SANTA MONICA, Calif., Nov. 3 /PRNewswire-FirstCall/ -- The Macerich
Company (NYSE:MAC) today announced results of operations for the
quarter ended September 30, 2006 which included net income
available to common stockholders of $47.0 million or $.66 per
share-diluted compared to $4.1 million or $.07 per share-diluted
for the quarter ended September 30, 2005. For the nine months ended
September 30, 2006, net income increased to $80.1 million compared
to $28.9 million for the nine months ended September 30, 2005.
Funds from operations ("FFO") diluted was $86.6 million or $.98 per
share compared to $81.1 million or $1.04 per share for the quarter
ended September 30, 2005. For the nine months ended September 30,
2006, FFO-diluted was $262.0 million compared to $234.1 million for
the nine months ended September 30, 2005. 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 to FFO and net income per common
share-diluted ("EPS") to FFO per share-diluted is included in the
financial tables accompanying this press release. Recent
Highlights: * During the quarter, Macerich signed 326,000 square
feet of specialty store leases at average initial rents of $40.88
per square foot. Starting base rent on new lease signings was 23.7%
higher than the expiring base rent. * Total same center tenant
sales, for the quarter ended September 30, 2006, were up 5.3%
compared to sales for the quarter ended September 30, 2005. *
Portfolio occupancy at September 30, 2006 was 93.0% compared to
93.4% at September 30, 2005. On a same center basis, occupancy was
93.0% at September 30, 2006 compared to 93.6% at September 30,
2005. * During the third quarter, Great Falls Marketplace, Greeley
Mall, Holiday Village Mall, and Parklane Mall were sold for a
combined sale price of approximately $132 million. The Macerich
total gain on sale of these assets recognized during the quarter
was in excess of $46 million. Commenting on results, Arthur Coppola
president and chief executive officer of Macerich stated, "The
quarter was highlighted by continued strong core operations.
Occupancy remained high, leasing spreads were excellent and mall
tenant sales growth continued at a healthy level. In addition
during the quarter we were active in selling non-core assets and
improving our balance sheet. The ultimate use of the sale proceeds
will be for our upcoming developments and redevelopments which is a
very effective recycling of our capital. The strengthening of our
balance sheet leaves us well positioned to take advantage of the
pipeline of development and redevelopment opportunities in our
existing portfolio." Redevelopment and Development Activity The
grand opening of the first phase of Twenty-Ninth Street, an 805,000
square foot shopping district in Boulder, Colorado, took place on
October 13. The balance of the project is scheduled for completion
in the summer 2007. Phase I of the project is 87% leased with
another 7% of the space in negotiation. Tenants include Ann Taylor
Loft, Apple, Bath and Body Works, Borders, California Pizza
Kitchen, Century Theatres, Coldwater Creek, Home Depot, J. Jill,
Macy's, Muttropolis, Puma, Purple Martini, Victoria's Secret and
Wild Oats Market. The grand re-opening of Carmel Plaza took place
on October 21. The center underwent an $11 million renovation which
included the reconfiguring of a former department store space. New
high-profile luxury tenants include San Francisco based Wilkes
Bashford, Tiffany & Co., Cos Bar and Anthropologie. On November
1, we received City Council approval for our application to add up
to four or five mixed use towers of up to 165 feet at Biltmore
Fashion Park. Biltmore Fashion Park is an established luxury
destination for first-to-market, high-end and luxury tenants in the
metropolitan Phoenix market. The mixed use towers are planned to be
built over time based upon demand. In Thousand Oaks, California,
the planning commission voted on October 23 to approve the first
comprehensive renovation and expansion plan of The Oaks Mall since
it was first opened in 1978. The expansion will add 230,000 square
feet of building area to the approximately 1 million square feet of
space that currently exists. Construction is projected to start in
January 2007. The expansion, including a new 144,000 square foot
Nordstrom is scheduled to open at the center in fall 2008. At
Westside Pavilion in Los Angeles, construction continues on the
redevelopment of the western portion of the center that will
include a 12 screen, state of the art Landmark Theatre, a Barnes
& Noble and restaurants. The estimated completion of the
redevelopment is fall 2007. In February, construction began 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 1.2 million square feet on 120 acres. The
center is currently 70% leased and will be anchored by Dillard's,
Harkins Theatres and will contain a lifestyle shopping district
featuring retail, office and restaurants. Additional tenants
include American Eagle Outfitters, Ann Taylor Loft, Borders,
Charlotte Russe, Chico's, Coldwater Creek, J. Jill, Lucy, Pac Sun
and Soma. The project is scheduled to open in phases starting in
the fall of 2007, with the retail phases expected to be completed
by late 2008. Asset Sales Macerich continued its strategy of
selling non-core assets with the third quarter sales of Great Falls
Marketplace, Greeley Mall, Holiday Village Mall and Parklane Mall.
The aggregate total purchase price was approximately $132 million.
The gain on the sale of these four assets was in excess of $46
million. These centers totaled 1.0 million square feet and averaged
$239 per square foot in annual tenant sales. Financing Activity In
July, the Company's line of credit was upsized from $1.0 billion to
$1.5 billion. The borrowing spread was reduced by .25% to 1.15%
over LIBOR at the current leverage level. The maturity was extended
from July 2007 to April 2010. In September, Macerich swapped $400
million of the line to a fixed rate of 5.08% plus the applicable
line of credit borrowing spread. In July, a $61 million, 6.26%
fixed rate, 10-year loan was placed on Crossroads Mall. The loan
proceeds were used primarily to pay-down floating rate debt.
Primarily as a result of the above transactions and the application
of the asset sale proceeds to reduce the line of credit
indebtedness, the percentage of unhedged floating rate debt to
total debt was reduced to 18.65%. Macerich 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 84% 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 73 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.earnings.com/. The call begins today, November 3, 2006
at 10:30 AM Pacific Time. To listen to the call, please go to
either 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. The Company will publish a supplemental financial
information package which will be available at
http://www.macerich.com/ in the Investing Section. It will also be
furnished to the SEC as part of a Current Report on Form 8-K. 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, including the Annual Report on Form 10-K
for the year ended December 31, 2005, for a discussion of such
risks and uncertainties, which discussion is incorporated herein by
reference. (See attached tables) THE MACERICH COMPANY FINANCIAL
HIGHLIGHTS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) Results before
Impact of SFAS 144 (e) SFAS 144 (e) For the For the Three Months
Three Months Ended Ended September 30, September 30, Unaudited
Results of Operations: 2006 2005 2006 2005 Minimum rents $123,314
$124,738 ($895) ($4,737) Percentage rents 4,880 5,291 (14) 13
Tenant recoveries 67,541 65,645 (186) (1,585) Management Companies'
revenues 8,023 6,921 -- -- Other income 9,469 5,505 (26) (201)
Total revenues 213,227 208,100 (1,121) (6,510) Shopping center and
operating expenses 71,553 70,824 (595) (2,553) Management
Companies' operating expenses 14,455 12,914 -- -- Income tax
expense < benefit > 535 (1,166) -- -- Depreciation and
amortization 56,120 57,941 (277) (1,730) General, administrative
and other expenses 2,551 3,420 -- -- Interest expense 70,272 71,354
(117) (1,294) Loss on early extinguishment of debt 29 -- -- -- Gain
(loss) on sale or writedown of assets 46,560 10 (46,022) -- Pro
rata income (loss) of unconsolidated entities (c) 18,490 18,831 --
-- Minority interests in consolidated joint ventures (694) 90 (176)
(168) Income (loss) from continuing operations 62,068 11,744
(46,330) (1,101) Discontinued Operations: Gain (loss) on sale of
asset -- -- 46,214 -- Income from discontinued operations -- -- 116
1,101 Income before minority interests of OP 62,068 11,744 -- --
Income allocated to minority interests of OP 8,901 1,406 -- -- Net
income before preferred dividends 53,167 10,338 -- -- Preferred
dividends and distributions (a) 6,199 6,274 -- -- Net income to
common stockholders $46,968 $4,064 $0 $0 Average number of shares
outstanding - basic 71,479 59,247 Average shares outstanding,
assuming full conversion of OP Units (d) 85,021 73,660 Average
shares outstanding - diluted for FFO (d) 88,648 77,633 Per share
income - diluted before discontinued operations -- -- Net income
per share - basic $0.66 $0.07 Net income per share - diluted (a)
$0.66 $0.07 Dividend declared per share $0.68 $0.65 Funds from
operations "FFO" (b)(d) - basic $84,020 $78,264 Funds from
operations "FFO" (a)(b)(d) - diluted $86,595 $81,090 FFO per share-
basic (b)(d) $0.99 $1.07 FFO per share- diluted (a)(b)(d) $0.98
$1.04 Results after SFAS 144 (e) For the Three Months Ended
September 30, Unaudited Results of Operations: 2006 2005 Minimum
rents $122,419 $120,001 Percentage rents 4,866 5,304 Tenant
recoveries 67,355 64,060 Management Companies' revenues 8,023 6,921
Other income 9,443 5,304 Total revenues 212,106 201,590 Shopping
center and operating expenses 70,958 68,271 Management Companies'
operating expenses 14,455 12,914 Income tax expense < benefit
> 535 (1,166) Depreciation and amortization 55,843 56,211
General, administrative and other expenses 2,551 3,420 Interest
expense 70,155 70,060 Loss on early extinguishment of debt 29 --
Gain (loss) on sale or writedown of assets 538 10 Pro rata income
(loss) of unconsolidated entities (c) 18,490 18,831 Minority
interests in consolidated joint ventures (870) (78) Income (loss)
from continuing operations 15,738 10,643 Discontinued Operations:
Gain (loss) on sale of asset 46,214 -- Income from discontinued
operations 116 1,101 Income before minority interests of OP 62,068
11,744 Income allocated to minority interests of OP 8,901 1,406 Net
income before preferred dividends 53,167 10,338 Preferred dividends
and distributions (a) 6,199 6,274 Net income to common stockholders
$46,968 $4,064 Average number of shares outstanding - basic 71,479
59,247 Average shares outstanding, assuming full conversion of OP
Units (d) 85,021 73,660 Average shares outstanding - diluted for
FFO (d) 88,648 77,633 Per share income - diluted before
discontinued operations $0.12 $0.06 Net income per share - basic
$0.66 $0.07 Net income per share - diluted (a) $0.66 $0.07 Dividend
declared per share $0.68 $0.65 Funds from operations "FFO" (b)(d)-
basic $84,020 $78,264 Funds from operations "FFO" (a)(b)(d) -
diluted $86,595 $81,090 FFO per share - basic (b)(d) $0.99 $1.07
FFO per share - diluted (a)(b)(d) $0.98 $1.04 THE MACERICH COMPANY
FINANCIAL HIGHLIGHTS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
Results before Impact of SFAS 144 (e) SFAS 144 (e) For the For the
Nine Months Nine Months Ended Ended September 30, September 30,
Unaudited Results of Operations: 2006 2005 2006 2005 Minimum rents
$384,383 $335,391 ($10,314) ($14,376) Percentage rents 10,601
11,164 (248) (431) Tenant recoveries 200,879 169,811 (3,954)
(5,179) Management Companies' revenues 22,650 18,362 -- -- Other
income 22,756 16,684 (349) (517) Total revenues 641,269 551,412
(14,865) (20,503) Shopping center and operating expenses 209,831
179,169 (6,125) (7,964) Management Companies' operating expenses
41,295 37,291 -- -- Income tax expense (benefit) 219 (2,205) -- --
Depreciation and amortization 179,071 149,767 (3,097) (4,851)
General, administrative and other expenses 9,540 9,937 -- --
Interest expense 213,426 175,636 (2,253) (3,501) Loss on early
extinguishment of debt 1,811 -- -- -- Gain (loss) on sale or
writedown of assets 109,020 1,474 (108,983) (297) Pro rata income
(loss) of unconsolidated entities (c) 57,367 46,416 -- -- Minority
interests in consolidated joint ventures (39,101) (471) 37,229
(173) Income (loss) from continuing operations 113,362 49,236
(75,144) (4,657) Discontinued Operations: Gain (loss) on sale of
asset -- -- 72,167 297 Income from discontinued operations -- --
2,977 4,360 Income before minority interests of OP 113,362 49,236
-- -- Income allocated to minority interests of OP 15,131 7,085 --
-- Net income before preferred dividends 98,231 42,151 -- --
Preferred dividends and distributions (a) 18,139 13,197 -- -- Net
income to common stockholders $80,092 $28,954 $0 $0 Average number
of shares outstanding - basic 70,587 59,073 Average shares
outstanding, assuming full conversion of OP Units (d) 84,216 73,522
Average shares outstanding - diluted for FFO (d) 87,843 77,349 Per
share income - diluted before discontinued operations -- -- Net
income per share - basic $1.13 $0.49 Net income per share - diluted
(a) $1.13 $0.49 Dividend declared per share $2.04 $1.95 Funds from
operations "FFO" (b)(d) - basic $254,523 $226,569 Funds from
operations "FFO" (a)(b)(d) - diluted $262,031 $234,110 FFO per
share - basic (b)(d) 3.03 $3.10 FFO per share- diluted (a)(b)(d)
$2.98 $3.03 Results after SFAS 144 (e) For the Nine Months Ended
September 30, Unaudited Results of Operations: 2006 2005 Minimum
rents $374,069 $321,015 Percentage rents 10,353 10,733 Tenant
recoveries 196,925 164,632 Management Companies' revenues 22,650
18,362 Other income 22,407 16,167 Total revenues 626,404 530,909
Shopping center and operating expenses 203,706 171,205 Management
Companies' operating expenses 41,295 37,291 Income tax expense
(benefit) 219 (2,205) Depreciation and amortization 175,974 144,916
General, administrative and other expenses 9,540 9,937 Interest
expense 211,173 172,135 Loss on early extinguishment of debt 1,811
-- Gain (loss) on sale or writedown of assets 37 1,177 Pro rata
income (loss) of unconsolidated entities (c) 57,367 46,416 Minority
interests in consolidated joint ventures (1,872) (644) Income
(loss) from continuing operations 38,218 44,579 Discontinued
Operations: Gain (loss) on sale of asset 72,167 297 Income from
discontinued operations 2,977 4,360 Income before minority
interests of OP 113,362 49,236 Income allocated to minority
interests of OP 15,131 7,085 Net income before preferred dividends
98,231 42,151 Preferred dividends and distributions (a) 18,139
13,197 Net income to common stockholders $80,092 $28,954 Average
number of shares outstanding - basic 70,587 59,073 Average shares
outstanding, assuming full conversion of OP Units (d) 84,216 73,522
Average shares outstanding - diluted for FFO (d) 87,843 77,349 Per
share income - diluted before discontinued operations $0.24 $0.43
Net income per share - basic $1.13 $0.49 Net income per share -
diluted (a) $1.13 $0.49 Dividend declared per share $2.04 $1.95
Funds from operations "FFO" (b)(d) - basic $254,523 $226,569 Funds
from operations "FFO" (a)(b)(d) - diluted $262,031 $234,110 FFO per
share - basic (b)(d) $3.03 $3.10 FFO per share - diluted (a)(b)(d)
$2.98 $3.03 (a) On February 25, 1998, the Company sold $100,000 of
convertible preferred stock representing 3.627 million shares. 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 - diluted for 2006 and 2005 as
they would be antidilutive to those calculations. 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 undepreciated assets and the impact of SFAS 141 have been
included in FFO. The inclusion of gains on sales of undepreciated
assets increased FFO for the three and nine months ended September
30, 2006 and 2005 by $2.3 million, $6.0 million, $1.3 million and
$3.2 million, respectively, or by $.03 per share, $.07 per share,
$.02 per share and $.04 per share, respectively. Additionally, SFAS
141 increased FFO for the three and nine months ended September 30,
2006 and 2005 by $4.0 million, $12.9 million, $4.8 million and
$10.9 million, respectively or by $.04 per share, $.15 per share,
$.06 per share and $.14 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. (d) The Macerich Partnership,
LP (the "Operating Partnership" or the "OP") has operating
partnership units ("OP units"). Each OP unit can be converted into
a share of Company stock. Conversion of the OP units not owned by
the Company has been assumed for purposes of calculating the FFO
per share and the weighted average number of shares outstanding.
The computation of average shares for FFO - diluted includes the
effect of outstanding stock options and restricted stock using the
treasury method. Also assumes conversion of MACWH, LP units to the
extent they are dilutive to the calculation. For the three and nine
months ended September 30, 2006 and 2005, the MACWH, LP units were
antidilutive to FFO. (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 January 5, 2005,
the Company sold Arizona Lifestyle Galleries. The sale of this
property resulted in a gain on sale of $0.3 million. On June 9,
2006, Scottsdale 101 in Arizona was sold. The sale of this property
resulted in a gain on sale, at the Company's prorata share, of
$25.8 million. Additionally, the Company reclassified the results
of operations for the three and nine months ended September 30,
2006 and 2005 to discontinued operations. On July 13, 2006,
Parklane Mall in Nevada was sold. The sale of this property
resulted in a gain on sale of $5.9 million. The Company
reclassified the results of operations for the three and nine
months ended September 30, 2006 and 2005 to discontinued
operations. On July 27, 2006, Greeley Mall in Colorado and Holiday
Village in Montana were sold. The sale of these properties resulted
in gains on sale of $21.3 million and $7.3 million, respectively.
The Company reclassified the results of operations for the three
and nine months ended September 30, 2006 and 2005 to discontinued
operations. On August 11, 2006, Great Falls Marketplace in Montana
was sold. The sale of this property resulted in a gain on sale of
$11.9 million. The Company reclassified the results of operations
for the three and nine months ended September 30, 2006 and 2005 to
discontinued operations. September 30, Dec 31, Summarized Balance
Sheet Information 2006 2005 (UNAUDITED) Cash and cash equivalents
$62,047 $155,113 Investment in real estate, net (h) $5,675,959
$5,438,496 Investments in unconsolidated entities (i) $1,001,051
$1,075,621 Total Assets $7,280,523 $7,178,944 Mortgage and notes
payable $4,852,636 $5,424,730 Pro rata share of debt on
unconsolidated entities $1,644,727 $1,438,960 Total common shares
outstanding at quarter end: 71,482 59,942 Total preferred shares
outstanding at quarter end: 3,627 3,627 Total partnership/preferred
units outstanding at quarter end: 16,387 16,647 September 30,
September 30, Additional financial data as of: 2006 2005 Occupancy
of centers (f) 93.00% 93.40% Comparable quarter change in same
center sales (f) (g) 5.30% 7.00% Additional financial data for the
nine months ended: Acquisitions of property and equipment -
including joint ventures at prorata $359,213 $2,476,820
Redevelopment and expansions of centers - including joint ventures
at prorata $141,039 $114,648 Renovations of centers - including
joint ventures at prorata $44,546 $44,916 Tenant allowances -
including joint ventures at prorata $28,794 $22,074 Deferred
leasing costs - including joint ventures at prorata $20,473 $19,939
(f) excludes redevelopment properties. (g) includes mall and
freestanding stores. (h) includes construction in process on wholly
owned assets of $295,852 at September 30, 2006 and $162,157 at
December 31, 2005. (i) the Company's prorata share of construction
in process on unconsolidated entities of $148,800 at September 30,
2006 and $98,180 at December 31, 2005. PRORATA SHARE OF For the
Three Months For the Nine Months JOINT VENTURES Ended September 30,
Ended September 30, (UNAUDITED) (UNAUDITED) (All amounts in (All
amounts in (Unaudited) thousands) thousands) 2006 2005 2006 2005
Revenues: Minimum rents $59,760 $54,310 $177,230 $150,130
Percentage rents 2,784 2,391 7,306 5,942 Tenant recoveries 28,674
23,909 82,680 65,846 Other 3,931 2,910 10,607 8,665 Total revenues
95,149 83,520 277,823 230,583 Expenses: Shopping center expenses
32,425 28,818 92,869 77,067 Interest expense 23,507 16,823 66,260
54,128 Depreciation and amortization 21,045 20,495 62,209 55,243
Total operating expenses 76,977 66,136 221,338 186,438 Gain on sale
or writedown of assets 1 1,321 245 1,861 Equity in income of joint
ventures 317 126 637 410 Net income $18,490 $18,831 $57,367 $46,416
RECONCILIATION OF For the Three Months For the Nine Months NET
INCOME TO Ended September 30, Ended September 30, FFO (b)(e)
(UNAUDITED) (UNAUDITED) (All amounts in (All amounts in thousands)
thousands) 2006 2005 2006 2005 Net income - available to common
stockholders $46,968 $4,064 $80,092 $28,954 Adjustments to
reconcile net income to FFO - basic Minority interest in OP 8,901
1,406 15,131 7,085 (Gain ) loss on sale of consolidated assets
(46,560) (10) (109,020) (1,474) plus gain on undepreciated asset
sales - consolidated assets 2,339 -- 5,715 1,307 plus minority
interest share of gain on sale of consolidated joint ventures (192)
-- 36,816 -- (Gain) loss on sale of assets from unconsolidated
entities (pro rata share) (1) (1,321) (245) (1,861) plus gain on
undepreciated asset sales - unconsolidated assets -- 1,323 244
1,867 Depreciation and amortization on consolidated assets 56,120
57,941 179,071 149,767 Less depreciation and amortization allocable
to minority interests on consolidated joint ventures (1,128)
(1,787) (4,351) (3,612) Depreciation and amortization on joint
ventures (pro rata) 21,045 20,495 62,209 55,243 Less: depreciation
on personal property and amortization of loan costs and interest
rate caps (3,472) (3,847) (11,139) (10,707) Total FFO - basic
84,020 78,264 254,523 226,569 Additional adjustment to arrive at
FFO - diluted Preferred stock dividends earned 2,575 2,503 7,508
7,218 Non-participating preferred units - dividends 323 323
Participating preferred units - dividends n/a - antidilutive n/a -
antidilutive FFO - diluted 86,595 81,090 262,031 234,110 For the
Three Months For the Nine Months Ended September 30, Ended
September 30, (UNAUDITED) (UNAUDITED) (All amounts in (All amounts
in Reconciliation of EPS thousands) thousands) to FFO per diluted
share: 2006 2005 2006 2005 Earnings per share $0.66 $0.07 $1.13
$0.49 Per share impact of depreciation and amortization real estate
$0.86 $0.99 $2.69 $2.60 Per share impact of gain on sale of
depreciated assets ($0.52) $0.00 ($0.79) $0.00 Per share impact of
preferred stock not dilutive to EPS ($0.02) ($0.02) ($0.05) ($0.06)
Fully Diluted FFO per share $0.98 $1.04 $2.98 $3.03 THE MACERICH
COMPANY RECONCILIATION OF For the Three Months For the Nine Months
NET INCOME TO EBITDA Ended September 30, Ended September 30,
(UNAUDITED) (UNAUDITED) (All amounts in (All amounts in thousands)
thousands) 2006 2005 2006 2005 Net income - available to common
stockholders $46,968 $4,064 $80,092 $28,954 Interest expense 70,272
71,354 213,426 175,636 Interest expense - unconsolidated entities
(pro rata) 23,507 16,823 66,260 54,128 Depreciation and
amortization - consolidated assets 56,120 57,941 179,071 149,767
Depreciation and amortization - unconsolidated entities (pro rata)
21,045 20,495 62,209 55,243 Minority interest 8,901 1,406 15,131
7,085 Less: Interest expense and depreciation and amortization
allocable to minority interests on consolidated joint ventures
(1,264) (2,559) (6,191) (5,163) Loss on early extinguishment of
debt 29 -- 1,811 -- Loss on early extinguishment of debt -
unconsolidated entities (pro rata) -- 7 -- 7 Loss (gain) on sale of
assets - consolidated assets (46,560) (10) (109,020) (1,474) Loss
(gain) on sale of assets - unconsolidated entities (pro rata) (1)
(1,321) (245) (1,861) Add: Minority interest share of gain on sale
of consolidated joint ventures (192) -- 36,816 -- Income tax
expense (benefit) 535 (1,166) 219 (2,205) Preferred dividends 6,199
6,274 18,139 13,197 EBITDA (j) $185,559 $173,308 $557,718 $473,314
THE MACERICH COMPANY RECONCILIATION OF EBITDA TO SAME CENTERS - NET
OPERATING INCOME ("NOI") For the Three Months For the Nine Months
Ended September 30, Ended September 30, (UNAUDITED) (UNAUDITED)
(All amounts in (All amounts in thousands) thousands) 2006 2005
2006 2005 EBITDA (j) $185,559 $173,308 $557,718 $473,314 Add: REIT
general and administrative expenses 2,551 3,420 9,540 9,937
Management Companies' revenues (c) (8,023) (6,921) (22,650)
(18,362) Management Companies' operating expenses (c) 14,455 12,914
41,295 37,291 EBITDA of non- comparable centers (13,017) (5,898)
(120,501) (55,679) SAME CENTERS - Net operating income ("NOI")(k)
$181,525 $176,823 $465,402 $446,501 (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: 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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