Cousins Properties Incorporated (NYSE:CUZ) today reported its
results of operations for the three and six months ended June 30,
2008. All per share amounts are reported on a diluted basis; basic
per share data is included in the Condensed Consolidated Statements
of Income accompanying this release. Funds from Operations
Available to Common Stockholders (�FFO�) was $16.1 million, or
$0.31 per share, for the second quarter of 2008 compared with FFO
of $9.4 million, or $0.18 per share, for the second quarter of
2007. FFO was $29.9 million, or $0.58 per share, for the six months
ended June 30, 2008, compared to $33.9 million, or $0.63 per share,
for the same period in 2007. Net Income Available to Common
Stockholders (�Net Income Available�) was $2.9 million, or $0.06
per share, for the second quarter of 2008 compared with Net Income
Available of $395,000, or $0.01 per share, for the second quarter
of 2007. Net Income Available was $4.8 million, or $0.09 per share,
for the six months ended June 30, 2008, compared with $14.8
million, or $0.28 per share, for the same period in 2007. Second
quarter highlights of the Company included the following: Sold two
tracts totaling 70 acres at Jefferson Mill Business Park for
approximately $8.5 million, generating FFO of approximately
$748,000. Entered into an agreement to sell an additional 53-acre
tract at Jefferson Mill Business Park and a 44-acre tract at King
Mill Distribution Park for an aggregate price of $10.1 million.
These tracts are expected to close on or before December 31, 2009.
Sold a 28-acre tract adjacent to The Avenue Forsyth for $17.6
million, generating FFO of approximately $3.4 million. The Company
expects to recognize an additional $664,000 in FFO from this sale
in 2008 and 2009 as it completes certain site improvement work on
the tract. Through its CL Realty joint venture, sold 30 acres at
its Long Meadows Farms project for $7.7�million, generating a gain
of $4.8 million. The Company�s share of this gain, representing
pre-tax FFO, is $931,000. Celebrated the grand opening of The
Avenue Forsyth, a 527,000-square-foot lifestyle center in north
metropolitan Atlanta. Other highlights subsequent to quarter-end:
Through its 50 Biscayne joint venture, sold all of the remaining
120 residential units for $30.3�million. This venture currently
holds only seven unsold commercial units. Entered into an $18.4
million mortgage loan secured by its Lakeshore Park Plaza office
building. This non-recourse loan matures August 1, 2012, and bears
interest at 5.89%. At June 30, 2008, the Company�s portfolio of
operational office buildings was 93% leased, its portfolio of
operational retail centers was 91% leased and its operational
industrial buildings were 40% leased. At June 30, 2008, the Company
and its joint ventures had seven office and retail projects under
development and redevelopment totaling 3.8 million Company-owned
square feet and two multi-family projects under development
containing a total of 208 units. The Company estimates the total
cost of these projects will be approximately $957 million and
expects completion of these projects throughout the next three
years. In addition, the Company and its joint ventures had 24
residential communities in which approximately 2,000 completed lots
are in inventory and an additional 7,900 lots are available for
future development and/or sale. �With economic conditions
continuing to deteriorate, leasing remains a top priority for us,
and our team is looking for distressed transactions where we can
use our expertise to create value for our shareholders,� said Tom
Bell, chairman and CEO of Cousins. �Fortunately, our tract sales
business � selling entitled land to users or other developers �
continues to be a bright spot this year and highlights a sometimes
overlooked but important recurring business for Cousins. During the
second half of the year, we will continue to press on the lease-up
of our existing projects while aggressively pursuing opportunities
that result from this down cycle,� Bell added. The Condensed
Consolidated Statements of Income, Condensed Consolidated Balance
Sheets and a schedule entitled Funds From Operations, which
reconciles Net Income Available to FFO, are attached to this press
release. More detailed information on Net Income Available and FFO
results is included in the �Net Income and Funds From
Operations-Supplemental Detail� schedule which is included along
with other supplemental information in the Company�s Current Report
on Form 8-K, which the Company is furnishing to the Securities and
Exchange Commission (�SEC�), and which can be viewed through the
�Quarterly Disclosures� and �SEC Filings� links on the Investor
Relations page of the Company�s Web site at
www.cousinsproperties.com. This information may also be obtained by
calling the Company�s Investor Relations Department at (404)
407-1490. The Company will conduct a conference call at 10:00 a.m.
(Eastern Time) on Tuesday, August�12, 2008, to discuss the results
of the quarter ended June 30, 2008. The number to call for this
interactive teleconference is (303) 262-2140. A replay of the
conference call will be available for 14 days by dialing (303)
590-3000 and entering the passcode 11116487#. The replay can be
accessed on the Company�s Web site, www.cousinsproperties.com,
through the �Q2 2008 Cousins Properties Incorporated Earnings
Conference Call� link on the Investor Relations page, as well as at
www.streetevents.com and www.earnings.com. The rebroadcast will be
available on the Investor Relations page of the Company�s Web site
for 14 days. Celebrating its 50th anniversary in 2008, Cousins
Properties Incorporated is a leading diversified real estate
company with extensive experience in development, acquisition,
financing, management and leasing. Based in Atlanta, the Company
actively invests in office, multi-family, retail, industrial and
land development projects. Since its founding, Cousins has
developed 20 million square feet of office space, 20 million square
feet of retail space, more than 4,000 multi-family units and more
than 60 single-family neighborhoods. The Company is a fully
integrated equity real estate investment trust (REIT) and trades on
the New York Stock Exchange under the symbol CUZ. For more, please
visit www.cousinsproperties.com. Certain matters discussed in this
news release are forward-looking statements within the meaning of
the federal securities laws and are subject to uncertainties and
risk. These include, but are not limited to, general and local
economic conditions, local real estate conditions (including the
overall condition of the residential markets), the activity of
others developing competitive projects, the risks associated with
development projects (such as delay, cost overruns and
leasing/sales risk of new properties), the cyclical nature of the
real estate industry, the financial condition of existing tenants,
interest rates, the Company�s ability to obtain favorable financing
or zoning, environmental matters, the effects of terrorism, the
ability of the Company to close properties under contract and other
risks detailed from time to time in the Company�s filings with the
Securities and Exchange Commission, including those described in
Part I, Item 1A of the Company�s Annual Report on Form 10-K for the
year ended December 31, 2007. The words �believes,� �expects,�
�anticipates,� �estimates� and similar expressions are intended to
identify forward-looking statements. Although the Company believes
that its plans, intentions and expectations reflected in any
forward-looking statement are reasonable, the Company can give no
assurance that these plans, intentions or expectations will be
achieved. Such forward-looking statements are based on current
expectations and speak as of the date of such statements. The
Company undertakes no obligation to publicly update or revise any
forward-looking statement, whether as a result of future events,
new information or otherwise. COUSINS PROPERTIES INCORPORATED AND
SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited, in thousands, except per share amounts) � � � � Three
Months Ended June 30, � Six Months Ended June 30, 2008 � 2007 2008
� 2007 REVENUES: Rental property revenues $ 36,706 $ 25,499 $
71,019 $ 49,629 Fee income 7,802 9,860 15,360 17,926 Residential
lot and outparcel sales 1,255 1,476 2,999 2,902 Interest and other
940 � � 833 � 2,300 � � 4,500 � 46,703 � � 37,668 � 91,678 � �
74,957 � � COSTS AND EXPENSES: Rental property operating expenses
14,792 11,341 28,470 21,358 General and administrative expenses
13,067 15,604 27,452 30,294 Depreciation and amortization 12,785
8,721 24,224 18,076 Residential lot and outparcel cost of sales 832
1,085 1,778 2,293 Interest expense 7,367 531 13,642 531 Other 549 �
� 758 � 2,304 � � 1,118 � 49,392 � � 38,040 � 97,870 � � 73,670 � �
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE TAXES, MINORITY
INTEREST AND INCOME FROM UNCONSOLIDATED JOINT VENTURES (2,689 )
(372 ) (6,192 ) 1,287 � BENEFIT FOR INCOME TAXES FROM OPERATIONS
2,176 1,073 5,393 2,100 � MINORITY INTEREST IN INCOME OF
CONSOLIDATED SUBSIDIARIES (251 ) (842 ) (922 ) (1,704 ) � INCOME
FROM UNCONSOLIDATED JOINT VENTURES 2,239 � � 4,101 � 5,056 � �
7,809 � � INCOME FROM CONTINUING OPERATIONS BEFORE GAIN ON SALE OF
INVESTMENT PROPERTIES 1,475 3,960 3,335 9,492 � GAIN ON SALE OF
INVESTMENT PROPERTIES, NET OF APPLICABLE INCOME TAX PROVISION 5,212
� � 62 � 9,004 � � 4,502 � � INCOME FROM CONTINUING OPERATIONS
6,687 4,022 12,339 13,994 � DISCONTINUED OPERATIONS, NET OF
APPLICABLE INCOME TAX PROVISION: � Income from discontinued
operations 36 207 36 291 Gain (loss) on sale of investment
properties - � � (22 ) - � � 8,142 � 36 � � 185 � 36 � � 8,433 � �
NET INCOME 6,723 4,207 12,375 22,427 � DIVIDENDS TO PREFERRED
STOCKHOLDERS (3,812 ) � (3,812 ) (7,625 ) � (7,625 ) � NET INCOME
AVAILABLE TO COMMON STOCKHOLDERS $ 2,911 � � $ 395 � $ 4,750 � � $
14,802 � � PER COMMON SHARE INFORMATION - BASIC: Income from
continuing operations $ 0.06 $ 0.01 $ 0.09 $ 0.13 Income from
discontinued operations - � � - � - � � 0.16 � Basic net income
available to common stockholders $ 0.06 � � $ 0.01 � $ 0.09 � � $
0.29 � � PER COMMON SHARE INFORMATION - DILUTED: Income from
continuing operations $ 0.06 $ 0.01 $ 0.09 $ 0.12 Income from
discontinued operations - � � - � - � � 0.16 � Diluted net income
available to common stockholders $ 0.06 � � $ 0.01 � $ 0.09 � � $
0.28 � � CASH DIVIDENDS DECLARED PER COMMON SHARE $ 0.37 � � $ 0.37
� $ 0.74 � � $ 0.74 � � WEIGHTED AVERAGE SHARES 51,187 � � 51,825 �
51,167 � � 51,772 � � DILUTED WEIGHTED AVERAGE SHARES 52,040 � �
53,306 � 51,842 � � 53,440 � COUSINS PROPERTIES INCORPORATED AND
SUBSIDIARIES FUNDS FROM OPERATIONS FOR THE THREE AND SIX MONTHS
ENDED JUNE 30, 2008 AND 2007 (Unaudited, in thousands, except per
share amounts) � � � Three Months Ended Six Months Ended June 30,
June 30, 2008 2007 2008 2007 � Net Income Available to Common
Stockholders $ 2,911 $ 395 $ 4,750 $ 14,802 Depreciation and
amortization: Consolidated properties 12,785 8,721 24,224 18,076
Discontinued properties - (14 ) - 151 Share of unconsolidated joint
ventures 1,473 1,089 2,864 2,170 Depreciation of furniture,
fixtures and equipment and amortization of specifically
identifiable intangible assets: � Consolidated properties (967 )
(758 ) (1,744 ) (1,259 ) Share of unconsolidated joint ventures (26
) - (51 ) - Gain on sale of investment properties, net of
applicable income tax provision: � Consolidated (5,212 ) (62 )
(9,004 ) (4,502 ) Discontinued properties - 22 - (8,142 ) Share of
unconsolidated joint ventures - (10 ) - 34 Gain on sale of
undepreciated investment properties 5,156 � - � 8,892 � 12,540 � �
Funds From Operations Available to Common Stockholders $ 16,120 � $
9,383 � $ 29,931 � $ 33,870 � � � Per Common Share - Basic: Net
Income Available $ .06 � $ .01 � $ .09 � $ .29 � Funds From
Operations $ .31 � $ .18 � $ .58 � $ .65 � Weighted Average
Shares-Basic 51,187 � 51,825 � 51,167 � 51,772 � � Per Common Share
- Diluted: Net Income Available $ .06 � $ .01 � $ .09 � $ .28 �
Funds From Operations $ .31 � $ .18 � $ .58 � $ .63 � Weighted
Average Shares-Diluted 52,040 � 53,306 � 51,842 � 53,440 � � The
table above shows Funds From Operations Available to Common
Stockholders (�FFO�) and the related reconciliation to Net Income
Available to Common Stockholders ("Net Income Available") for
Cousins Properties Incorporated and Subsidiaries.��The Company
calculated FFO in accordance with the National Association of Real
Estate Investment Trusts' ("NAREIT") definition, which is net
income available to common stockholders (computed in accordance
with accounting principles generally accepted in the United States
("GAAP")), excluding extraordinary items, cumulative effect of
change in accounting principle and gains or losses from sales of
depreciable property, plus depreciation and amortization of real
estate assets, and after adjustments for unconsolidated
partnerships and joint ventures to reflect FFO on the same basis. �
FFO is used by industry analysts and investors as a supplemental
measure of an equity REIT�s operating performance. Historical cost
accounting for real estate assets implicitly assumes that the value
of real estate assets diminishes predictably over time.��Since real
estate values instead have historically risen or fallen with market
conditions, many industry investors and analysts have considered
presentation of operating results for real estate companies that
use historical cost accounting to be insufficient by
themselves.��Thus, NAREIT created FFO as a supplemental measure of
REIT operating performance that excludes historical cost
depreciation, among other items, from GAAP net income.��Management
believes that the use of FFO, combined with the required primary
GAAP presentations, has been fundamentally beneficial, improving
the understanding of operating results of REITs among the investing
public and making comparisons of REIT operating results more
meaningful.��Company management evaluates the operating performance
of its reportable segments and of its divisions based in part on
FFO.��Additionally, the Company uses FFO and FFO per share, along
with other measures, to assess performance in connection with
evaluating and granting incentive compensation to key employees.
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