Exhibit 99.1
Listed on the New York Stock Exchange (CLP) NEWS RELEASE
Colonial Properties Trust Reports Results for Third Quarter 2011
--Same-Property Portfolio Posts 8.3% NOI Growth-
--Completes Sales of $106 Million as Part of Asset Recycling Strategy--
BIRMINGHAM, Ala. - October 27, 2011 - Colonial Properties Trust (NYSE: CLP) announced its results for the quarter ended September 30, 2011.
For the third quarter 2011, the company reported net income available to common shareholders of $12.5 million, or $0.14 per diluted share, compared with a net loss available to common shareholders of $16.8 million, or $0.23 per diluted share, for the same period in 2010. For the nine months ended September 30, 2011, the company reported a net loss available to common shareholders of $5.6 million, or $0.07 per diluted share, compared with a net loss available to common shareholders of $40.9 million, or $0.59 per diluted share, for the same period in 2010. The change from the prior-year periods is primarily attributable to an increase in net operating income (NOI) from the company's multifamily same-property communities as a result of improving rental rates, income from multifamily properties acquired in 2011 and $23.7 million of gains recognized from the sale of six apartment communities during the third quarter 2011.
Funds from Operations Available to Common Shareholders and Unitholders (FFO), a widely accepted measure of REIT performance, for the third quarter 2011 was $26.4 million, or $0.28 per diluted share, compared with $16.3 million, or $0.20 per diluted share, for the same period in 2010. FFO for the nine months ended September 30, 2011, totaled $78.4 million, or $0.87 per diluted share, compared with $57.6 million, or $0.74 per diluted share, for the same period in 2010. The change from the prior-year periods is primarily attributable to an increase in NOI from the company's multifamily same-property communities as a result of improving rental rates and income from multifamily properties acquired in 2011.
A reconciliation of net income/loss available to common shareholders to FFO and to Operating FFO, and a reconciliation of NOI to income/loss from continuing operations, as well as definitions and statements of purpose, is included in the financial tables accompanying this press release.
“Our third quarter same-property NOI growth of 8.3 percent and same-property revenue growth of 5.5 percent represent some of the best operating results in our company's history and reflect the strong operating fundamentals we are experiencing in our multifamily portfolio,” stated Thomas H. Lowder, Chairman and Chief Executive Officer. “We sold $106 million of multifamily apartment communities and acquired $90 million as part of our asset recycling strategy during the quarter, improving our portfolio's average age, margin and average rent per unit, while lowering the capital expenditure requirements.”
Highlights for the Third Quarter 2011
• | Multifamily same-property NOI increased 8.3 percent compared with third quarter 2010 |
• | Multifamily same-property revenue increased 5.5 percent compared with third quarter 2010 |
• | Ended the quarter with multifamily same-property physical occupancy of 96.1 percent |
• | Executed on the company's asset recycling strategy with the sale of six apartment communities for $105.8 million and the acquisition of three apartment communities for $90.3 million |
• | Closed a $250 million unsecured term loan maturing in 2018 |
Multifamily Operating Performance
Multifamily NOI for the third quarter 2011 increased 8.3 percent compared with the third quarter 2010 for the 29,233 apartment homes included in the consolidated same-property results. Multifamily same-property revenues increased 5.5 percent and expenses increased 1.9 percent compared with the third quarter 2010. The increase in revenues was primarily due to an improvement in both new and renewal lease rates and a consistently high occupancy level. Same-property physical occupancy as of September 30, 2011, was 96.1 percent compared with 96.5 percent at September 30, 2010.
Sequentially, multifamily same-property NOI for the third quarter 2011 decreased 1.4 percent compared with the second quarter 2011, with revenues increasing 1.5 percent and expenses increasing 5.6 percent compared with the prior quarter. The decrease in same-property NOI is primarily due to seasonal increases in utilities and repair and maintenance costs in the third quarter 2011 compared to the second quarter 2011.
Development Activity
During the third quarter 2011, the company commenced construction of Colonial Grand at Lake Mary, a 232-unit apartment community located in Orlando, Florida. Total project costs are expected to be approximately $30.3 million, with completion scheduled for the fourth quarter 2012 and stabilization expected in the third quarter 2013.
Additionally, the company commenced site work at Colonial Promenade Huntsville, a retail shopping center located in Huntsville, Alabama, that will be shadow anchored by Wal-Mart. Total site work costs for the first phase are expected to be approximately $3.8 million, including land previously acquired in 2007. Completion of the site work is scheduled for the fourth quarter 2012. The company is evaluating plans for this development, which will be finalized upon tenant interest.
Asset Recycling Transactions
As previously announced, the company completed the sales of six apartment communities with a total of 1,726 units and an average age of 21.8 years for total proceeds of $105.8 million and acquired three apartment communities with a total of 906 units with an average age of 3.7 years for a total of $90.3 million.
The acquired properties include: the 278-unit Colonial Reserve at Medical District in Dallas, Texas; the 316-unit Colonial Village at Beaver Creek in Raleigh, North Carolina; and the 312-unit Colonial Grand at Commerce Park in Charleston, South Carolina.
The company sold the following properties: the 250-unit Colonial Grand at Sugarloaf and 434-unit Colonial Grand at McGinnis Ferry in Atlanta, Georgia; the 250-unit Colonial Village at Meadow Creek in Charlotte, North Carolina; and the 232-unit Summer Tree, 232-unit Brookfield and 328-unit Paces Cove apartment communities in Dallas/Ft. Worth, Texas.
Financing Activity
As previously disclosed, on July 22, 2011, the company completed a $250 million unsecured term loan led by Wells Fargo Bank N.A. that has a scheduled maturity date of August 1, 2018. The unsecured term loan bears an interest rate of LIBOR plus a margin ranging from 165 to 290 basis points, based on credit ratings on the company's unsecured debt from time to time, with an initial margin of 245 basis points. The company executed two interest rate swaps that fixed the rate of this unsecured term loan through
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maturity at an all-in initial fixed interest rate of 5.00 percent, based on the initial margin of 245 basis points. The proceeds from the loan were used to pay down a portion of the outstanding balance under the company's unsecured credit facility.
Capital Markets Activity
In early July, the company completed its previously announced $75 million “at-the-market” equity offering program, pursuant to which it issued a total of 3.6 million shares at an average price of $20.67 per share, including 0.4 million shares issued during the third quarter 2011. Year-to-date, the company has raised total net proceeds of $163.7 million through its “at-the-market” equity offering programs at an average price of $19.80 per share.
Quarterly Dividend on Common Shares
On October 26, 2011, the Board of Trustees approved a cash dividend of $0.15 per common share, payable November 14, 2011, to shareholders of record as of November 7, 2011, representing an ex-dividend date of November 3, 2011.
2011 EPS and FFO per Share Guidance
The company's updated guidance range for the full-year 2011 for EPS and FFO per share, with revised assumptions regarding multifamily same-property NOI growth and the timing of certain transactions, is set forth and reconciled below:
Full-Year 2011 Range | |||||||
Low | - | High | |||||
Diluted EPS | $ | (0.20 | ) | - | $ | (0.03 | ) |
Plus: Real Estate Depreciation & Amortization | 1.60 | - | 1.60 | ||||
Less: Gain on Sale of Operating Properties | (0.26 | ) | - | (0.41 | ) | ||
Total Diluted FFO per share | $ | 1.14 | - | $ | 1.16 | ||
Less: Transaction Income | |||||||
(Gain)/Loss on Sale of Land and Bond or Preferred Stock Unit Repurchases | 0.00 | - | 0.00 | ||||
Operating FFO per share | $ | 1.14 | $ | 1.16 |
Following are current assumptions reflected in the company's full-year 2011 guidance:
• | Multifamily same-property net operating income: growth of 6.50 to 7.25 percent. |
◦ | Revenue: Increase of 3.75 to 4.50 percent |
◦ | Expense: Increase of 0.00 to 0.75 percent |
• | Development spending of $50 million to $60 million ($25.4 million spent to date in 2011). |
• | Acquisitions of $200 million to $250 million ($200.8 million completed to date in 2011). |
• | Dispositions of $125 million to $225 million ($105.8 million completed to date in 2011). |
• | Unsecured debt financings of $250 million, which was completed in July 2011. |
• | Land and for-sale residential property dispositions of $16 million to $18 million ($16.1 million completed to date in 2011). |
• | Corporate G&A expenses of $20 million to $21 million. |
The company's guidance range reflects the existence of volatile economic conditions, and is based on a number of assumptions, many of which are outside the company's control and all of which are subject to
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change. The company's guidance may change if actual results vary from these assumptions.
For additional details regarding the company's disposition and investment activities, see the company's Supplemental Financial Highlights available on the company's website at www.colonialprop.com.
Conference Call and Supplemental Materials
The company will hold its quarterly conference call Thursday, October 27, 2011, at 1:00 p.m. Central Time. The call will include a review of the company's third quarter performance and a discussion of the company's strategy and expectations for the future.
To participate, please dial 1-800-936-4761. As with previous calls, a replay will be available for seven days by dialing 1-800-633-8284; the conference ID is 21515952. Access to the live call and a replay will also be available through the company's website at www.colonialprop.com under “Investors: Press Releases: Event Calendar.”
Colonial Properties Trust produces a supplemental information package that provides detailed information regarding operating performance, investing activities and the company's overall financial position. For a copy of Colonial Properties' detailed Supplemental Financial Highlights, please visit the company's website at www.colonialprop.com under the “Investors: Financial Information and Filings: Quarterly Supplemental Information” tab, or contact Jerry Brewer in Investor Relations at 1-800-645-3917.
Colonial Properties Trust is a real estate investment trust (REIT) that creates value for its shareholders through a multifamily focused portfolio and the management and development of select commercial assets in the Sunbelt region of the United States. As of September 30, 2011, the company owned or managed 34,369 apartment units and 13.3 million square feet of commercial space. Headquartered in Birmingham, Alabama, Colonial Properties is listed on the New York Stock Exchange under the symbol CLP and is included in the S&P SmallCap 600 Index. For more information, please visit the company's website at www.colonialprop.com.
Non-GAAP Financial Measures
The company uses certain non-GAAP financial measures in this press release. The non-GAAP financial measures include FFO, Operating FFO and NOI. The definitions of these non-GAAP financial measures are summarized below. The company believes that these measures are helpful to investors in measuring financial performance and comparing such performance to other REITs.
Funds from Operations - FFO, as defined by the National Association of Real Estate Investment Trusts (NAREIT), means income (loss) before non-controlling interest (determined in accordance with GAAP), excluding gains (losses) from debt restructuring and sales of depreciated property, plus real estate depreciation and after adjustments for unconsolidated partnerships and joint ventures. FFO is presented to assist investors in analyzing the company's performance. The company believes that FFO is useful to investors because it provides an additional indicator of the company's financial and operating performance. This is because, by excluding the effect of real estate depreciation and gains (or losses) from sales of properties (all of which are based on historical costs which may be of limited relevance in evaluating current performance), FFO can facilitate comparison of operating performance among equity REITs. FFO is a widely recognized measure in the company's industry.
The company believes that the line on its consolidated statements of income entitled “net income available to common shareholders” is the most directly comparable GAAP measure to FFO.
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Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, many industry investors and analysts have considered presentation of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. Thus, NAREIT created FFO as a supplemental measure of REIT operating performance that excludes historical cost depreciation, among other items, from GAAP net income. Management believes that the use of FFO, combined with the required primary GAAP presentations, is fundamentally beneficial, improving the understanding of operating results of REITs among the investing public and making comparisons of REIT operating results more meaningful. In addition to company management evaluating the operating performance of its reportable segments based on FFO results, management uses FFO and FFO per share, along with other measures, to assess performance in connection with evaluating and granting incentive compensation to key employees.
Operating FFO - The company also uses operating funds from operations (“Operating FFO”) as an operating measure. The company defines Operating FFO as FFO excluding gains on the sale of land and development properties and gains on the repurchase of bonds and preferred shares. The company believes Operating FFO is an important supplemental measure because it provides a measure of operating performance. While land and development gains or the repurchase of debt/preferred shares are components of the company's current business plan, the timing and amount of these transactions can vary significantly between periods. The company believes that the line on its consolidated statements of income entitled “net income available to common shareholders” is the most directly comparable GAAP measure to Operating FFO.
Property Net Operating Income - The company uses property NOI, including same store NOI, as an operating measure. NOI is defined as total property revenues, including unconsolidated partnerships and joint ventures, less total property operating expenses (such items as repairs and maintenance, payroll, utilities, property taxes, insurance and advertising). The company believes that in order to facilitate a clear understanding of its operating results, NOI should be examined in conjunction with (loss) income from continuing operations as presented in the company's consolidated financial statements. The company also believes that NOI is an important supplemental measure of operating performance for a REIT's operating real estate because it provides a measure of the core operations, rather than factoring in depreciation and amortization, financing costs and general and administrative expenses. This measure is particularly useful, in the opinion of the company, in evaluating the performance of geographic operations, same store groupings and individual properties. Additionally, the company believes that NOI is a widely accepted measure of comparative operating performance in the real estate investment community. The company believes that the line on its consolidated statements of income entitled "(loss) income from continuing operations" is the most directly comparable GAAP measure to NOI. In addition to company management evaluating the operating performance of its reportable segments based on NOI results, management uses NOI, along with other measures, to assess performance in connection with evaluating and granting incentive compensation to key employees.
The company's method of calculating FFO, Operating FFO and NOI may be different from methods used by other REITs and, accordingly, may not be comparable to such other REITs. FFO, Operating FFO and NOI should not be considered (1) as an alternative to net income (determined in accordance with GAAP), (2) as an indicator of financial performance, (3) as cash flow from operating activities (determined in accordance with GAAP) or (4) as a measure of liquidity, nor is it indicative of sufficient cash flow to fund all of the company's needs, including the company's ability to make distributions.
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Safe Harbor Statement
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: Estimates of future earnings are, by definition, and certain other statements in this press release, including statements regarding the company's asset recycling program, development costs and stabilization expectations, may constitute, “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and involve known and unknown risks, uncertainties and other factors that may cause the company's actual results, performance, achievements or transactions to be materially different from the results, performance, achievements or transactions expressed or implied by the forward looking statements. Factors that impact such forward looking statements include, among others, changes in national, regional and local economic conditions, which may be negatively impacted by concerns about inflation, deflation, government deficits, high unemployment rates, decreased consumer confidence and liquidity concerns, particularly in markets in which we have a high concentration of properties; exposure, as a multifamily focused REIT, to risks inherent in investments in a single industry; ability to obtain financing on favorable rates, if at all; performance of affiliates or companies in which we have made investments; changes in operating costs; higher than expected construction costs; uncertainties associated with the timing and amount of real estate disposition and the resulting gains/losses associated with such dispositions; legislative or regulatory decisions; the company's ability to continue to maintain our status as a REIT for federal income tax purposes; price volatility, dislocations and liquidity disruptions in the financial markets and the resulting impact on availability of financing; the effect of any rating agency action on the cost and availability of new debt financings; level and volatility of interest rates or capital market conditions; effect of any terrorist activity or other heightened geopolitical crisis; or other factors affecting the real estate industry generally.
Except as otherwise required by the federal securities laws, the company assumes no responsibility to update the information in this press release.
The company refers you to the documents filed by the company from time to time with the Securities and Exchange Commission, specifically the section titled “Risk Factors” in the company's Annual Report on Form 10-K for the year ended December 31, 2010, as may be updated or supplemented in the company's Form 10-Q filings, which discuss these and other factors that could adversely affect the company's results.
CONTACT: Colonial Properties Trust
Jerry A. Brewer, Executive Vice President, Finance, 1-800-645-3917
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COLONIAL PROPERTIES TRUST | |||||||
Financial Statements | |||||||
Third Quarter 2011 | |||||||
BALANCE SHEET | |||||||
($ in 000s) | As of | As of | |||||
9/30/2011 | 12/31/2010 | ||||||
ASSETS | |||||||
Real Estate Assets | |||||||
Operating Properties | $ | 3,423,680 | $ | 3,331,108 | |||
Undeveloped Land & Construction in Progress | 290,401 | 261,955 | |||||
Total Real Estate, before Depreciation | 3,714,081 | 3,593,063 | |||||
Less: Accumulated Depreciation | (703,230 | ) | (640,981 | ) | |||
Real Estate Assets Held for Sale, net | 12,073 | 16,861 | |||||
Net Real Estate Assets | 3,022,924 | 2,968,943 | |||||
Cash and Equivalents | 3,697 | 4,954 | |||||
Restricted Cash | 22,076 | 9,294 | |||||
Accounts Receivable, net | 26,210 | 20,734 | |||||
Notes Receivable | 43,923 | 44,538 | |||||
Prepaid Expenses | 21,519 | 23,225 | |||||
Deferred Debt and Lease Costs | 23,035 | 23,035 | |||||
Investment in Unconsolidated Subsidiaries | 19,253 | 22,828 | |||||
Other Assets | 51,264 | 53,583 | |||||
Total Assets | $ | 3,233,901 | $ | 3,171,134 | |||
LIABILITIES | |||||||
Unsecured Credit Facility | $ | 105,529 | $ | 377,362 | |||
Notes and Mortgages Payable | 1,576,191 | 1,384,209 | |||||
Total Debt | 1,681,720 | 1,761,571 | |||||
Accounts Payable | 39,302 | 38,915 | |||||
Accrued Interest | 16,317 | 12,002 | |||||
Accrued Expenses | 28,550 | 15,267 | |||||
Investment in Unconsolidated Subsidiaries | 31,126 | 27,954 | |||||
Other Liabilities | 20,898 | 10,129 | |||||
Total Liabilities | 1,817,913 | 1,865,838 | |||||
Redeemable Common Units | 144,616 | 145,539 | |||||
EQUITY | |||||||
Noncontrolling Interest | |||||||
Series B 7 1/4%, Preferred Units | 50,000 | 50,000 | |||||
Limited Partner's Noncontrolling Interest | 756 | 769 | |||||
Total Noncontrolling Interest | 50,756 | 50,769 | |||||
Cumulative Earnings | 1,257,944 | 1,260,944 | |||||
Cumulative Distributions | (1,848,863 | ) | (1,808,700 | ) | |||
Common Equity, including Additional Paid-in Capital | 1,976,956 | 1,809,138 | |||||
Treasury Shares, at Cost | (150,163 | ) | (150,163 | ) | |||
Accumulated Other Comprehensive Loss | (15,258 | ) | (2,231 | ) | |||
Total Equity, including Noncontrolling Interest | 1,271,372 | 1,159,757 | |||||
Total Liabilities and Equity | $ | 3,233,901 | $ | 3,171,134 | |||
SHARES & UNITS OUTSTANDING, END OF PERIOD | |||||
(shares and units in 000s) | As of | As of | |||
9/30/2011 | 12/31/2010 | ||||
Basic | |||||
Shares | 87,306 | 78,334 | |||
Operating Partnership Units (OP Units) | 7,249 | 7,300 | |||
Total Shares & OP Units | 94,555 | 85,634 |
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COLONIAL PROPERTIES TRUST | |||||||||||||||
Financial Statements | |||||||||||||||
Third Quarter 2011 | |||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||
($ in 000s, except per share data) | Three Months Ended | Nine Months Ended | |||||||||||||
9/30/2011 | 9/30/2010 | 9/30/2011 | 9/30/2010 | ||||||||||||
Revenue | |||||||||||||||
Minimum Rent | $ | 79,073 | $ | 70,807 | $ | 229,782 | $ | 211,893 | |||||||
Tenant Recoveries | 2,888 | 2,410 | 8,081 | 7,795 | |||||||||||
Other Property Related Revenue | 13,177 | 11,737 | 38,531 | 34,225 | |||||||||||
Other Non-Property Related Revenue | 1,967 | 2,614 | 5,950 | 8,912 | |||||||||||
Total Revenue | 97,105 | 87,568 | 282,344 | 262,825 | |||||||||||
Operating Expenses | |||||||||||||||
Operating Expenses: | |||||||||||||||
Property Operating Expenses | 28,740 | 26,925 | 79,520 | 75,970 | |||||||||||
Taxes, Licenses and Insurance | 10,556 | 9,419 | 31,641 | 30,506 | |||||||||||
Total Property Operating Expenses | 39,296 | 36,344 | 111,161 | 106,476 | |||||||||||
Property Management Expenses | 2,395 | 2,323 | 6,998 | 6,008 | |||||||||||
General and Administrative Expenses | 5,204 | 3,757 | 15,595 | 14,022 | |||||||||||
Management Fee and Other Expenses | 2,028 | 2,001 | 5,681 | 7,259 | |||||||||||
Investment and Development Expenses (1) | 458 | 9 | 1,437 | 42 | |||||||||||
Depreciation | 31,147 | 29,359 | 92,895 | 87,563 | |||||||||||
Amortization | 2,232 | 2,297 | 6,519 | 6,688 | |||||||||||
Impairment and Other Losses (2) | 100 | 131 | 2,344 | 914 | |||||||||||
Total Operating Expenses | 82,860 | 76,221 | 242,630 | 228,972 | |||||||||||
Income from Operations | 14,245 | 11,347 | 39,714 | 33,853 | |||||||||||
Other Income (Expense) | |||||||||||||||
Interest Expense | (22,309 | ) | (20,854 | ) | (63,582 | ) | (61,957 | ) | |||||||
Debt Cost Amortization | (1,218 | ) | (1,149 | ) | (3,516 | ) | (3,452 | ) | |||||||
Gain on Retirement of Debt | — | — | — | 1,044 | |||||||||||
Interest Income | 418 | 444 | 1,224 | 1,162 | |||||||||||
Loss from Partially-Owned Investments | (618 | ) | (687 | ) | (1,091 | ) | (23 | ) | |||||||
Loss on Hedging Activities | — | — | — | (289 | ) | ||||||||||
Gain (Loss) on Sale of Property, net of Income Taxes of $ - (Q3) and $ - (YTD) in 2011 and | |||||||||||||||
$24 (Q3) and $117 (YTD) in 2010 | 69 | (287 | ) | 13 | (947 | ) | |||||||||
Income Tax Expense | (221 | ) | (196 | ) | (740 | ) | (883 | ) | |||||||
Total Other Income (Expense) | (23,879 | ) | (22,729 | ) | (67,692 | ) | (65,345 | ) | |||||||
Loss from Continuing Operations | (9,634 | ) | (11,382 | ) | (27,978 | ) | (31,492 | ) | |||||||
Discontinued Operations | |||||||||||||||
Income from Discontinued Operations | 402 | 250 | 947 | 1,031 | |||||||||||
Gain (Loss) on Disposal of Discontinued Operations | 23,681 | (347 | ) | 23,681 | (396 | ) | |||||||||
Income (Loss) from Discontinued Operations | 24,083 | (97 | ) | 24,628 | 635 | ||||||||||
Net Income (Loss) | 14,449 | (11,479 | ) | (3,350 | ) | (30,857 | ) | ||||||||
Noncontrolling Interest | |||||||||||||||
Continuing Operations | |||||||||||||||
Noncontrolling Interest of Limited Partners | (4 | ) | (1 | ) | (47 | ) | 110 | ||||||||
Noncontrolling Interest in CRLP - Preferred | (906 | ) | (1,813 | ) | (2,719 | ) | (5,438 | ) | |||||||
Noncontrolling Interest in CRLP - Common | 810 | 1,639 | 2,449 | 4,537 | |||||||||||
Discontinued Operations | |||||||||||||||
Noncontrolling Interest in CRLP - Common | (1,850 | ) | 8 | (1,962 | ) | (62 | ) | ||||||||
Noncontrolling Interest of Limited Partners | — | — | — | (5 | ) | ||||||||||
Income Attributable to Noncontrolling Interest | (1,950 | ) | (167 | ) | (2,279 | ) | (858 | ) | |||||||
Net Income (Loss) Attributable to Parent Company | 12,499 | (11,646 | ) | (5,629 | ) | (31,715 | ) | ||||||||
Dividends to Preferred Shareholders | — | (1,582 | ) | — | (5,649 | ) | |||||||||
Preferred Share Issuance Costs Write-off, net of Discount | — | (3,550 | ) | — | (3,550 | ) | |||||||||
Net Income (Loss) Available to Common Shareholders | $ | 12,499 | $ | (16,778 | ) | $ | (5,629 | ) | $ | (40,914 | ) | ||||
_________________________ | |||||||||||||||
Continued on following page |
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COLONIAL PROPERTIES TRUST | |||||||||||||||
Financial Statements | |||||||||||||||
Third Quarter 2011 | |||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||
9/30/2011 | 9/30/2010 | 9/30/2011 | 9/30/2010 | ||||||||||||
Income (Loss) per Share - Basic | |||||||||||||||
Continuing Operations | $ | (0.11 | ) | $ | (0.23 | ) | $ | (0.34 | ) | $ | (0.60 | ) | |||
Discontinued Operations | 0.25 | — | 0.27 | 0.01 | |||||||||||
EPS - Basic | $ | 0.14 | $ | (0.23 | ) | $ | (0.07 | ) | $ | (0.59 | ) | ||||
Income (Loss) per Share - Diluted | |||||||||||||||
Continuing Operations | $ | (0.11 | ) | $ | (0.23 | ) | $ | (0.34 | ) | $ | (0.60 | ) | |||
Discontinued Operations | 0.25 | — | 0.27 | 0.01 | |||||||||||
EPS - Diluted | $ | 0.14 | $ | (0.23 | ) | $ | (0.07 | ) | $ | (0.59 | ) | ||||
(1) Reflects costs incurred related to acquisitions and abandoned pursuits. These costs are volatile and therefore may vary between periods. | |||||||||||||||
(2) For the nine months ended September 30, 2011, the Company recorded a $1.5 million charge for a loss contingency related to certain litigation, $0.6 million in | |||||||||||||||
casualty losses and $0.2 million in non-cash impairment charges. The casualty loss is related to property damage at four of the Company's multifamily apartment | |||||||||||||||
communities. Of the impairment charge, $0.1 million is related to sales of various for-sale residential units and $0.1 million is related to the sale of land outparcels. | |||||||||||||||
For the nine months ended September 30, 2010, the Company incurred $0.8 million in casualty losses related to property damage at three of the Company's | |||||||||||||||
multifamily apartment communities and $0.1 million in non-cash impairment charges related to the sales of various for-sale residential units. |
SHARES AND UNITS OUTSTANDING, WEIGHTED | |||||||||||
(shares and units in 000s) | Three Months Ended | Nine Months Ended | |||||||||
9/30/2011 | 9/30/2010 | 9/30/2011 | 9/30/2010 | ||||||||
Basic | |||||||||||
Shares | 86,573 | 74,411 | 83,250 | 70,157 | |||||||
Operating Partnership Units (OP Units) | 7,253 | 7,371 | 7,265 | 7,722 | |||||||
Total Shares & OP Units | 93,826 | 81,782 | 90,515 | 77,879 | |||||||
Dilutive Common Share Equivalents | — | — | — | — | |||||||
Diluted (1) | |||||||||||
Shares | 86,573 | 74,411 | 83,250 | 70,157 | |||||||
Total Shares & OP Units | 93,826 | 81,782 | 90,515 | 77,879 | |||||||
(1) For periods where the Company reported a net loss from continuing operations (after preferred dividends), the effect of dilutive shares has been excluded | |||||||||||
from per share computations as including such shares would be anti-dilutive. |
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COLONIAL PROPERTIES TRUST | |||||||||||||||
Financial Statements | |||||||||||||||
Third Quarter 2011 | |||||||||||||||
FUNDS FROM OPERATIONS (FFO) RECONCILIATION | |||||||||||||||
($ in 000s, except per share data) | Three Months Ended | Nine Months Ended | |||||||||||||
9/30/2011 | 9/30/2010 | 9/30/2011 | 9/30/2010 | ||||||||||||
Net Income (Loss) Available to Common Shareholders | $ | 12,499 | $ | (16,778 | ) | $ | (5,629 | ) | $ | (40,914 | ) | ||||
Noncontrolling Interest in CRLP (Operating Partnership Unitholders) | 1,040 | (1,647 | ) | (487 | ) | (4,475 | ) | ||||||||
Total | 13,539 | (18,425 | ) | (6,116 | ) | (45,389 | ) | ||||||||
Adjustments - Consolidated Properties | |||||||||||||||
Depreciation - Real Estate | 31,634 | 30,156 | 95,165 | 89,779 | |||||||||||
Amortization - Real Estate | 2,228 | 1,888 | 6,259 | 5,370 | |||||||||||
Remove: (Gain)/Loss on Sale of Property, net of Income Tax and Noncontrolling Interest | (23,751 | ) | 633 | (23,695 | ) | 1,343 | |||||||||
Include: Gain/(Loss) on Sale of Undepreciated Property, net of Income Tax and | |||||||||||||||
Noncontrolling Interest | 75 | (635 | ) | 6 | (1,276 | ) | |||||||||
Total Adjustments - Consolidated | 10,186 | 32,042 | 77,735 | 95,216 | |||||||||||
Adjustments - Unconsolidated Properties | |||||||||||||||
Depreciation - Real Estate | 1,678 | 2,070 | 4,927 | 6,193 | |||||||||||
Amortization - Real Estate | 1,181 | 739 | 2,363 | 2,185 | |||||||||||
Remove: Gain/(Loss) on Sale of Property | — | (23 | ) | 22 | (117 | ) | |||||||||
Total Adjustments - Unconsolidated | 2,859 | 2,786 | 7,312 | 8,261 | |||||||||||
Funds from Operations | $ | 26,584 | $ | 16,403 | $ | 78,931 | $ | 58,088 | |||||||
Income Allocated to Participating Securities | (183 | ) | (125 | ) | (563 | ) | (465 | ) | |||||||
Funds from Operations Available to Common Shareholders and Unitholders | $ | 26,401 | $ | 16,278 | $ | 78,368 | $ | 57,623 | |||||||
FFO per Share | |||||||||||||||
Basic | $ | 0.28 | $ | 0.20 | $ | 0.87 | $ | 0.74 | |||||||
Diluted | $ | 0.28 | $ | 0.20 | $ | 0.87 | $ | 0.74 | |||||||
Operating FFO: | |||||||||||||||
Funds from Operations | $ | 26,401 | $ | 16,278 | $ | 78,368 | $ | 57,623 | |||||||
Less: Transaction Income | |||||||||||||||
-Development and Land (Gains)/Losses | (75 | ) | 635 | (6 | ) | 1,163 | |||||||||
-Bond Repurchase Gains, net of Write-off | — | — | — | (755 | ) | ||||||||||
-Preferred Share Issuance Costs, net of Discount | — | 3,550 | — | 3,550 | |||||||||||
Operating FFO | $ | 26,326 | $ | 20,463 | $ | 78,362 | $ | 61,581 | |||||||
Operating FFO per Share | |||||||||||||||
Basic | $ | 0.28 | $ | 0.25 | $ | 0.87 | $ | 0.79 | |||||||
Diluted | $ | 0.28 | $ | 0.25 | $ | 0.87 | $ | 0.79 | |||||||
FFO, as defined by the National Association of Real Estate Investment Trusts (NAREIT), means income (loss) before Noncontrolling Interest (determined in | |||||||||||||||
accordance with GAAP), excluding gains (losses) from debt restructuring and sales of depreciated property, plus real estate depreciation and after adjustments for | |||||||||||||||
unconsolidated partnerships and joint ventures. FFO is presented to assist investors in analyzing the Company's performance. The Company believes that FFO | |||||||||||||||
is useful to investors because it provides an additional indicator of the Company's financial and operating performance. This is because, by excluding the effect of | |||||||||||||||
real estate depreciation and gains (or losses) from sales of properties (all of which are based on historical costs which may be of limited relevance in evaluating | |||||||||||||||
current performance), FFO can facilitate comparison of operating performance among equity REITs. FFO is a widely recognized measure in the Company's | |||||||||||||||
industry. | |||||||||||||||
The Company defines Operating FFO as FFO excluding gains on the sale of land and development properties, gains on the repurchase of bonds, net of the | |||||||||||||||
attributable write-off of future interest expense held in OCI, and gains on the repurchase of preferred shares/units, net of the write-off of issuance costs. The Company | |||||||||||||||
believes Operating FFO is an important supplemental measure because it provides a measure of operating performance. While land and development gains or the | |||||||||||||||
repurchase of debt/preferred shares/units are components of the Company's current business plan, the timing and amount of these transactions can vary significantly | |||||||||||||||
between periods. | |||||||||||||||
The Company's method of calculating FFO and Operating FFO may be different from methods used by other REITs and, accordingly, may not be comparable to | |||||||||||||||
such other REITs. Neither FFO nor Operating FFO should be considered (1) as an alternative to net income (determined in accordance with GAAP), (2) as an | |||||||||||||||
indicator of financial performance, (3) as cash flow from operating activities (determined in accordance with GAAP) or (4) as a measure of liquidity nor is it | |||||||||||||||
indicative of sufficient cash flow to fund all of our needs, including our ability to make distributions. |
Page 10
COLONIAL PROPERTIES TRUST | |||||||||||||||
Corporate Reconciliations | |||||||||||||||
($ in 000s) | |||||||||||||||
RECONCILIATION OF REVENUES | |||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||
9/30/2011 | 9/30/2010 | 9/30/2011 | 9/30/2010 | ||||||||||||
Divisional Total Revenues | |||||||||||||||
Multifamily - Same Property | $ | 74,764 | $ | 70,869 | $ | 220,113 | $ | 211,540 | |||||||
Multifamily - Non-Same Property (1) | 11,640 | 6,710 | 30,433 | 18,950 | |||||||||||
Commercial | 19,626 | 19,477 | 58,450 | 60,789 | |||||||||||
Total Divisional Revenues | 106,030 | 97,056 | 308,996 | 291,279 | |||||||||||
Less: Unconsolidated Revenues - Multifamily | (462 | ) | (662 | ) | (1,877 | ) | (2,573 | ) | |||||||
Less: Unconsolidated Revenues - Commercial | (6,813 | ) | (7,869 | ) | (19,918 | ) | (24,050 | ) | |||||||
Discontinued Operations | (3,617 | ) | (3,571 | ) | (10,807 | ) | (10,743 | ) | |||||||
Unallocated Corporate Revenues | 1,967 | 2,614 | 5,950 | 8,912 | |||||||||||
Consolidated Revenue Adjusted - '10 Discontinued Operations (2) | 97,105 | 87,568 | 282,344 | 262,825 | |||||||||||
Add: Additional Discontinued Operations Revenue, post filing (3) | — | 3,571 | — | 10,743 | |||||||||||
Total Consolidated Revenue, per 10-Q (4) | $ | 97,105 | $ | 91,139 | $ | 282,344 | $ | 273,568 | |||||||
RECONCILIATION OF EXPENSES | |||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||
9/30/2011 | 9/30/2010 | 9/30/2011 | 9/30/2010 | ||||||||||||
Divisional Total Expenses | |||||||||||||||
Multifamily - Same Property | $ | 31,549 | $ | 30,950 | $ | 90,855 | $ | 91,179 | |||||||
Multifamily - Non-Same Property (1) | 5,713 | 3,542 | 14,576 | 10,052 | |||||||||||
Commercial | 6,606 | 6,645 | 18,857 | 19,633 | |||||||||||
Total Divisional Expenses | 43,868 | 41,137 | 124,288 | 120,864 | |||||||||||
Less: Unconsolidated Expenses - Multifamily | (218 | ) | (379 | ) | (941 | ) | (1,412 | ) | |||||||
Less: Unconsolidated Expenses - Commercial | (2,283 | ) | (2,663 | ) | (6,582 | ) | (7,895 | ) | |||||||
Discontinued Operations | (2,071 | ) | (1,751 | ) | (5,604 | ) | (5,081 | ) | |||||||
Total Property Operating Expenses | 39,296 | 36,344 | 111,161 | 106,476 | |||||||||||
Property Management Expenses | 2,395 | 2,323 | 6,998 | 6,008 | |||||||||||
General & Administrative Expenses | 5,204 | 3,757 | 15,595 | 14,022 | |||||||||||
Management Fee and Other Expenses | 2,028 | 2,001 | 5,681 | 7,259 | |||||||||||
Investment and Development Expenses (5) | 458 | 9 | 1,437 | 42 | |||||||||||
Impairment and Other Losses | 100 | 131 | 2,344 | 914 | |||||||||||
Depreciation | 31,147 | 29,359 | 92,895 | 87,563 | |||||||||||
Amortization | 2,232 | 2,297 | 6,519 | 6,688 | |||||||||||
Consolidated Expense Adjusted - '10 Discontinued Operations (2) | 82,860 | 76,221 | 242,630 | 228,972 | |||||||||||
Add: Additional Discontinued Operations Expense, post filing (3) | — | 2,934 | — | 8,539 | |||||||||||
Total Consolidated Expense, per 10-Q (4) | $ | 82,860 | $ | 79,155 | $ | 242,630 | $ | 237,511 | |||||||
________________________ | |||||||||||||||
Continued on following page |
Page 11
COLONIAL PROPERTIES TRUST | |||||||||||||||
Corporate Reconciliations | |||||||||||||||
($ in 000s) | |||||||||||||||
RECONCILIATION OF NOI | |||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||
9/30/2011 | 9/30/2010 | 9/30/2011 | 9/30/2010 | ||||||||||||
Divisional Total NOI | |||||||||||||||
Multifamily - Same Property | $ | 43,215 | $ | 39,919 | $ | 129,258 | $ | 120,361 | |||||||
Multifamily - Non-Same Property (1) | 5,927 | 3,168 | 15,857 | 8,898 | |||||||||||
Commercial | 13,020 | 12,832 | 39,593 | 41,156 | |||||||||||
Total Divisional NOI | $ | 62,162 | $ | 55,919 | $ | 184,708 | $ | 170,415 | |||||||
Less: Unconsolidated NOI - Multifamily | (244 | ) | (283 | ) | (936 | ) | (1,161 | ) | |||||||
Less: Unconsolidated NOI - Commercial | (4,530 | ) | (5,206 | ) | (13,336 | ) | (16,155 | ) | |||||||
Discontinued Operations | (1,546 | ) | (1,820 | ) | (5,203 | ) | (5,662 | ) | |||||||
Unallocated Corporate Revenues | 1,967 | 2,614 | 5,950 | 8,912 | |||||||||||
Property Management Expenses | (2,395 | ) | (2,323 | ) | (6,998 | ) | (6,008 | ) | |||||||
General & Administrative Expenses | (5,204 | ) | (3,757 | ) | (15,595 | ) | (14,022 | ) | |||||||
Management Fee and Other Expenses | (2,028 | ) | (2,001 | ) | (5,681 | ) | (7,259 | ) | |||||||
Investment and Development Expenses (5) | (458 | ) | (9 | ) | (1,437 | ) | (42 | ) | |||||||
Impairment and Other Losses | (100 | ) | (131 | ) | (2,344 | ) | (914 | ) | |||||||
Depreciation | (31,147 | ) | (29,359 | ) | (92,895 | ) | (87,563 | ) | |||||||
Amortization | (2,232 | ) | (2,297 | ) | (6,519 | ) | (6,688 | ) | |||||||
Income from Operations | 14,245 | 11,347 | 39,714 | 33,853 | |||||||||||
Total Other Income (Expense) | (23,879 | ) | (22,729 | ) | (67,692 | ) | (65,345 | ) | |||||||
Loss from Continuing Operations (6) | (9,634 | ) | (11,382 | ) | (27,978 | ) | (31,492 | ) | |||||||
Discontinued Operations | — | 261 | — | 1,090 | |||||||||||
Loss from Continuing Operations, per 10-Q (4) | $ | (9,634 | ) | $ | (11,121 | ) | $ | (27,978 | ) | $ | (30,402 | ) | |||
(1) Includes operations from for-sale portfolio. | |||||||||||||||
(2) Reflects total consolidated revenue and total consolidated expense (as applicable), adjusted to reflect discontinued operations classifications made after | |||||||||||||||
filing of prior period financials. | |||||||||||||||
(3) Adjustment to prior period financials to reflect discontinued operations classifications made after filing of prior period financials. | |||||||||||||||
(4) For prior period, reflects total consolidated revenue, expense or (loss) income from continuing operations (as applicable) as presented in prior period | |||||||||||||||
financials (i.e., excluding adjustment for discontinued operations classifications made after filing of prior period financials). | |||||||||||||||
(5) Reflects costs incurred related to acquisitions and abandoned pursuits. These costs are volatile and therefore may vary between periods. | |||||||||||||||
(6) Loss from Continuing Operations before extraordinary items, noncontrolling interest and discontinued operations. Adjustments for additional | |||||||||||||||
discontinued operations have restated prior periods in accordance with ASC 205-20. |
Page 12