EXHIBIT 99.1
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CAMDEN PROPERTY TRUST ANNOUNCES
THIRD QUARTER 2012 OPERATING RESULTS
Houston, TEXAS (November 1, 2012) – Camden Property Trust (NYSE: CPT) today announced operating results for the three and nine months ended September 30, 2012.
Funds From Operations (“FFO”)
FFO for the third quarter of 2012 totaled $0.93 per diluted share or $82.1 million, as compared to $0.77 per diluted share or $58.8 million for the same period in 2011.
FFO for the nine months ended September 30, 2012 totaled $2.65 per diluted share or $227.4 million, as compared to $1.89 per diluted share or $143.3 million for the same period in 2011. FFO for the nine months ended September 30, 2012 included a $2.1 million or $0.02 per diluted share charge related to the redemption of perpetual preferred operating partnership units. FFO for the nine months ended September 30, 2011 included: a $0.40 per diluted share impact related to a $29.8 million loss on discontinuation of a hedging relationship of an interest rate swap and $0.5 million write-off of unamortized loan costs related to the payoff of a term loan; a $4.7 million or $0.06 per diluted share gain on sale of undeveloped land; and a net $3.3 million or $0.04 per diluted share impact related to gain on sale of an available-for-sale investment.
“We are pleased to report another strong quarter, with FFO per share growing 21% and same property net operating income rising 10.7%,” said Richard Campo, Camden’s Chairman & Chief Executive Officer. “Apartment fundamentals continue to be strong across our markets, allowing us to increase our 2012 earnings guidance for the third time this year.”
Net Income Attributable to Common Shareholders (“EPS”)
The Company reported EPS of $30.7 million or $0.35 per diluted share for the third quarter of 2012, as compared to $11.8 million or $0.16 per diluted share for the same period in 2011. EPS for the three months ended September 30, 2012 included a $2.9 million or $0.03 per diluted share impact related to the gain on sale of an unconsolidated joint venture property.
For the nine months ended September 30, 2012, the Company reported EPS of $141.2 million or $1.66 per diluted share, as compared to $2.5 million or $0.03 per diluted share for the same period in 2011. EPS for the nine months ended September 30, 2012 included: a $40.2 million or $0.47 per diluted share impact related to the gain on acquisition of the controlling interest in twelve joint ventures; a $32.5 million or $0.38 per diluted share impact related to the gain on sale of discontinued operations; a $2.9 million or $0.03 per diluted share impact related to the gain on sale of an unconsolidated joint venture property; and, a $2.1 million or $0.02 per diluted share charge related to the redemption of perpetual preferred operating partnership units. EPS for the nine months ended September 30, 2011 included: a $0.42 per diluted share impact related to a $29.8 million loss on discontinuation of a hedging relationship of an interest rate swap and $0.5 million write-off of unamortized loan costs related to the payoff of a term loan; a $4.7 million or $0.07 per diluted share gain on sale of undeveloped land; a net $3.3 million or $0.05 per diluted share impact related to gain on sale of an available-for-sale investment; and a $1.1 million or $0.02 per diluted share impact from gain on sale of three joint venture interests.
A reconciliation of net income attributable to common shareholders to FFO is included in the financial tables accompanying this press release.
Same Property Results
For the 47,251 apartment homes included in consolidated same property results, third quarter 2012 same property NOI increased 10.7% compared to the third quarter of 2011, with revenues increasing 6.6% and expenses increasing 0.4%. On a sequential basis, third quarter 2012 same property NOI increased 2.8% compared to the second quarter of 2012, with revenues increasing 2.6% and expenses increasing 2.4% compared to the prior quarter. On a year-to-date basis, 2012 same property NOI increased 9.6%, with revenues increasing 6.5% and expenses increasing 1.6% compared to the same period in 2011. Same property physical occupancy levels for the portfolio averaged 95.6% during the third quarter of 2012, compared to 95.1% in the third quarter of 2011 and 95.4% in the second quarter of 2012.
The Company defines same property communities as communities owned and stabilized as of January 1, 2011, excluding properties held for sale and communities under major redevelopment. A reconciliation of net income attributable to common shareholders to net operating income and same property net operating income is included in the financial tables accompanying this press release.
Acquisition Activity
Camden acquired three stabilized communities during the third quarter for a total of $135.0 million: Camden Creekstone, a 223-home apartment community in Atlanta, GA; Camden Landmark, a 469-home apartment community in Ontario, CA; and Camden Henderson, a 106-home apartment community in Dallas, TX. The Company also purchased the remaining 75% non-controlling ownership interest in a fully-consolidated joint venture during the quarter. Camden Travis Street, a 253-home apartment community in Houston, TX, is now wholly-owned by the Company.
During the quarter the Company acquired 12.0 acres of land located in Austin, TX for future development of a multifamily community. Subsequent to quarter-end Camden acquired 2.4 acres of land in Plantation, FL for future development of a multifamily community.
Disposition Activity
Camden disposed of one joint venture community during the quarter, which was owned by one of the Company’s funds. Camden South Congress, a 253-home apartment community in Austin, TX, was sold for approximately $54.4 million. Camden’s proportionate share of the gain was approximately $2.9 million.
Subsequent to quarter-end, the Company sold two wholly-owned communities for a total of $26.6 million: Camden Laurel Ridge, a 183-home apartment community in Austin, TX; and Camden Steeplechase, a 290-home apartment community in Houston, TX. The Company also sold Camden Passage, a 596-home joint venture apartment community in Kansas City, MO for approximately $40.7 million subsequent to quarter-end.
Development Activity
Lease-ups were completed during the quarter at three development communities: Camden Montague, a 192-home project in Tampa, FL which is currently 96% occupied; Camden LaVina, a 420-home project in Orlando, FL, which is currently 96% occupied; and Camden Summerfield II, a 187-home project in Landover, MD, which is currently 95% occupied.
Construction was completed during the quarter at Camden Westchase Park, a 348-home project in Tampa, FL which is currently 95% leased. Lease-ups continued during the quarter at Camden Royal Oaks II, a 104-home project in Houston, TX, which is currently 61% leased; and Camden Town Square, a 438-home project in Orlando, FL which is currently 60% leased.
Construction began during the quarter at Camden Flatirons in Denver, CO, a $78 million project with 424 apartment homes, and continued at three additional wholly-owned development communities: Camden City Centre II in Houston, TX, a $36 million project with 268 apartment homes; Camden NOMA in Washington, DC, a $110 million project with 320 apartment homes; and Camden Lamar Heights in Austin, TX, a $47 million project with 314 apartment homes.
Construction was also completed during the quarter on one joint venture community, Camden Amber Oaks II in Austin, TX, a 244-home project which is currently 86% leased. Construction continued on Camden South Capitol in Washington, DC, a 276-home joint venture project expected to have initial occupancy in the third quarter of 2013.
Equity Issuance
During the third quarter, Camden issued 1,302,454 common shares through its at-the-market (“ATM”) share offering programs at an average price of $69.34 per share, for total net consideration of approximately $88.9 million. Year-to-date through October 2012, Camden has issued 4,579,308 common shares through its ATM programs at an average price of $66.93 per share, for total net consideration of approximately $301.8 million.
Earnings Guidance
Camden updated its earnings guidance for 2012 based on its current and expected views of the apartment market and general economic conditions. Full-year 2012 FFO is expected to be $3.59 to $3.63 per diluted share, and full-year 2012 EPS is expected to be $2.06 to $2.10 per diluted share. Fourth quarter 2012 earnings guidance is $0.94 to $0.98 per diluted share for FFO and $0.42 to $0.46 per diluted share for EPS. Guidance for EPS excludes potential future gains on the sale of properties. Camden intends to update its earnings guidance to the market on a quarterly basis.
The Company’s 2012 earnings guidance is based on projections of same property revenue growth between 6.20% and 6.70%, expense growth between 2.00% and 2.50%, and NOI growth between 8.75% and 9.25%. Additional information on the Company’s 2012 financial outlook and a reconciliation of expected net income attributable to common shareholders to expected FFO are included in the financial tables accompanying this press release.
Conference Call
The Company will hold a conference call on Friday, November 2, 2012 at 11:00 a.m. Central Time to review its third quarter 2012 results and discuss its outlook for future performance. To participate in the call, please dial (866) 843-0890 (Domestic) or (412) 317-9250 (International) by 10:50 a.m. Central Time and enter passcode: 3311044, or join the live webcast of the conference call by accessing the Investor Relations section of the Company’s website at camdenliving.com. Supplemental financial information is available in the Investor Relations section of the Company’s website under Earnings Releases or by calling Camden’s Investor Relations Department at (800) 922-6336.
Forward-Looking Statements
In addition to historical information, this press release contains forward-looking statements under the federal securities law. These statements are based on current expectations, estimates and projections about the industry and markets in which Camden operates, management's beliefs, and assumptions made by management. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties which are difficult to predict.
About Camden
Camden Property Trust, an S&P 400 Company, is a real estate company engaged in the ownership, development, acquisition, management and disposition of multifamily apartment communities. Camden owns interests in and operates 200 properties containing 67,762 apartment homes across the United States. Upon completion of six properties under development, the Company's portfolio will increase to 69,802 apartment homes in 206 properties. Camden was recently named by FORTUNE® Magazine for the fifth consecutive year as one of the “100 Best Companies to Work For” in America, ranking #7.
For additional information, please contact Camden’s Investor Relations Department at (800) 922-6336 or (713) 354-2787 or access our website at www.camdenliving.com.
CAMDEN | OPERATING RESULTS | |||||||||||||||
(In thousands, except per share and property data amounts) | ||||||||||||||||
(Unaudited) | Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | |||||||||||||||
OPERATING DATA | 2012 | 2011 | 2012 | 2011 | ||||||||||||
Property revenues | ||||||||||||||||
Rental revenues | $166,179 | $140,332 | $477,501 | $412,794 | ||||||||||||
Other property revenues | 28,025 | 23,892 | 79,322 | 68,605 | ||||||||||||
Total property revenues | 194,204 | 164,224 | 556,823 | 481,399 | ||||||||||||
Property expenses | ||||||||||||||||
Property operating and maintenance | 54,008 | 48,731 | 153,491 | 138,974 | ||||||||||||
Real estate taxes | 19,096 | 16,892 | 56,586 | 51,596 | ||||||||||||
Total property expenses | 73,104 | 65,623 | 210,077 | 190,570 | ||||||||||||
Non-property income | ||||||||||||||||
Fee and asset management | 3,041 | 2,646 | 9,572 | 6,955 | ||||||||||||
Interest and other income (loss) | 3 | (108 | ) | (750 | ) | 4,749 | ||||||||||
Income (loss) on deferred compensation plans | (1,781 | ) | (6,096 | ) | 3,820 | 1,233 | ||||||||||
Total non-property income | 1,263 | (3,558 | ) | 12,642 | 12,937 | |||||||||||
Other expenses | ||||||||||||||||
Property management | 5,509 | 5,050 | 15,644 | 15,478 | ||||||||||||
Fee and asset management | 1,864 | 1,330 | 5,051 | 4,220 | ||||||||||||
General and administrative | 9,303 | 8,572 | 27,712 | 26,392 | ||||||||||||
Interest | 25,865 | 27,354 | 78,795 | 85,472 | ||||||||||||
Depreciation and amortization | 52,588 | 43,367 | 155,579 | 133,547 | ||||||||||||
Amortization of deferred financing costs | 909 | 1,344 | 2,721 | 4,761 | ||||||||||||
Expense (benefit) on deferred compensation plans | (1,781 | ) | (6,096 | ) | 3,820 | 1,233 | ||||||||||
Total other expenses | 94,257 | 80,921 | 289,322 | 271,103 | ||||||||||||
Gain on acquisition of controlling interests in joint ventures | - | - | 40,191 | - | ||||||||||||
Gain on sale of properties, including land | - | - | - | 4,748 | ||||||||||||
Gain on sale of unconsolidated joint venture interests | - | - | - | 1,136 | ||||||||||||
Loss on discontinuation of hedging relationship | - | - | - | (29,791 | ) | |||||||||||
Equity in income (loss) of joint ventures | 3,688 | (556 | ) | 4,686 | (166 | ) | ||||||||||
Income from continuing operations before income taxes | 31,794 | 13,566 | 114,943 | 8,590 | ||||||||||||
Income tax expense - current | (334 | ) | (313 | ) | (992 | ) | (1,889 | ) | ||||||||
Income from continuing operations | 31,460 | 13,253 | 113,951 | 6,701 | ||||||||||||
Income from discontinued operations | 343 | 1,098 | 1,262 | 3,196 | ||||||||||||
Gain on sale of discontinued operations, net of tax | - | - | 32,541 | - | ||||||||||||
Net income | 31,803 | 14,351 | 147,754 | 9,897 | ||||||||||||
Less income allocated to noncontrolling interests from continuing operations | (1,100 | ) | (752 | ) | (3,009 | ) | (2,089 | ) | ||||||||
Less income, including gain on sale, allocated to noncontrolling interests from discontinued operations | - | (9 | ) | (670 | ) | (29 | ) | |||||||||
Less income allocated to perpetual preferred units | - | (1,750 | ) | (776 | ) | (5,250 | ) | |||||||||
Less write off of original issuance costs of redeemed perpetual preferred units | - | - | (2,075 | ) | - | |||||||||||
Net income attributable to common shareholders | $30,703 | $11,840 | $141,224 | $2,529 | ||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||||||||||||||
Net income | $31,803 | $14,351 | $147,754 | $9,897 | ||||||||||||
Other comprehensive income | ||||||||||||||||
Unrealized loss on cash flow hedging activities | - | - | - | (2,692 | ) | |||||||||||
Reclassification of net losses on cash flow hedging activities | - | 108 | - | 39,660 | ||||||||||||
Reclassification of gain on available-for-sale investment to earnings, net of tax | - | - | - | (3,309 | ) | |||||||||||
Reclassification of prior service cost on post retirement obligations | 7 | - | 23 | - | ||||||||||||
Comprehensive income | 31,810 | 14,459 | 147,777 | 43,556 | ||||||||||||
Less income allocated to noncontrolling interests from continuing operations | (1,100 | ) | (752 | ) | (3,009 | ) | (2,089 | ) | ||||||||
Less income, including gain on sale, allocated to noncontrolling interests from discontinued operations | - | (9 | ) | (670 | ) | (29 | ) | |||||||||
Less income allocated to perpetual preferred units | - | (1,750 | ) | (776 | ) | (5,250 | ) | |||||||||
Less write off of original issuance costs of redeemed perpetual preferred units | - | - | (2,075 | ) | - | |||||||||||
Comprehensive income attributable to common shareholders | $30,710 | $11,948 | $141,247 | $36,188 | ||||||||||||
PER SHARE DATA | ||||||||||||||||
Net income attributable to common shareholders - basic | $0.36 | $0.16 | $1.69 | $0.03 | ||||||||||||
Net income attributable to common shareholders - diluted | 0.35 | 0.16 | 1.66 | 0.03 | ||||||||||||
Income (loss) from continuing operations attributable to common shareholders - basic | 0.35 | 0.14 | 1.29 | (0.01 | ) | |||||||||||
Income (loss) from continuing operations attributable to common shareholders - diluted | 0.35 | 0.14 | 1.27 | (0.01 | ) | |||||||||||
Weighted average number of common and | ||||||||||||||||
common equivalent shares outstanding: | ||||||||||||||||
Basic | 85,631 | 73,242 | 82,923 | 72,502 | ||||||||||||
Diluted | 86,293 | 74,274 | 84,694 | 72,502 | ||||||||||||
Note: Please refer to the following pages for definitions and reconciliations of all non-GAAP financial measures presented in this document. |
CAMDEN | FUNDS FROM OPERATIONS | |||||||||||||||
(In thousands, except per share and property data amounts) | ||||||||||||||||
(Unaudited) | Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | |||||||||||||||
FUNDS FROM OPERATIONS | 2012 | 2011 | 2012 | 2011 | ||||||||||||
Net income attributable to common shareholders (a) | $30,703 | $11,840 | $141,224 | $2,529 | ||||||||||||
Real estate depreciation from continuing operations | 51,477 | 42,095 | 152,246 | 129,778 | ||||||||||||
Real estate depreciation and amortization from discontinued operations | 221 | 1,191 | 844 | 3,564 | ||||||||||||
Adjustments for unconsolidated joint ventures | 1,885 | 3,223 | 6,198 | 7,042 | ||||||||||||
Income allocated to noncontrolling interests | 702 | 458 | 2,504 | 1,494 | ||||||||||||
(Gain) on sale of unconsolidated joint venture property | (2,875 | ) | - | (2,875 | ) | - | ||||||||||
(Gain) on acquisition of controlling interests in joint ventures | - | - | (40,191 | ) | - | |||||||||||
(Gain) on sale of discontinued operations, net of tax | - | - | (32,541 | ) | - | |||||||||||
(Gain) on sale of unconsolidated joint venture interests | - | - | - | (1,136 | ) | |||||||||||
Funds from operations - diluted | $82,113 | $58,807 | $227,409 | $143,271 | ||||||||||||
PER SHARE DATA | ||||||||||||||||
Funds from operations - diluted | $0.93 | $0.77 | $2.65 | $1.89 | ||||||||||||
Cash distributions | 0.56 | 0.49 | 1.68 | 1.47 | ||||||||||||
Weighted average number of common and | ||||||||||||||||
common equivalent shares outstanding: | ||||||||||||||||
FFO - diluted | 88,514 | 76,494 | 85,822 | 75,685 | ||||||||||||
PROPERTY DATA | ||||||||||||||||
Total operating properties (end of period) (b) | 203 | 197 | 203 | 197 | ||||||||||||
Total operating apartment homes in operating properties (end of period) (b) | 68,831 | 67,491 | 68,831 | 67,491 | ||||||||||||
Total operating apartment homes (weighted average) | 54,934 | 50,921 | 53,870 | 50,895 | ||||||||||||
Total operating apartment homes - excluding discontinued operations (weighted average) | 54,461 | 48,627 | 53,204 | 48,601 | ||||||||||||
(a) Includes a $29.8 million charge related to a loss on the discontinuation of a hedging relationship for the nine months ended September 30, 2011. | ||||||||||||||||
(b) Includes joint ventures and properties held for sale. |
Note: Please refer to the following pages for definitions and reconciliations of all non-GAAP financial measures presented in this document.
CAMDEN | BALANCE SHEETS | |||||||||||||||||||
(In thousands) | ||||||||||||||||||||
(Unaudited) | Sept 30, | Jun 30, | Mar 31, | Dec 31, | Sep 30, | |||||||||||||||
2012 | 2012 | 2012 | 2011 | 2011 | ||||||||||||||||
ASSETS | ||||||||||||||||||||
Real estate assets, at cost | ||||||||||||||||||||
Land | $929,289 | $893,910 | $868,964 | $768,016 | $766,302 | |||||||||||||||
Buildings and improvements | 5,359,707 | 5,203,675 | 5,068,560 | 4,751,654 | 4,758,397 | |||||||||||||||
6,288,996 | 6,097,585 | 5,937,524 | 5,519,670 | 5,524,699 | ||||||||||||||||
Accumulated depreciation | (1,542,530 | ) | (1,505,862 | ) | (1,458,451 | ) | (1,432,799 | ) | (1,421,867 | ) | ||||||||||
Net operating real estate assets | 4,746,466 | 4,591,723 | 4,479,073 | 4,086,871 | 4,102,832 | |||||||||||||||
Properties under development, including land | 280,948 | 297,712 | 301,282 | 299,870 | 274,201 | |||||||||||||||
Investments in joint ventures | 46,566 | 47,776 | 49,436 | 44,844 | 37,033 | |||||||||||||||
Properties held for sale | 6,373 | - | - | 11,131 | - | |||||||||||||||
Total real estate assets | 5,080,353 | 4,937,211 | 4,829,791 | 4,442,716 | 4,414,066 | |||||||||||||||
Accounts receivable - affiliates | 28,874 | 29,940 | 29,742 | 31,035 | 31,395 | |||||||||||||||
Other assets, net (a) | 96,401 | 88,002 | 89,706 | 88,089 | 87,657 | |||||||||||||||
Cash and cash equivalents | 5,590 | 52,126 | 49,702 | 55,159 | 56,099 | |||||||||||||||
Restricted cash | 6,742 | 5,295 | 5,074 | 5,076 | 5,357 | |||||||||||||||
Total assets | $5,217,960 | $5,112,574 | $5,004,015 | $4,622,075 | $4,594,574 | |||||||||||||||
LIABILITIES AND EQUITY | ||||||||||||||||||||
Liabilities | ||||||||||||||||||||
Notes payable | ||||||||||||||||||||
Unsecured | $1,415,354 | $1,381,152 | $1,380,952 | $1,380,755 | $1,380,560 | |||||||||||||||
Secured | 978,371 | 1,015,260 | 1,050,154 | 1,051,357 | 1,052,544 | |||||||||||||||
Accounts payable and accrued expenses | 118,879 | 87,041 | 105,370 | 93,747 | 97,613 | |||||||||||||||
Accrued real estate taxes | 43,757 | 31,607 | 17,991 | 21,883 | 37,721 | |||||||||||||||
Distributions payable | 49,940 | 49,135 | 47,594 | 39,364 | 39,319 | |||||||||||||||
Other liabilities (b) | 78,551 | 83,471 | 90,423 | 109,276 | 111,043 | |||||||||||||||
Total liabilities | 2,684,852 | 2,647,666 | 2,692,484 | 2,696,382 | 2,718,800 | |||||||||||||||
Commitments and contingencies | ||||||||||||||||||||
Perpetual preferred units | - | - | - | 97,925 | 97,925 | |||||||||||||||
Equity | ||||||||||||||||||||
Common shares of beneficial interest | 959 | 945 | 919 | 845 | 839 | |||||||||||||||
Additional paid-in capital | 3,580,528 | 3,501,354 | 3,327,961 | 2,901,024 | 2,861,139 | |||||||||||||||
Distributions in excess of net income attributable to common shareholders | (692,235 | ) | (674,221 | ) | (648,074 | ) | (690,466 | ) | (700,897 | ) | ||||||||||
Treasury shares, at cost | (425,756 | ) | (430,958 | ) | (437,215 | ) | (452,003 | ) | (452,244 | ) | ||||||||||
Accumulated other comprehensive income (loss) (c) | (660 | ) | (667 | ) | (675 | ) | (683 | ) | 201 | |||||||||||
Total common equity | 2,462,836 | 2,396,453 | 2,242,916 | 1,758,717 | 1,709,038 | |||||||||||||||
Noncontrolling interests | 70,272 | 68,455 | 68,615 | 69,051 | 68,811 | |||||||||||||||
Total equity | 2,533,108 | 2,464,908 | 2,311,531 | 1,827,768 | 1,777,849 | |||||||||||||||
Total liabilities and equity | $5,217,960 | $5,112,574 | $5,004,015 | $4,622,075 | $4,594,574 | |||||||||||||||
(a) Includes: | ||||||||||||||||||||
net deferred charges of: | $13,695 | $14,432 | $15,267 | $16,102 | $16,868 | |||||||||||||||
(b) Includes: | ||||||||||||||||||||
deferred revenues of: | $1,746 | $2,012 | $2,337 | $2,140 | $2,213 | |||||||||||||||
distributions in excess of investments in joint ventures of: | $16,708 | $16,499 | $16,298 | $30,596 | $31,799 | |||||||||||||||
fair value adjustment of derivative instruments: | $185 | $5,918 | $11,574 | $16,486 | $22,192 | |||||||||||||||
(c) Represents the unrealized (loss)/gain and unamortized prior service costs on post retirement obligations. |
CAMDEN | NON-GAAP FINANCIAL MEASURES |
DEFINITIONS & RECONCILIATIONS | |
(In thousands, except per share amounts) | |
(Unaudited) | |
This document contains certain non-GAAP financial measures management believes are useful in evaluating an equity REIT's performance. Camden's | |
definitions and calculations of non-GAAP financial measures may differ from those used by other REITs, and thus may not be comparable. The non-GAAP | |
financial measures should not be considered as an alternative to net income as an indication of our operating performance, or to net cash provided by operating | |
activities as a measure of our liquidity. |
FFO |
The National Association of Real Estate Investment Trusts (“NAREIT”) currently defines FFO as net income attributable to common shares computed in accordance |
with generally accepted accounting principles (“GAAP”), excluding gains or losses from depreciable operating property sales, plus real estate depreciation and amortization, |
and after adjustments for unconsolidated partnerships and joint ventures. Camden’s definition of diluted FFO also assumes conversion of all dilutive convertible securities, |
including minority interests, which are convertible into common equity. The Company considers FFO to be an appropriate supplemental measure of operating performance |
because, by excluding gains or losses on dispositions of operating properties and excluding depreciation, FFO can help one compare the operating performance of a |
company's real estate between periods or as compared to different companies. A reconciliation of net income attributable to common shareholders to FFO is provided below: |
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Net income (loss) attributable to common shareholders (a) | $30,703 | $11,840 | $141,224 | $2,529 | ||||||||||||
Real estate depreciation from continuing operations | 51,477 | 42,095 | 152,246 | 129,778 | ||||||||||||
Real estate depreciation and amortization from discontinued operations | 221 | 1,191 | 844 | 3,564 | ||||||||||||
Adjustments for unconsolidated joint ventures | 1,885 | 3,223 | 6,198 | 7,042 | ||||||||||||
Income allocated to noncontrolling interests | 702 | 458 | 2,504 | 1,494 | ||||||||||||
(Gain) on sale of unconsolidated joint venture property | (2,875 | ) | - | (2,875 | ) | - | ||||||||||
(Gain) on acquisition of controlling interests in joint ventures | - | - | (40,191 | ) | - | |||||||||||
(Gain) on sale of discontinued operations, net of tax | - | - | (32,541 | ) | - | |||||||||||
(Gain) on sale of unconsolidated joint venture interests | - | - | - | (1,136 | ) | |||||||||||
Funds from operations - diluted | $82,113 | $58,807 | $227,409 | $143,271 | ||||||||||||
Weighted average number of common and | ||||||||||||||||
common equivalent shares outstanding: | ||||||||||||||||
EPS diluted | 86,293 | 74,274 | 84,694 | 72,502 | ||||||||||||
FFO diluted | 88,514 | 76,494 | 85,822 | 75,685 | ||||||||||||
Net income (loss) attributable to common shareholders - diluted | $0.35 | $0.16 | $1.66 | $0.03 | ||||||||||||
FFO per common share - diluted | $0.93 | $0.77 | $2.65 | $1.89 | ||||||||||||
(a) Includes a $29.8 million charge related to a loss on the discontinuation of a hedging relationship for the nine months ended September 30, 2011. |
Expected FFO |
Expected FFO is calculated in a method consistent with historical FFO, and is considered an appropriate supplemental measure of expected operating |
performance when compared to expected net income attributable to common shareholders (EPS). A reconciliation of the ranges provided for expected |
net income attributable to common shareholders per diluted share to expected FFO per diluted share is provided below: |
4Q12 Range | 2012 Range | |||||||||||||||
Low | High | Low | High | |||||||||||||
Expected net income attributable to common shareholders per share - diluted | $0.42 | $0.46 | $2.06 | $2.10 | ||||||||||||
Expected real estate depreciation from continuing operations | 0.56 | 0.56 | 2.33 | 2.33 | ||||||||||||
Expected real estate depreciation and amortization from discontinued operations | 0.00 | 0.00 | 0.01 | 0.01 | ||||||||||||
Expected adjustments for unconsolidated joint ventures | (0.05 | ) | (0.05 | ) | 0.02 | 0.02 | ||||||||||
Expected income allocated to noncontrolling interests | 0.01 | 0.01 | 0.04 | 0.04 | ||||||||||||
(Gain) on sale of uncosolidated joint venture property | 0.00 | 0.00 | (0.03 | ) | (0.03 | ) | ||||||||||
Realized (gain) on acquisition of controlling interests in joint ventures | 0.00 | 0.00 | (0.46 | ) | (0.46 | ) | ||||||||||
Realized (gain) on sale of discontinued operations, net of tax | 0.00 | 0.00 | (0.38 | ) | (0.38 | ) | ||||||||||
Expected FFO per share - diluted | $0.94 | $0.98 | $3.59 | $3.63 |
Note: This table contains forward-looking statements. Please see the paragraph regarding forward-looking statements earlier in this document.
CAMDEN | NON-GAAP FINANCIAL MEASURES |
DEFINITIONS & RECONCILIATIONS | |
(In thousands, except per share amounts) | |
(Unaudited) |
Net Operating Income (NOI) |
NOI is defined by the Company as total property income less property operating and maintenance expenses less real estate taxes. The Company considers |
NOI to be an appropriate supplemental measure of operating performance to net income attributable to common shareholders because it reflects the |
operating performance of our communities without allocation of corporate level property management overhead or general and administrative costs. |
A reconciliation of net income attributable to common shareholders to net operating income is provided below: |
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Net income attributable to common shareholders | $30,703 | $11,840 | $141,224 | $2,529 | ||||||||||||
Less: Fee and asset management income | (3,041 | ) | (2,646 | ) | (9,572 | ) | (6,955 | ) | ||||||||
Less: Interest and other (income) loss | (3 | ) | 108 | 750 | (4,749 | ) | ||||||||||
Less: Income (loss) on deferred compensation plans | 1,781 | 6,096 | (3,820 | ) | (1,233 | ) | ||||||||||
Plus: Property management expense | 5,509 | 5,050 | 15,644 | 15,478 | ||||||||||||
Plus: Fee and asset management expense | 1,864 | 1,330 | 5,051 | 4,220 | ||||||||||||
Plus: General and administrative expense | 9,303 | 8,572 | 27,712 | 26,392 | ||||||||||||
Plus: Interest expense | 25,865 | 27,354 | 78,795 | 85,472 | ||||||||||||
Plus: Depreciation and amortization | 52,588 | 43,367 | 155,579 | 133,547 | ||||||||||||
Plus: Amortization of deferred financing costs | 909 | 1,344 | 2,721 | 4,761 | ||||||||||||
Plus: Expense (benefit) on deferred compensation plans | (1,781 | ) | (6,096 | ) | 3,820 | 1,233 | ||||||||||
Less: Gain on acquisition of controlling interests in joint ventures | - | - | (40,191 | ) | - | |||||||||||
Less: Gain on sale of properties, including land | - | - | - | (4,748 | ) | |||||||||||
Less: Gain on sale of unconsolidated joint venture interests | - | - | - | (1,136 | ) | |||||||||||
Plus: Loss on discontinuation of hedging relationship | - | - | - | 29,791 | ||||||||||||
Less: Equity in income (loss) of joint ventures | (3,688 | ) | 556 | (4,686 | ) | 166 | ||||||||||
Plus: Income tax expense - current | 334 | 313 | 992 | 1,889 | ||||||||||||
Less: Income from discontinued operations | (343 | ) | (1,098 | ) | (1,262 | ) | (3,196 | ) | ||||||||
Less: Gain on sale of discontinued operations, net of tax | - | - | (32,541 | ) | - | |||||||||||
Plus: Income allocated to noncontrolling interests from continuing operations | 1,100 | 752 | 3,009 | 2,089 | ||||||||||||
Plus: Income, including gain on sale, allocated to noncontrolling interests from discontinued operations | - | 9 | 670 | 29 | ||||||||||||
Plus: Income allocated to perpetual preferred units | - | 1,750 | 776 | 5,250 | ||||||||||||
Plus: Write off of original issuance costs of redeemed perpetual preferred units | - | - | 2,075 | - | ||||||||||||
Net Operating Income (NOI) | $121,100 | $98,601 | $346,746 | $290,829 | ||||||||||||
"Same Property" Communities | $105,939 | $95,735 | $309,612 | $282,528 | ||||||||||||
Non-"Same Property" Communities | 13,300 | 2,567 | 33,127 | 7,839 | ||||||||||||
Development and Lease-Up Communities | 1,148 | - | 1,476 | - | ||||||||||||
Other | 713 | 299 | 2,531 | 462 | ||||||||||||
Net Operating Income (NOI) | $121,100 | $98,601 | $346,746 | $290,829 |
EBITDA |
EBITDA is defined by the Company as earnings before interest, taxes, depreciation and amortization, including net operating income from discontinued operations, |
excluding equity in (income) loss of joint ventures, (gain) loss on sale of unconsolidated joint venture interests, gain on acquisition of controlling interest in joint ventures, |
gain on sale of discontinued operations, net of tax, and income (loss) allocated to noncontrolling interests. |
The Company considers EBITDA to be an appropriate supplemental measure of operating performance to net income attributable to common |
shareholders because it represents income before non-cash depreciation and the cost of debt, and excludes gains or losses from property dispositions. |
A reconciliation of net income attributable to common shareholders to EBITDA is provided below: |
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Net income attributable to common shareholders | $30,703 | $11,840 | $141,224 | $2,529 | ||||||||||||
Plus: Interest expense | 25,865 | 27,354 | 78,795 | 85,472 | ||||||||||||
Plus: Amortization of deferred financing costs | 909 | 1,344 | 2,721 | 4,761 | ||||||||||||
Plus: Depreciation and amortization | 52,588 | 43,367 | 155,579 | 133,547 | ||||||||||||
Plus: Income allocated to perpetual preferred units | - | 1,750 | 776 | 5,250 | ||||||||||||
Plus: Write off of original issuance costs of redeemed perpetual preferred units | - | - | 2,075 | - | ||||||||||||
Plus: Income, including gain on sale, allocated to noncontrolling interests from discontinued operations | - | 9 | 670 | 29 | ||||||||||||
Plus: Income allocated to noncontrolling interests from continuing operations | 1,100 | 752 | 3,009 | 2,089 | ||||||||||||
Plus: Income tax expense - current | 334 | 313 | 992 | 1,889 | ||||||||||||
Plus: Real estate depreciation and amortization from discontinued operations | 221 | 1,191 | 844 | 3,564 | ||||||||||||
Less: Gain on sale of properties, including land | - | - | - | (4,748 | ) | |||||||||||
Less: Gain on sale of unconsolidated joint venture interests | - | - | - | (1,136 | ) | |||||||||||
Less: Gain on acquisition of controlling interests in joint ventures | - | - | (40,191 | ) | - | |||||||||||
Less: Equity in income (loss) of joint ventures | (3,688 | ) | 556 | (4,686 | ) | 166 | ||||||||||
Less: Gain on sale of discontinued operations, net of tax | - | - | (32,541 | ) | - | |||||||||||
Plus: Loss on discontinuation of hedging relationship | - | - | - | 29,791 | ||||||||||||
EBITDA | $108,032 | $88,476 | $309,267 | $263,203 |
Note: This table contains forward-looking statements. Please see the paragraph regarding forward-looking statements earlier in this document.