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 JANUARY 31, 1995 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 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 February 28, 1995 was 52,944,762. Total number of pages 10 NEW PLAN REALTY TRUST AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (UNAUDITED) (IN THOUSANDS) ASSETS: 1/31/95 7/31/94 Real estate, at cost Land and buildings $682,333 $621,342 Less accumulated depreciation and amortization 56,189 49,102 ________ ________ 626,144 572,240 Cash and cash equivalents 9,508 3,116 Marketable securities (Note B) 5,476 6,293 Mortgages and notes receivable 22,892 22,910 Trade and notes receivable 6,898 6,290 Other receivables 1,430 1,628 Prepaid expenses and deferred charges 3,167 2,429 Other assets 2,215 2,087 ________ ________ TOTAL ASSETS $677,730 $616,993 LIABILITIES: Mortgages payable $ 33,353 $ 28,060 Notes payable (Note C) 63,000 7,500 Other liabilities 10,561 13,666 Tenants' security deposits 2,966 2,274 ________ ________ TOTAL LIABILITIES 109,880 51,500 ________ ________ SHAREHOLDERS' EQUITY: Shares of beneficial interest without par value, unlimited authorization; issued and outstanding** 615,973 609,067 Less: Loans receivable for share purchases 3,458 3,630 Distributions in excess of net income 44,265 39,944 Unrealized holding losses, net (Note B) 400 ________ ________ TOTAL SHAREHOLDERS' EQUITY 567,850 565,493 ________ ________ TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $677,730 $616,993 ** SHARES ISSUED AND OUTSTANDING 52,945 52,594 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 SIX MONTHS ENDED 1/31/95 1/31/94 1/31/95 1/31/94 REVENUES Rental income and related revenues $31,227 $23,823 $60,365 $43,880 Interest and dividend income 835 1,039 1,658 2,886 _______ _______ _______ _______ 32,062 24,862 62,023 46,766 _______ _______ _______ _______ OPERATING EXPENSES Operating costs 7,632 5,510 14,557 9,616 Leasehold rents 138 143 277 252 Real estate and other taxes 3,060 2,347 5,751 4,546 Interest expense 921 528 1,662 978 Depreciation and amortization 3,656 2,818 7,129 5,218 Provision for doubtful accounts, net of recoveries (Note E) 131 274 369 553 _______ _______ _______ _______ TOTAL OPERATING EXPENSES 15,538 11,620 29,745 21,163 _______ _______ _______ _______ Administrative expenses 677 798 1,172 1,589 _______ _______ _______ _______ INCOME BEFORE GAIN ON SALE OF PROPERTY AND SECURITIES 15,847 12,444 31,106 24,014 _______ _______ _______ _______ Gain/(Loss) on sale of property -- (8) -- 460 Gain on sale of securities, net -- 505 -- 531 _______ _______ _______ _______ NET INCOME $15,847 $12,941 $31,106 $25,005 NET INCOME PER SHARE $0.30 $0.26 $O.59 $0.51 DIVIDENDS PER SHARE $0.3375 $0.3275 $O.6725 $0.6525 WEIGHTED AVERAGE SHARES OUTSTANDING 52,792 49,136 52,719 49,070 See accompanying notes to consolidated financial statements. NEW PLAN REALTY TRUST AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)(IN THOUSANDS) SIX MONTHS ENDED 1/31/95 1/31/94 OPERATING ACTIVITIES ------- ------- - - -------------------- Net Income $31,106 $25,005 Adjustment to reconcile net income to net cash provided by operating activities: Depreciation and amortization 7,129 5,218 _______ _______ 38,235 30,223 Gain on sale of property -- (460) Gain on sale of securities, net -- (531) Changes in operating assets and liabilities, net Increase in trade and notes receivable (844) (1,838) Decrease in other receivables 198 471 Increase in allowance for doubtful accounts 236 402 Increase in other liabilities 309 137 Increase in net sundry assets and liabilities (217) (157) _______ _______ NET CASH PROVIDED BY OPERATING ACTIVITIES 37,917 28,247 _______ _______ INVESTING ACTIVITIES Sales of marketable securities 417 41,626 Purchases of marketable securities -- (1,298) Net proceeds from the sale of property -- 1,996 Purchase and improvement of properties (58,960) (137,480) Repayment of mortgage notes receivable 18 1,513 _______ _______ NET CASH USED IN INVESTING ACTIVITIES (58,525) (93,643) _______ _______ FINANCING ACTIVITIES Distributions to shareholders (35,427) (31,998) Issuance of shares of beneficial interest pursuant to dividend reinvestment plan 6,884 7,070 Issuance of shares of beneficial interest upon exercise of stock options 21 288 Proceeds from short-term debt 63,000 Repayment of short-term debt (7,500) Principal payments on mortgages (150) (180) Repayment of mortgages -- (6,694) Repayment of loans receivable for the purchase of shares of beneficial interest 172 206 _______ _______ NET CASH PROVIDED BY/(USED IN) FINANCING ACTIVITIES 27,000 (31,308) _______ _______ INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS 6,392 (96,704) Cash and cash equivalents at beginning of year 3,116 102,312 _______ ________ CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 9,508 $ 5,608 See accompanying notes to consolidated financial statements. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note A: The accompanying unaudited condensed 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 adjustments) necessary for a fair presentation of financial position, results of operations and cash flows in accordance with generally accepted accounting principles. 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 six months ended January 31, 1995 are not necessarily indicative of the results 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: Available For Sale Securities Reported As a Component Of Shareholders Equity The Trust has adopted Statement of Financial Accounting Standards 115 "Accounting for Certain Investments in Debt and Equity Securities" and accordingly has classified all such investments as available-for-sale. All investments are recorded at current market value with an offsetting adjustment to Shareholders' Equity. January 31, 1995 July 31, 1994 Equity Debt Equity Debt Amortized cost/cost basis $ 980 $4,896 $ 977 $5,316 Unrealized holdings gains 560 -- -- -- Unrealized holdings losses -- (960) -- -- ______ ______ ______ ______ Fair value $1,540 $3,936 $ 977 $5,316 The debt securities have maturity dates ranging from 1996 to 2009. Note C: Notes Payable The Trust has extended its unsecured revolving credit facility to November 28, 1995. The facility is for $100 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 January 31, 1995, the average interest rate on outstanding notes was 6.5%. Note D: Supplemental Cash Flow Information State and local income taxes paid for the six months ended January 31, 1995 and 1994 were $81,000 and $88,000, respectively. Interest paid for the six months ended January 31, 1995 and 1994 was $2,640,000 and $1,098,000, respectively. Interest costs capitalized for the six months ended January 31, 1995 and 1994 were $978,000 and $190,000, respectively. The Trust entered into the following non-cash investing and financing activities (in thousands): 1/31/95 1/31/94 Mortgage obligations assumed upon the purchase of property $ 5,443 $12,019 Note E: Provision for Doubtful Accounts The provision for doubtful accounts is net of recoveries. For the six months ended January 31, 1995 and 1994, recoveries were $344,000 and $184,000, respectively. For the 3 months ended January 31, 1995 and 1994, recoveries were $224,000 and $79,000, respectively. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS I. Liquidity and Capital Resources On January 31, 1995 the Trust had $15,384,000 in available cash, cash equivalents and marketable securities. During the six month period ended January 31, 1995, the Trust paid approximately $36,400,000 to acquire eight shopping centers (803,000 gross leasable square feet) and one apartment property (164 units). Debt at January 31, 1995 consisted of $33,353,000 of mortgages payable and short term notes payable of $63,000,000. The notes payable are from the Trust's $100,000,000 unsecured revolving credit facility which was put into place in December, 1993. The dividend reinvestment program provided $6,884,000 during the six month period ended January 31, 1995. In addition, the Trust made dividend distributions of $35,427,000 to shareholders, paid $36,400,000 to acquire new properties and spent approximately $22,560,000 in expansion and improvements to properties. Funds from operations (net income plus depreciation and amortization of properties less gains from asset sales) increased $9,003,000 to $38,235,000 from $29,232,000 in the prior year's six month period. II. Results of operations for the six months ended January 31, 1995 and 1994 A. Revenues Rental income and related revenues increased $16,485,000 to $60,365,000. The increase was primarily due to the acquisition of new properties. In addition, there was an increase in revenues in all categories of properties owned in both periods. Interest and dividend income decreased $1,228,000 due to a reduced investment base during this period compared to the prior year. The lower investment base is a result of funds used for the purchase of 33 properties. (three factory outlet centers, 22 shopping centers, eight apartments) since July 31, 1993. B. Operating Expenses Operating costs and leasehold rents increased $4,966,000 to $14,834,000. The increase was due primarily to the acquisition of new properties. Real estate and other taxes increased $1,205,000 to $5,751,000. The increase was due primarily to new property acquisitions. Interest expense increased $684,000 to $1,662,000. Mortgage interest increased due to a higher level of debt caused by the assumption of mortgages in connection with the purchase of two properties and the use of the Trust's $100 million unsecured revolving line of credit. The increase in interest expense was partially offset by the capitalization of interest on construction projects which are expanding factory outlets and a shopping center. Depreciation and amortization of properties increased $1,911,000 to $7,129,000. This was due primarily to the acquisition of properties. Provision for doubtful accounts, net recoveries, decreased principally because recoveries were higher than they were in the six months of fiscal 1994. C. Administrative Expenses Administrative expenses as a percentage of total revenues decreased to 1.9% from 3.4%. The decrease was due primarily to the increase in revenue from newly acquired properties. D. Gains on property and securities There were no property sales or gains or losses from sale of securities during the six months ended January 31, 1995. III. Results of operations for the three months ended January 31, 1995 and 1994 A. Revenues Rental income and related revenues increased $7,404,000 to $31,227,000. The increase was primarily due to the acquisition of new properties. In addition, there was an increase in revenues in all categories of properties owned in both periods. Interest and dividend income decreased $204,000 due to a reduced investment base during this period compared to the prior year. The lower investment base is a result of the purchase of 24 properties. (three factory outlet centers, 15 shopping centers, six apartments) since October 31, 1993. B. Operating Expenses Operating costs and leasehold rents increased $2,117,000 to $7,770,000. The increase was due primarily to the acquisition of new properties. Real estate and other taxes increased $713,000 to $3,060,000. The increase was due primarily to new property acquisitions. Interest expense increased $393,000 to $921,000. Mortgage interest increased due to a higher level of debt caused by the assumption of mortgages in connection with the purchase of two properties and the use of the Trust's $100 million unsecured revolving line of credit. The increase in interest expense was partially offset by the capitalization of interest on construction projects which are expanding factory outlets and a shopping center. Depreciation and amortization of properties increased $838,000 to $3,656,000. This was due primarily to the acquisition of properties. Provision for doubtful accounts, net recoveries, decreased principally because recoveries were higher than they were in the second quarter of fiscal 1994. C. Administrative Expenses Administrative expenses as a percentage of total revenues decreased to 2.1% from 3.2%. The decrease was due primarily to the increase in revenue from newly acquired properties. D. Gains on property and securities There were no property sales or gains or losses from sale of securities during the quarter ended January 31, 1995. PART II - OTHER INFORMATION Item 4. Submission of Matters to a Vote of Security Holders An annual meeting of shareholders was held on December 14, 1994. Proxies for the meeting were solicited by the registrant pursuant to Regulation 14 under the Securities Exchange Act of 1934; there was no solicitation in opposition to the management's nominee as listed in the proxy statement and all of such nominees were elected. There were no abstentions and no broker non-votes. Votes of 46,305,920 shares were cast for the election of John Wetzler as a Trustee; votes of 305,402 were withheld. Votes of 46$333,720 shares were cast for the election of Gregory White as a Trustee; votes of 277,602 were withheld. Votes of 46,334,580 shares were cast for the election of William Newman as a Trustee; votes of 276,742 were withheld. Votes of 46,340,105 shares ere cast for the election of Arnold Laubich as a Trustee; votes of 271,217 were withheld. In addition to the nominees elected as trustees, the other trustees whose terms of office continue after the meeting are Melvin Newman, Raymond Bottorf, Norman Gold, James Steuterman and Dean Bernstein. Item 6. Exhibits and Reports on Form 8-K (a) Exhibit: The following exhibit is being filed: 11.1 Statement of Computation of Earnings Per Share (b) For EDGAR filing purposes only this report contains Exhibit 27, Financial Data Schedule. (c) During the period covered by this report the Trust did not file any reports on Form 8-K. 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: March 13, 1995 NEW PLAN REALTY TRUST By: /s/ Michael I. Brown 				 -------------------- MICHAEL I. BROWN Chief Financial Officer NEW PLAN REALTY TRUST INDEX TO EXHIBITS No. 11.1 Statement of Computation of Earnings Per Share 27 Financial Data Schedule1 1Filed in electronic format only. Exhibit 11.1 Statement of Computation of Earnings Per Share for the Six Months Ended July 31, 1995 Earnings Per Share ------------------- Primary Fully Diluted ------- ------------- 1. Proceeds upon exercise of options $37,706,000 $37,706,000 2. Market price of shares Closing --- $20.500 Average $20.625 --- 3. Treasury shares that could be repurchased 1,828,170 1,839,317 4. Option shares outstanding 1,911,300 1,911,300 5. Common stock equivalent shares (Excess shares under option over Treasury shares that could be repurchased) 83,130 71,983 6. Weighted average number of shares outstanding 52,718,554 52,718,554 7. Total number of common and common share equivalents 52,801,684 52,790,537 8. Net income for the period $31,106,000 $31,106,000 9. Earnings per share $.59 $.59 10. Reported earnings per share $.59 Not applicable