This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

PS Business Parks, Inc. Reports Results For The First Quarter Ended March 31, 2012

Stocks in this article: PSB

Additional financial data attached.

         
 

PS BUSINESS PARKS, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

 
 
March 31, December 31,
2012 2011
(Unaudited)
 
ASSETS
 
Cash and cash equivalents $ 6,056 $ 4,980
 
Real estate facilities, at cost:
Land 772,933 772,933
Buildings and equipment   2,166,902     2,157,729  
2,939,835 2,930,662
Accumulated depreciation   (871,833 )   (846,799 )
2,068,002 2,083,863
Land held for development   6,829     6,829  
2,074,831 2,090,692
 
Rent receivable 4,109 3,198
Deferred rent receivable 24,296 23,388
Other assets   12,699     16,361  
 
Total assets $ 2,121,991   $ 2,138,619  
 
LIABILITIES AND EQUITY
 
Accrued and other liabilities $ 65,194 $ 60,940
Credit facility 106,000 185,000
Term loan 250,000 250,000
Mortgage notes payable   281,874     282,084  
Total liabilities 703,068 778,024
 
Commitments and contingencies
 
Equity:
PS Business Parks, Inc.’s shareholders’ equity:
Preferred stock, $0.01 par value, 50,000,000 shares authorized,

26,576 and 23,942 shares issued and outstanding at

March 31, 2012 and December 31, 2011, respectively

664,396 598,546
Common stock, $0.01 par value, 100,000,000 shares authorized,

24,219,901 and 24,128,184 shares issued and outstanding at

March 31, 2012 and December 31, 2011, respectively

241 240
Paid-in capital 536,191 534,322
Cumulative net income 899,401 878,704
Cumulative distributions   (860,442 )   (832,607 )
Total PS Business Parks, Inc.’s shareholders’ equity 1,239,787 1,179,205
Noncontrolling interests:
Preferred units 5,583 5,583
Common units   173,553     175,807  
Total noncontrolling interests   179,136     181,390  
Total equity   1,418,923     1,360,595  
 
Total liabilities and equity $ 2,121,991   $ 2,138,619  
 
 
     
 

PS BUSINESS PARKS, INC.

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited, in thousands, except per share amounts)

 
 
For The Three Months

Ended March 31,

2012     2011
 
Revenues:
Rental income $ 84,728 $ 73,512
Facility management fees   166     178  
Total operating revenues   84,894     73,690  
Expenses:
Cost of operations 28,172 25,708
Depreciation and amortization 27,299 20,754
General and administrative   2,273     1,570  
Total operating expenses   57,744     48,032  
Other income and (expenses):
Interest and other income 43 94
Interest expense   (5,348 )   (1,215 )
Total other income and (expenses)   (5,305 )   (1,121 )
Income from continuing operations   21,845     24,537  
Discontinued operations:
Income from discontinued operations       136  
Total discontinued operations       136  
 
Net income $ 21,845   $ 24,673  
 
Net income allocation:
Net income allocable to noncontrolling interests:
Noncontrolling interests — common units $ 1,049 $ 4,901
Noncontrolling interests — preferred units   99     (7,290 )
Total net income allocable to noncontrolling interests   1,148     (2,389 )
Net income allocable to PS Business Parks, Inc.:
Common shareholders 3,467 16,562
Preferred shareholders 17,186 10,450
Restricted stock unit holders   44     50  
Total net income allocable to PS Business Parks, Inc.   20,697     27,062  
$ 21,845   $ 24,673  
 
Net income per common share — basic:
Continuing operations $ 0.14 $ 0.67
Discontinued operations $ $
Net income $ 0.14 $ 0.67
 
Net income per common share — diluted:
Continuing operations $ 0.14 $ 0.66
Discontinued operations $ $
Net income $ 0.14 $ 0.67
 
Weighted average common shares outstanding:
Basic   24,157     24,685  
Diluted   24,241     24,792  
 
 
     
 

PS BUSINESS PARKS, INC.

Computation of Diluted Funds from Operations (“FFO”) and Funds Available for Distribution (“FAD”)

(Unaudited, in thousands, except per share amounts)

 
 
For The Three Months

Ended March 31,

2012   2011

Computation of Diluted Funds From Operations (“FFO”) (1) :

 
Net income allocable to common shareholders $ 3,467 $ 16,562
Adjustments:
Depreciation and amortization 27,299 20,859
Net income allocable to noncontrolling

interests — common units

1,049 4,901
Net income allocable to restricted stock unit holders   44     50  
FFO allocable to common and dilutive shares $ 31,859   $ 42,372  
 
Weighted average common shares outstanding 24,157 24,685
Weighted average common OP units outstanding 7,305 7,305
Weighted average restricted stock units outstanding 113 72
Weighted average common share equivalents outstanding   84     107  
Total common and dilutive shares   31,659     32,169  
 
FFO per common and dilutive share $ 1.01   $ 1.32  
 

Computation of Funds Available for Distribution (“FAD”) (2) :

 
FFO allocable to common and dilutive shares $ 31,859 $ 42,372
 
Adjustments:
Recurring capital improvements (1,116 ) (856 )
Tenant improvements (7,968 ) (4,752 )
Lease commissions (1,269 ) (1,480 )
Straight-line rent (1,136 ) (281 )
Non-cash stock compensation expense 1,266 458
In-place lease adjustment 159 209
Tenant improvement reimbursements, net of lease incentives (170 ) (195 )

Non-cash distributions related to the redemption of preferred equity

5,260
Gain on repurchase of preferred equity, net of issuance costs       (7,389 )
FAD $ 26,885   $ 28,086  
 
Distributions to common and dilutive shares $ 13,907   $ 14,114  
 
Distribution payout ratio   51.7 %   50.3 %
 
(1)  

Funds From Operations (“FFO”) is computed in accordance with the White Paper on FFO approved by the Board of Governors of the National Association of Real Estate Investment Trusts (“NAREIT”). The White Paper defines FFO as net income, computed in accordance with GAAP, before depreciation, amortization, gains or losses on asset dispositions, net income allocable to noncontrolling interests — common units, net income allocable to restricted stock unit holders and nonrecurring items. FFO should be analyzed in conjunction with net income. However, FFO should not be viewed as a substitute for net income as a measure of operating performance or liquidity as it does not reflect depreciation and amortization costs or the level of capital expenditure and leasing costs necessary to maintain the operating performance of the Company’s properties, which are significant economic costs and could materially impact the Company’s results from operations. Other REITs may use different methods for calculating FFO and, accordingly, the Company’s FFO may not be comparable to other real estate companies.

 

(2)

Funds Available for Distribution (“FAD”) is computed by adjusting consolidated FFO for recurring capital improvements, which the Company defines as those costs incurred to maintain the assets’ value, tenant improvements, lease commissions, straight-line rent, stock compensation expense, impairment charges, amortization of lease incentives and tenant improvement reimbursements, in-place lease adjustment and the effect of redemption/repurchase of preferred equity. Like FFO, the Company considers FAD to be a useful measure for investors to evaluate the operations and cash flows of a REIT. FAD does not represent net income or cash flow from operations as defined by GAAP.

 




5 of 6

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,805.41 +127.51 0.76%
S&P 500 1,964.58 +13.76 0.71%
NASDAQ 4,483.7150 +30.9230 0.69%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs