SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED APRIL 30, 1994 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM __________ TO __________ Commission file number 1-8459 NEW PLAN REALTY TRUST AND SUBSIDIARIES (Exact name of registrant as specified in its charter) MASSACHUSETTS 13-1995781 (State or other Jurisdiction of (IRS Employer Incorporation or Organization) Identification No.) 1120 Avenue of the Americas New York, New York 10036 (Address of Principal Executive Office) (Zip Code) 212-869-3000 Registrant's Telephone Number Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities and Exchange Act of 1934 during the preceding 12 months and (2) has been subject to such filing requirements for the past 90 days. Yes X No _ The number of shares outstanding at June 3, 1994 was 49,424,090. Total number of Pages 10 NEW PLAN REALTY TRUST AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS APRIL 30, 1994 AND JULY 31, 1993 (UNAUDITED) (IN THOUSANDS) 4/30/94 7/31/93 ------------- ------------- ASSETS: - - --------------------------- Real estate, at cost Land and buildings 559,103 $388,228 Less accumulated depreciation and amortization 45,911 38,183 ------------- ------------- 513,192 350,045 Cash and cash equivalents 8,033 102,312 Marketable securities (Note B) 7,594 47,988 Mortgages and notes receivable 22,918 24,135 Trade and notes receivable 7,032 3,904 Other receivables 1,585 1,916 Prepaid expenses and deferred charges 3,128 1,465 Other assets 1,702 2,483 ------------- ------------- TOTAL ASSETS $565,184 $534,248 ============= ============= LIABILITIES: - - --------------------------- Mortgages payable $28,140 $23,321 Notes payable (Note C) 25,000 - Accounts payable and other liabilities 8,669 8,808 Tenants' security deposits 2,072 1,548 ------------- ------------- TOTAL LIABILITIES 63,881 33,677 SHAREHOLDERS' EQUITY: - - --------------------------- Shares of beneficial interest without par value, unlimited authorization; issued and outstanding** 541,464 530,901 Less: Loans receivable for share purchases 2,480 2,761 Distributions in excess of net income 37,681 27,569 ------------- ------------- TOTAL SHAREHOLDERS' EQUITY 501,303 500,571 ------------- ------------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $565,184 $534,248 ============= ============= ** SHARES ISSUED AND OUTSTANDING 49,423 48,957 ============= ============= See accompanying notes to consolidated financial statements. NEW PLAN REALTY TRUST AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (IN THOUSANDS EXCEPT FOR PER SHARE AMOUNTS) THREE MONTHS ENDED NINE MONTHS ENDED 04/30/94 04/30/93 04/30/94 04/30/93 REVENUES ------------------ ------------------ - - ----------------------------- Rental income and related revenues $25,388 $17,336 $69,268 $47,468 Interest and dividend income 899 2,385 3,785 8,728 ------------------ ----------------- 26,287 19,721 73,053 56,196 ------------------ ----------------- OPERATING EXPENSES - - ----------------------------- Operating costs 6,167 3,956 15,783 10,370 Leasehold rents 135 109 387 328 Real estate and other taxes 2,387 1,829 6,933 5,211 Mortgage and other interest 439 268 1,417 1,036 Interest on notes payable 201 201 Depreciation and amortization 3,023 2,015 8,241 5,482 Provision for doubtful accounts, net of recoveries (Note E) 230 283 783 473 ----------------- ----------------- 12,582 8,460 33,745 22,900 ----------------- ----------------- Administrative expenses 567 690 2,156 1,934 ----------------- ----------------- INCOME BEFORE GAIN ON SALE OF PROPERTY AND SECURITIES 13,138 10,571 37,152 31,362 ----------------- ----------------- Gain on sale of property - - 460 - Gain on sale of securities, net - 631 531 933 ------------------ ------------------ NET INCOME $13,138 $11,202 $38,143 $32,295 ================== ================== NET INCOME PER SHARE $.27 $.23 $.78 $.67 DIVIDENDS PER SHARE $.33 $.3175 $.9825 $.9525 WEIGHTED AVERAGE SHARES OUTSTANDING 49,310 48,701 49,148 48,554 SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NEW PLAN REALTY TRUST AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)(IN THOUSANDS) (Note D) Nine Months Ended April 30, 1993 1994 ________ _______ OPERATING ACTIVITIES Net Income $38,143 $32,295 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 8,241 5,482 ________ _______ 46,384 37,777 Gain on sale of property (460) - Gain on sale of securities, net (531) (933) Changes in operating assets and liabilities, net Increase in trade and notes receivable (3,236) (469) Decrease / (Increase) in other receivables 331 (230) Increase in allowance for doubtful accounts 108 446 (Decrease) / increase in other liabilities (139) 301 Increase in net sundry assets and liabilities (288) (997) _______ _______ NET CASH PROVIDED BY OPERATING ACTIVITIES 42,169 35,895 _______ ______ INVESTING ACTIVITIES Sales of marketable securities 42,223 17,577 Purchases of marketable securities (1,298) (24,707) Net proceeds from the sale of property 1,996 - Purchase and improvement of properties (160,715) (63,798) Increase in notes receivable (300) - Repayment of mortgage notes receivable 1,517 9,411 ______ ______ NET CASH USED IN INVESTING ACTIVITIES (116,577) (61,517) ______ ______ FINANCING ACTIVITIES Distributions to shareholders (48,255) (46,227) Issuance of shares of beneficial interest pursuant to dividend reinvestment plan 10,276 8,087 Issuance of shares of beneficial interest upon exercise of stock options 287 516 Proceeds from short term borrowing 25,000 - Principal payments on mortgages (246) (855) Repayment of mortgages (7,214) (5,238) Repayment of loans receivable for the purchase of shares of beneficial interest 281 512 ______ ______ NET CASH USED IN FINANCING ACTIVITIES (19,871) (43,205) ______ ______ DECREASE IN CASH AND CASH EQUIVALENTS (94,279) (68,827) Cash and cash equivalents at beginning of year 102,312 177,045 ______ ______ CASH AND CASH EQUIVALENTS AT END OF PERIOD $8,033 $108,218 See accompanying notes to consolidated financial statements. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note A: The accompanying unaudited consolidated financial statements have been prepared by the Trust pursuant to the rules of the Securities and Exchange Commission ("SEC") and, in the opinion of the Trust, include all adjustments (consisting of normal recurring accruals) necessary for a fair presentation of financial position, results of operations and cash flows. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such SEC rules. The Trust believes that the disclosures made are adequate to make the information presented not misleading. The consolidated statements of income for the nine months ended April 30, 1994 are not necessarily indicative of the results to be expected for the full year. It is suggested that these financial statements be read in conjunction with the audited financial statements and notes thereto included in the Trust's latest annual report on Form 10-K. Note B: Marketable securities Equity securities are carried at the lower of cost or market while debt securities are carried at cost. Marketable securities consist of the following (in thousands): 4/30/94 7/31/93 ------- ------- Equity securities 978 1,151 Debt securities 4,639 38,915 Insured bank certificates of deposit 1,977 7,922 ------- ------- 7,594 47,988 ======= ======= The aggregate market value of the marketable securities at April 30, 1994 and July 31, 1993 was $7,696,000 and $48,464,000, respectively. Note C: Notes Payable At December 30, 1993 the Trust entered into a 364 day unsecured revolving credit facility providing for borrowings of up to $65 million. At the time of borrowing the Trust can choose from three interest rate options. There are restrictive covenants that place a ceiling on total indebtedness of the lesser of 50% of tangible net worth or 250,000,000, a ceiling on mortgage indebtedness of 105,000,000, a minimum interest coverage ratio of 2.5 to 1 and a minimum tangible net worth of 400,000,000. At April 30, 1994, the average interest rate on outstanding notes was 4.58%. Note D: Supplemental Cash Flow Information State and local income taxes paid for the nine months ended April 30, 1994 and 1993 were $108,000 and $127,000, respectively. Interest paid for the nine months ended April 30, 1994 and 1993 was $1,914,000 and $1,178,000, respectively. Interest costs capitalized for the nine months ended April 30, 1994 was $296,000. The Trust entered into the following non-cash investing and financing activities (in thousands): April 30, 1994 1993 Loans to employees to exercise stock options $ 319 Mortgage obligation assumed upon the purchase of property $12,019 9,309 Accrued liability to be paid upon the completion of a property expansion 3,506 Note E: Provision for Doubtful Accounts The provision for doubtful accounts is net of recoveries. For the none months ended April 30, 1994 and 1993 recoveries were $201,000 and $409,000, respectively. For the three months ended April 30, 1994 and 1993 recoveries were $27,000 and $20,000, respectively. Note F: Subsequent Events Subsequent to April 30, 1994, the Trust purchased four shopping centers for an aggregate purchase price of approximately $26,000,000. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS I. Liquidity and Capital Resources On April 30, 1994 the Trust had $15,627,000 in available cash, cash equivalents and marketable securities. During the nine month period ended April 30, 1994 the Trust paid approximately $147,300,000 to acquire eleven shopping centers (1.8 million gross leasable square feet), three apartment properties (834 units) and the capital stock of Factory Merchants Malls, Inc. whose assets consisted of three factory outlet centers (565,000 gross leasable square feet). The amount paid does not include assumed mortgages in the amount of $12,019,000. Debt at April 30, 1994 consisted of $28,140,000 of mortgages payable and short term notes payable of $25,000,000. The notes payable are the result of the use of the Trust's $65,000,000 unsecured revolving credit facility which was put into place in December, 1993. The Trust expects to increase the unsecured revolving credit facility to $100 million. The dividend reinvestment program provided $10,276,000 during the nine month period ended April 30, 1994. In addition, the Trust made dividend distributions of $48,255,000 to shareholders, paid $147,300,000 to acquire new properties and spent approximately $13,400,000 in improvements to properties. Funds from operations (net income plus depreciation and amortization of properties less gains from asset sales) increased $8,549,000 to $45,393,000 from $36,844,000 in the prior year's comparable nine month period. II. Results of operations for the nine months ended April 30, 1994 and 1993 A. Revenues Rental income and related revenues increased $21,800,000 to $69,268,000. The increase was primarily due to the acquisition of new properties which were present in the current period but not in the prior period. This was coupled with a rise in revenues in all categories of properties owned in both periods. Interest and dividend income decreased $4,943,000 due a significantly reduced investment base during this period compared to the prior year and the repayment of mortgages receivable by the borrower. The lower investment base is a result of the purchase of 25 properties (four factory outlet centers, 17 shopping centers, 4 apartments) since July 31, 1992. B. Operating Expenses Operating costs and leasehold rents increased by $5,472,000 to $16,170,000. The increase was due primarily to the acquisition of new properties. Real estate and other taxes increased by $1,722,000 to $6,933,000. The increase was due to new property acquisitions. Interest expense increased $582,000 to $1,618,000. Mortgage interest increased due to a higher level of debt caused by the assumption of mortgages with the purchase of three properties, out of 25, since August 1, 1992. The increase in interest expense on notes payable was a result of use, for the first time, of the Trust's $65 million unsecured line of credit. Depreciation and amortization of properties increased due to the acquisition of 25 properties. Provision for doubtful accounts, net of recoveries increased principally because provisions for losses were higher and recoveries of previously reserved uncollectible amounts were lower than in the comparable period of the prior year. C. Other (Income) and Expenses Administrative expenses as a percentage of total revenues decreased to 3.0% from 3.4%. III. Results of operations for the three months ended April 30, 1994 and 1993 A. Revenues Rental income and related revenues increased $8,052,000 to $25,388,000. The increase was due to the acquisition of new properties which were present in the current period but not in the prior period. Interest and dividend income decreased $1,486,000 due a significantly reduced investment base during this period compared to the prior year. The lower investment base is a result of the purchase of 21 properties (three factory outlet centers, 14 shopping centers, four apartments) since January 31, 1993. B. Operating Expenses Operating costs and leasehold rents increased by $2,237,000 to $6,302,000. The increase was due primarily to the acquisition of new properties. Real estate and other taxes increased by $558,000 to $2,387,000. The increase was due to new property acquisitions. Depreciation and amortization of properties increased due to the acquisition of properties. C. Other (Income) and Expenses Administrative expenses as a percentage of total revenues decreased to 2.2% from 3.5%. Gains from the sale of securities were lower in the current period. This is a non recurring item and there were no transactions in the current period. PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K (a) Exhibits: None (b) During the period covered by this report the Trust filed the following four Current Reports: Form 8-K dated August 3, 1993 and Form 8-K/A containing Amendment No. 1 dated October 6, 1993 Form 8-K dated November 17, 1993, Form 8-K/A containing Amendment No. 1 dated January 13, 1994 and Form 8-K/A containing Amendment No. 2 dated April 20, 1994. Form 8-K dated February 10, 1994. Form 8-K dated April 7, 1994 The Form 8-K filings summarized the acquisition of certain assets. (c) During the period covered by this report the Trust filed a Form S-3 dated April 28, 1994. This preliminary prospectus registered up to $250,000,000 of one or more of the following securities: debt securities, preferred shares, depositary shares, common shares, warrants. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Dated: June 9, 1994 NEW PLAN REALTY TRUST By: /s/ Michael I. Brown 					________________________ MICHAEL I. BROWN Chief Financial Officer