SANTA MONICA, Calif., Aug. 4 /PRNewswire-FirstCall/ -- The Macerich
Company (NYSE:MAC) today announced results of operations for the
quarter and six months ended June 30, 2005 which included funds
from operations ("FFO") per share -- diluted increasing 13% to
$1.00 compared to $.89 for the quarter ended June 30, 2004 and
increasing to $1.99 for the six months ended June 30, 2005 compared
to $1.79 for the comparable period in 2004. Total FFO -- diluted
increased by 13.2% to $77 million for the quarter compared to $68
million for the quarter ended June 30, 2004 and to $153 million for
the six months ended June 30, 2005 compared to $137 million for the
comparable period in 2004. The Company's definition of FFO is in
accordance with the definition provided by the National Association
of Real Estate Investment Trusts ("NAREIT"). A reconciliation of
net income per common share-diluted ("EPS") to FFO per
share-diluted is included in the financial tables accompanying this
press release. Net income available to common stockholders for the
quarter ended June 30, 2005 was $6.7 million or $.11 per
share-diluted compared to $17.1 million or $.29 per share-diluted
for the quarter ended June 30, 2004. For the six months ended June
30, 2005 net income available to common stockholders was $24.9
million or $.42 per share-diluted compared to $35.2 million or $.60
per share- diluted for the six months ended June 30, 2004. A
reconciliation of net income to FFO is included in the financial
highlights section of this press release. Recent highlights: --
During the quarter, Macerich signed 339,000 square feet of
specialty store leases at average initial rents of $34.97 per
square foot. First year rents on mall and freestanding store leases
signed during the quarter were 13% higher than average expiring
rents. -- This quarter's FFO per diluted share increased 13% to
$1.00 from $.89 for the quarter ended June 30, 2004. The growth was
reduced by approximately $.02 per share as a result of marking the
director's phantom stock to market. -- Total same center tenant
sales, for the quarter ended June 30, 2005, were up 6.0% compared
to sales levels for the quarter ended June 30, 2004. -- Portfolio
occupancy at June 30, 2005 was 92.3% compared to 91.7% at June 30,
2004. On a same center basis occupancy was 92.1% at June 30, 2005
compared to 92.3% at June 30, 2004. -- On April 25, 2005 the
Company closed on the $2.333 billion acquisition of the Wilmorite
portfolio. Commenting on results and recent events, Arthur Coppola
president and chief executive officer of Macerich stated, "The
quarter was highlighted by the acquisition of Wilmorite. The
addition of Tysons Corner, Danbury Fair Mall, Freehold Raceway Mall
and the balance of the Wilmorite portfolio is a huge benefit for
us. Tysons, Danbury, Freehold, along with our recently expanded
Queens Center in New York, gives us a very substantial presence in
the East. Macerich enjoyed another quarter of double digit growth
in FFO per share and we continue to see very strong occupancy
levels and leasing activity. Our substantial redevelopment and
growing development pipelines continue to progress well and we
expect them to fuel our FFO growth in the years to come. On July
28, 2005, Federated Department Store, Inc. announced that after
their merger with May Department Stores, they plan to sell or
dispose of 68 anchor stores where the two companies have duplicate
locations. Within the Macerich portfolio, there are ten stores that
were included in this announcement. These stores are located in
highly productive Macerich malls which currently average
approximately $470 per square foot. The recycling of these
locations will result in the opportunity to introduce exciting new
retailers to these centers and the possibility of accelerating the
timing of currently planned expansions and remerchandising at
several of the centers". Redevelopment and Development Activity At
Washington Square in suburban Portland, the Company is proceeding
with a lifestyle oriented expansion project which consists of the
addition of 76,000 square feet of shop space. The expansion is
underway with substantial completion earmarked for the fourth
quarter of 2005. New tenants include Cheesecake Factory, Pottery
Barn Kids, Williams-Sonoma, Godiva and Papyrus. In addition
agreement has been reached with Mervyn's to recapture their 100,000
square foot location and recycle that square footage over the next
two years. At Fresno Fashion Fair, an 87,000 square foot lifestyle
center expansion to the existing mall continues on schedule. The
ground breaking took place in March 2005 with completion expected
in the spring of 2006. Illustrative new tenants in the expansion
include Cheesecake Factory, Sephora, Anthropologie, Bebe Sport,
Lucky Brand Jeans and Fleming's Steakhouse. The recycling of the
former Crossroads Mall, now named Twenty Ninth Street in Boulder,
Colorado continues. The vast majority of the former mall has been
demolished and construction has commenced on the 877,000 square
foot open-air retail and entertainment center. The planned
completion is in the fall of 2006. The 364,000 square foot
expansion of the recently acquired Tysons Corner Center is
scheduled to open on September 29, 2005. The expansion is currently
97% leased. Included in the expansion is a 105,000 square foot,
state of the art, 16-screen AMC theatre complex, five exclusive
restaurants including Coastal Flats, Brio Tuscan Grille, Pauli
Moto's Asian Bistro, Gordon Biersch, and T.G.I. Friday's. In
addition the expansion features a two-level, 33,700 square foot
Barnes & Noble and a 10-unit 800 seat food court. Notable
tenants include Z Gallerie, West Elm, H by Tommy Hilfiger, Banana
Republic Petites, Esprit, Sony Style, The North Face, Urban
Outfitters, Guess, Mexx, Lucky Brand Jeans, Free People and Oakley.
Also at Tysons Corner Center the entitlement process is underway to
further expand our project with the addition of approximately 3
million square feet of office, residential and mixed use high- rise
development. Construction will begin soon on the SanTan Village
regional shopping center in Gilbert, Arizona. The center is an
outdoor open air streetscape project planned to contain in excess
of 1,200,000 square feet on 120 acres. The center will be anchored
by Dillard's, Harkins Theatres and will contain a lifestyle
shopping district featuring retail, office, residential and
restaurants. Robinson's-May had previously committed to this center
and management anticipates that after the Federated/May Company
merger that Macy's will replace Robinson's-May in this project. The
project is scheduled to open in phases with completion by fall
2007. Plans for Estrella Falls, a major regional shopping center
and mixed use project, have been accelerated. The project is
located on approximately 300 acres in Goodyear, Arizona. The
Company will develop the regional mall, which will consist of
approximately 1.2 million square feet, and will co-develop
associated commercial uses surrounding the shopping center. The
first phase of this project is anticipated to open in 2007 with
completion of the mall in 2008. Acquisitions On April 25, 2005 the
Company completed its $2.333 billion acquisition of Wilmorite
Properties, Inc. and Wilmorite Holdings L.P. ("Wilmorite").
Wilmorite's portfolio includes interests in 11 regional malls and
two open-air community centers, with 13.4 million square feet of
space located in Connecticut, New York, New Jersey, Kentucky and
Virginia. Approximately 5 million square feet of gross leaseable
area is located at three premier regional malls: Tysons Corner
Center in McLean, Virginia, Freehold Raceway Mall in Freehold, New
Jersey and Danbury Fair Mall in Danbury, Connecticut. The average
tenant sales-per-square foot for these three centers is in excess
of $539. The total portfolio average of mall store annual sales per
square foot is $392. The addition of Tysons Corner Center, Freehold
Raceway Mall and Danbury Fair Mall combined with the recently
expanded Queens Center gives Macerich four premier super-regional
malls in the East with combined total annual retail sales in excess
of $2 billion. Financing Activity Concurrent with the Wilmorite
closing, the Company repriced its $250 million unsecured term loan.
The interest rate on the loan was reduced from LIBOR plus 2.50% to
LIBOR plus 1.50%. The Company has refinanced the mortgage on
Lakewood Mall. The former mortgage of $127 million with interest at
7.1% was replaced with a $250 million 10-year fixed rate loan
bearing interest at 5.41%. Earnings Guidance Management is
reaffirming its previously issued guidance for 2005 FFO per share
and revising its EPS guidance as follows: Guidance for 2005 and
reconciliation of EPS to FFO per share and to EBITDA per share:
Range per share: Fully Diluted EPS $.89 ... $ .99 Plus: Real Estate
Depreciation and Amortization $3.49 ... $3.49 Less: other items
including gain on asset sales ($.08) ... ($.08) Fully Diluted FFO
per share $4.30 ... $4.40 Plus: Interest Expense per share $4.43
... $4.43 Plus: effect of preferred stock dividends $.33 ... $ .33
Plus: Non real estate depreciation, income taxes and ground rent
expense per share $.23 ... $ .23 EBITDA per share $9.29 ... $9.39
Less: management company expenses, REIT General and administrative
expenses and EBITDA of non-comparable centers ($2.87) ... ($2.87)
Same center EBITDA per share $6.42 ... $6.52 This range is based on
many assumptions, including the following: Management expects 2005
same center EBITDA to grow at a 2.5% to 3.0% rate compared to 2004
results. EBITDA represents earnings before interest, income taxes,
depreciation, amortization, minority interest, extraordinary items,
gain (loss) on sale of assets and preferred dividends and includes
joint ventures at their pro rata share. Management has assumed
short-term LIBOR interest rates will increase to 3.75% by year-end
2005. The guidance is based on management's current view of the
current market conditions in the regional mall business. Due to the
uncertainty in the timing and economics of acquisitions and
dispositions, the guidance ranges do not include any potential
property acquisitions or dispositions other than those that have
closed or are under contract as of August 4, 2005. The Company is
not able to assess at this time the potential impact of such
exclusions on future EPS and FFO. FFO does not include gains or
losses on sales of depreciated operating assets. The Macerich
Company is a fully integrated self-managed and self- administered
real estate investment trust, which focuses on the acquisition,
leasing, management, development and redevelopment of regional
malls throughout the United States. The Company is the sole general
partner and owns an 81% ownership interest in The Macerich
Partnership, L.P. Macerich now owns approximately 79 million square
feet of gross leaseable area consisting primarily of interests in
76 regional malls. Additional information about The Macerich
Company can be obtained from the Company's web site at
http://www.macerich.com/. Investor Conference Call The Company will
provide an online Web simulcast and rebroadcast of its quarterly
earnings conference call. The call will be available on The
Macerich Company's website at http://www.macerich.com/ and through
CCBN at http://www.fulldisclosure.com/. The call begins today,
August 4, 2005 at 10:30 AM Pacific Time. To listen to the call,
please go to any of these web sites at least 15 minutes prior to
the call in order to register and download audio software if
needed. An online replay at http://www.macerich.com/ will be
available for one year after the call. Note: This release contains
statements that constitute forward-looking statements. Stockholders
are cautioned that any such forward-looking statements are not
guarantees of future performance and involve risks, uncertainties
and other factors that may cause actual results, performance or
achievements of the Company to vary materially from those
anticipated, expected or projected. Such factors include, among
others, general industry, economic and business conditions, which
will, among other things, affect demand for retail space or retail
goods, availability and creditworthiness of current and prospective
tenants, anchor or tenant bankruptcies, closures, mergers or
consolidations, lease rates and terms, interest rate fluctuations,
availability and cost of financing and operating expenses; adverse
changes in the real estate markets including, among other things,
competition from other companies, retail formats and technology,
risks of real estate development and redevelopment, acquisitions
and dispositions; governmental actions and initiatives (including
legislative and regulatory changes); environmental and safety
requirements; and terrorist activities which could adversely affect
all of the above factors. The reader is directed to the Company's
various filings with the Securities and Exchange Commission, for a
discussion of such risks and uncertainties. THE MACERICH COMPANY
FINANCIAL HIGHLIGHTS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
Results before Impact of SFAS 144 (e) SFAS 144 (e) For the Three
For the Three Results of Operations: Months Months Ended June 30,
Ended June 30, Unaudited 2005 2004 2005 2004 Minimum Rents $116,657
$80,126 ($1,724) ($2,677) Percentage Rents 3,068 2,400 (11) (91)
Tenant Recoveries 57,172 41,519 (899) (1,373) Management Companies
(c) 6,164 5,411 - - Other Income 6,033 4,854 (76) (110) Total
Revenues 189,094 134,310 (2,710) (4,251) Shopping center and
operating expenses 59,942 40,955 (1,217) (1,480) Management
Companies' operating expenses (c) 12,800 12,000 - - Depreciation
and amortization 54,173 35,311 (727) (1,452) General,
administrative and other expenses 3,865 2,271 - - Interest expense
61,718 34,755 - 26 Loss on early extinguishment of debt - - - -
Gain (loss) on sale or writedown of assets (141) 1,068 115 (302)
Pro rata income (loss) of unconsolidated entities (c) 16,338 13,310
- - Income (loss) of the Operating Partnership from continuing
operations 12,793 23,396 (651) (1,647) Discontinued Operations:
Gain (loss) on sale of asset - - (115) 302 Income from discontinued
operations - - 766 1,345 Income before minority interests 12,793
23,396 - - Income allocated to minority interests 1,480 4,070 - -
Net income before preferred dividends 11,313 19,326 - - Preferred
dividends (a) 4,566 2,213 - - Net income to common stockholders
$6,747 $17,113 $0 $0 Average number of shares outstanding - basic
59,099 58,612 Average shares outstanding, assuming full conversion
of OP Units (d) 73,616 73,202 Average shares outstanding - diluted
for FFO (d) 77,244 76,830 Per share income- diluted before
discontinued operations - - Net income per share-basic $0.11 $0.29
Net income per share- diluted $0.11 $0.29 Dividend declared per
share $0.65 $0.61 Funds from operations "FFO" (b) (d)- basic 74,706
65,836 Funds from operations "FFO" (a) (b) (d) - diluted 77,064
68,049 FFO per share- basic (b) (d) $1.02 $0.90 FFO per share-
diluted (a) (b) (d) $1.00 $0.89 percentage change Results after
SFAS 144 (e) Results of Operations: For the Three Months Ended June
30, Unaudited 2005 2004 Minimum Rents $114,933 $77,449 Percentage
Rents 3,057 2,309 Tenant Recoveries 56,273 40,146 Management
Companies (c) 6,164 5,411 Other Income 5,957 4,744 Total Revenues
186,384 130,059 Shopping center and operating expenses 58,725
39,475 Management Companies' operating expenses (c) 12,800 12,000
Depreciation and amortization 53,446 33,859 General, administrative
and other expenses 3,865 2,271 Interest expense 61,718 34,781 Loss
on early extinguishment of debt - - Gain (loss) on sale or
writedown of assets (26) 766 Pro rata income (loss) of
unconsolidated entities (c) 16,338 13,310 Income (loss) of the
Operating Partnership from continuing operations 12,142 21,749
Discontinued Operations: Gain (loss) on sale of asset (115) 302
Income from discontinued operations 766 1,345 Income before
minority interests 12,793 23,396 Income allocated to minority
interests 1,480 4,070 Net income before preferred dividends 11,313
19,326 Preferred dividends (a) 4,566 2,213 Net income to common
stockholders $6,747 $17,113 Average number of shares outstanding -
basic 59,099 58,612 Average shares outstanding, assuming full
conversion of OP Units (d) 73,616 73,202 Average shares outstanding
- diluted for FFO (d) 77,244 76,830 Per share income- diluted
before discontinued operations $0.10 $0.27 Net income per
share-basic $0.11 $0.29 Net income per share- diluted $0.11 $0.29
Dividend declared per share $0.65 $0.61 Funds from operations "FFO"
(b) (d)- basic 74,706 65,836 Funds from operations "FFO" (a) (b)
(d) - diluted 77,064 68,049 FFO per share- basic (b) (d) $1.02
$0.90 FFO per share- diluted (a) (b) (d) $1.00 $0.89 percentage
change 12.64% Results before Impact of SFAS 144 (e) SFAS 144 (e)
Results of Operations: For the Six Months For the Six Months Ended
June 30, Ended June 30, Unaudited 2005 2004 2005 2004 Minimum Rents
$211,454 $156,073 ($3,486) ($5,520) Percentage Rents 5,873 4,827
(43) (119) Tenant Recoveries 103,365 82,840 (1,877) (2,649)
Management Companies (c) 11,441 10,014 - - Other Income 11,180
8,909 (144) (296) Total Revenues 343,313 262,663 (5,550) (8,584)
Shopping center and operating expenses 108,906 81,243 (2,385)
(2,917) Management Companies' operating expenses (c) 23,338 19,150
- - Depreciation and amortization 91,826 69,612 (1,413) (2,435)
General, administrative and other expenses 6,517 5,294 - - Interest
expense 104,282 68,088 (7) (47) Loss on early extinguishment of
debt - 405 - - Gain (loss) on sale or writedown of assets 1,463
1,094 (182) (301) Pro rata income (loss) of unconsolidated entities
(c) 27,584 28,160 - - Income (loss) of the Operating Partnership
from continuing operations 37,491 48,125 (1,927) (3,486)
Discontinued Operations: Gain (loss) on sale of asset - - 182 301
Income from discontinued operations - - 1,745 3,185 Income before
minority interests 37,491 48,125 - - Income allocated to minority
interests 5,679 8,470 - - Net income before preferred dividends
31,812 39,655 - - Preferred dividends (a) 6,923 4,425 - - Net
income to common stockholders $24,889 $35,230 $0 $0 Average number
of shares outstanding - basic 58,984 58,354 Average shares
outstanding, assuming full conversion of OP Units (d) 73,452 72,966
Average shares outstanding - diluted for FFO (d) 77,080 76,595 Per
share income- diluted before discontinued operations - - Net income
per share-basic $0.42 $0.60 Net income per share- diluted $0.42
$0.60 Dividend declared per share $1.30 $1.22 Funds from operations
"FFO" (b) (d)- basic 148,303 132,307 Funds from operations "FFO"
(a) (b) (d) - diluted $153,018 $136,732 FFO per share- basic (b)
(d) $2.03 $1.82 FFO per share- diluted (a) (b) (d) $1.99 $1.79
percentage change Results after SFAS 144 (e) Results of Operations:
For the Six Months Ended June 30, Unaudited 2005 2004 Minimum Rents
$207,968 $150,553 Percentage Rents 5,830 4,708 Tenant Recoveries
101,488 80,191 Management Companies (c) 11,441 10,014 Other Income
11,036 8,613 Total Revenues 337,763 254,079 Shopping center and
operating expenses 106,521 78,326 Management Companies' operating
expenses (c) 23,338 19,150 Depreciation and amortization 90,413
67,177 General, administrative and other expenses 6,517 5,294
Interest expense 104,275 68,041 Loss on early extinguishment of
debt - 405 Gain (loss) on sale or writedown of assets 1,281 793 Pro
rata income (loss) of unconsolidated entities (c) 27,584 28,160
Income (loss) of the Operating Partnership from continuing
operations 35,564 44,639 Discontinued Operations: Gain (loss) on
sale of asset 182 301 Income from discontinued operations 1,745
3,185 Income before minority interests 37,491 48,125 Income
allocated to minority interests 5,679 8,470 Net income before
preferred dividends 31,812 39,655 Preferred dividends (a) 6,923
4,425 Net income to common stockholders $24,889 $35,230 Average
number of shares outstanding - basic 58,984 58,354 Average shares
outstanding, assuming full conversion of OP Units (d) 73,452 72,966
Average shares outstanding - diluted for FFO (d) 77,080 76,595 Per
share income- diluted before discontinued operations - $0.39 $0.55
Net income per share-basic $0.42 $0.60 Net income per share-
diluted $0.42 $0.60 Dividend declared per share $1.30 $1.22 Funds
from operations "FFO" (b) (d)- basic 148,303 132,307 Funds from
operations "FFO" (a) (b) (d) - diluted 153,018 136,732 FFO per
share- basic (b) (d) $2.03 $1.82 FFO per share- diluted (a) (b) (d)
$1.99 $1.79 percentage change 11.21% (a) On February 25, 1998, the
Company sold $100,000 of convertible preferred stock and on June
16, 1998 another $150,000 of convertible preferred stock was
issued. The convertible preferred shares can be converted on a 1
for 1 basis for common stock. These preferred shares are not
assumed converted for purposes of net income per share for 2004 and
2005 as it would be antidilutive to those calculations. On
September 9, 2003, 5.487 million shares of Series B convertible
preferred stock were converted into common shares. The weighted
average preferred shares outstanding are assumed converted for
purposes of FFO per diluted share as they are dilutive to that
calculation for all periods presented. (b) The Company uses FFO in
addition to net income to report its operating and financial
results and considers FFO and FFO-diluted as supplemental measures
for the real estate industry and a supplement to Generally Accepted
Accounting Principles (GAAP) measures. NAREIT defines FFO as net
income (loss) (computed in accordance with GAAP), excluding gains
(or losses) from extraordinary items and sales of depreciated
operating properties, plus real estate related depreciation and
amortization and after adjustments for unconsolidated partnerships
and joint ventures. Adjustments for unconsolidated partnerships and
joint ventures are calculated to reflect FFO on the same basis. FFO
and FFO on a fully diluted basis are useful to investors in
comparing operating and financial results between periods. This is
especially true since FFO excludes real estate depreciation and
amortization, as the Company believes real estate values fluctuate
based on market conditions rather than depreciating in value
ratably on a straight-line basis over time. FFO on a fully diluted
basis is one of the measures investors find most useful in
measuring the dilutive impact of outstanding convertible
securities. FFO does not represent cash flow from operations as
defined by GAAP, should not be considered as an alternative to net
income as defined by GAAP and is not indicative of cash available
to fund all cash flow needs. FFO as presented may not be comparable
to similarly titled measures reported by other real estate
investment trusts. Effective January 1, 2003, gains or losses on
sale of peripheral land and the impact of SFAS 141 have been
included in FFO. The inclusion of gains on sales of peripheral land
increased FFO for the three and six months ended June 30, 2005 and
2004 by $0.3 million, $1.6 million, $1.0 million and $2.4 million,
respectively, or by $.00 per share, $.02 per share, $.01 per share
and $.03 per share, respectively. Additionally, SFAS 141 increased
FFO for the three and six months ended June 30, 2005 and 2004 by
$3.7 million, $6.0 million, $1.9 million and $3.8 million,
respectively or by $.05 per share, $.08 per share, $.02 per share
and $.05 per share, respectively. (c) This includes, using the
equity method of accounting, the Company's prorata share of the
equity in income or loss of its unconsolidated joint ventures for
all periods presented. Certain reclassifications have been made in
the 2004 financial highlights to conform to the 2005 financial
highlights presentation. (d) The Macerich Partnership, LP has
operating partnership units ("OP units"). Each OP unit can be
converted into a share of Company stock. Conversion of the OP units
has been assumed for purposes of calculating the FFO per share and
the weighted average number of shares outstanding. (e) In October
2001, the FASB issued SFAS No. 144, "Accounting for the Impairment
or Disposal of Long-Lived Assets" ("SFAS 144"). SFAS 144 addresses
financial accounting and reporting for the impairment or disposal
of long- lived assets. The Company adopted SFAS 144 on January 1,
2002. On December 17, 2004, the Company sold Westbar and the
results for the three and six months ended June 30, 2004 have been
reclassified to discontinued operations. The sale of Westbar
resulted in a gain on sale of $6.8 million. On January 5, 2005, the
Company sold Arizona Lifestyle Galleries and the results for the
three and six months ended June 30, 2004 have been reclassified to
discontinued operations. The sale of this property resulted in a
gain on sale of $0.3 million. Additionally, the results of
Crossroads Mall in Oklahoma for the three and six months ended June
30, 2005 and 2004 have been reclassified to discontinued operations
as the Company has identified this asset for disposition. June 30,
Dec 31 2005 2004 (UNAUDITED) Summarized Balance Sheet Information
Cash and cash equivalents $73,778 $72,114 Investment in real
estate, net (h) $5,392,694 $3,574,553 Investments in unconsolidated
entities (i) $1,061,939 $618,523 Total Assets $7,081,428 $4,637,096
Mortgage and notes payable $5,284,005 $3,230,120 Pro rata share of
debt on unconsolidated entities $1,454,305 $1,147,268 June 30, June
30, Additional financial data as of: 2005 2004 Occupancy of centers
(f) 92.30% 91.70% Comparable quarter change in same center sales
(f) (g) 6.00% 6.00% Additional financial data for the six months
ended: Acquisitions of property and equipment - including joint
ventures prorata $2,457,446 $40,910 Redevelopment and expansions of
centers- including joint ventures prorata $60,377 $84,740
Renovations of centers- including joint ventures at prorata $19,609
$16,711 Tenant allowances- including joint ventures at prorata
$14,347 $5,774 Deferred leasing costs- including joint ventures at
prorata $12,690 $9,576 (f) excludes redevelopment properties- 29th
Street Center, Parklane Mall, Santa Monica Place (g) includes mall
and freestanding stores. (h) includes construction in process on
wholly owned assets of $113,170 at June 30, 2005 and $88,228 at
December 31, 2004. (i) the Company's prorata share of construction
in process on unconsolidated entities of $61,080 at June 30, 2005
and $32,047 at December 31, 2004. For the Three Months For the Six
Months PRORATA SHARE OF JOINT Ended June 30, Ended June 30,
VENTURES (UNAUDITED) (UNAUDITED) (All amounts in (All amounts in
(Unaudited) thousands) thousands) 2005 2004 2005 2004 Revenues:
Minimum rents $51,254 $42,931 $95,819 $82,992 Percentage rents
1,644 1,221 3,551 2,729 Tenant recoveries 22,777 18,566 41,937
36,455 Other 2,936 1,286 5,755 3,276 Total revenues 78,611 64,004
147,062 125,452 Expenses: Shopping center expenses 24,790 23,513
47,965 44,212 Interest expense 20,484 15,074 37,305 30,030
Depreciation and amortization 17,253 12,775 34,748 25,133 Total
operating expenses 62,527 51,362 120,018 99,375 Gain on sale or
writedown of assets 254 668 540 2,083 Net income $16,338 $13,310
$27,584 $28,160 RECONCILIATION OF NET INCOME TO FFO (b)(e) For the
Three Months For the Six Months Ended June 30, Ended June 30,
(UNAUDITED) (UNAUDITED) (All amounts in thousands)(All amounts in
thousands) 2005 2004 2005 2004 Net income - available to common
stockholders $6,747 $17,113 $24,889 $35,230 Adjustments to
reconcile net income to FFO - basic Minority interest 1,480 4,070
5,679 8,470 (Gain) loss on sale of wholly owned assets 141 (1,068)
(1,463) (1,094) plus gain on land sales - consolidated assets - 334
1,308 334 (Gain) loss on sale or write-down of assets from
unconsolidated entities (pro rata share) (254) (668) (540) (2,083)
plus gain on land sales - unconsolidated assets 258 668 543 2,083
Depreciation and amortization on consolidated assets 54,173 35,311
91,826 69,612 Less depreciation and amortization allocable to
minority interests (1,404) - (1,825) - Depreciation and
amortization on joint ventures (pro rata) 17,253 12,775 34,748
25,133 Less: depreciation on personal property and amortization of
loan costs and interest rate caps (3,688) (2,699) (6,862) (5,378)
Total FFO - basic 74,706 65,836 148,303 132,307 Additional
adjustment to arrive at FFO - diluted Preferred stock dividends
earned 2,358 2,213 4,715 4,425 Preferred OP units - dividends n/a -
antidilutive n/a - antidilutive FFO - diluted $77,064 $68,049
$153,018 $136,732 For the Three For the Six Months Months Ended
June 30, Ended June 30, (UNAUDITED) (UNAUDITED) (All amounts in
(All amounts in thousands) thousands) Reconciliation of EPS to FFO
per diluted share: 2005 2004 2005 2004 Earnings per share $0.11
$0.29 $0.42 $0.60 Per share impact of depreciation and amortization
real estate $0.91 $0.62 $1.62 $1.23 Per share impact of gain on
sale of depreciated assets $0.00 ($0.01) ($0.01) ($0.01) Per share
impact of preferred stock not dilutive to EPS ($0.02) ($0.01)
($0.04) ($0.03) Fully Diluted FFO per share $1.00 $0.89 $1.99 $1.79
For the Three For the Six THE MACERICH COMPANY Months Months
RECONCILIATION OF NET INCOME TO EBITDA Ended June 30, Ended June
30, (UNAUDITED) (UNAUDITED) (All amounts in (All amounts in
thousands) thousands) 2005 2004 2005 2004 Net income - available to
common stockholders $6,747 $17,113 $24,889 $35,230 Interest expense
61,718 34,755 104,282 68,088 Interest expense - unconsolidated
entities (pro rata) 20,484 15,074 37,305 30,030 Depreciation and
amortization - wholly- owned centers 54,173 35,311 91,826 69,612
Depreciation and amortization - unconsolidated entities (pro rata)
17,253 12,775 34,748 25,133 Minority interest 1,480 4,070 5,679
8,470 Less: Interest expense and depreciation and amortization
allocable to minority interests on consolidated assets (1,619) -
(2,157) - Loss on early extinguishment of debt - - - 405 Loss
(gain) on sale of assets - wholly-owned centers 141 (1,068) (1,463)
(1,094) Loss (gain) on sale of assets - unconsolidated entities
(pro rata) (254) (668) (540) (2,083) Preferred dividends 4,566
2,213 6,923 4,425 EBITDA (j) $164,689 $119,575 $301,492 $238,216
THE MACERICH COMPANY RECONCILIATION OF EBITDA TO SAME CENTERS - NET
OPERATING INCOME ("NOI") For the Three For the Six Months Months
Ended June 30, Ended June 30, (UNAUDITED) (UNAUDITED) (All amounts
in (All amounts in thousands) thousands) 2005 2004 2005 2004 EBITDA
(j) $164,689 $119,575 $301,492 $238,216 Add: REIT general and
administrative expenses 3,865 2,271 6,517 5,294 Management
Companies' revenues (c) (6,164) (5,411) (11,441) (10,014)
Management Companies' operating expenses (c) 12,800 12,000 23,338
19,150 EBITDA of non- comparable centers (60,666) (16,404) (89,953)
(28,811) SAME CENTERS - Net operating income ("NOI") (k) $114,524
$112,031 $229,953 $223,835 (j) EBITDA represents earnings before
interest, income taxes, depreciation, amortization, minority
interest, extraordinary items, gain (loss) on sale of assets and
preferred dividends and includes joint ventures at their pro rata
share. Management considers EBITDA to be an appropriate
supplemental measure to net income because it helps investors
understand the ability of the Company to incur and service debt and
make capital expenditures. EBITDA should not be construed as an
alternative to operating income as an indicator of the Company's
operating performance, or to cash flows from operating activities
(as determined in accordance with GAAP) or as a measure of
liquidity. EBITDA, as presented, may not be comparable to similarly
titled measurements reported by other companies. (k) The Company
presents same-center NOI because the Company believes it is useful
for investors to evaluate the operating performance of comparable
centers. Same-center NOI is calculated using total EBITDA and
subtracting out EBITDA from non-comparable centers and eliminating
the management companies and the Company's general and
administrative expenses. DATASOURCE: The Macerich Company CONTACT:
Arthur Coppola, President and Chief Executive Officer or Thomas E.
O'Hern, Executive Vice President and Chief Financial Officer, both
of The Macerich Company, +1-310-394-6000 Web site:
http://www.macerich.com/
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