SANTA MONICA, Calif.,
May 4 /PRNewswire-FirstCall/ -- The
Macerich Company (NYSE: MAC) today announced results of operations
for the quarter ended March 31, 2010
which included total funds from operations ("FFO") diluted of
$71.6 million or $.66 per share-diluted, compared to $1.16 per share-diluted for the quarter ended
March 31, 2009. Net loss available to
common stockholders for the quarter ended March 31, 2010 was $6.4
million or -$.08 per
share-diluted compared to net income available to common
stockholders of $14.0 million or
$.18 per share-diluted for the
quarter ended March 31, 2009.
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 or
loss to FFO and net income or loss 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, same center net operating income increased
by 1.8%.
- Occupancy increased to 91.1% at March
31, 2010, up from 90.1% at March 31,
2009.
- Mall total tenant sales increased 3.4% for the quarter compared
to the quarter ended March 31,
2009.
- In April, the Company issued 31 million shares of common stock
raising net proceeds in excess of $1.2
billion.
- The Company closed on property loans for over $280 million during the first four months of
2010.
Commenting on results, Arthur
Coppola chairman and chief executive officer of Macerich
stated, "Over a year ago we embarked on a multi-faceted capital
plan to raise liquidity and strengthen our balance sheet.
With the completion of our recent equity issuance we have
successfully executed our capital plan and we now have a very
strong balance sheet and have positioned the Company to be
opportunistic.
In addition to the recent capital activity, we are pleased to
report improving business fundamentals including increased
occupancy, positive same center operating results, increasing
tenant sales and very strong leasing volumes."
Redevelopment Update
In 2010, Macerich announced new leases with 18 retailers for the
new Santa Monica Place, including Barneys Co-op, Betsy Johnson and Tory
Burch, as well as The Market at Santa Monica Place. The
project is slated to open in August
2010. To date, executed deals with nearly 60 retailers and
restaurants have been announced, including Bloomingdale's and
Nordstrom. The project has tenant leases or commitments for over
92% of the project.
On May 7, a relocated and expanded
138,000-square-foot Nordstrom and 35,000 square feet of new small
shop space will open at Los Cerritos Center, Macerich's
high-performing super-regional shopping center in Southern California. The project is 100%
leased and new retailers include True Religion, Love Culture, MAC
Cosmetics, Foreign Exchange, Carlton
Hair and Vision Shoes.
Financing Activity
Transactions completed in 2010 include the recent closing of a
$135 million, five year floating rate
bank loan on Vintage Faire Mall. The new loan carries a LIBOR
plus 3.00% interest rate and paid off the former loan of
$62 million with a fixed interest
rate of 7.9%.
The Company has also closed on a $105
million, five year, 6.08% CMBS financing on South Plains
Mall in Lubbuck, Texas. The
loan proceeds repaid the former loan of $58
million with an interest rate of 9.5%.
In addition, the Company has financing agreements in place for
the refinancings of Panorama Mall and Wilton Mall. The
combined financings total $88
million.
Upon completion of the above transactions, the Company will have
$155 million of remaining loan
maturities for 2010.
In April, the Company executed a one year extension option on
its $1.5 billion credit facility and
repaid the existing balance in its entirety.
Dividend
On April 29th, 2010, the Board of
Directors of the Company declared a quarterly cash dividend of
$.50 per share of common stock.
The dividend is payable on June 8,
2010 to stockholders of record at the close of business on
May 10, 2010. This represents
the Company's return to a 100% cash dividend.
Earnings Guidance
Management is providing revised guidance for both FFO per
share-diluted and EPS for 2010. The revised guidance gives
effect to the upsized public offering of 31 million shares of
common stock from the initial offering of 18.5 million shares used
in the previously issued guidance.
The reconciliation from the prior 2010 FFO guidance and its
reconciliation to EPS is reflected below:
Previously provided FFO per share
guidance
|
$2.70 to
$2.90
|
|
Less additional dilution from the
|
|
|
Up-sized equity offering
|
- .10
to -.10
|
|
Revised FFO per share guidance:
|
$2.60 to
$2.80
|
|
|
|
|
Less depreciation and amortization
expense:
|
2.48
to 2.48
|
|
|
|
|
EPS guidance range:
|
$.12
to $.32
|
|
|
|
The revised guidance assumes that the use of proceeds is to
reduce the Company's indebtedness and for general corporate
purposes.
The Company's 2010 earnings guidance is based upon its internal
forecasting and planning process and on many assumptions including
management's current view of market and economic conditions,
including those specifically impacting the regional mall business.
Due to the uncertainty in the timing and economics of
dispositions and acquisitions of assets and joint venture
interests, the guidance ranges do not include any potential impact
from such future dispositions or acquisitions.
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 a
91% ownership interest in The Macerich Partnership, L.P. Macerich
now owns approximately 74 million square feet of gross leaseable
area consisting primarily of interests in 71 regional malls.
Additional information about Macerich can be obtained from the
Company's website at 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 www.macerich.com
(Investing Section) and through CCBN at www.earnings.com. The
call begins today, May 4, 2010 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 www.macerich.com (Investing Section)
will be available for one year after the call.
The Company will publish a supplemental financial information
package which will be available at 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, terms 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; the liquidity of real estate
investments, 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, 2009 and the
Quarterly Reports on Form 10-Q, for a discussion of such risks and
uncertainties, which discussion is incorporated herein by
reference. The Company does not intend, and undertakes no
obligation, to update any forward-looking information to reflect
events or circumstances after the date of this release or to
reflect the occurrence of unanticipated events unless required by
law to do so.
(See attached tables)
THE MACERICH
COMPANY
|
|
FINANCIAL
HIGHLIGHTS
|
|
(IN THOUSANDS, EXCEPT PER
SHARE AMOUNTS)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Results of Operations:
|
|
|
|
|
|
Results
before
|
Impact
of
|
Results
after
|
|
|
Discontinued
Operations (a)
|
Discontinued
Operations (a)
|
Discontinued
Operations (a)
|
|
|
For the Three
Months
|
For the Three
Months
|
For the Three
Months
|
|
|
Ended March 31,
|
Ended March 31,
|
Ended March 31,
|
|
|
Unaudited
|
Unaudited
|
|
|
2010
|
2009
|
2010
|
2009
|
2010
|
2009
|
|
Minimum rents
|
$101,976
|
$127,477
|
4
|
($4,268)
|
$101,980
|
$123,209
|
|
Percentage rents
|
2,987
|
2,801
|
-
|
-
|
2,987
|
2,801
|
|
Tenant recoveries
|
61,009
|
64,910
|
-
|
(765)
|
61,009
|
64,145
|
|
Management Companies' revenues
|
10,221
|
8,541
|
-
|
-
|
10,221
|
8,541
|
|
Other income
|
5,917
|
7,054
|
-
|
(29)
|
5,917
|
7,025
|
|
Total revenues
|
182,110
|
210,783
|
4
|
(5,062)
|
182,114
|
205,721
|
|
|
|
|
|
|
|
|
|
Shopping center and operating
expenses
|
60,930
|
70,780
|
(109)
|
(1,356)
|
60,821
|
69,424
|
|
Management Companies' operating
expenses
|
22,187
|
23,431
|
-
|
-
|
22,187
|
23,431
|
|
Income tax benefit
|
(1,215)
|
(801)
|
-
|
-
|
(1,215)
|
(801)
|
|
Depreciation and amortization
|
59,215
|
64,911
|
-
|
(1,436)
|
59,215
|
63,475
|
|
REIT general and administrative
expenses
|
7,518
|
5,258
|
-
|
-
|
7,518
|
5,258
|
|
Interest expense
|
55,411
|
69,939
|
-
|
-
|
55,411
|
69,939
|
|
Gain on early extinguishment of debt
|
-
|
22,474
|
-
|
-
|
-
|
22,474
|
|
Gain on sale or write down of assets
|
-
|
756
|
-
|
17
|
-
|
773
|
|
Co-venture interests (b)
|
(1,384)
|
-
|
-
|
-
|
(1,384)
|
-
|
|
Equity in income of unconsolidated joint
ventures
|
16,459
|
15,926
|
-
|
-
|
16,459
|
15,926
|
|
|
|
|
|
|
|
|
|
(Loss) income from continuing
operations
|
(6,861)
|
16,421
|
113
|
(2,253)
|
(6,748)
|
14,168
|
|
Discontinued operations:
|
|
|
|
|
|
|
|
Loss on sale or write down of
assets
|
-
|
-
|
-
|
(17)
|
-
|
(17)
|
|
(Loss) income from discontinued
operations
|
-
|
-
|
(113)
|
2,270
|
(113)
|
2,270
|
|
Total (loss) income from discontinued
operations
|
-
|
-
|
(113)
|
2,253
|
(113)
|
2,253
|
|
Net (loss) income
|
(6,861)
|
16,421
|
-
|
-
|
(6,861)
|
16,421
|
|
Less net (loss) income attributable to
noncontrolling interests
|
(504)
|
2,405
|
-
|
-
|
(504)
|
2,405
|
|
Net (loss) income attributable to the
Company
|
(6,357)
|
14,016
|
-
|
-
|
(6,357)
|
14,016
|
|
Less preferred dividends
|
-
|
-
|
-
|
-
|
-
|
-
|
|
Net (loss) income available to common
stockholders
|
($6,357)
|
$14,016
|
-
|
-
|
($6,357)
|
$14,016
|
|
|
|
|
|
|
|
|
|
Average number of shares outstanding -
basic
|
96,951
|
76,897
|
|
|
96,951
|
76,897
|
|
Average shares outstanding, assuming full
conversion of OP Units (c)
|
109,118
|
88,551
|
|
|
109,118
|
88,551
|
|
Average shares outstanding - Funds From Operations
("FFO") - diluted (c)
|
109,118
|
88,551
|
|
|
109,118
|
88,551
|
|
|
|
|
|
|
|
|
|
Per share (loss) income- diluted before
discontinued operations
|
-
|
-
|
|
|
($0.08)
|
$0.15
|
|
Net (loss) income per share-basic
|
($0.08)
|
$0.18
|
|
|
($0.08)
|
$0.18
|
|
Net (loss) income per share - diluted
(c)
|
($0.08)
|
$0.18
|
|
|
($0.08)
|
$0.18
|
|
Dividend declared per share
|
$0.60
|
$0.80
|
|
|
$0.60
|
$0.80
|
|
FFO - basic (c) (d)
|
$71,597
|
$102,839
|
|
|
$71,597
|
$102,839
|
|
FFO - diluted (c) (d)
|
$71,597
|
$102,839
|
|
|
$71,597
|
$102,839
|
|
FFO per share- basic (c) (d)
|
$0.66
|
$1.16
|
|
|
$0.66
|
$1.16
|
|
FFO per share- diluted (c) (d)
|
$0.66
|
$1.16
|
|
|
$0.66
|
$1.16
|
|
(a) The following dispositions
impacted the results for the three months ended March 31, 2010 and
2009:
During the twelve
months ended December 31, 2009, the Company sold six non-core
community centers for $83.2 million and sold five Kohl's stores for
approximately $52.7 million. As a result of these sales, the
Company has classified the results of operations to discontinued
operations for all periods presented.
(b) This represents the outside
partners' allocation of net income in the Chandler Fashion
Center/Freehold Raceway Mall joint venture.
(c) The Macerich Partnership, L.P.
(the "Operating Partnership" or the "OP") has operating partnership
units ("OP units"). OP units can be converted into shares of
Company common 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 share and unit-based compensation plans and convertible
senior notes using the treasury stock method. It also assumes
conversion of MACWH, LP preferred and common units to the extent
they are dilutive to the calculation.
(d) 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. The Company also cautions that FFO as
presented, may not be comparable to similarly titled measures
reported by other real estate investment trusts.
Gains or losses on
sales of undepreciated assets and the impact of amortization of
above/below market leases have been included in FFO. The inclusion
of gains on sales of undepreciated assets increased FFO for the
three months ended March 31, 2010 and 2009 by $0.0 million and $1.3
million, respectively, or by $0.00 per share and $0.01 per share,
respectively. Additionally, amortization of above/below market
leases increased FFO for the three months ended March 31, 2010 and
2009 by $2.9 million and $4.1 million, respectively, or by $0.03
per share and $0.05 per share, respectively.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
THE MACERICH
COMPANY
|
|
FINANCIAL
HIGHLIGHTS
|
|
(IN THOUSANDS, EXCEPT PER
SHARE AMOUNTS)
|
|
|
|
|
|
|
|
|
|
|
|
Pro rata share of unconsolidated joint
ventures:
|
|
|
|
|
|
|
For the Three
Months
|
|
|
|
Ended March
31,
|
|
|
|
Unaudited
|
|
|
|
2010
|
2009
|
|
Revenues:
|
|
|
|
|
Minimum rents
|
|
$74,051
|
$67,036
|
|
Percentage
rents
|
|
1,896
|
1,397
|
|
Tenant
recoveries
|
|
37,314
|
32,055
|
|
Other
|
|
4,183
|
3,435
|
|
Total revenues
|
|
117,444
|
103,923
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
Shopping center and
operating expenses
|
|
41,816
|
35,979
|
|
Interest
expense
|
|
31,092
|
25,502
|
|
Depreciation and
amortization
|
|
27,455
|
26,501
|
|
Total operating
expenses
|
|
100,363
|
87,982
|
|
(Loss) gain on sale or write down of
assets
|
|
(62)
|
8
|
|
Loss on early extinguishment of
debt
|
|
(689)
|
-
|
|
Equity in income (loss) of joint
ventures
|
|
129
|
(23)
|
|
Net income
|
|
$16,459
|
$15,926
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Net (loss) income to FFO
(d):
|
|
|
|
|
|
|
For the Three
Months
|
|
|
|
Ended March
31,
|
|
|
|
Unaudited
|
|
|
|
2010
|
2009
|
|
Net (loss) income - available to common
stockholders
|
|
($6,357)
|
$14,016
|
|
|
|
|
|
|
Adjustments to reconcile net (loss) income to FFO
- basic
|
|
|
|
|
Noncontrolling interests in OP
|
|
(798)
|
2,124
|
|
Gain on sale or write down of consolidated
assets
|
|
-
|
(756)
|
|
plus gain on undepreciated asset
sales- consolidated assets
|
|
-
|
1,354
|
|
less write down of consolidated
assets
|
|
-
|
(582)
|
|
Loss (gain) on sale or write-down of assets
from unconsolidated
entities (pro rata)
|
|
62
|
(8)
|
|
less loss on undepreciated asset
sales - unconsolidated entities
(pro rata share)
|
|
(31)
|
-
|
|
less write down of assets -
unconsolidated entities (pro rata share)
|
|
(32)
|
-
|
|
Depreciation and amortization on
consolidated assets
|
|
59,215
|
64,911
|
|
Less depreciation and amortization
allocable to noncontrolling
interests on consolidated
joint ventures
|
|
(5,093)
|
(1,067)
|
|
Depreciation and amortization on joint
ventures (pro rata)
|
|
27,455
|
26,501
|
|
Less: depreciation on personal
property
|
|
(2,824)
|
(3,654)
|
|
|
|
|
|
|
Total FFO - basic
|
|
71,597
|
102,839
|
|
|
|
|
|
|
Additional adjustment to arrive at FFO -
diluted:
|
|
|
|
|
Preferred units -
dividends
|
|
-
|
-
|
|
Total FFO - diluted
|
|
$71,597
|
$102,839
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of EPS to FFO per diluted
share:
|
|
|
|
|
|
|
For the Three
Months
|
|
|
|
Ended March
31,
|
|
|
|
Unaudited
|
|
|
|
2010
|
2009
|
|
Earnings per share - diluted
|
|
($0.08)
|
$0.18
|
|
Per share impact of depreciation and
amortization of real estate
|
|
0.74
|
0.98
|
|
FFO per share - diluted
|
|
$0.66
|
$1.16
|
|
|
|
|
|
|
|
|
|
|
|
THE MACERICH
COMPANY
|
|
FINANCIAL
HIGHLIGHTS
|
|
(IN THOUSANDS, EXCEPT PER
SHARE AMOUNTS)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months
|
|
Reconciliation of Net (loss) income to
EBITDA:
|
|
Ended March
31,
|
|
|
|
Unaudited
|
|
|
|
2010
|
2009
|
|
|
|
|
|
|
Net (loss) income - available to common
stockholders
|
|
($6,357)
|
$14,016
|
|
|
|
|
|
|
Interest expense - consolidated
assets
|
|
55,411
|
69,939
|
|
Interest expense - unconsolidated entities
(pro rata)
|
|
31,092
|
25,502
|
|
Depreciation and amortization -
consolidated assets
|
|
59,215
|
64,911
|
|
Depreciation and amortization -
unconsolidated entities (pro rata)
|
|
27,455
|
26,501
|
|
Noncontrolling interests in OP
|
|
(798)
|
2,124
|
|
Less: Interest expense and depreciation and
amortization
|
|
|
|
|
allocable to noncontrolling interests
on consolidated joint ventures
|
|
(7,999)
|
(1,488)
|
|
Gain on early extinguishment of
debt
|
|
-
|
(22,474)
|
|
Loss on early extinguishment of debt -
unconsolidated entities
(pro rata)
|
|
689
|
-
|
|
Loss (gain) on sale or write down of assets
- consolidated assets
|
|
-
|
(756)
|
|
Loss (gain) on sale or write down of assets
- unconsolidated entities
(pro rata)
|
|
62
|
(8)
|
|
Income tax (benefit) expense
|
|
(1,215)
|
(801)
|
|
Distributions on preferred units
|
|
208
|
243
|
|
|
|
|
|
|
EBITDA (e)
|
|
$157,763
|
$177,709
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of EBITDA to Same Centers - Net
Operating
Income ("NOI"):
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months
|
|
|
|
Ended March
31,
|
|
|
|
Unaudited
|
|
|
|
2010
|
2009
|
|
EBITDA (e)
|
|
$157,763
|
$177,709
|
|
|
|
|
|
|
Add: REIT general and administrative
expenses
|
|
7,518
|
5,258
|
|
Management Companies'
revenues
|
|
(10,221)
|
(8,541)
|
|
Management Companies'
operating expenses
|
|
22,187
|
23,431
|
|
Lease termination
income of comparable centers
|
|
(1,273)
|
(1,542)
|
|
EBITDA of
non-comparable centers
|
|
(28,235)
|
(51,196)
|
|
|
|
|
|
|
Same Centers - NOI (f)
|
|
$147,739
|
$145,119
|
|
|
|
|
|
|
|
|
|
|
|
(e) EBITDA represents earnings
before interest, income taxes, depreciation, amortization,
noncontrolling interests, 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.
(f) 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. Same center NOI excludes the impact of
straight- line and above/below market adjustments to minimum
rents.
|
|
|
|
|
|
SOURCE The Macerich Company