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Colonial Properties Trust Reports Results For First Quarter 2012

Stocks in this article: CLP

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.

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 future dispositions and developments, development costs and projected stabilization dates, operating performance outlook and other business fundamentals, 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 (including the European sovereign debt crisis), 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, 2011, 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.

 

COLONIAL PROPERTIES TRUSTFinancial StatementsFirst Quarter 2012

       
BALANCE SHEET            
 
($ in 000s) As of As of
3/31/2012 12/31/2011
ASSETS

Real Estate Assets

Operating Properties $ 3,495,238 $ 3,445,455
Undeveloped Land & Construction in Progress   317,883     306,826  
Total Real Estate, before Depreciation 3,813,121 3,752,281
 
Less: Accumulated Depreciation (762,632 ) (731,894 )
Real Estate Assets Held for Sale, net   15,713     10,543  
 
Net Real Estate Assets 3,066,202 3,030,930
 
Cash and Equivalents 5,430 6,452
Restricted Cash 32,000 43,489
Accounts Receivable, net 25,825 26,762
Notes Receivable 43,465 43,787
Prepaid Expenses 15,119 19,912
Deferred Debt and Lease Costs 25,461 22,408
Investment in Unconsolidated Subsidiaries 9,469 12,303
Other Assets   50,338     52,562  
 
Total Assets $ 3,273,309   $ 3,258,605  
 
LIABILITIES
Unsecured Credit Facility $ 226,503 $ 184,000
Notes and Mortgages Payable   1,575,256     1,575,727  
Total Debt 1,801,759 1,759,727
 
Accounts Payable 29,824 50,266
Accrued Interest 16,446 11,923
Accrued Expenses 25,992 15,731
Investment in Unconsolidated Subsidiaries 32,085 31,577
Other Liabilities   21,113     25,208  
Total Liabilities   1,927,219     1,894,432  
 
Redeemable Common Units 164,985 159,582
 
EQUITY
Limited Partner's Noncontrolling Interest 723 728
 
Cumulative Earnings 1,261,984 1,267,958
Cumulative Distributions (1,878,635 ) (1,862,838 )
Common Equity, including Additional Paid-in Capital 1,962,417 1,965,812
Treasury Shares, at Cost (150,163 ) (150,163 )
Accumulated Other Comprehensive Loss   (15,221 )   (16,906 )
Total Equity, including Noncontrolling Interest   1,181,105     1,204,591  
 
Total Liabilities and Equity $ 3,273,309   $ 3,258,605  
 
SHARES & UNITS OUTSTANDING, END OF PERIOD            
 
(shares and units in 000s) As of As of
3/31/2012 12/31/2011
Basic
Shares 87,905 87,474
Operating Partnership Units (OP Units)   7,168     7,169  
Total Shares & OP Units 95,073 94,643
 
COLONIAL PROPERTIES TRUST
Financial Statements
First Quarter 2012
     
 
CONSOLIDATED STATEMENTS OF OPERATIONS
 
($ in 000s, except per share data) Three Months Ended
3/31/2012 3/31/2011

Revenue

Minimum Rent $ 83,614 $ 73,526
Tenant Recoveries 3,004 2,698
Other Property Related Revenue 13,644 11,885
Other Non-Property Related Revenue   1,344     1,810  
Total Revenues 101,606 89,919
 

Operating Expenses

Operating Expenses:
Property Operating Expenses 27,332 24,623
Taxes, Licenses and Insurance   11,595     10,619  
Total Property Operating Expenses 38,927 35,242
 
Property Management Expenses 2,846 2,422
General and Administrative Expenses 5,767 5,203
Management Fee and Other Expenses 2,045 1,770
Investment and Development Expenses (1) 387 587
Depreciation 32,177 30,286
Amortization 2,080 2,127
Impairment and Other Losses (2)   500     2,097  
Total Operating Expenses   84,729     79,734  
Income from Operations 16,877 10,185
 

Other Income (Expense)

Interest Expense (23,053 ) (20,878 )
Debt Cost Amortization (1,433 ) (1,150 )
Interest Income 1,031 416
Income (Loss) from Partially-Owned Investments 673 (340 )
Loss on Sale of Property (227 ) (79 )
Income Tax and Other   (188 )   (248 )
Total Other Income (Expense)   (23,197 )   (22,279 )
- -
Loss from Continuing Operations (6,320 ) (12,094 )
 

Discontinued Operations

(Loss) Income from Discontinued Operations (131 ) 338
Loss on Disposal of Discontinued Operations   (2 )   -  
Net (Loss) Income from Discontinued Operations

 

  (133 )   338  
 
Net Loss   (6,453 )   (11,756 )
 
Noncontrolling Interest

Continuing Operations

Noncontrolling Interest of Limited Partners (9 ) (3 )
Noncontrolling Interest in CRLP - Preferred - (906 )
Noncontrolling Interest in CRLP - Common 478 1,082

Discontinued Operations

Noncontrolling Interest in CRLP - Common   10     (28 )
Loss Attributable to Noncontrolling Interest   479     145  
Net Loss Available to Common Shareholders $ (5,974 ) $ (11,611 )
 

COLONIAL PROPERTIES TRUSTFinancial StatementsFirst Quarter 2012

 
CONSOLIDATED STATEMENTS OF OPERATIONS (continued)
 
Three Months Ended
3/31/2012 3/31/2011
Loss per Share - Basic
Continuing Operations $ (0.07 ) $ (0.15 )
Discontinued Operations   -     -  
EPS - Basic $ (0.07 ) $ (0.15 )
 
Loss per Share - Diluted
Continuing Operations $ (0.07 ) $ (0.15 )
Discontinued Operations   -     -  
EPS - Diluted $ (0.07 ) $ (0.15 )
 

(1) Reflects costs incurred related to acquisitions and abandoned pursuits. These costs are volatile and therefore may vary between periods.

(2) During the three months ended March 31, 2012, the Company recorded a $0.5 million charge as a result of warranty claims on units previously sold at one of the Company's for-sale residential projects. During the three months ended March 31, 2011, the Company recorded a $1.5 million charge for a loss contingency related to certain litigation, $0.4 million in casualty losses and $0.2 million in non-cash impairment charges.
 
SHARES AND UNITS OUTSTANDING, WEIGHTED
 
(shares and units in 000s) Three Months Ended
3/31/2012 3/31/2011
 
Basic
Shares 87,012 79,512
Operating Partnership Units (OP Units)   7,169     7,284  
Total Shares & OP Units 94,181 86,796
 
Dilutive Common Share Equivalents - -
 

Diluted (1)

Shares 87,012 79,512
Total Shares & OP Units 94,181 86,796
 
 
(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.
 

COLONIAL PROPERTIES TRUSTFinancial StatementsFirst Quarter 2012

 
FUNDS FROM OPERATIONS (FFO) RECONCILIATION
 
($ in 000s, except per share data) Three Months Ended
3/31/2012 3/31/2011
Net Loss Available to Common Shareholders $ (5,974 ) $ (11,611 )
Noncontrolling Interest in CRLP (Operating Partnership Unitholders)   (488 )   (1,054 )
Total (6,462 ) (12,665 )
 

Adjustments - Consolidated Properties

Depreciation - Real Estate 31,961 31,751
Amortization - Real Estate 2,118 2,046

Remove: (Gain)/Loss on Sale of Property, net of Income Tax and Noncontrolling Interest

229 79

Include: Gain/(Loss) on Sale of Undepreciated Property, net of Income Tax and Noncontrolling Interest

  (261 )   (79 )
Total Adjustments - Consolidated 34,047 33,797
 

Adjustments - Unconsolidated Properties

Depreciation - Real Estate 1,117 1,651
Amortization - Real Estate 367 654
Remove: Gain/(Loss) on Sale of Property   (803 )   21  
Total Adjustments - Unconsolidated   681     2,326  
 
Funds from Operations $ 28,266   $ 23,458  
 
Income Allocated to Participating Securities   (219 )   (200 )

Funds from Operations Available to Common Shareholders and Unitholders

$ 28,047   $ 23,258  
           
FFO per Share
Basic $ 0.30 $ 0.27
Diluted $ 0.30 $ 0.27
 
Operating FFO:
Funds from Operations $ 28,047 $ 23,258
Less: Transaction Income
- Development and Land Losses   261     79  
Operating FFO $ 28,308   $ 23,337  
 
Operating FFO per Share
Basic $ 0.30 $ 0.27
Diluted $ 0.30 $ 0.27
 
 
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 sales of depreciated property and impairment write-downs of depreciable real estate, plus real estate depreciation and amortization 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.
 
COLONIAL PROPERTIES TRUST
Corporate Reconciliations
($ in 000s)
 
   
RECONCILIATION OF REVENUES
 
Three Months Ended
3/31/2012 3/31/2011
Divisional Total Revenues
Multifamily - Same Property $ 78,843 $ 74,411
Multifamily - Non-Same Property (1) 8,998 5,683
Commercial   17,717     19,769  
Total Divisional Revenues 105,558 99,863
 
Less: Unconsolidated Revenues - Multifamily (471 ) (713 )
Less: Unconsolidated Revenues - Commercial (4,794 ) (6,572 )
Discontinued Operations (31 ) (4,469 )
Unallocated Corporate Revenues   1,344     1,810  
Consolidated Revenue Adjusted -'11 Discontinued Operations (2)   101,606     89,919  
Add: Additional Discontinued Operations Revenue, post filing (3)   -     4,467  
Total Consolidated Revenue, per 10-Q (4) $ 101,606   $ 94,386  
 
RECONCILIATION OF EXPENSES
 
3/31/2012 3/31/2011
Divisional Total Expenses
Multifamily - Same Property $ 31,248 $ 30,475
Multifamily - Non-Same Property (1) 4,034 2,946
Commercial   5,731     6,228  
Total Divisional Expenses 41,013 39,649
 
Less: Unconsolidated Expenses - Multifamily (217 ) (374 )
Less: Unconsolidated Expenses - Commercial (1,707 ) (2,124 )
Discontinued Operations   (162 )   (1,909 )
Total Property Operating Expenses 38,927 35,242
Property Management Expenses 2,846 2,422
General & Administrative Expenses 5,767 5,203
Management Fee and Other Expenses 2,045 1,770
Investment and Development Expenses (5) 387 587
Impairment and Other Losses 500 2,097
Depreciation 32,177 30,286
Amortization   2,080     2,127  
Consolidated Expense Adjusted -'11 Discontinued Operations (2)   84,729     79,734  
Add: Additional Discontinued Operations Expense, post filing (3)   -     3,727  
Total Consolidated Expense, per 10-Q (4) $ 84,729   $ 83,461  
 
RECONCILIATION OF NOI
 
3/31/2012 3/31/2011
Divisional Total NOI
Multifamily - Same Property $ 47,595 $ 43,936
Multifamily - Non-Same Property (1) 4,964 2,737
Commercial   11,986     13,541  
Total Divisional NOI 64,545 60,214
 
Less: Unconsolidated NOI - Multifamily (254 ) (339 )
Less: Unconsolidated NOI - Commercial (3,087 ) (4,448 )
Discontinued Operations 131 (2,560 )
Unallocated Corporate Revenues 1,344 1,810
Property Management Expenses (2,846 ) (2,422 )
General & Administrative Expenses (5,767 ) (5,203 )
Management Fee and Other Expenses (2,045 ) (1,770 )
Investment and Development Expenses (5) (387 ) (587 )
Impairment and Other Losses (500 ) (2,097 )
Depreciation (32,177 ) (30,286 )
Amortization   (2,080 )   (2,127 )
Income from Operations 16,877 10,185
Total Other Income (Expense)   (23,197 )   (22,279 )
Loss from Continuing Operations (6)   (6,320 )   (12,094 )
Discontinued Operations   -     374  
Loss from Continuing Operations, per 10-Q (4) $ (6,320 ) $ (11,720 )
 
(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 income (loss) 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 periods in accordance with ASC 205-20.





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