CPT Camden Property Trust

Camden Property Trust (NYSE:CPT) announced that its funds from operations (�FFO�) for the third quarter of 2006 totaled $1.24 per diluted share or $77.8 million, as compared to $0.76 per diluted share or $44.4 million for the same period in 2005. FFO for the three months ended September 30, 2006 included a $0.40 per diluted share impact from gain on sale of land. FFO for the nine months ended September 30, 2006 totaled $3.02 per diluted share or $183.1 million, as compared to $2.63 per diluted share or $145.8 million for the same period in 2005. FFO for the nine months ended September 30, 2006 included a $0.44 per diluted share impact from gain on sale of land. FFO for the nine months ended September 30, 2005 included a $0.44 per diluted share impact from the sale of technology investments, and a $0.25 per diluted share charge for transaction compensation and merger expenses relating to Camden�s merger with Summit Properties Inc. (�Summit�). Net Income (�EPS�) The Company reported net income (�EPS�) of $125.5 million or $2.07 per diluted share for the third quarter of 2006, as compared to a net loss of $2.3 million or ($0.05) per diluted share for the same period in 2005. EPS for the three months ended September 30, 2006 included a $2.07 per diluted share impact from gain on sale of land, operating properties, joint venture properties and discontinued operations. For the nine months ended September 30, 2006, net income totaled $201.5 million or $3.46 per diluted share, as compared to $186.2 million or $3.38 per diluted share for the same period in 2005. EPS for the nine months ended September 30, 2006 included a $3.07 per diluted share impact from gain on sale of land, operating properties, joint venture properties and discontinued operations. EPS for the nine months ended September 30, 2005 included a $3.03 per diluted share impact from gain on sale of operating properties and discontinued operations, $0.44 per diluted share income from the sale of technology investments, and a $0.25 per diluted share charge for transaction compensation and merger expenses relating to Camden�s merger with Summit. A reconciliation of net income to FFO is included in the financial tables accompanying this press release. Same-Property Results For the 46,565 apartment homes included in consolidated same-property results, third quarter 2006 same-property net operating income (�NOI�) growth was 8.1% compared to the third quarter of 2005, with revenues increasing 7.6% and expenses increasing 7.0%. On a sequential basis, third quarter 2006 same-property NOI decreased 0.7% compared to second quarter 2006, with revenues increasing 2.2% and expenses increasing 7.0% compared to the prior quarter. On a year-to-date basis, 2006 same-property NOI increased 9.4%, with revenue growth of 8.0% and expense growth of 5.7% compared to the same period in 2005. Same-property physical occupancy levels for the combined portfolio averaged 94.9% during the third quarter of 2006, compared to 96.1% in the third quarter of 2005 and 95.7% in the second quarter of 2006. The Company defines same-property communities as communities owned by either Camden or Summit and stabilized as of January 1, 2005, excluding properties held for sale. A reconciliation of net income to net operating income and same-property net operating income is included in the financial tables accompanying this press release. Development Activity As of September 30, 2006, Camden had four completed apartment communities in lease-up: Camden Fairfax Corner in Fairfax, VA, an $82.0 million project that is currently 86% leased; Camden Manor Park in Raleigh, NC, a $52.0 million project that is currently 69% leased; Camden Westwind in Ashburn, VA, a $97.6 million project that is currently 64% leased; and Camden Royal Oaks in Houston, TX, a $22.0 million project that is currently 31% leased. Camden announced one new joint venture development start during the quarter: Camden College Park in College Park, MD, a $139.9 million project with 508 apartment homes scheduled for initial occupancy in late 2007. The Company�s current development pipeline includes eight wholly-owned communities with 2,693 apartment homes and a total budgeted cost of $565.0 million, and three joint venture communities with 1,069 apartment homes and a total budgeted cost of $289.9 million. Of those 11 communities, two are currently in lease-up. Camden Clearbrook in Frederick, MD is currently 60% leased; and Camden Old Creek in San Marcos, CA is currently 17% leased. Acquisition/Disposition Activity During the quarter, the Company acquired Camden Stoneleigh, a 390-home apartment community in Austin, TX for $35.3 million, and disposed of Camden Oaks, a 446-home apartment community in Dallas, TX, for $19.2 million. Gain on sale of Camden Oaks totaled $8.8 million. The Company also sold Summit Hollow, a 232-home joint venture apartment community in Charlotte, NC for $15.5 million. Camden�s pro-rata share of that disposition totaled $3.9 million, and a $1.1 million gain on sale was recognized. In addition, the Company sold 8.7 acres of undeveloped land in Long Beach, CA, Orlando, FL, Fort Lauderdale, FL and Dallas, TX, and contributed 10.6 acres of undeveloped land in College Park, MD to a joint venture during the quarter. The combined sales price for those transactions totaled $69.6 million, and gains of $25.2 million were recorded. Camden contributed nine existing multifamily communities with 3,237 apartment homes located in Camden�s Midwest markets to a newly created $239.0 million joint venture. Camden retained a 15% ownership interest in the venture and continues to serve as the property manager for all nine communities. The Company recorded a gain of $91.6 million as a result of this transaction. Properties and Land Held for Sale At September 30, 2006, Camden had five operating communities consisting of 1,744 apartment homes classified as held for sale. These properties included: Camden Crossing, a 366-home apartment community in Houston, TX; Camden Wyndham, a 448-home apartment community in Houston, TX; Camden Downs, a 254-home apartment community in Louisville, KY; Camden Taravue, a 304-home apartment community in St. Louis, MO; and Camden Trace, a 372-home apartment community in St. Louis, MO. The Company also had 5.7 acres of undeveloped land in Miami, FL, Boca Raton, FL and Dallas, TX classified as held for sale at quarter-end. Earnings Guidance 2006 FFO is now expected to be $3.82 to $3.88 per diluted share for full-year 2006, and $0.81 to $0.87 per diluted share for fourth quarter 2006. EPS is expected to be $3.60 to $3.66 per diluted share for full-year 2006, and $0.17 to $0.23 per diluted share for the fourth quarter of 2006. Guidance for 2006 includes a charge of $0.07 per diluted share during the fourth quarter of 2006 relating to early vesting of previously granted share awards. The Company�s 2006 earnings guidance is based on projections of same-property revenue growth between 7.00% and 7.75%, same-property expense growth between 5.00% and 5.50%, and same-property NOI growth between 8.25% and 9.25%. No acquisitions, dispositions or new development starts are expected for the remainder of 2006. Camden expects to release its fourth quarter and full year 2006 earnings on February 1, 2007, and hold a conference call on February 2, 2007. The Company plans to discuss its 2006 results and earnings guidance for 2007 at that time. A reconciliation of expected net income to expected FFO is included in the financial tables accompanying this press release. Conference Call The Company will hold a conference call on Friday, November 3, 2006 at 10:00 a.m. Central Time to review its third quarter results and discuss its outlook for future performance. To participate in the call, please dial 877-407-0782 (domestic) or 201-689-8567 (international) by 9:50 a.m. Central Time and request the Camden Property Trust Third Quarter 2006 Earnings Call, or join the live webcast of the conference call by accessing the Investor Relations section of the Company�s website at www.camdenliving.com. Supplemental financial information is available in the Investor Relations section of the Company�s website under Earnings Releases or by calling Camden�s Investor Relations Department at 800-922-6336. Forward-Looking Statements In addition to historical information, this press release contains forward-looking statements under the federal securities law. These statements are based on current expectations, estimates and projections about the industry and markets in which Camden operates, management's beliefs, and assumptions made by management. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties which are difficult to predict. About Camden Camden Property Trust is a real estate company engaged in the ownership, development, acquisition, management and disposition of multifamily apartment communities. Camden owns interests in and operates 188 properties containing 64,657 apartment homes across the United States. Upon completion of 11 properties under development, the Company�s portfolio will increase to 68,419 apartment homes in 199 properties. For additional information, please contact Camden�s Investor Relations Department at 800-922-6336 or 713-354-2787 or access our website at www.camdenliving.com. CAMDEN OPERATING RESULTS (In thousands, except per share and property data amounts) � � � � � � � � � � (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, OPERATING DATA 2006� � 2005� 2006� � 2005 (a) Property revenues Rental revenues $139,354� $125,125� $408,581� $348,250� Other property revenues 15,202� � 11,507� 41,172� � 31,612� Total property revenues 154,556� 136,632� 449,753� 379,862� � Property expenses Property operating and maintenance 45,806� 38,697� 124,089� 105,960� Real estate taxes 16,345� � 14,870� 48,845� � 42,512� Total property expenses 62,151� 53,567� 172,934� 148,472� � Non-property income Fee and asset management 5,433� 1,789� 11,030� 10,929� Sale of technology investments 1,602� -� 1,602� 24,199� Interest and other income 1,733� 1,913� 6,097� 6,401� Income on deferred compensation plans 1,927� � 3,209� 4,308� � 5,327� Total non-property income 10,695� 6,911� 23,037� 46,856� � Other expenses Property management 4,629� 4,208� 13,821� 11,350� Fee and asset management 3,689� 2,008� 8,293� 4,999� General and administrative 9,849� 6,183� 25,299� 18,017� Transaction compensation and merger expenses -� -� -� 14,085� Interest 29,176� 29,331� 91,592� 81,416� Depreciation and amortization 40,399� 44,030� 117,945� 119,117� Amortization of deferred financing costs 941� 855� 2,897� 2,872� Expense on deferred compensation plans 1,927� � 3,209� 4,308� � 5,327� Total other expenses 90,610� � 89,824� 264,155� � 257,183� � Income from continuing operations before gain on sale of properties, equity in income (loss) of joint ventures and minority interests 12,490� 152� 35,701� 21,063� Gain on sale of properties, including land 96,247� -� 97,556� 132,117� Equity in income (loss) of joint ventures 1,628� (1,827) 4,514� (1,472) Minority interests: Distributions on perpetual preferred units (1,750) (1,750) (5,250) (5,278) Original issuance costs on redeemed perpetual preferred units -� -� -� (365) Income allocated to common units and other minority interests (12,413) � (261) (14,750) � (1,756) Income (loss) from continuing operations 96,202� (3,686) 117,771� 144,309� Income from discontinued operations 665� 1,481� 4,998� 6,118� Gain on sale of discontinued operations 29,350� -� 80,394� 36,115� Income from discontinued operations allocated to common units (760) � (112) (1,681) � (343) Net income (loss) $125,457� � ($2,317) $201,482� � $186,199� � PER SHARE DATA Net income (loss) - basic $2.15� ($0.04) $3.59� $3.63� Net income (loss) - diluted 2.07� (0.05) 3.46� 3.38� Income (loss) from continuing operations - basic 1.65� (0.07) 2.10� 2.81� Income (loss) from continuing operations - diluted 1.58� (0.07) 2.03� 2.63� � Weighted average number of common and common equivalent shares outstanding: � Basic 58,348� 54,018� 56,063� 51,294� Diluted 61,250� 55,671� 58,904� 55,494� � PROPERTY DATA Total operating properties (end of period) (b) 188� 193� 188� 193� Total operating apartment homes in operating properties (end of period) (b) 64,657� 66,619� 64,657� 66,619� Total operating apartment homes (weighted average) 56,161� 56,150� 56,624� 54,368� Total operating apartment homes - excluding discontinued operations (weighted average) 54,350� 52,119� 53,880� 49,970� � � (a) The Company's 2005 financial results include the results of Summit subsequent to February 28, 2005. � (b) Includes joint ventures and properties held for sale. � Note: Please refer to the following pages for definitions and reconciliations of all non-GAAP financial measures presented in this document. CAMDEN FUNDS FROM OPERATIONS (In thousands, except per share and property data amounts) � � � � � � � � � � � (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, FUNDS FROM OPERATIONS 2006� � 2005� 2006� � 2005 (a) � Net income (loss) $125,457� ($2,317) $201,482� $186,199� Real estate depreciation and amortization from continuing operations 39,735� 43,386� 115,964� 117,239� Real estate depreciation from discontinued operations 255� 1,777� 1,350� 5,387� Adjustments for unconsolidated joint ventures 760� 1,284� 2,305� 3,249� Income from continuing operations allocated to common units 12,365� 129� 14,599� 1,626� Income from discontinued operations allocated to common units 760� 112� 1,681� 343� (Gain) on sale of operating properties (91,581) -� (91,581) (132,117) (Gain) on sale of discontinued operations (8,842) -� (59,886) (36,104) (Gain) on sale of joint venture properties (1,085) � -� (2,848) � -� Funds from operations - diluted $77,824� � $44,371� $183,066� � $145,822� � PER SHARE DATA Funds from operations - diluted $1.24� $0.76� $3.02� $2.63� Cash distributions 0.66� 0.64� 1.98� 1.91� � Weighted average number of common and common equivalent shares outstanding: � FFO - diluted 62,885� 58,600� 60,666� 55,494� � PROPERTY DATA Total operating properties (end of period) (b) 188� 193� 188� 193� Total operating apartment homes in operating properties (end of period) (b) 64,657� 66,619� 64,657� 66,619� Total operating apartment homes (weighted average) 56,161� 56,150� 56,624� 54,368� Total operating apartment homes - excluding discontinued operations (weighted average) 54,350� 52,119� 53,880� 49,970� � (a) The Company's 2005 financial results include the results of Summit subsequent to February 28, 2005. � (b) Includes joint ventures and properties held for sale. � Note: Please refer to the following pages for definitions and reconciliations of all non-GAAP financial measures presented in this document. CAMDEN BALANCE SHEETS (In thousands) � � � � � � � � (Unaudited) Sep 30, Jun 30, Mar 31, Dec 31, Sep 30, 2006� 2006� 2006� 2005� 2005� ASSETS Real estate assets, at cost Land $683,645� $697,690� $664,219� $646,854� $660,748� Buildings and improvements 3,988,031� 4,074,737� 3,892,700� 3,840,969� 3,881,682� 4,671,676� 4,772,427� 4,556,919� 4,487,823� 4,542,430� Accumulated depreciation (725,790) (786,208) (732,984) (716,650) (713,991) Net operating real estate assets 3,945,886� 3,986,219� 3,823,935� 3,771,173� 3,828,439� Properties under development, including land 351,246� 427,500� 419,843� 372,976� 377,787� Investments in joint ventures 8,266� 8,270� 8,199� 6,096� 6,937� Properties held for sale 45,074� 55,562� 188,477� 172,112� 51,741� Total real estate assets 4,350,472� 4,477,551� 4,440,454� 4,322,357� 4,264,904� Accounts receivable - affiliates 33,624� 33,408� 33,361� 34,084� 35,313� Notes receivable Affiliates 31,037� 23,327� 22,531� 11,916� 11,505� Other 3,855� 9,211� 13,264� 13,261� 24,865� Other assets, net (a) 112,801� 111,636� 102,269� 99,516� 100,080� Cash and cash equivalents 8,061� 49,700� 1,256� 1,576� 1,076� Restricted cash 5,541� 5,194� 5,269� 5,089� 5,829� Total assets $4,545,391� $4,710,027� $4,618,404� $4,487,799� $4,443,572� � LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities Notes payable Unsecured $1,693,106� $1,940,693� $2,118,403� $2,007,164� $1,903,094� Secured 587,347� 620,592� 623,250� 625,927� 661,723� Accounts payable and accrued expenses 120,566� 117,301� 116,215� 108,979� 102,231� Accrued real estate taxes 41,165� 31,280� 17,818� 26,070� 39,740� Other liabilities (b) 101,332� 99,460� 98,327� 88,811� 84,835� Distributions payable 43,056� 43,031� 40,612� 38,922� 38,933� Total liabilities 2,586,572� 2,852,357� 3,014,625� 2,895,873� 2,830,556� � Commitments and contingencies � Minority interests Perpetual preferred units 97,925� 97,925� 97,925� 97,925� 97,925� Common units 116,776� 106,217� 113,034� 112,637� 115,190� Other minority interests 10,002� 10,555� 10,512� 10,461� 10,425� Total minority interests 224,703� 214,697� 221,471� 221,023� 223,540� � Shareholders' equity Common shares of beneficial interest 650� 649� 610� 608� 607� Additional paid-in capital 2,176,170� 2,172,616� 1,908,099� 1,902,595� 1,899,713� Distributions in excess of net income (206,442) (293,386) (289,482) (295,074) (273,609) Employee notes receivable (2,047) (2,035) (2,046) (2,078) (2,087) Treasury shares, at cost (234,215) (234,871) (234,873) (235,148) (235,148) Total share-holders' equity 1,734,116� 1,642,973� 1,382,308� 1,370,903� 1,389,476� Total liabilities and share-holders' equity $4,545,391� $4,710,027� $4,618,404� $4,487,799� $4,443,572� � � � (a) includes: net deferred charges of: $11,155� $13,120� $14,079� $13,061� $13,757� value of in place leases of: $452� $431� $1,156� $1,363� $10,561� � (b) includes: deferred revenues of: $5,256� $4,408� $4,843� $2,008� $2,152� above/below market leases of: $80� $13� $51� $90� $889� distri-butions in excess of investments in joint ventures of: $18,044� $12,701� $11,556� $11,256� $18,730� CAMDEN NON-GAAP FINANCIAL MEASURES DEFINITIONS & RECONCILIATIONS (In thousands, except per share amounts) � � � � � � � � (Unaudited) � This document contains certain non-GAAP financial measures management believes are useful in evaluating an equity REIT's performance. Camden's definitions and calculations of non-GAAP financial measures may differ from those used by other REITs, and thus may not be comparable. The non-GAAP financial measures should not be considered as an alternative to net income as an indication of our operating performance, or to net cash provided by operating activities as a measure of our liquidity. � FFO The National Association of Real Estate Investment Trusts (�NAREIT�) currently defines FFO as net income computed in accordance with generally accepted accounting principles (�GAAP�), excluding gains or losses from depreciable operating property sales, plus real estate depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Camden�s definition of diluted FFO also assumes conversion of all dilutive convertible securities, including minority interests, which are convertible into common equity. The Company considers FFO to be an appropriate supplemental measure of operating performance because, by excluding gains or losses on dispositions of operating properties and excluding depreciation, FFO can help one compare the operating performance of a company's real estate between periods or as compared to different companies. A reconciliation of net income to FFO is provided below: � � Three Months Ended Nine Months Ended September 30, September 30, 2006� 2005� 2006� 2005� Net income (loss) $125,457� ($2,317) $201,482� $186,199� Real estate depreciation and amortization from continuing operations 39,735� 43,386� 115,964� 117,239� Real estate depreciation from discontinued operations 255� 1,777� 1,350� 5,387� Adjustments for unconsolidated joint ventures 760� 1,284� 2,305� 3,249� Income from continuing operations allocated to common units 12,365� 129� 14,599� 1,626� Income from discontinued operations allocated to common units 760� 112� 1,681� 343� (Gain) on sale of operating properties (91,581) -� (91,581) (132,117) (Gain) on sale of discontinued operations (8,842) -� (59,886) (36,104) (Gain) on sale of joint venture properties (1,085) -� (2,848) -� Funds from operations - diluted $77,824� $44,371� $183,066� $145,822� � Weighted average number of common and common equivalent shares outstanding: � EPS diluted 61,250� 55,671� 58,904� 55,494� FFO diluted 62,885� 58,600� 60,666� 55,494� � Net income (loss) per common share - diluted $2.07� ($0.05) $3.46� $3.38� FFO per common share - diluted $1.24� $0.76� $3.02� $2.63� � Expected FFO Expected FFO is calculated in a method consistent with historical FFO, and is considered an appropriate supplemental measure of expected operating performance when compared to expected net income (EPS). A reconciliation of the ranges provided for expected net income per diluted share to expected FFO per diluted share is provided below: � 4Q06 Range 2006 Range Low High Low High � Expected net income per share - diluted $0.17� $0.23� $3.60� $3.66� Expected difference between EPS and fully diluted FFO shares (0.03) (0.03) (0.17) (0.17) Expected real estate depreciation 0.64� 0.64� 2.57� 2.57� Expected adjustments for unconsolidated joint ventures 0.01� 0.01� 0.05� 0.05� Expected income allocated to common units 0.02� 0.02� 0.29� 0.29� Expected (gain) on sale of properties held in joint ventures 0.00� 0.00� (0.05) (0.05) Expected (gain) on sale of properties and properties held for sale 0.00� 0.00� (2.47) (2.47) Expected FFO per share - diluted $0.81� $0.87� $3.82� $3.88� � Note: This table contains forward-looking statements. Please see the paragraph regarding forward-looking statements earlier in this document. Net Operating Income (NOI) NOI is defined by the Company as total property income less property operating and maintenance expenses less real estate taxes. The Company considers NOI to be an appropriate supplemental measure of operating performance to net income because it reflects the operating performance of our communities without allocation of corporate level property management overhead or general and administrative costs. A reconciliation of net income to net operating income is provided below: � Three Months Ended Nine Months Ended September 30, September 30, 2006� 2005� 2006� 2005� Net income (loss) $125,457� ($2,317) $201,482� $186,199� Fee and asset management (5,433) (1,789) (11,030) (10,929) Sale of technology investments (1,602) -� (1,602) (24,199) Interest and other income (1,733) (1,913) (6,097) (6,401) Income on deferred compensation plans (1,927) (3,209) (4,308) (5,327) Property management expense 4,629� 4,208� 13,821� 11,350� Fee and asset management expense 3,689� 2,008� 8,293� 4,999� General and administrative expense 9,849� 6,183� 25,299� 18,017� Transaction compensation and merger expenses -� -� -� 14,085� Interest expense 29,176� 29,331� 91,592� 81,416� Depreciation and amortization 40,399� 44,030� 117,945� 119,117� Amortization of deferred financing costs 941� 855� 2,897� 2,872� Expense on deferred compensation plans 1,927� 3,209� 4,308� 5,327� Gain on sale of properties, including land (96,247) -� (97,556) (132,117) Equity in income (loss) of joint ventures (1,628) 1,827� (4,514) 1,472� Distributions on perpetual preferred units 1,750� 1,750� 5,250� 5,278� Original issuance costs on redeemed perpetual preferred units -� -� -� 365� Income allocated to common units and other minority interests 12,413� 261� 14,750� 1,756� Income from discontinued operations (665) (1,481) (4,998) (6,118) Gain on sale of discontinued operations (29,350) -� (80,394) (36,115) Income from discontinued operations allocated to common units 760� 112� 1,681� 343� Net Operating Income (NOI) $92,405� $83,065� $276,819� $231,390� � "Same Property" Communities $78,032� $72,215� $233,936� $197,187� Non-"Same Property" Communities 8,416� 4,939� 24,633� 12,877� Development and Lease-Up Communities 2,838� 29� 5,540� 29� Dispositions / Other 3,119� 5,882� 12,710� 21,297� Net Operating Income (NOI) $92,405� $83,065� $276,819� $231,390� � � EBITDA EBITDA is defined by the Company as earnings before interest, taxes, depreciation and amortization, including net operating income from discontinued operations, excluding equity in income of joint ventures, gain on sale of real estate assets, and income allocated to minority interests. The Company considers EBITDA to be an appropriate supplemental measure of operating performance to net income because it represents income before non-cash depreciation and the cost of debt, and excludes gains or losses from property dispositions. A reconciliation of net income to EBITDA is provided below: � Three Months Ended Nine Months Ended September 30, September 30, 2006� 2005� 2006� 2005� Net income (loss) $125,457� ($2,317) $201,482� $186,199� Interest expense 29,176� 29,331� 91,592� 81,416� Amortization of deferred financing costs 941� 855� 2,897� 2,872� Depreciation and amortization 40,399� 44,030� 117,945� 119,117� Distributions on perpetual preferred units 1,750� 1,750� 5,250� 5,278� Original issuance costs on redeemed perpetual preferred units -� -� -� 365� Income allocated to common units and other minority interests 12,413� 261� 14,750� 1,756� Real estate depreciation from discontinued operations 255� 1,777� 1,350� 5,387� Gain on sale of properties, including land (96,247) -� (97,556) (132,117) Equity in income (loss) of joint ventures (1,628) 1,827� (4,514) 1,472� Gain on sale of discontinued operations (29,350) -� (80,394) (36,115) Income from discontinued operations allocated to common units 760� 112� 1,681� 343� EBITDA $83,926� $77,626� $254,483� $235,973� Camden Property Trust (NYSE:CPT) announced that its funds from operations ("FFO") for the third quarter of 2006 totaled $1.24 per diluted share or $77.8 million, as compared to $0.76 per diluted share or $44.4 million for the same period in 2005. FFO for the three months ended September 30, 2006 included a $0.40 per diluted share impact from gain on sale of land. FFO for the nine months ended September 30, 2006 totaled $3.02 per diluted share or $183.1 million, as compared to $2.63 per diluted share or $145.8 million for the same period in 2005. FFO for the nine months ended September 30, 2006 included a $0.44 per diluted share impact from gain on sale of land. FFO for the nine months ended September 30, 2005 included a $0.44 per diluted share impact from the sale of technology investments, and a $0.25 per diluted share charge for transaction compensation and merger expenses relating to Camden's merger with Summit Properties Inc. ("Summit"). Net Income ("EPS") The Company reported net income ("EPS") of $125.5 million or $2.07 per diluted share for the third quarter of 2006, as compared to a net loss of $2.3 million or ($0.05) per diluted share for the same period in 2005. EPS for the three months ended September 30, 2006 included a $2.07 per diluted share impact from gain on sale of land, operating properties, joint venture properties and discontinued operations. For the nine months ended September 30, 2006, net income totaled $201.5 million or $3.46 per diluted share, as compared to $186.2 million or $3.38 per diluted share for the same period in 2005. EPS for the nine months ended September 30, 2006 included a $3.07 per diluted share impact from gain on sale of land, operating properties, joint venture properties and discontinued operations. EPS for the nine months ended September 30, 2005 included a $3.03 per diluted share impact from gain on sale of operating properties and discontinued operations, $0.44 per diluted share income from the sale of technology investments, and a $0.25 per diluted share charge for transaction compensation and merger expenses relating to Camden's merger with Summit. A reconciliation of net income to FFO is included in the financial tables accompanying this press release. Same-Property Results For the 46,565 apartment homes included in consolidated same-property results, third quarter 2006 same-property net operating income ("NOI") growth was 8.1% compared to the third quarter of 2005, with revenues increasing 7.6% and expenses increasing 7.0%. On a sequential basis, third quarter 2006 same-property NOI decreased 0.7% compared to second quarter 2006, with revenues increasing 2.2% and expenses increasing 7.0% compared to the prior quarter. On a year-to-date basis, 2006 same-property NOI increased 9.4%, with revenue growth of 8.0% and expense growth of 5.7% compared to the same period in 2005. Same-property physical occupancy levels for the combined portfolio averaged 94.9% during the third quarter of 2006, compared to 96.1% in the third quarter of 2005 and 95.7% in the second quarter of 2006. The Company defines same-property communities as communities owned by either Camden or Summit and stabilized as of January 1, 2005, excluding properties held for sale. A reconciliation of net income to net operating income and same-property net operating income is included in the financial tables accompanying this press release. Development Activity As of September 30, 2006, Camden had four completed apartment communities in lease-up: Camden Fairfax Corner in Fairfax, VA, an $82.0 million project that is currently 86% leased; Camden Manor Park in Raleigh, NC, a $52.0 million project that is currently 69% leased; Camden Westwind in Ashburn, VA, a $97.6 million project that is currently 64% leased; and Camden Royal Oaks in Houston, TX, a $22.0 million project that is currently 31% leased. Camden announced one new joint venture development start during the quarter: Camden College Park in College Park, MD, a $139.9 million project with 508 apartment homes scheduled for initial occupancy in late 2007. The Company's current development pipeline includes eight wholly-owned communities with 2,693 apartment homes and a total budgeted cost of $565.0 million, and three joint venture communities with 1,069 apartment homes and a total budgeted cost of $289.9 million. Of those 11 communities, two are currently in lease-up. Camden Clearbrook in Frederick, MD is currently 60% leased; and Camden Old Creek in San Marcos, CA is currently 17% leased. Acquisition/Disposition Activity During the quarter, the Company acquired Camden Stoneleigh, a 390-home apartment community in Austin, TX for $35.3 million, and disposed of Camden Oaks, a 446-home apartment community in Dallas, TX, for $19.2 million. Gain on sale of Camden Oaks totaled $8.8 million. The Company also sold Summit Hollow, a 232-home joint venture apartment community in Charlotte, NC for $15.5 million. Camden's pro-rata share of that disposition totaled $3.9 million, and a $1.1 million gain on sale was recognized. In addition, the Company sold 8.7 acres of undeveloped land in Long Beach, CA, Orlando, FL, Fort Lauderdale, FL and Dallas, TX, and contributed 10.6 acres of undeveloped land in College Park, MD to a joint venture during the quarter. The combined sales price for those transactions totaled $69.6 million, and gains of $25.2 million were recorded. Camden contributed nine existing multifamily communities with 3,237 apartment homes located in Camden's Midwest markets to a newly created $239.0 million joint venture. Camden retained a 15% ownership interest in the venture and continues to serve as the property manager for all nine communities. The Company recorded a gain of $91.6 million as a result of this transaction. Properties and Land Held for Sale At September 30, 2006, Camden had five operating communities consisting of 1,744 apartment homes classified as held for sale. These properties included: Camden Crossing, a 366-home apartment community in Houston, TX; Camden Wyndham, a 448-home apartment community in Houston, TX; Camden Downs, a 254-home apartment community in Louisville, KY; Camden Taravue, a 304-home apartment community in St. Louis, MO; and Camden Trace, a 372-home apartment community in St. Louis, MO. The Company also had 5.7 acres of undeveloped land in Miami, FL, Boca Raton, FL and Dallas, TX classified as held for sale at quarter-end. Earnings Guidance 2006 FFO is now expected to be $3.82 to $3.88 per diluted share for full-year 2006, and $0.81 to $0.87 per diluted share for fourth quarter 2006. EPS is expected to be $3.60 to $3.66 per diluted share for full-year 2006, and $0.17 to $0.23 per diluted share for the fourth quarter of 2006. Guidance for 2006 includes a charge of $0.07 per diluted share during the fourth quarter of 2006 relating to early vesting of previously granted share awards. The Company's 2006 earnings guidance is based on projections of same-property revenue growth between 7.00% and 7.75%, same-property expense growth between 5.00% and 5.50%, and same-property NOI growth between 8.25% and 9.25%. No acquisitions, dispositions or new development starts are expected for the remainder of 2006. Camden expects to release its fourth quarter and full year 2006 earnings on February 1, 2007, and hold a conference call on February 2, 2007. The Company plans to discuss its 2006 results and earnings guidance for 2007 at that time. A reconciliation of expected net income to expected FFO is included in the financial tables accompanying this press release. Conference Call The Company will hold a conference call on Friday, November 3, 2006 at 10:00 a.m. Central Time to review its third quarter results and discuss its outlook for future performance. To participate in the call, please dial 877-407-0782 (domestic) or 201-689-8567 (international) by 9:50 a.m. Central Time and request the Camden Property Trust Third Quarter 2006 Earnings Call, or join the live webcast of the conference call by accessing the Investor Relations section of the Company's website at www.camdenliving.com. Supplemental financial information is available in the Investor Relations section of the Company's website under Earnings Releases or by calling Camden's Investor Relations Department at 800-922-6336. Forward-Looking Statements In addition to historical information, this press release contains forward-looking statements under the federal securities law. These statements are based on current expectations, estimates and projections about the industry and markets in which Camden operates, management's beliefs, and assumptions made by management. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties which are difficult to predict. About Camden Camden Property Trust is a real estate company engaged in the ownership, development, acquisition, management and disposition of multifamily apartment communities. Camden owns interests in and operates 188 properties containing 64,657 apartment homes across the United States. Upon completion of 11 properties under development, the Company's portfolio will increase to 68,419 apartment homes in 199 properties. For additional information, please contact Camden's Investor Relations Department at 800-922-6336 or 713-354-2787 or access our website at www.camdenliving.com. -0- *T CAMDEN OPERATING RESULTS (In thousands, except per share and property data amounts) ---------------------------------------------------------------------- (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, ------------------- ------------------- OPERATING DATA 2006 2005 2006 2005 (a) ------------------------------ ------------------- ------------------- Property revenues Rental revenues $139,354 $125,125 $408,581 $348,250 Other property revenues 15,202 11,507 41,172 31,612 ------------------- ------------------- Total property revenues 154,556 136,632 449,753 379,862 Property expenses Property operating and maintenance 45,806 38,697 124,089 105,960 Real estate taxes 16,345 14,870 48,845 42,512 ------------------- ------------------- Total property expenses 62,151 53,567 172,934 148,472 Non-property income Fee and asset management 5,433 1,789 11,030 10,929 Sale of technology investments 1,602 - 1,602 24,199 Interest and other income 1,733 1,913 6,097 6,401 Income on deferred compensation plans 1,927 3,209 4,308 5,327 ------------------- ------------------- Total non-property income 10,695 6,911 23,037 46,856 Other expenses Property management 4,629 4,208 13,821 11,350 Fee and asset management 3,689 2,008 8,293 4,999 General and administrative 9,849 6,183 25,299 18,017 Transaction compensation and merger expenses - - - 14,085 Interest 29,176 29,331 91,592 81,416 Depreciation and amortization 40,399 44,030 117,945 119,117 Amortization of deferred financing costs 941 855 2,897 2,872 Expense on deferred compensation plans 1,927 3,209 4,308 5,327 ------------------- ------------------- Total other expenses 90,610 89,824 264,155 257,183 ------------------- ------------------- Income from continuing operations before gain on sale of properties, equity in income (loss) of joint ventures and minority interests 12,490 152 35,701 21,063 Gain on sale of properties, including land 96,247 - 97,556 132,117 Equity in income (loss) of joint ventures 1,628 (1,827) 4,514 (1,472) Minority interests: Distributions on perpetual preferred units (1,750) (1,750) (5,250) (5,278) Original issuance costs on redeemed perpetual preferred units - - - (365) Income allocated to common units and other minority interests (12,413) (261) (14,750) (1,756) ------------------- ------------------- Income (loss) from continuing operations 96,202 (3,686) 117,771 144,309 Income from discontinued operations 665 1,481 4,998 6,118 Gain on sale of discontinued operations 29,350 - 80,394 36,115 Income from discontinued operations allocated to common units (760) (112) (1,681) (343) ------------------- ------------------- Net income (loss) $125,457 ($2,317) $201,482 $186,199 =================== =================== PER SHARE DATA ------------------------------ Net income (loss) - basic $2.15 ($0.04) $3.59 $3.63 Net income (loss) - diluted 2.07 (0.05) 3.46 3.38 Income (loss) from continuing operations - basic 1.65 (0.07) 2.10 2.81 Income (loss) from continuing operations - diluted 1.58 (0.07) 2.03 2.63 Weighted average number of common and common equivalent shares outstanding: Basic 58,348 54,018 56,063 51,294 Diluted 61,250 55,671 58,904 55,494 PROPERTY DATA ------------------------------ Total operating properties (end of period) (b) 188 193 188 193 Total operating apartment homes in operating properties (end of period) (b) 64,657 66,619 64,657 66,619 Total operating apartment homes (weighted average) 56,161 56,150 56,624 54,368 Total operating apartment homes - excluding discontinued operations (weighted average) 54,350 52,119 53,880 49,970 (a) The Company's 2005 financial results include the results of Summit subsequent to February 28, 2005. (b) Includes joint ventures and properties held for sale. Note: Please refer to the following pages for definitions and reconciliations of all non-GAAP financial measures presented in this document. *T -0- *T CAMDEN FUNDS FROM OPERATIONS (In thousands, except per share and property data amounts) ---------------------------------------------------------------------- (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, ------------------- ------------------- FUNDS FROM OPERATIONS 2006 2005 2006 2005 (a) ------------------------------ ------------------- ------------------- Net income (loss) $125,457 ($2,317) $201,482 $186,199 Real estate depreciation and amortization from continuing operations 39,735 43,386 115,964 117,239 Real estate depreciation from discontinued operations 255 1,777 1,350 5,387 Adjustments for unconsolidated joint ventures 760 1,284 2,305 3,249 Income from continuing operations allocated to common units 12,365 129 14,599 1,626 Income from discontinued operations allocated to common units 760 112 1,681 343 (Gain) on sale of operating properties (91,581) - (91,581) (132,117) (Gain) on sale of discontinued operations (8,842) - (59,886) (36,104) (Gain) on sale of joint venture properties (1,085) - (2,848) - ------------------- ------------------- Funds from operations - diluted $77,824 $44,371 $183,066 $145,822 =================== =================== PER SHARE DATA ------------------------------ Funds from operations - diluted $1.24 $0.76 $3.02 $2.63 Cash distributions 0.66 0.64 1.98 1.91 Weighted average number of common and common equivalent shares outstanding: FFO - diluted 62,885 58,600 60,666 55,494 PROPERTY DATA ------------------------------ Total operating properties (end of period) (b) 188 193 188 193 Total operating apartment homes in operating properties (end of period) (b) 64,657 66,619 64,657 66,619 Total operating apartment homes (weighted average) 56,161 56,150 56,624 54,368 Total operating apartment homes - excluding discontinued operations (weighted average) 54,350 52,119 53,880 49,970 (a) The Company's 2005 financial results include the results of Summit subsequent to February 28, 2005. (b) Includes joint ventures and properties held for sale. Note: Please refer to the following pages for definitions and reconciliations of all non-GAAP financial measures presented in this document. *T -0- *T CAMDEN BALANCE SHEETS (In thousands) ---------------------------------------------------------------------- (Unaudited) Sep 30, Jun 30, Mar 31, Dec 31, Sep 30, 2006 2006 2006 2005 2005 ------------------------------------------------------- ASSETS Real estate assets, at cost Land $683,645 $697,690 $664,219 $646,854 $660,748 Buildings and improvements 3,988,031 4,074,737 3,892,700 3,840,969 3,881,682 ------------------------------------------------------- 4,671,676 4,772,427 4,556,919 4,487,823 4,542,430 Accumulated depreciation (725,790) (786,208) (732,984) (716,650) (713,991) ------------------------------------------------------- Net operating real estate assets 3,945,886 3,986,219 3,823,935 3,771,173 3,828,439 Properties under development, including land 351,246 427,500 419,843 372,976 377,787 Investments in joint ventures 8,266 8,270 8,199 6,096 6,937 Properties held for sale 45,074 55,562 188,477 172,112 51,741 ------------------------------------------------------- Total real estate assets 4,350,472 4,477,551 4,440,454 4,322,357 4,264,904 Accounts receivable - affiliates 33,624 33,408 33,361 34,084 35,313 Notes receivable Affiliates 31,037 23,327 22,531 11,916 11,505 Other 3,855 9,211 13,264 13,261 24,865 Other assets, net (a) 112,801 111,636 102,269 99,516 100,080 Cash and cash equivalents 8,061 49,700 1,256 1,576 1,076 Restricted cash 5,541 5,194 5,269 5,089 5,829 ------------------------------------------------------- Total assets $4,545,391 $4,710,027 $4,618,404 $4,487,799 $4,443,572 ======================================================= LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities Notes payable Unsecured $1,693,106 $1,940,693 $2,118,403 $2,007,164 $1,903,094 Secured 587,347 620,592 623,250 625,927 661,723 Accounts payable and accrued expenses 120,566 117,301 116,215 108,979 102,231 Accrued real estate taxes 41,165 31,280 17,818 26,070 39,740 Other liabilities (b) 101,332 99,460 98,327 88,811 84,835 Distributions payable 43,056 43,031 40,612 38,922 38,933 ------------------------------------------------------- Total liabilities 2,586,572 2,852,357 3,014,625 2,895,873 2,830,556 Commitments and contingencies Minority interests Perpetual preferred units 97,925 97,925 97,925 97,925 97,925 Common units 116,776 106,217 113,034 112,637 115,190 Other minority interests 10,002 10,555 10,512 10,461 10,425 ------------------------------------------------------- Total minority interests 224,703 214,697 221,471 221,023 223,540 Shareholders' equity Common shares of beneficial interest 650 649 610 608 607 Additional paid-in capital 2,176,170 2,172,616 1,908,099 1,902,595 1,899,713 Distributions in excess of net income (206,442) (293,386) (289,482) (295,074) (273,609) Employee notes receivable (2,047) (2,035) (2,046) (2,078) (2,087) Treasury shares, at cost (234,215) (234,871) (234,873) (235,148) (235,148) ------------------------------------------------------- Total share- holders' equity 1,734,116 1,642,973 1,382,308 1,370,903 1,389,476 ------------------------------------------------------- Total liabilities and share- holders' equity $4,545,391 $4,710,027 $4,618,404 $4,487,799 $4,443,572 ======================================================= (a) includes: net deferred charges of: $11,155 $13,120 $14,079 $13,061 $13,757 value of in place leases of: $452 $431 $1,156 $1,363 $10,561 (b) includes: deferred revenues of: $5,256 $4,408 $4,843 $2,008 $2,152 above/below market leases of: $80 $13 $51 $90 $889 distri- butions in excess of investments in joint ventures of: $18,044 $12,701 $11,556 $11,256 $18,730 *T -0- *T CAMDEN NON-GAAP FINANCIAL MEASURES DEFINITIONS & RECONCILIATIONS (In thousands, except per share amounts) ---------------------------------------------------------------------- (Unaudited) This document contains certain non-GAAP financial measures management believes are useful in evaluating an equity REIT's performance. Camden's definitions and calculations of non-GAAP financial measures may differ from those used by other REITs, and thus may not be comparable. The non-GAAP financial measures should not be considered as an alternative to net income as an indication of our operating performance, or to net cash provided by operating activities as a measure of our liquidity. FFO ------------------------------ The National Association of Real Estate Investment Trusts ("NAREIT") currently defines FFO as net income computed in accordance with generally accepted accounting principles ("GAAP"), excluding gains or losses from depreciable operating property sales, plus real estate depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Camden's definition of diluted FFO also assumes conversion of all dilutive convertible securities, including minority interests, which are convertible into common equity. The Company considers FFO to be an appropriate supplemental measure of operating performance because, by excluding gains or losses on dispositions of operating properties and excluding depreciation, FFO can help one compare the operating performance of a company's real estate between periods or as compared to different companies. A reconciliation of net income to FFO is provided below: Three Months Ended Nine Months Ended September 30, September 30, ------------------- ------------------- 2006 2005 2006 2005 ------------------- ------------------- Net income (loss) $125,457 ($2,317) $201,482 $186,199 Real estate depreciation and amortization from continuing operations 39,735 43,386 115,964 117,239 Real estate depreciation from discontinued operations 255 1,777 1,350 5,387 Adjustments for unconsolidated joint ventures 760 1,284 2,305 3,249 Income from continuing operations allocated to common units 12,365 129 14,599 1,626 Income from discontinued operations allocated to common units 760 112 1,681 343 (Gain) on sale of operating properties (91,581) - (91,581)(132,117) (Gain) on sale of discontinued operations (8,842) - (59,886) (36,104) (Gain) on sale of joint venture properties (1,085) - (2,848) - ------------------- ------------------- Funds from operations - diluted $77,824 $44,371 $183,066 $145,822 =================== =================== Weighted average number of common and common equivalent shares outstanding: EPS diluted 61,250 55,671 58,904 55,494 FFO diluted 62,885 58,600 60,666 55,494 Net income (loss) per common share - diluted $2.07 ($0.05) $3.46 $3.38 FFO per common share - diluted $1.24 $0.76 $3.02 $2.63 Expected FFO ------------------------------ Expected FFO is calculated in a method consistent with historical FFO, and is considered an appropriate supplemental measure of expected operating performance when compared to expected net income (EPS). A reconciliation of the ranges provided for expected net income per diluted share to expected FFO per diluted share is provided below: 4Q06 Range 2006 Range Low High Low High ------------------- ------------------- Expected net income per share - diluted $0.17 $0.23 $3.60 $3.66 Expected difference between EPS and fully diluted FFO shares (0.03) (0.03) (0.17) (0.17) Expected real estate depreciation 0.64 0.64 2.57 2.57 Expected adjustments for unconsolidated joint ventures 0.01 0.01 0.05 0.05 Expected income allocated to common units 0.02 0.02 0.29 0.29 Expected (gain) on sale of properties held in joint ventures 0.00 0.00 (0.05) (0.05) Expected (gain) on sale of properties and properties held for sale 0.00 0.00 (2.47) (2.47) ------------------- ------------------- Expected FFO per share - diluted $0.81 $0.87 $3.82 $3.88 Note: This table contains forward-looking statements. Please see the paragraph regarding forward-looking statements earlier in this document. *T -0- *T Net Operating Income (NOI) ------------------------------ NOI is defined by the Company as total property income less property operating and maintenance expenses less real estate taxes. The Company considers NOI to be an appropriate supplemental measure of operating performance to net income because it reflects the operating performance of our communities without allocation of corporate level property management overhead or general and administrative costs. A reconciliation of net income to net operating income is provided below: Three Months Ended Nine Months Ended September 30, September 30, ------------------- ------------------- 2006 2005 2006 2005 ------------------- ------------------- Net income (loss) $125,457 ($2,317) $201,482 $186,199 Fee and asset management (5,433) (1,789) (11,030) (10,929) Sale of technology investments (1,602) - (1,602) (24,199) Interest and other income (1,733) (1,913) (6,097) (6,401) Income on deferred compensation plans (1,927) (3,209) (4,308) (5,327) Property management expense 4,629 4,208 13,821 11,350 Fee and asset management expense 3,689 2,008 8,293 4,999 General and administrative expense 9,849 6,183 25,299 18,017 Transaction compensation and merger expenses - - - 14,085 Interest expense 29,176 29,331 91,592 81,416 Depreciation and amortization 40,399 44,030 117,945 119,117 Amortization of deferred financing costs 941 855 2,897 2,872 Expense on deferred compensation plans 1,927 3,209 4,308 5,327 Gain on sale of properties, including land (96,247) - (97,556)(132,117) Equity in income (loss) of joint ventures (1,628) 1,827 (4,514) 1,472 Distributions on perpetual preferred units 1,750 1,750 5,250 5,278 Original issuance costs on redeemed perpetual preferred units - - - 365 Income allocated to common units and other minority interests 12,413 261 14,750 1,756 Income from discontinued operations (665) (1,481) (4,998) (6,118) Gain on sale of discontinued operations (29,350) - (80,394) (36,115) Income from discontinued operations allocated to common units 760 112 1,681 343 ------------------- ------------------- Net Operating Income (NOI) $92,405 $83,065 $276,819 $231,390 "Same Property" Communities $78,032 $72,215 $233,936 $197,187 Non-"Same Property" Communities 8,416 4,939 24,633 12,877 Development and Lease-Up Communities 2,838 29 5,540 29 Dispositions / Other 3,119 5,882 12,710 21,297 ------------------- ------------------- Net Operating Income (NOI) $92,405 $83,065 $276,819 $231,390 EBITDA ------------------------------ EBITDA is defined by the Company as earnings before interest, taxes, depreciation and amortization, including net operating income from discontinued operations, excluding equity in income of joint ventures, gain on sale of real estate assets, and income allocated to minority interests. The Company considers EBITDA to be an appropriate supplemental measure of operating performance to net income because it represents income before non-cash depreciation and the cost of debt, and excludes gains or losses from property dispositions. A reconciliation of net income to EBITDA is provided below: Three Months Ended Nine Months Ended September 30, September 30, ------------------- ------------------- 2006 2005 2006 2005 ------------------- ------------------- Net income (loss) $125,457 ($2,317) $201,482 $186,199 Interest expense 29,176 29,331 91,592 81,416 Amortization of deferred financing costs 941 855 2,897 2,872 Depreciation and amortization 40,399 44,030 117,945 119,117 Distributions on perpetual preferred units 1,750 1,750 5,250 5,278 Original issuance costs on redeemed perpetual preferred units - - - 365 Income allocated to common units and other minority interests 12,413 261 14,750 1,756 Real estate depreciation from discontinued operations 255 1,777 1,350 5,387 Gain on sale of properties, including land (96,247) - (97,556)(132,117) Equity in income (loss) of joint ventures (1,628) 1,827 (4,514) 1,472 Gain on sale of discontinued operations (29,350) - (80,394) (36,115) Income from discontinued operations allocated to common units 760 112 1,681 343 ------------------- ------------------- EBITDA $83,926 $77,626 $254,483 $235,973 *T