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ROUSE COMPANY OF COLUMBIA REPORTS EARNINGS

 ROUSE COMPANY OF COLUMBIA REPORTS EARNINGS
 COLUMBIA, Md., Aug. 10 /PRNewswire/ -- The Rouse Company of


Columbia, Md., today released financial results for the first half and the second quarter of 1992. Total earnings before depreciation and deferred taxes for the six months were $19,391,000, down 1.9 percent from $19,761,000 recorded in 1991's first half. For the second quarter, earnings before depreciation and deferred taxes were $8,517,000, a 6 percent decline from $9,075,000 in 1991's April through June period. The net loss for the six months was $8,658,000, compared to a net loss of $8,426,000 in the first half of 1991 (before revision for a one-time earnings benefit of $13,463,000 as a result of a change in accounting for income taxes). For the second quarter, the net loss was $6,128,000 compared to $4,902,000 for the same period last year.
 These declines were largely the result of lower revenues and earnings from the sale of land in Columbia -- due primarily to timing differences. Expectations are that land sales revenues and earnings for the full year of 1992 will match or exceed 1991 levels.
 The company's retail centers had a second consecutive strong quarter, producing first half earnings before depreciation and deferred taxes of $28,875,000 -- 12.4 percent ahead of 1991's first six months.
 THE ROUSE COMPANY
 Financial Highlights
 (Unaudited, in thousands)
 Three months Six months
 June 30 1992 1991 1992 1991
 Revenues $139,837 $139,421 $278,296 $273,701
 Earnings before
 depreciation and
 deferred taxes
 from operations(A):
 From operating properties 14,719 14,710 27,129 27,076
 Total 8,517 9,075 19,391 19,761
 Net earnings (loss) (6,128) (4,902) (8,658) 5,037
 Weighted average number of
 common shares outstanding 48,286 48,150 48,238 48,142
 (A) Earnings before depreciation and deferred taxes from operations represents revenues less operating, interest and current income tax expenses.
 The following is the company's letter to shareholders:
 The company produced good first half financial results in the context of the lingering weak economy in the United States. Total earnings before depreciation and deferred taxes were $19,391,000, down 1.9 percent from $19,761,000 in 1991's first six months; however, earnings before depreciation and deferred taxes from operating properties increased slightly to $27,129,000, up from $27,076,000 in the first six months a year ago. After deducting depreciation and deferred taxes, the company's net loss for the six month period was $8,658,000 versus $8,426,000 in the comparable period of 1991 (before revision for a one-time earnings benefit of $13,463,000 as a result of a change in accounting for income taxes.)
 Operating Properties
 The company's retail centers had a second consecutive strong quarter, producing first half earnings before depreciation and deferred taxes of $28,875,000 - a 12.4 percent gain over 1991's first six months. Retail occupancy rates remained high, at 91.3 percent on June 30, 1992, compared to 91.8 percent at that time in 1991, 91.0 percent in 1990 and 90.7 percent in 1989. Sales of the small merchants in the company's retail centers increased by 1 percent during the first six months. These sales results indicate that the United States' economy is emerging from the recession at a relatively slow pace that consumers sentiment is still not optimistic. We expect that the rate of growth of tenant sales will improve in the second half of this year, particularly since sales in 1991's comparative second half were weak.
 Office, mixed-use and other properties, the second component of the company's operating properties, recorded a loss before depreciation and deferred taxes of $1,746,000 for the half year, compared to earnings before depreciation and deferred taxes of $1,395,000 a year ago. The second quarter's loss of $553,000 was substantially less than each of the past two quarters, and was in line with our expectations. In addition, while the country's office markets have not improved substantially, our projects appear to be stabilized and are benefiting from increasing occupancy levels at the newer, mixed-use projects.
 For the full year 1992, it is unlikely that the company's retail centers will continue to produce a 12.4 percent growth rate, but they should certainly show a substantial increase in earnings before depreciation and deferred taxes over last year. This increase will be partially offset by the expected losses in the office, mixed-use and other properties. However, we believe that our total property portfolio will produce growth in earnings before depreciation and deferred taxes for 1992.
 Columbia
 Land sale revenues in Columbia were behind last year's second quarter, $3,034,000 compared to $3,969,000, and the resulting earnings also trailed 1991, $118,000 versus $1,063,000. For the six months, earnings were $3,674,000 compared to $4,546,000 a year ago. These results primarily reflect timing differences, and we remain confident that sales and earnings for 1992 will meet and perhaps exceed 1991's levels.
 Development
 Two new projects had successful openings during the second quarter:
 -- The Ryland Group Headquarters Building in down-town Columbia was completed, with the move-in commencing in early June. The Ryland Group is occupying the entire 167,000 square foot building and Ryland officials and personnel are pleased and excited by their new offices.
 -- The Hickory Ridge Village Center, the company's seventh village center in Columbia, opened on June 17, 1992. Customer and tenant reaction has been over-whelmingly favorable, and the retail space is 95 percent leased.
 Outside Columbia, the company is focused primarily on major expansions to existing, successful retail centers, with five presently underway: Oakwood Center in the suburbs of New Orleans; Mall St. Matthews in Louisville; Governor's Square in Tallahassee; Staten Island Mall in New York; and Franklin Park in Toledo. These expansions are all expected to open in 1993 and/or 1994, with new department store space, substantial additions to the mall area and general renovations to the properties. One other project, for which we are development manager, is also continuing no more forward -- the Christopher Columbus Center of Marine Research and Exploration which will be built on Baltimore's Inner Harbor.
 Summary
 The company's first six months' results are generally in accord with our expectations. Looking ahead, we believe that 1992 will be a year of growth for our retail centers and for Columbia land sales. In addition, the company continues to maintain strong financial health, with substantial liquidity. The company is in an excellent position to benefit when consumer sentiment and the nation's economy improve, and we are optimistic about the future.
 THE ROUSE COMPANY
 CONSOLIDATED STATEMENTS OF EARNINGS
 Before Depreciation and Deferred Taxes From Operations
 (Unaudited -- In thousands)
 Three months ended Six months ended
 6/30/92 6/30/91 6/30/92 6/30/91
 Revenues
 Operating properties:
 Retail centers $101,739 $101,755 $200,740 $198,996
 Office, mixed-use & other 33,460 33,241 64,727 63,046
 136,199 134,996 265,467 262,042
 Land sales 3,034 3,969 11,322 10,701
 Corporate interest income 604 456 1,507 958
 Total revenues 139,837 139,421 278,296 273,701
 Expenses exclusive of
 depreciation and deferred
 taxes
 Operating properties:
 Retail centers 87,467 88,152 171,865 173,315
 Office, mixed-use and
 other 34,013 32,134 66,473 61,651
 121,480 120,286 238,338 234,966
 Land sales 2,916 2,906 7,648 6,155
 Development 1,243 2,007 1,803 2,903
 Corporate interest and
 other expenses 5,681 5,147 11,116 9,916
 Total expenses 131,320 130,346 258,905 253,940
 Earnings before depreciation
 and deferred taxes from
 operations by division
 Operating properties:
 Retail centers 15,272 13,603 28,875 25,681
 Office, mixed-use & other (553) 1,107 (1,746) 1,395
 14,719 14,710 27,129 27,076
 Land sales 118 1,063 3,674 4,546
 Development (1,243) (2,007) (1,803) (2,903)
 Corporate (5,077) (4,691) (9,609) (8,958)
 Earnings before depreciation
 and deferred taxes
 from operations 8,517 9,075 19,391 19,761
 THE ROUSE COMPANY
 CONSOLIDATED STATEMENTS OF OPERATIONS
 (Unaudited -- In thousands, except per share data)
 Three months ended Six months ended
 6/30/92 6/30/91 6/30/92 6/30/91
 Revenues $139,837 $139,421 $278,296 $273,701
 Operating expenses 79,805 80,627 157,644 155,815
 Interest expense 51,390 49,618 101,057 97,949
 Depreciation & amortiz. 17,308 16,248 33,195 31,981
 Gain on disposition
 of assets (10) -- 1,405 --
 Loss before income taxes,
 extraordinary loss and
 cumulative effect of
 change in accounting
 principle (8,676) (7,072) (12,195) (12,044)
 Income tax benefit (provision):
 Current-state (125) (101) (204) (176)
 Deferred 2,740 2,271 3,808 3,794
 2,615 2,170 3,604 3,618
 Loss before extraordinary loss
 and cumulative effect of
 change in accounting
 principle (6,061) (4,902) (8,591) (8,426)
 Extraordinary loss from
 extinguishment of debt,
 net of related income
 tax benefit (67) -- (67) --
 Cumulative effect at Jan.
 1, 1991 of change in accting.
 for income taxes -- -- -- 13,463
 Net earnings (loss) (6,128) (4,902) (8,658) 5,037
 Earnings (loss) per share
 of common stock
 Loss before extraordinary
 loss and cumulative effect
 of change in accounting
 principle (.13) (.10) (.18) (.18)
 Extraordinary loss -- -- -- --
 Cumulative effect of
 change in accounting
 principle -- -- -- .28
 Total (.13) (.10) (.18) .10
 Reconciliation of earnings
 before depreciation and
 deferred taxes from oper.
 to net earnings (loss)
 Earnings before depreciation
 and deferred taxes
 from operations 8,517 9,075 19,391 19,761
 Depreciation & amortiz. (17,308) (16,248) (33,195) (31,981)
 Gain on disposition
 of assets (10) -- 1,405 --
 Deferred income tax
 benefit 2,740 2,271 3,808 3,794
 Extraordinary loss, net
 of related income tax
 benefit (67) -- (67) --
 Cumulative effect of change
 in accounting principle -- -- -- 13,463
 Net earnings (loss) (6,128) (4,902) (8,658) 5,037
 THE ROUSE COMPANY
 CONSOLIDATED BALANCE SHEETS
 (Unaudited, in thousands)
 June 30, 1992 Dec. 31, 1991
 Assets
 Property:
 Operating properties, net $2,200,084 $2,150,980
 Development operations,net 66,545 69,024
 Total property 2,266,629 2,220,004
 Property held for development and sale 160,060 158,472
 Other assets 97,268 96,847
 Accounts and notes receivable 76,807 75,547
 Investments in marketable securities 29,057 27,505
 Cash and cash equivalents 86,215 59,077
 Total 2,716,036 2,637,452
 Liabilities
 Debt:
 Property debt not carrying a parent
 company guarantee of repayment $1,734,616 $1,628,880
 Parent company debt and debt carrying
 a parent company guarantee of repayment:
 Property debt 401,492 392,062
 Convertible subordinated debentures 230,000 230,000
 Other debt 45,730 35,754
 677,222 657,816
 Total debt 2,411,838 2,286,696
 Obligations under capital leases 69,459 87,831
 Accounts payable, accrued expenses
 and other liabilities 156,400 160,482
 Deferred income taxes 81,272 85,115
 Common stock and other shareholders'
 equity (deficit) (2,933) 17,328
 Total 2,716,036 2,637,452
 THE ROUSE COMPANY
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Unaudited, in thousands)
 Six months ended June 30 1992 1991
 Cash flows from operating activities
 Rents and other revenues received $264,987 $266,649
 Proceeds from land sales 9,601 11,452
 Operating and interest expenditures (242,651) (245,383)
 Land development expenditures (4,703) (8,749)
 Net cash provided by operating activities 27,234 23,969
 Cash flows from investing activities
 Construction and development expenditures (49,022) (35,073)
 Expenditures for property acquisitions (38,148) (915)
 Expenditures for improvements to existing properties:
 Tenant leasing and remerchandising (8,841) (8,183)
 Building and equipment (11,383) (12,112)
 Other (1,085) 7,185
 Net cash used in investing activities (108,479) (49,098)
 Cash flows from financing activities
 Proceeds from issuance of debt 184,225 83,216
 Repayments of debt (62,540) (60,855)
 Dividends paid (13,788) (13,711)
 Other 486 280
 Net cash provided by financing activities 108,383 8,930
 Net increase (decrease) in cash and
 cash equivalents 27,138 (16,190)
 Reconciliation of net earnings (loss) to cash
 provided by operating activities
 Net earnings (loss) (8,658) 5,037
 Depreciation and amortization 33,195 31,981
 Gain on disposition of assets (1,405) ---
 Deferred income tax benefit (3,808) (3,794)
 Extraordinary loss, net of related
 income tax benefit 67 --
 Cumulative effect of change in
 accounting principle -- (13,463)
 Additions to pre-construction reserve 868 1,667
 Increase in operating assets and
 liabilities, net 6,975 2,541
 Net cash provided by operating activities 27,234 23,969
 1992 1991
 Schedule of Non-Cash Investing and
 Financing Activities
 Termination of capital lease obligation on
 disposition of an interest in a property 17,000 ---
 -0- 8/10/92
 /CONTACT: David L. Tripp, vice president of Rouse Company, 301-992-6546/
 (ROUS) CO: The Rouse Company ST: Maryland IN: FIN SU: ERN


LR-OS -- NY056 -- 8637 08/10/92 16:00 EDT
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Date:Aug 10, 1992
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