DUKE REALTY CORPORATION AND SUBSIDIARIES
Consolidated Statements of Operations
For the Years Ended December 31,
(in thousands, except per share amounts)
| | 2001 | 2000 | 1999 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| RENTAL OPERATIONS: | ||||||||||||
| Revenues: | ||||||||||||
| Rental income | $ | 685,779 | $ | 692,266 | $ | 522,527 | ||||||
| Equity in earnings of unconsolidated companies | 31,391 | 14,556 | 11,613 | |||||||||
| 717,170 | 706,822 | 534,140 | ||||||||||
| Operating Expenses: | ||||||||||||
| Rental expenses | 121,089 | 117,689 | 88,062 | |||||||||
| Real estate taxes | 70,523 | 70,819 | 54,101 | |||||||||
| Interest expense | 112,338 | 132,018 | 86,450 | |||||||||
| Depreciation and amortization | 158,050 | 161,716 | 110,638 | |||||||||
| 462,000 | 482,242 | 339,251 | ||||||||||
| Earnings from rental operations | 255,170 | 224,580 | 194,889 | |||||||||
| SERVICE OPERATIONS: | ||||||||||||
| Revenues: | ||||||||||||
| General contractor gross revenue | 264,455 | 292,661 | 216,079 | |||||||||
| General contractor costs | (229,845 | ) | (253,763 | ) | (188,021 | ) | ||||||
| Net general contractor revenue | 34,610 | 38,898 | 28,058 | |||||||||
| Property management, maintenance and leasing fees | 22,824 | 25,477 | 21,941 | |||||||||
| Construction and development activity income | 19,142 | 16,965 | 2,870 | |||||||||
| Other income | 3,883 | 1,459 | 1,162 | |||||||||
| Total revenue | 80,459 | 82,799 | 54,031 | |||||||||
| Operating expenses | 45,344 | 50,039 | 36,159 | |||||||||
| Earnings from service operations | 35,115 | 32,760 | 17,872 | |||||||||
| General and administrative expense | (15,559 | ) | (21,144 | ) | (16,555 | ) | ||||||
| Operating income | 274,726 | 236,196 | 196,206 | |||||||||
OTHER INCOME (EXPENSE): | ||||||||||||
| Interest income | 5,303 | 6,861 | 2,669 | |||||||||
| Gain on sale of land and depreciable property dispositions, net of impairment allowance | 45,708 | 60,692 | 10,012 | |||||||||
| Other expense | (2,582 | ) | (963 | ) | (1,091 | ) | ||||||
| Other minority interest in earnings of subsidiaries | (2,411 | ) | (2,145 | ) | (2,050 | ) | ||||||
| Minority interest in earnings of common unitholders | (32,172 | ) | (31,839 | ) | (19,749 | ) | ||||||
| Minority interest in earnings of preferred unitholders | (8,408 | ) | (8,408 | ) | (4,204 | ) | ||||||
| Income from continuing operations | 280,164 | 260,394 | 181,793 | |||||||||
Discontinued operations: | ||||||||||||
| Net income from discontinued operations, net of minority interest | 2,245 | 1,545 | 447 | |||||||||
| Net income | 282,409 | 261,939 | 182,240 | |||||||||
| Dividends on preferred shares | (52,442 | ) | (48,981 | ) | (42,604 | ) | ||||||
| Net income available for common shareholders | $ | 229,967 | $ | 212,958 | $ | 139,636 | ||||||
| Basic net income per common share: | ||||||||||||
| Continuing operations | $ | 1.75 | $ | 1.67 | $ | 1.33 | ||||||
| Discontinued operations | 0.02 | 0.01 | — | |||||||||
| Total | $ | 1.77 | $ | 1.68 | $ | 1.33 | ||||||
| Diluted net income per common share: | ||||||||||||
| Continuing operations | $ | 1.73 | $ | 1.65 | $ | 1.32 | ||||||
| Discontinued operations | 0.02 | 0.01 | — | |||||||||
| Total | $ | 1.75 | $ | 1.66 | $ | 1.32 | ||||||
| Weighted average number of common shares outstanding | 129,660 | 126,836 | 104,884 | |||||||||
| Weighted average number of common and dilutive potential common shares | 151,710 | 147,441 | 120,511 | |||||||||
See accompanying Notes to Consolidated Financial Statements.
DUKE REALTY CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements—(Continued)
(15) Discontinued Operations
The Company adopted Statement of Financial Accounting Standards No. 144, "Accounting for the Impairment or Disposal of Long Lived Assets" ("SFAS 144"), on January 1, 2002. SFAS 144 requires the Company to report in discontinued operations the results of operations of a property which has either been disposed or is classified as held for sale, unless certain conditions are met.
The Company classified the results of operations of three buildings as discontinued operations in accordance with SFAS No. 144. The results of operations for the held for sale properties as identified in Footnote 6 are included in continuing operations as these properties were identified for sale prior to the adoption of SFAS 144. The effect of the adoption of SFAS 144 resulted in net income, net of minority interest, of $2.2 million, $1.5 million and $447,000 being classified as net income from discontinued operations for the years ended December 31, 2001, 2000, and 1999, respectively.
