CHATTANOOGA, Tenn.--(BUSINESS WIRE)--
CBL & Associates Properties, Inc. (NYSE:CBL):
-- Reported FFO per diluted share of $0.62 for the fourth quarter and $2.52
for the year ended December 31, 2009, excluding a non-cash impairment of
real estate assets.
-- Total portfolio same-center NOI, excluding lease termination fees, for
the fourth quarter and year ended December 31, 2009, declined 1.5% and
1.3%, respectively, from the prior year periods.
-- Stabilized mall occupancy increased 130 bps to 91.6% as of December 31,
2009, from the sequential quarter.
CBL & Associates Properties, Inc. (NYSE:CBL) announced results for the
fourth quarter and year ended December 31, 2009. A description of each
non-GAAP financial measure and the related reconciliation to the
comparable GAAP measure is located at the end of this news release. In
accordance with recently issued accounting guidance related to the
treatment of the stock component of our dividend paid on April 15, 2009,
all previously reported share and per share amounts that were
retroactively adjusted to reflect the common stock and common units, as
applicable, issued as part of that dividend have been revised. The new
guidance requires that the stock component be treated as a stock
issuance. Thus, the Company has reflected the stock distribution in its
share and per share amounts beginning April 15, 2009.
Funds from Operations ("FFO") allocable to common shareholders for the
fourth quarter ended December 31, 2009, was $2,358,000 or $0.02 per
diluted share. FFO for the current quarter was reduced by a non-cash
impairment of real estate of $0.60 per diluted share. Excluding the
impact of this impairment of real estate, FFO allocable to common
shareholders was $0.62 per diluted share. Additionally, FFO for the
fourth quarter 2009, excluding the impairment of real estate, reflects
dilution of $0.34 per fully diluted share as a result of the 66.63
million shares issued in the June 2009 equity offering. FFO allocable to
common shareholders for the fourth quarter ended December 31, 2008, was
$52,867,000 or $0.80 per diluted share.
During the course of the Company's normal quarterly review, the Company
determined that it was appropriate to write down the depreciated book
value of three shopping centers to their estimated fair values. The Net
Operating Income ("NOI") of the three centers represents less than 0.6%
of total 2009 portfolio NOI. These write downs resulted in a non-cash
impairment of real estate in the fourth quarter 2009 of $114,862,000.
Property-specific information is provided in the section titled "Property
Review."
"We are pleased that the overwhelming majority of properties in our
portfolio are performing well and reinforcing the strength of our market
dominant mall strategy, notwithstanding the impairment of these three
properties," said John N. Foy, Vice Chairman and Chief Financial Officer.
FFO allocable to common shareholders for the year ended December 31,
2009, was $190,066,000, or $1.79 per diluted share. FFO for the year
ended December 31, 2009, was reduced by the non-cash impairment of real
estate of $0.73 per diluted share. Excluding the impact of this
impairment, FFO allocable to common shareholders was $2.52 per diluted
share. FFO for the year ended December 31, 2009, excluding the
impairment of real estate, was also reduced by $0.75 per fully diluted
share as a result of the 66.63 million shares issued in the June 2009
equity offering. FFO allocable to common shareholders for the year ended
December 31, 2008, was $213,347,000, or $3.21 per diluted share.
FFO of the operating partnership for the fourth quarter ended December
31, 2009, was $3,247,000, or $118,109,000 excluding the non-cash
impairment of real estate, compared with $93,207,000 for the fourth
quarter ended December 31, 2008. FFO of the operating partnership for
the year ended December 31, 2009, was $282,206,000, or $397,068,000
excluding the non-cash impairment of real estate, compared with
$376,273,000 for the year ended December 31, 2008.
Net loss attributable to common shareholders for the fourth quarter
ended December 31, 2009, was $57,790,000, or $0.42 per diluted share,
compared with net loss of $10,055,000, or $0.15 per diluted share for
the prior-year period. Net loss attributable to common shareholders for
the year ended December 31, 2009, was $36,807,000, or $0.35 per diluted
share, compared with net income of $9,768,000, or $0.15 per diluted
share, for the year ended December 31, 2008. Net loss attributable to
common shareholders for the fourth quarter and year ended December 31,
2009, was impacted by the non-cash impairment of real estate and per
share information was diluted by the 66.63 million shares issued in the
June 2009 equity offering.
CBL's President and Chief Executive Officer, Stephen D. Lebovitz,
commented, "Our performance in the fourth quarter and for the full year
2009 demonstrated the continuing stability of our portfolio. While the
impairment announcement impacted our stated financial results, 2009 was
clearly a year of significant achievement in operating performance for
CBL. We were pleased to report full-year same-center NOI at the high end
of our guidance range as well as improvements in occupancy and sales
throughout the year. We continue to make progress in releasing the
inventory of junior anchor spaces with more than 45% of these spaces now
leased. We also finished the year with more than $1.6 billion of
financing activity, over five million square feet of leases signed, and
three new developments completed with leased or committed rates greater
than 90%.
"We have a realistic view of 2010 and are looking for opportunities for
CBL to benefit from the economic recovery. We are proactively addressing
upcoming debt maturities and the ongoing deleveraging of the company.
Near-term liquidity issues have been resolved to the point where we are
exploring new capital sources at more attractive terms than a year ago.
While managing expenses very closely, we are also transitioning more of
our efforts to driving NOI growth with continued emphasis on leasing and
other sources of income. As a much stronger and leaner company than a
year ago, we are confident our strategic focus has positioned us for
long-term success."
HIGHLIGHTS
-- Total portfolio same-center NOI, excluding lease termination fees, for
the fourth quarter and year ended December 31, 2009, declined 1.5% and
1.3%, respectively, compared with a decline of 4.0% and 1.8%,
respectively, in the prior-year periods.
-- Same-store sales for mall tenants of 10,000 square feet or less for
stabilized malls as of December 31, 2009, declined 5.4% to $313 per
square foot compared with $331 per square foot as of December 31, 2008.
-- Consolidated and unconsolidated variable rate debt of $1,755,656,000
represents 21.1% of the total market capitalization for the Company and
28.4% of the Company's share of total consolidated and unconsolidated
debt.
PORTFOLIO OCCUPANCY September 30, December 31,
2009 2009 2008
Portfolio occupancy 89.2% 90.4% 92.3%
Mall portfolio 89.9% 91.3% 92.6%
Stabilized malls 90.3% 91.6% 92.9%
Non-stabilized malls 74.0% 76.3% 86.5%
Associated centers 90.0% 92.5% 92.2%
Community centers 80.4% 80.9% 92.1%
PROPERTY REVIEW
During the course of the Company's normal quarterly review, the Company
determined that it was appropriate to write down the depreciated book
value of three shopping centers to their estimated fair values including
Hickory Hollow Mall in Nashville (Antioch), TN, Pemberton Square in
Vicksburg, MS, and Towne Mall in Franklin, OH.
Hickory Hollow Mall has experienced declining income as a result of
changes in the property-specific market conditions as well as increasing
retail competition. These declines were further exacerbated by the
recent economic conditions. CBL has formulated a repositioning plan to
enhance and maximize property NOI. The plan contemplates incorporating
non-retail uses at Hickory Hollow Mall and CBL is in the process of
executing this plan. However, as a result of the current estimate of
projected future cash flows, CBL determined that a write down of the
depreciated book value from $107.4 million to an estimated fair value of
$12.6 million was appropriate. Currently Hickory Hollow Mall generates
insufficient NOI to cover debt service on its $33.4 million recourse
loan. CBL plans to continue to service the loan, which is
self-liquidating, over the remaining eight year term.
Pemberton Square and Towne Mall have also experienced declining
property-specific market conditions. CBL is exploring redevelopment
plans that would seek to maximize both properties' cash flow. However,
due to the uncertainty as to the timing of these projects, CBL
determined that it was appropriate to write down Pemberton Square's
depreciated book value of $7.1 million to an estimated fair value of
$1.4 million and Towne Mall's depreciated book value of $15.8 million to
an estimated fair value of $1.4 million. Pemberton Square and Towne Mall
are currently unencumbered.
DISPOSITIONS
During the fourth quarter, the Company completed the sale of its 60%
interest in Plaza Macae in Macae, Brazil to a third party for $24.2
million.
FINANCING ACTIVITY
In 2009, CBL refinanced or extended more than $1.6 billion in mortgage
loans and credit facilities. These included the extension of its three
major credit facilities, while maintaining full lending capacity
aggregating $1.2 billion, as well as successfully addressing nine
property-specific mortgages or construction loans totaling more than
$360.0 million.
During the fourth quarter, CBL repaid the $52.3 million loan secured by
Eastgate Mall in Cincinnati, OH. Eastgate Mall was then pledged to the
Company's $560 million credit facility. During the fourth quarter CBL
also repaid two secured facilities including a $17.2 million facility
and a $20.0 million facility. The properties used to collateralize those
facilities were pledged to the Company's $560 million credit facility.
Subsequent to the fourth quarter 2009, CBL closed a $72.0 million
non-recourse loan secured by St. Clair Square in Fairview Heights, IL.
The new five-year loan bears a floating interest rate of LIBOR plus 400
basis points. This loan replaced the existing $58.0 million loan, which
was scheduled to mature in April 2010. Concurrent with the closing, CBL
entered into a two-year LIBOR cap agreement with an associated strike
rate of 3.0%
DEVELOPMENT
On March 10, 2010, CBL will celebrate the official Grand Opening for the
415,000-square-foot phase one of The Pavilion at Port Orange, an open
air development in Port Orange, FL. The area's newest and most unique
shopping destination will open more than 92% leased or committed with
anchors including Hollywood Theaters, Belk, Homegoods, Marshall's,
Michaels, PETCO and ULTA.
OTHER EVENTS
During the fourth quarter, CBL announced that its Board of Directors
promoted Stephen D. Lebovitz to serve as Chief Executive Officer of the
Company effective January 1, 2010, in addition to his position as
President. Former Chairman and Chief Executive Officer, Charles B.
Lebovitz, continues to serve as executive Chairman of the Board,
maintaining an integral role in the Company's ongoing operations and
leadership.
CBL also announced the expansion of its executive management team with
the promotions of Augustus N. Stephas to Executive Vice President and
Chief Operating Officer, Farzana K. Mitchell to the role of Executive
Vice President - Finance and Michael I. Lebovitz to the role of
Executive Vice President - Development and Administration.
OUTLOOK AND GUIDANCE
Based on today's outlook the Company is providing 2010 FFO guidance of
$1.82 - $1.90 per share. The full year guidance assumes $3.0 million to
$6.0 million of outparcel sales and same-center NOI growth in the range
of (1.5%) to (3.5%), excluding the impact of lease termination fees from
both applicable periods. The guidance excludes the impact of any future
unannounced acquisitions or dispositions. The Company expects to update
its annual guidance after each quarter's results.
Low High
Expected diluted earnings per common share $ 0.18 $ 0.26
Adjust to fully converted shares from common shares (0.05 ) (0.07 )
Expected earnings per diluted, fully converted common 0.13 0.19
share
Add: depreciation and amortization 1.64 1.64
Add: noncontrolling interest in earnings of Operating 0.05 0.07
Partnership
Expected FFO per diluted, fully converted common share $ 1.82 $ 1.90
INVESTOR CONFERENCE CALL AND SIMULCAST
CBL & Associates Properties, Inc. will conduct a conference call at
11:00 a.m. ET on Thursday, February 4, 2010, to discuss its fourth
quarter results. The number to call for this interactive teleconference
is (212) 231-2921. A seven-day replay of the conference call will be
available by dialing (402) 977-9140 and entering the passcode 21449058.
A transcript of the Company's prepared remarks will be furnished on a
Form 8-K following the conference call.
To receive the CBL & Associates Properties, Inc., fourth quarter
earnings release and supplemental information please visit our website
at cblproperties.com
or contact Investor Relations at 423-490-8312.
The Company will also provide an online Web simulcast and rebroadcast of
its 2009 fourth quarter earnings release conference call. The live
broadcast of CBL's quarterly conference call will be available online at
the Company's Web site at cblproperties.com
on Thursday, February 4, 2010, beginning at 11:00 a.m. ET. The online
replay will follow shortly after the call and continue through February
11, 2010.
CBL is one of the largest and most active owners and developers of malls
and shopping centers in the United States. CBL owns, holds interests in
or manages 163 properties, including 88 regional malls/open-air centers.
The properties are located in 27 states and total 87.8 million square
feet including 3.0 million square feet of non-owned shopping centers
managed for third parties. CBL currently has one project under
construction totaling 500,000 square feet, The Pavilion at Port Orange
in Port Orange, FL. Headquartered in Chattanooga, TN, CBL has regional
offices in Boston (Waltham), MA, Dallas (Irving), TX, and St. Louis, MO.
Additional information can be found at cblproperties.com.
NON-GAAP FINANCIAL MEASURES
Funds From Operations
FFO is a widely used measure of the operating performance of real estate
companies that supplements net income (loss) determined in accordance
with GAAP. The National Association of Real Estate Investment Trusts
("NAREIT") defines FFO as net income (loss) (computed in accordance with
GAAP) excluding gains or losses on sales of operating properties, plus
depreciation and amortization, and after adjustments for unconsolidated
partnerships and joint ventures and noncontrolling interests.
Adjustments for unconsolidated partnerships and joint ventures and
noncontrolling interests are calculated on the same basis. The Company
defines FFO allocable to its common shareholders as defined above by
NAREIT less dividends on preferred stock. The Company's method of
calculating FFO allocable to its common shareholders may be different
from methods used by other REITs and, accordingly, may not be comparable
to such other REITs.
The Company believes that FFO provides an additional indicator of the
operating performance of its properties without giving effect to real
estate depreciation and amortization, which assumes the value of real
estate assets declines predictably over time. Since values of
well-maintained real estate assets have historically risen with market
conditions, the Company believes that FFO enhances investors'
understanding of its operating performance. The use of FFO as an
indicator of financial performance is influenced not only by the
operations of the Company's properties and interest rates, but also by
its capital structure.
The Company presents both FFO of its operating partnership and FFO
allocable to its common shareholders, as it believes that both are
useful performance measures. The Company believes FFO of its operating
partnership is a useful performance measure since it conducts
substantially all of its business through its operating partnership and,
therefore, it reflects the performance of the properties in absolute
terms regardless of the ratio of ownership interests of the Company's
common shareholders and the noncontrolling interest in the operating
partnership. The Company believes FFO allocable to its common
shareholders is a useful performance measure because it is the
performance measure that is most directly comparable to net income
(loss) attributable to its common shareholders.
In the reconciliation of net income (loss) attributable to the Company's
common shareholders to FFO allocable to its common shareholders, located
at the end of this earnings release, the Company makes an adjustment to
add back noncontrolling interest in earnings of its operating
partnership in order to arrive at FFO of its operating partnership. The
Company then applies a percentage to FFO of its operating partnership to
arrive at FFO allocable to its common shareholders. The percentage is
computed by taking the weighted average number of common shares
outstanding for the period and dividing it by the sum of the weighted
average number of common shares and the weighted average number of
operating partnership units outstanding during the period.
During the fourth quarter and year ended December 31, 2009, the Company
recorded a loss on impairment of real estate assets related to three
operating properties. Considering the significance and nature of the
impairment, the Company believes that it is important to emphasize the
impact on the Company's FFO measures for a reader to have a complete
understanding of the Company's results of operations. Therefore, the
Company has also presented what FFO would have been excluding the
impairment charge.
FFO does not represent cash flows from operations as defined by
accounting principles generally accepted in the United States, is not
necessarily indicative of cash available to fund all cash flow needs and
should not be considered as an alternative to net income (loss) for
purposes of evaluating the Company's operating performance or to cash
flow as a measure of liquidity.
Same-Center Net Operating Income
NOI is a supplemental measure of the operating performance of the
Company's shopping centers. The Company defines NOI as operating
revenues (rental revenues, tenant reimbursements and other income) less
property operating expenses (property operating, real estate taxes and
maintenance and repairs).
Similar to FFO, the Company computes NOI based on its pro rata share of
both consolidated and unconsolidated properties. The Company's
definition of NOI may be different than that used by other companies
and, accordingly, the Company's NOI may not be comparable to that of
other companies. A reconciliation of same-center NOI to net income
(loss) is located at the end of this earnings release.
Since NOI includes only those revenues and expenses related to the
operations of its shopping center properties, the Company believes that
same-center NOI provides a measure that reflects trends in occupancy
rates, rental rates and operating costs and the impact of those trends
on the Company's results of operations. Additionally, there are
instances when tenants terminate their leases prior to the scheduled
expiration date and pay the Company one-time, lump-sum termination fees.
These one-time lease termination fees may distort same-center NOI trends
and may result in same-center NOI that is not indicative of the ongoing
operations of the Company's shopping center properties. Therefore, the
Company believes that presenting same-center NOI, excluding lease
termination fees, is useful to investors.
Pro Rata Share of Debt
The Company presents debt based on its pro rata ownership share
(including the Company's pro rata share of unconsolidated affiliates and
excluding noncontrolling interests' share of consolidated properties)
because it believes this provides investors a clearer understanding of
the Company's total debt obligations which affect the Company's
liquidity. A reconciliation of the Company's pro rata share of debt to
the amount of debt on the Company's consolidated balance sheet is
located at the end of this earnings release.
Information included herein contains "forward-looking statements"
within the meaning of the federal securities laws. Such
statements are inherently subject to risks and uncertainties, many of
which cannot be predicted with accuracy and some of which might not even
be anticipated. Future events and actual events, financial and
otherwise, may differ materially from the events and results discussed
in the forward-looking statements. The reader is directed to the
Company's various filings with the Securities and Exchange Commission,
including without limitation the Company's Annual Report on Form 10-K
and the "Management's Discussion and Analysis of Financial Condition and
Results of Operations" incorporated by reference therein, for a
discussion of such risks and uncertainties.
CBL & Associates Properties, Inc.
Consolidated Statements of Operations
(Unaudited; in thousands, except per share amounts)
Three Months Ended Year Ended
December 31, December 31,
2009 2008 2009 2008
REVENUES:
Minimum rents $ 182,718 $ 188,300 $ 693,911 $ 716,570
Percentage rents 7,163 8,509 16,422 18,375
Other rents 8,959 9,372 20,763 22,887
Tenant reimbursements 80,946 85,183 322,702 336,173
Management, development 1,980 2,459 7,372 19,393
and leasing fees
Other 7,371 5,575 28,319 24,820
Total revenues 289,137 299,398 1,089,489 1,138,218
EXPENSES:
Property operating 39,068 49,274 162,819 190,148
Depreciation and 84,317 102,369 309,682 332,475
amortization
Real estate taxes 22,466 23,658 96,881 95,393
Maintenance and repairs 14,812 17,258 57,441 65,617
General and 9,830 11,973 41,010 45,241
administrative
Loss on impairment of 114,862 - 114,862 -
real estate
Other 7,009 14,643 25,794 33,333
Total expenses 292,364 219,175 808,489 762,207
Income (loss) from (3,227 ) 80,223 281,000 376,011
operations
Interest and other 1,022 2,942 5,211 10,076
income
Interest expense (78,204 ) (79,473 ) (294,051 ) (313,209 )
Loss on extinguishment (601 ) - (601 ) -
of debt
Loss on impairment of (411 ) (11,403 ) (9,260 ) (17,181 )
investments
Gain on sales of real 2,352 279 3,820 12,401
estate assets
Equity in earnings of
unconsolidated 3,622 1,523 5,489 2,831
affiliates
Income tax benefit 619 (738 ) 1,222 (13,495 )
(provision)
Income (loss) from (74,828 ) (6,647 ) (7,170 ) 57,434
continuing operations
Operating income (loss)
of discontinued (10 ) 347 122 1,809
operations
Gain (loss) on 45 10 (17 ) 3,798
discontinued operations
Net income (loss) (74,793 ) (6,290 ) (7,065 ) 63,041
Net (income) loss
attributable to
noncontrolling
interests:
Operating partnership 29,018 7,700 17,845 (7,495 )
Other consolidated (6,561 ) (6,010 ) (25,769 ) (23,959 )
subsidiaries
Net income (loss)
attributable to the (52,336 ) (4,600 ) (14,989 ) 31,587
Company
Preferred dividends (5,454 ) (5,455 ) (21,818 ) (21,819 )
Net income (loss)
attributable to common $ (57,790 ) $ (10,055 ) $ (36,807 ) $ 9,768
shareholders
Basic per share data
attributable to common
shareholders:
Income (loss) from
continuing operations, $ (0.42 ) $ (0.15 ) $ (0.35 ) $ 0.10
net of preferred
dividends
Discontinued operations - - - 0.05
Net income (loss)
attributable to common $ (0.42 ) $ (0.15 ) $ (0.35 ) $ 0.15
shareholders
Weighted average common 137,878 66,360 106,366 66,313
shares outstanding
Diluted per share data
attributable to common
shareholders:
Income (loss) from
continuing operations, $ (0.42 ) $ (0.15 ) $ (0.35 ) $ 0.10
net of preferred
dividends
Discontinued operations - - - 0.05
Net income (loss)
attributable to common $ (0.42 ) $ (0.15 ) $ (0.35 ) $ 0.15
shareholders
Weighted average common
and potential dilutive 137,878 66,360 106,366 66,418
common shares
outstanding
Amounts attributable to
common shareholders:
Income (loss) from
continuing operations, $ (57,815 ) $ (10,257 ) $ (36,878 ) $ 6,589
net of preferred
dividends
Discontinued operations 25 202 71 3,179
Net income (loss)
attributable to common $ (57,790 ) $ (10,055 ) $ (36,807 ) $ 9,768
shareholders
The Company's calculation of FFO allocable to Company shareholders is as
follows:
(in thousands, except per share data)
Three Months Ended Year Ended
December 31, December 31,
2009 2008 2009 2008
Net income (loss)
attributable to common $ (57,790 ) $ (10,055 ) $ (36,807 ) $ 9,768
shareholders
Noncontrolling interest in
earnings (loss) of (29,018 ) (7,700 ) (17,845 ) 7,495
operating partnership
Depreciation and
amortization expense of:
Consolidated properties 84,317 102,369 309,682 332,475
Unconsolidated affiliates 6,334 8,875 28,826 29,987
Discontinued operations - - - 892
Non-real estate assets (231 ) (257 ) (962 ) (1,027 )
Noncontrolling interests'
share of depreciation and (320 ) (15 ) (705 ) (958 )
amortization
(Gain) loss on (45 ) (10 ) 17 (3,798 )
discontinued operations
Income tax provision on
disposal of discontinued - - - 1,439
operations
Funds from operations of 3,247 93,207 282,206 376,273
the operating partnership
Loss on impairment of real 114,862 - 114,862 -
estate
Funds from operations of
the operating partnership, $ 118,109 $ 93,207 $ 397,068 $ 376,273
excluding loss on
impairment of real estate
Funds from operations per $ 0.02 $ 0.80 $ 1.79 $ 3.21
diluted share
Loss on impairment of real 0.60 - 0.73 -
estate per diluted share
Funds from operations,
excluding loss on $ 0.62 $ 0.80 $ 2.52 $ 3.21
impairment of real estate,
per diluted share
Weighted average common
and potential dilutive
common shares outstanding 189,866 117,022 157,970 117,051
with operating partnership
units fully converted
Reconciliation of FFO of
the operating partnership
to FFO allocable to
Company shareholders:
Funds from operations of $ 3,247 $ 93,207 $ 282,206 $ 376,273
the operating partnership
Percentage allocable to 72.63 % 56.72 % 67.35 % 56.70 %
Company shareholders (1)
Funds from operations
allocable to Company $ 2,358 $ 52,867 $ 190,066 $ 213,347
shareholders
Funds from operations of
the operating partnership, $ 118,109 $ 93,207 $ 397,068 $ 376,273
excluding loss on
impairment of real estate
Percentage allocable to 72.63 % 56.72 % 67.35 % 56.70 %
Company shareholders (1)
Funds from operations
allocable to Company
shareholders, excluding $ 85,783 $ 52,867 $ 267,425 $ 213,347
loss on impairment of real
estate
(1) Represents the weighted average number of common shares outstanding for the
period divided by the sum of the weighted average number of common shares and
the weighted average number of operating partnership units outstanding during
the period. See the reconciliation of shares and operating partnership units on
page 11.
SUPPLEMENTAL FFO INFORMATION:
Three Months Ended Year Ended
December 31, December 31,
(in thousands, except per 2009 2008 2009 2008
share data)
Lease termination fees $ 2,871 $ 679 $ 7,284 $ 9,935
Lease termination fees per $ 0.02 $ 0.01 $ 0.05 $ 0.08
share
Straight-line rental $ 1,602 $ 2,087 $ 7,762 $ 6,137
income
Straight-line rental $ 0.01 $ 0.02 $ 0.05 $ 0.05
income per share
Gains on outparcel sales $ 3,791 $ 1,111 $ 6,136 $ 15,963
Gains on outparcel sales $ 0.02 $ 0.01 $ 0.04 $ 0.14
per share
Amortization of acquired
above- and below-market $ 1,109 $ 3,950 $ 5,561 $ 10,735
leases
Amortization of acquired
above- and below-market $ 0.01 $ 0.03 $ 0.04 $ 0.09
leases per share
Amortization of debt $ 1,623 $ 1,991 $ 6,980 $ 7,909
premiums
Amortization of debt $ 0.01 $ 0.02 $ 0.04 $ 0.07
premiums per share
Income tax benefit $ 619 $ (738 ) $ 1,222 $ (12,056 )
(provision)
Income tax benefit $ - $ (0.01 ) $ 0.01 $ (0.10 )
(provision) per share
Loss on impairment of real $ (114,862 ) $ - $ (114,862 ) $ -
estate
Loss on impairment of real $ (0.60 ) $ - $ (0.73 ) $ -
estate per share
Loss on impairment of $ (411 ) $ (11,403 ) $ (9,260 ) $ (17,181 )
investments
Loss on impairment of $ - $ (0.10 ) $ (0.06 ) $ (0.15 )
investments per share
Same-Center Net Operating Income
(Dollars in thousands)
Three Months Ended Year Ended
December 31, December 31,
2009 2008 2009 2008
Net income (loss) $ (52,336 ) $ (4,600 ) $ (14,989 ) $ 31,587
attributable to the Company
Adjustments:
Depreciation and 84,317 102,369 309,682 332,475
amortization
Depreciation and
amortization from 6,334 8,875 28,826 29,987
unconsolidated affiliates
Depreciation and
amortization from - - - 892
discontinued operations
Noncontrolling interests'
share of depreciation and (320 ) (15 ) (705 ) (958 )
amortization in other
consolidated subsidiaries
Interest expense 78,204 79,473 294,051 313,209
Interest expense from 6,332 7,653 29,092 28,525
unconsolidated affiliates
Noncontrolling interests'
share of interest expense in (238 ) (135 ) (933 ) (1,492 )
other consolidated
subsidiaries
Loss on extinguishment of 601 - 601 -
debt
Abandoned projects expense 155 9,407 1,501 12,351
Gain on sales of real estate (2,352 ) (279 ) (3,820 ) (12,401 )
assets
Gain on sales of real estate
assets of unconsolidated (1,433 ) (832 ) (2,310 ) (3,548 )
affiliates
Loss on impairment of 411 11,403 9,260 17,181
investments
Loss on impairment of real 114,862 - 114,862 -
estate
Income tax (benefit) (619 ) 738 (1,222 ) 13,495
provision
Noncontrolling interest in
earnings (loss) of operating (29,018 ) (7,700 ) (17,845 ) 7,495
partnership
(Gain) loss on discontinued (45 ) (10 ) 17 (3,798 )
operations
Operating partnership's 204,855 206,347 746,068 765,000
share of total NOI
General and administrative 9,830 11,973 41,010 45,241
expenses
Management fees and (6,488 ) (7,651 ) (22,711 ) (36,255 )
non-property level revenues
Operating partnership's 208,197 210,669 764,367 773,986
share of property NOI
NOI of non-comparable (3,470 ) (4,925 ) (14,779 ) (11,946 )
centers
Total same-center NOI $ 204,727 $ 205,744 $ 749,588 $ 762,040
Total same-center NOI -0.5 % -1.6 %
percentage change
Total same-center NOI $ 204,727 $ 205,744 $ 749,588 $ 762,040
Less lease termination fees (2,846 ) (717 ) (7,243 ) (9,927 )
Total same-center NOI,
excluding lease termination $ 201,881 $ 205,027 $ 742,345 $ 752,113
fees
Malls $ 184,549 $ 188,527 $ 674,157 $ 681,796
Associated centers 7,932 7,960 31,430 33,979
Community centers 3,487 3,492 13,972 14,641
Office and other 5,913 5,048 22,786 21,697
Total same-center NOI,
excluding lease termination $ 201,881 $ 205,027 $ 742,345 $ 752,113
fees
Percentage Change:
Malls -2.1 % -1.1 %
Associated centers -0.4 % -7.5 %
Community centers -0.1 % -4.6 %
Office and other 17.1 % 5.0 %
Total same-center NOI,
excluding lease termination -1.5 % -1.3 %
fees
Company's Share of Consolidated and Unconsolidated Debt
(Dollars in thousands)
December 31, 2009
Fixed Rate Variable Rate Total
Consolidated debt $ 4,049,718 $ 1,566,421 $ 5,616,139
Noncontrolling interests' (23,737 ) (928 ) (24,665 )
share of consolidated debt
Company's share of
unconsolidated affiliates' 404,104 190,163 594,267
debt
Company's share of consolidated $ 4,430,085 $ 1,755,656 $ 6,185,741
and unconsolidated debt
Weighted average interest rate 5.95 % 3.07 % 5.13 %
December 31, 2008
Fixed Rate Variable Rate Total
Consolidated debt $ 4,608,347 $ 1,487,329 $ 6,095,676
Noncontrolling interests' (23,648 ) (928 ) (24,576 )
share of consolidated debt
Company's share of
unconsolidated affiliates' 418,761 143,468 562,229
debt
Company's share of consolidated $ 5,003,460 $ 1,629,869 $ 6,633,329
and unconsolidated debt
Weighted average interest rate 5.96 % 2.02 % 4.99 %
Debt-To-Total-Market Capitalization Ratio as of December 31, 2009
(In thousands, except stock price)
Shares
Stock Price (1) Value
Outstanding
Common stock and operating 189,837 $ 9.67 $ 1,835,724
partnership units
7.75% Series C Cumulative 460 250.00 115,000
Redeemable Preferred Stock
7.375% Series D Cumulative 700 250.00 175,000
Redeemable Preferred Stock
Total market equity 2,125,724
Company's share of total debt 6,185,741
Total market capitalization $ 8,311,465
Debt-to-total-market 74.4 %
capitalization ratio
(1) Stock price for common stock and operating partnership units equals the
closing price of the common stock on December 31, 2009. The stock price for the
preferred stock represents the liquidation preference of each respective series
of preferred stock.
Reconciliation of Shares and Operating Partnership Units Outstanding
(In thousands)
Three Months Ended Year Ended
December 31, December 31,
2009: Basic Diluted Basic Diluted
Weighted average shares - 137,878 137,878 106,366 106,366
EPS
Weighted average diluted - 39 - 37
shares for FFO (2)
Weighted average operating 51,949 51,949 51,567 51,567
partnership units
Weighted average shares- FFO 189,827 189,866 157,933 157,970
2008:
Weighted average shares - 66,360 66,360 66,313 66,418
EPS
Weighted average diluted - 34 - -
shares for FFO (2)
Weighted average operating 50,628 50,628 50,633 50,633
partnership units
Weighted average shares- FFO 116,988 117,022 116,946 117,051
Dividend Payout Ratio
Three Months Ended Year Ended
December 31, December 31,
2009 2008 2009 2008
Weighted average dividend $ 0.10371 $ 0.37255 $ 0.74032 $ 2.02396
per share
FFO per diluted, fully $ 0.02 $ 0.80 $ 1.79 $ 3.21
converted share (3)
Dividend payout ratio 518.6 % 46.6 % 41.4 % 63.1 %
(2) Because the Company incurred net losses during the three months ended
December 31, 2009 and 2008 and during the year ended December 31, 2009, there
are no potentially dilutive shares recognized in the number of diluted weighted
average shares for EPS purposes for those periods due to their anti-dilutive
nature. However, because FFO was positive during these periods, the dilutive
shares are recognized in the number of diluted weighted average shares for
purposes of calculating FFO per share.
(3) FFO per diluted, fully converted share for the three months and year ended
December 31, 2009 includes the impact of a non-cash impairment of real estate of
$0.60 and $0.73, respectively, per share.
Consolidated Balance Sheets
(Unaudited, in thousands except share data)
December 31,
2009 2008
ASSETS
Real estate assets:
Land $ 956,750 $ 902,504
Buildings and improvements 7,569,015 7,503,334
8,525,765 8,405,838
Accumulated depreciation (1,505,840 ) (1,310,173 )
7,019,925 7,095,665
Developments in progress 85,110 225,815
Net investment in real estate assets 7,105,035 7,321,480
Cash and cash equivalents 48,062 51,227
Cash in escrow - 2,700
Receivables:
Tenant, net of allowance 73,170 74,402
Other 8,162 12,145
Mortgage and other notes receivable 38,208 58,961
Investments in unconsolidated affiliates 186,523 207,618
Intangible lease assets and other assets 279,950 305,802
$ 7,739,110 $ 8,034,335
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS
AND EQUITY
Mortgage and other indebtedness $ 5,616,139 $ 6,095,676
Accounts payable and accrued liabilities 258,333 329,991
Total liabilities 5,874,472 6,425,667
Commitments and contingencies
Redeemable noncontrolling interests:
Redeemable noncontrolling partnership interests 22,689 18,393
Redeemable noncontrolling preferred joint 421,570 421,279
venture interest
Total redeemable noncontrolling interests 444,259 439,672
Shareholders' equity:
Preferred Stock, $.01 par value, 15,000,000
shares authorized: 7.75% Series C Cumulative 5 5
Redeemable Preferred Stock, 460,000 shares
outstanding
7.375% Series D Cumulative Redeemable Preferred 7 7
Stock, 700,000 shares outstanding
Common Stock, $.01 par value, 180,000,000 shares
authorized, 137,888,408 and 66,394,844 issued 1,379 664
and outstanding in 2009 and 2008, respectively
Additional paid-in capital 1,399,654 993,941
Accumulated other comprehensive income (loss) 491 (12,786 )
Accumulated deficit (283,640 ) (193,307 )
Total shareholders' equity 1,117,896 788,524
Noncontrolling interests 302,483 380,472
Total equity 1,420,379 1,168,996
$ 7,739,110 $ 8,034,335
Source: CBL & Associates Properties, Inc.
Contact: CBL & Associates Properties, Inc.
Katie Reinsmidt
Vice President - Corporate Communications and Investor Relations
423-490-8301
katie_reinsmidt@cblproperties.com