtown Philadelphia apartment units to 621. Also acquired in the second quarter was Colony Woods, formerly Pacific Village, a 396-unit low-rise apartment complex in Bellevue, Washington Bellevue is a rapidly growing city in King County, Washington, U.S., across Lake Washington from Seattle. Long known as a suburb or satellite city of Seattle,[1] it is now categorized as an edge city or a boomburb. . "This project, which represents our first entry into the metropolitan Seattle market, is currently undergoing a $9 million remodeling remodeling /re·mod·el·ing/ (re-mod´el-ing) reorganization or renovation of an old structure. bone remodeling , and is being repositioned and remarketed," Mr. Ratner said. Construction to Start on New Apartment Building, Mall Expansions Following the completion of an agreement with the Redevelopment Agency of the City of San Jose, California, construction will start before year-end on a 316-unit apartment complex and mixed use facility on 3rd Street in downtown San Jose Downtown San Jose is the central business district of San Jose, California, United States. The area is generally located north of Interstate 280 and east of Guadalupe Parkway, which roughly parallels Guadalupe River. . "This $55 million project represents a continuation of Forest City's successful public/private partnership track record, is tax-exempt financed and expands our presence in the San Jose market," Mr. Ratner said. Mall expansions to begin construction during 1997 include a Regal Theater complex at the company's Ballston Common Mall in Arlington, Virginia, and a 130,000-square-foot expansion at Boulevard Mall Boulevard Mall, which opened in 1962, is a shopping mall located at the western edge of the Town of Amherst in Erie County, New York, USA. The name derives from its location on Niagara Falls Boulevard (U.S. Route 62), which divides Amherst from the Town of Tonawanda. in Amherst, New York Amherst is a town in Erie County, New York, U.S., directly northeast of the City of Buffalo. As of the 2000 census, the town had a total population of 116,510. This represents an increase from the 1990 census figure of 111,711. , following a grand re-opening of that renovated facility earlier this year. Cleveland Headquarters Relocating During September, Forest City will complete the relocation RELOCATION, Scotch law, contracts. To let again to renew a lease, is called a relocation. 2. When a tenant holds over after the expiration of his lease, with the consent of his landlord, this will amount to a relocation. of its corporate headquarters to the Terminal Tower office building in the company's Tower City Center mixed use complex in downtown Cleveland Downtown Cleveland is the central business district of the City of Cleveland and Northeast Ohio. Reinvestment in the area in the mid-1990s spurred a rebirth that continues to this day, with over $2 billion in capital projects slated to involve the downtown area over the next few . The move will bring occupancy at the 583,000-square-foot Terminal Tower to more than 93 percent. "The building of Tower City Center was a major turning point in downtown Cleveland's renaissance. As the developer of this complex, we are pleased to have our corporate headquarters relocated re·lo·cate v. re·lo·cat·ed, re·lo·cat·ing, re·lo·cates v.tr. To move to or establish in a new place: relocated the business. v.intr. to this symbol of Cleveland's rebirth re·birth n. 1. A second or new birth; reincarnation. 2. A renaissance; a revival: a rebirth of classicism in architecture. . From a practical standpoint The Standpoint is a newspaper published in the British Virgin Islands. It was originally published under the name Pennysaver, largely as a shopping-coupon promotional newspaper, but since emerged as one of the most influential sources of journalism in the , the relocation will put all of our Cleveland operations under the same roof for the first time in many years, and will result in more efficient operations," Mr. Ratner said. Forest City is a national diversified diversified (di·verˑ·s real estate development and management company with more than $2.5 billion in real estate assets. Its portfolio includes 14.8 million square feet of retail space at 33 shopping centers shopping center, a concentration of retail, service, and entertainment enterprises designed to serve the surrounding region. The modern shopping center differs from its antecedents—bazaars and marketplaces—in that the shops are usually amalgamated into , 6.9 million square feet of office space in 22 buildings, five hotels with 1,530 rooms and 33,620 apartment units in 116 buildings. Forest City also conducts raw land development programs and is the nation's second largest lumber lumber, term for timber that has been cut into boards for use as a building material. The major steps in producing lumber involve logging (the felling and preparation of timber for shipment to sawmills), sawing the logs into boards, grading the boards according to wholesaler. The company has interests in 21 states and the District of Columbia District of Columbia, federal district (2000 pop. 572,059, a 5.7% decrease in population since the 1990 census), 69 sq mi (179 sq km), on the east bank of the Potomac River, coextensive with the city of Washington, D.C. (the capital of the United States). . -0-
Forest City Enterprises, Inc. and Subsidiaries
Financial Highlights
For the Periods Ended July 31, 1997 and 1996
(dollars in thousands, except per share data)
Three Months Ended
July 31, Increase (Decrease)
____________________ __________________
1997 1996 Amount Percent
____________________ __________________
Revenues:
Forest City Enterprises,
Inc. $ 35,638 $ 41,516 $ (5,878) (14.2)
Forest City Rental
Properties Corporation 106,397 106,976 (579) (0.5)
____________________ ________
Total Revenues $142,035 $148,492 $ (6,457) (4.3)
____________________ ________
____________________ ________
Earnings before depreciation,
amortization and deferred
taxes (a) $ 24,725 $ 21,821 $ 2,904 13.3
____________________ ________
____________________ ________
Operating earnings,
net of tax $ 4,841 $ 2,257 $ 2,584
Gain (loss) on disposition
of properties, net of tax (1,894) 565 (2,459)
____________________ ________
Net earnings (loss) before
extraordinary gain 2,947 2,822 125
Extraordinary gain, net of
tax 3,142 907 2,235
____________________ ________
Net earnings $ 6,089 $ 3,729 $ 2,360
____________________ ________
____________________ ________
Per common share
Earnings before depreciation,
amortization and deferred
taxes (a) $ 1.69 $ 1.66 $ 0.03 1.8
____________________ ________
____________________ ________
Operating earnings,
net of tax $ 0.33 $ 0.17 $ 0.16
Gain (loss) on disposition
of properties, net of tax (0.13) 0.04 (0.17)
____________________ ________
Net earnings (loss) before
extraordinary gain 0.20 0.21 (0.01)
Extraordinary gain, net of
tax 0.22 0.07 0.15
____________________ ________
Net earnings $ 0.42 $ 0.28 $ 0.14
____________________ ________
____________________ ________
Weighted average shares
outstanding (b) 14,663,226 13,112,421 1,550,805
____________________________________________________________________
Pro forma per common share (c)
Earnings before depreciation,
amortization and deferred
taxes (a) $ 1.64 $ 1.45 $ 0.19
____________________ ________
____________________ ________
Operating earnings,
net of tax $ 0.32 $ 0.15 $ 0.17
Gain (loss) on disposition
of properties, net of tax (0.13) 0.04 (0.17)
____________________ ________
Net earnings (loss) before
extraordinary gain 0.19 0.19 -
Extraordinary gain, net
of tax 0.21 0.06 0.15
____________________ ________
Net earnings $ 0.40 $ 0.25 $ 0.15
____________________ ________
____________________ ________
Weighted average shares
outstanding (c) 15,066,976 15,067,421 (445)
Six Months Ended
July 31, Increase (Decrease)
____________________ __________________
1997 1996 Amount Percent
____________________ __________________
Revenues:
Forest City Enterprises,
Inc. $ 67,969 $ 72,658 $ (4,689) (6.5)
Forest City Rental
Properties Corporation 225,134 204,805 20,329 9.9
____________________ ________
Total Revenues $293,103 $277,463 $ 15,640 5.6
____________________ ________
____________________ ________
Earnings before depreciation,
amortization and deferred
taxes (a) $ 53,172 $ 37,778 $ 15,394 40.7
____________________ ________
____________________ ________
Operating earnings,
net of tax $ 15,039 $ 1,311 $ 13,728
Gain (loss) on disposition
of properties, net of tax (23,356) 565 (23,921)
____________________ ________
Net earnings (loss) before
extraordinary gain (8,317) 1,876 (10,193)
Extraordinary gain, net of
tax 14,187 907 13,280
____________________ ________
Net earnings $ 5,870 $ 2,783 $ 3,087
____________________ ________
____________________ ________
Per common share
Earnings before depreciation,
amortization and deferred
taxes (a) $ 3.83 $ 2.86 $ 0.97 33.9
____________________ ________
____________________ ________
Operating earnings,
net of tax $ 1.08 $ 0.10 $ 0.98
Gain (loss) on disposition
of properties, net of tax (1.68) 0.04 (1.72)
____________________ ________
Net earnings (loss) before
extraordinary gain (0.60) 0.14 (0.74)
Extraordinary gain, net of
tax 1.02 0.07 0.95
____________________ ________
Net earnings $ 0.42 $ 0.21 $ 0.21
____________________ ________
____________________ ________
Weighted average shares
outstanding (b) 13,900,457 13,198,522 701,935
____________________________________________________________________
Pro forma per common share (c)
Earnings before depreciation,
amortization and deferred
taxes (a) $ 3.53 $ 2.49 $ 1.04
____________________ ________
____________________ ________
Operating earnings,
net of tax $ 1.00 $ 0.09 $ 0.91
Gain (loss) on disposition
of properties, net of tax (1.55) 0.04 (1.59)
____________________ ________
Net earnings (loss) before
extraordinary gain (0.55) 0.13 (0.68)
Extraordinary gain, net
of tax 0.94 0.06 0.88
____________________ ________
Net earnings $ 0.39 $ 0.19 $ 0.20
____________________ ________
____________________ ________
Weighted average shares
outstanding (c) 15,066,976 15,153,522 (86,546)
____________________________________________________________________
(a) Earnings before depreciation, amortization and deferred taxes
consists of net earnings (loss), excluding the provision for
decline in real estate and gain (loss) on disposition of
properties, net of tax, before deducting the noncash charges
from Rental Properties for depreciation, amortization and
deferred income taxes.
(b) Adjusted for 3 for 2 common stock split effective
February 17, 1997.
(c) On May 20, 1997, the Company issued 1,955,000 Class A common
shares in a public offering. The above pro forma per share
data is computed as if the additional shares were issued
at the beginning of each period.
CONTACT: Forest City Enterprises Thomas G. Smith, 216/267-1200 http://www.fceinc.com |
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