-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, O2jCkvRY8eUBi1gRWzS9HutL0QDS5zmgvClpO4i+greuf9MB01Sf25B1L5nj0nsT c5nFeQ1fogGvdZV6FmAvCw== 0000950137-04-000340.txt : 20040127 0000950137-04-000340.hdr.sgml : 20040127 20040126210502 ACCESSION NUMBER: 0000950137-04-000340 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040126 ITEM INFORMATION: ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20040127 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GENERAL GROWTH PROPERTIES INC CENTRAL INDEX KEY: 0000895648 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 421283895 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-11656 FILM NUMBER: 04544560 BUSINESS ADDRESS: STREET 1: 110 N WACKER DRIVE STREET 2: STE 3100 CITY: CHICAGO STATE: IL ZIP: 60606 BUSINESS PHONE: 3129605000 MAIL ADDRESS: STREET 1: 110 N WACKER DRIVE STREET 2: STE 3100 CITY: CHICAGO STATE: IL ZIP: 60606 8-K 1 c82326e8vk.txt CURRENT REPORT SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K Current Report Pursuant to Section 13 or 15(d) of the Securities Act of 1934 Date of Report (Date of Earliest Event Reported) January 26, 2004 General Growth Properties, Inc. (Exact name of registrant as specified in its charter) Delaware 1-11656 42-1283895 --------------- ---------------- ---------------- (State or other (Commission (I.R.S. Employer jurisdiction of File Number) Identification incorporation) Number) 110 N. Wacker Drive, Chicago, Illinois 60606 (Address of principal executive offices) (Zip Code) (312) 960-5000 -------------- (Registrant's telephone number, including area code) N/A (Former name or former address, if changed since last report) ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS. Listed below are the financial statements, pro forma financial information and exhibits filed as part of this report: (a), (b) Not applicable. (c) Exhibits The following exhibit is furnished pursuant to Item 9 and Item 12. 99.1 Press Release dated January 26, 2004 ITEM 9. REGULATION FD DISCLOSURE On January 26, 2004, General Growth Properties, Inc. issued a press release describing its results of operations for its fourth quarter ended December 31, 2003. A copy of the press release is being furnished as Exhibit 99.1 to this report. ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION On January 26, 2004, General Growth Properties, Inc. issued a press release describing its results of operations for its fourth quarter ended December 31, 2003. A copy of the press release is being furnished as Exhibit 99.1 to this report. This information shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. GENERAL GROWTH PROPERTIES, INC. By: /s/ Bernard Freibaum --------------------------- Bernard Freibaum Executive Vice President and Chief Financial Officer Date: January 26, 2004 EXHIBIT INDEX EXHIBIT NAME NUMBER 99.1 Press Release dated January 26, 2004. EX-99.1 3 c82326exv99w1.txt PRESS RELEASE DATED 1/26/04 EXHIBIT 99.1 NEWS RELEASE GENERAL GROWTH PROPERTIES, INC. 110 North Wacker Drive Chicago, IL 60606 (312) 960-5000 FAX (312) 960-5463 FOR IMMEDIATE RELEASE CONTACT: John Bucksbaum - --------------------- 312/960-5005 Bernard Freibaum 312/960-5252 GENERAL GROWTH PROPERTIES, INC. REPORTS RECORD RESULTS CHICAGO, ILLINOIS, JANUARY 26, 2004 -- General Growth Properties, Inc. (NYSE: GGP) today announced a 21.1% increase in Earnings per share - diluted (EPS) for fourth quarter 2003 and a 15.4% increase in fully-diluted Funds from Operations (FFO) per share. For the full year, EPS increased 24.5% and FFO per share increased 22.9% over 2002. "I am pleased to report that nearly eleven years after our initial public offering, General Growth Properties consistently delivers recurring profitability," said John Bucksbaum, chief executive officer, General Growth Properties. "We have worked hard during that time, continuously pursuing our vision of creating special places and experiences for our Consumers, Owners, Retailers and Employees (our C.O.R.E. customers). The last eleven years has seen us meld our people, our knowledge and all of the communities within our company into a strong working group, producing compounded FFO per share growth of 16%. For every $1.00 invested when GGP went public, a shareholder would, including reinvestment of dividends, have over $5.50 today." FINANCIAL AND OPERATIONAL HIGHLIGHTS Due to the three-for-one stock split effective December 5, 2003, all share and per share amounts for all periods presented have been reflected on a post-split basis. In addition, to reflect changes in the treatment of rental revenues resulting from the acquisition of acquired below-market leases pursuant to SFAS No. 141 and SFAS No. 142 and to apply SFAS No.145 relating to debt extinguishment costs, FFO per share for 2002 has been adjusted to maintain comparability to the 2003 results. o EPS increased 21.1% in fourth quarter 2003 to $.46 versus $.38 for the comparable period in 2002. For the full year, EPS increased to $1.22 in 2003 from $.98 in 2002, an increase of 24.5%. o FFO per share, on a fully-diluted basis, grew 15.4% to $.75 in the fourth quarter of 2003, up from $.65 in the fourth quarter of 2002. FFO per fully-diluted share for full year 2003 was a record $2.31, up 22.9% from $1.88 in 2002. Total FFO for the quarter increased 21.3% to $205.9 million, from $169.7 million in last year's fourth quarter. For the twelve months ended December 31, 2003, total FFO increased 27.5% to $618.6 million, compared to $485.3 million for full year 2002. The application of SFAS No. 141 and 142 resulted in an increase of approximately $4.5 million in FFO or $.02 per fully-diluted share in fourth quarter 2003 and $23.5 million or $.09 per share for the full year. o For fiscal year 2004, the company currently estimates that FFO per fully-diluted share will be in the range of $2.56 to $2.66. The company intends to update this estimate quarterly in conjunction with its earnings releases. o Real estate property net operating income (NOI) increased 14.7% in the quarter to $333.4 million, from $290.8 million during the fourth quarter of 2002. For all of 2003, NOI increased 23.5% to $1.11 billion, up from $898.8 million in 2002. o Total pro rata revenues were $475.6 million for the quarter, an increase of 17.3%, compared to $405.6 million for the same period in 2002. Total pro rata revenues were $1.63 billion for full year 2003, or 25.7% above revenues of $1.30 billion for full year 2002. o Total tenant sales increased 3.0% for full year 2003 and comparable tenant sales increased 0.4% versus the same period last year. o Comparable center NOI increased by approximately 5.7% during fourth quarter 2003 compared to the same period last year. o Mall shop occupancy increased to 91.3% at the end of 2003, compared to 91.0% in 2002. o Sales for 2003 were $351 per square foot versus $355 per square foot in 2002. o Average rent per square foot for new/renewal leases signed for the year was $33.29 versus $36.00 for the same period in 2002. Average rent for all leases expiring in 2003 was $26.70 versus $29.90 in 2002. o In 2003, General Growth acquired 100% interests in 10 regional malls and additional ownership interests in seven malls, for total consideration of approximately $2.0 billion. CONFERENCE CALL/WEBCAST General Growth will host a live webcast of its conference call regarding this announcement on the company's web site, www.generalgrowth.com. This webcast will take place on Tuesday, January 27, at 10:00 a.m., Eastern Time (9:00 a.m. CT, 7:00 a.m. PT). The webcast can be accessed by selecting the conference call icon on the GGP home page. General Growth Properties is the country's second largest shopping center owner, developer and manager of regional shopping malls. General Growth currently has ownership interest in, or management responsibility for, a portfolio of 171 regional shopping malls in 41 states. The company portfolio totals approximately 148 million square feet of retail space and includes over 16,000 retailers nationwide. A publicly traded Real Estate Investment Trust (REIT), General Growth Properties is listed on the New York Stock Exchange under the symbol GGP. For more information on General Growth Properties and its portfolio of malls, please visit the company web site at http://www.generalgrowth.com. NON-GAAP SUPPLEMENTAL FINANCIAL MEASURES AND DEFINITIONS FUNDS FROM OPERATIONS (FFO) General Growth, consistent with real estate industry and investment community preferences, uses FFO as a supplemental measure of operating performance for a real estate investment trust (REIT). The National Association of Real Estate Investment Trusts (NAREIT) defines FFO as net income (loss) (computed in accordance with Generally Accepted Accounting Principles (GAAP)), excluding gains (or losses) from cumulative effects of accounting changes, extraordinary items and sales of properties, plus real estate related depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures. The company considers FFO a supplemental measure for equity REITs and a complement to GAAP measures because it facilitates an understanding of the operating performance of the company's properties. FFO does not give effect to real estate depreciation and amortization since these amounts are computed to allocate the cost of a property over its useful life. Since values for well-maintained real estate assets have historically increased or decreased based upon prevailing market conditions, the company believes that FFO provides investors with a clearer view of the company's operating performance. In order to provide a better understanding of the relationship between FFO and GAAP net income, a reconciliation of GAAP net income to FFO has been provided. FFO does not represent cash flow from operating activities in accordance with GAAP, should not be considered as an alternative to GAAP net income and is not necessarily indicative of cash available to fund cash needs. In addition, the company has presented FFO on a consolidated and pro rata basis as we believe that given the significance of the company's operations that are owned through investments accounted for on the equity method of accounting, the detail of the operations of our unconsolidated centers provides important insights into the income produced by such investments for the company as a whole. REAL ESTATE PROPERTY NET OPERATING INCOME (NOI) General Growth believes that Real Estate Property Net Operating Income (NOI) is a useful supplemental measure of the company's operating performance. The company defines NOI as operating revenues from continuing operations (rental income, tenant recoveries and other income) less property and related expenses from continuing operations (real estate taxes, repairs and maintenance, marketing and other property expenses). As with FFO discussed above, NOI has been reflected on a consoliodated and pro rata basis. Other REITs may use different methodologies for calculating NOI, and accordingly, the company's NOI may not be comparable to other REITs. Because NOI excludes general and administrative expenses, interest expense, depreciation and amortization, gains and losses from property dispositions, discontinued operations, and extraordinary items, it provides a performance measure that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating commercial real estate properties and the impact on operations from trends in occupancy rates, rental rates and operating costs. This measure thereby provides an operating perspective not immediately apparent from GAAP operating or net income. The company uses NOI to evaluate its operating performance on a property-by-property basis because NOI allows the company to evaluate the impact that factors such as lease structure, lease rates and tenant base, which vary by property, have on the company's operating results, gross margins and investment returns. In addition, management believes that NOI provides useful information to the investment community about the company's operating performance. However, due to the exclusions noted above, NOI should only be used as an alternative measure of the Company's financial performance. For reference and as an aid in understanding of management's computation of NOI, a reconciliation of NOI to consolidated operating income as computed in accordance with GAAP has been presented. PRO RATA INFORMATION The company has presented information on its consolidated and unconsolidated properties separately in the accompanying financial schedules. As a significant portion of the company's total operations are structured as joint venture arrangements which are unconsolidated, management of the company believes that operating data with respect to all properties owned provides important insights into the net cash flow and income produced by such investments for the company as a whole. In addition, the individual items of revenue and expense for the unconsolidated centers have been presented at the company's pro rata ownership share (generally 50%) of such unconsolidated ventures. As the management operating philosophies and strategies are the same regardless of ownership structure, an aggregate presentation of revenues and expenses and other operating statistics yields a more accurate representation of the relative size and significance of the elements of the company's overall operations. RISKS AND UNCERTAINTIES This release may contain forward-looking statements that involve risks and uncertainties. All statements other than statements of historical fact are statements that may be deemed forward-looking statements, which are subject to a number of risks, uncertainties and assumptions. Representative examples of these risks, uncertainties and critical accounting or other assumptions include (without limitation) general industry and economic conditions, acts of terrorism, interest rate trends, cost of capital and capital requirements, availability of real estate properties, competition from other companies and venues for the sale/distribution of goods and services, changes in retail rental rates in the company's markets, shifts in customer demands, tenant bankruptcies or store closures, changes in vacancy rates at the company's properties, changes in operating expenses, including employee wages, benefits and training, governmental and public policy changes, changes in applicable laws, rules and regulations (including changes in tax laws), the ability to obtain suitable equity and/or debt financing, and the continued availability of financing in the amounts and on the terms necessary to support the company's future business. Readers are referred to the documents filed by General Growth Properties, Inc. with the SEC, specifically the most recent reports on Forms 10-K and 10-Q, which identify important risk factors which could cause actual results to differ from those contained in the forward-looking statements. ###
FUNDS FROM OPERATIONS and Three Months Ended Twelve Months Ended PORTFOLIO RESULTS (unaudited) December 31, December 31, (in thousands, except share and per share data) 2003 2002 2003 2002 FUNDS FROM OPERATIONS (FFO) (a) Funds From Operations - Operating Partnership $ 205,925 $ 169,717 $ 618,561 $ 485,304 Less: Allocations to Operating Partnership unitholders $ 43,067 $ 40,626 $ 138,568 $ 116,170 ------------ ------------ ------------ ------------ Funds From Operations - Company stockholders $ 162,858 $ 129,091 $ 479,993 $ 369,134 Funds From Operations per share - Company stockholders - basic $ 0.75 $ 0.69 $ 2.39 $ 1.98 Funds From Operations per share - Operating Partnership - basic $ 0.75 $ 0.69 $ 2.39 $ 1.98 Funds From Operations per share - Operating Partnership - diluted $ 0.75 $ 0.65 $ 2.31 $ 1.88 Weighted average number of Company shares outstanding - basic 215,785 187,082 200,875 186,544 Weighted average number of Company shares outstanding - basic (assuming full conversion of Operating Partnership units) 272,848 245,767 258,865 245,250 Weighted average number of Company shares outstanding - diluted (assuming full conversion of Operating Partnership units and convertible preferred stock) 273,853 271,941 273,069 271,259 PORTFOLIO RESULTS (b) Total revenues (c),(d) $ 475,641 $ 405,621 $ 1,629,181 $ 1,295,883 Operating expenses (142,284) (114,870) (518,231) (397,112) ------------ ------------ ------------ ------------ Real estate property net operating income 333,357 290,751 1,110,950 898,771 Net General Growth Management, Inc. (GGMI) operations 695 6,571 4,828 6,517 Headquarters and regional costs including depreciation that reduces FFO (15,964) (22,721) (66,475) (56,487) General and administrative (2,289) (4,386) (9,585) (8,990) Net interest expense (e) (99,572) (84,654) (367,577) (302,034) Preferred stock dividends - (6,116) (13,030) (24,467) Preferred unit distributions (10,302) (9,728) (40,550) (28,006) ------------ ------------ ------------ ------------ Funds From Operations - Operating Partnership $ 205,925 $ 169,717 $ 618,561 $ 485,304 ============ ============ ============ ============ SUMMARIZED BALANCE SHEET INFORMATION (unaudited) December 31, December 31, 2003 2002 Cash and marketable securities $ 10,677 $ 54,116 Investment in real estate Net land, building and equipment $ 8,405,092 $ 6,069,073 Developments in progress 168,521 90,492 Investment in and loans from Unconsolidated Real Estate Affiliates 630,613 766,519 ------------ ------------ Investment in real estate, net $ 9,204,226 $ 6,926,084 Total assets $ 9,582,897 $ 7,280,822 Mortgage and other notes payable 6,649,490 4,592,311 Minority interest - Preferred 495,211 468,201 Minority interest - Common 408,613 377,746 Preferred stock - 337,500 Stockholders' equity 1,670,409 1,196,525 ------------ ------------ Total capitalization (at cost) $ 9,223,723 $ 6,972,283 ============ ============ PORTFOLIO CAPITALIZATION DATA (unaudited) Total portfolio debt (Company debt above ($6,649,490 and $4,592,311, respectively) plus pro rata share of debt ($1,907,478 and $2,177,024, respectively) from unconsolidated affiliates) of which (after the effect of the Company's current swap agreements) $2,806,803 and $2,453,571, respectively, is comprised of variable rate debt $ 8,556,968 $ 6,769,335 Preferred stock - 449,415 Preferred equity - primarily preferred Operating Partnership units 495,211 468,201 Stock market value of common stock and common Operating Partnership units outstanding at end of period 7,575,923 4,261,573 ------------ ------------ Total market capitalization at end of period $ 16,628,102 $ 11,948,524 ============ ============
(a) Due to the three-for-one stock split effective December 5, 2003, all share and per share amounts have been reflected on a post-split basis. (b) Portfolio results combine the revenues and expenses of General Growth Management, Inc. (a Taxable REIT Subsidiary) with the applicable ownership percentage multiplied by the revenues and expenses from properties wholly and/or partially owned by the Operating Partnership. (c) Includes straight-line rent of $3,679 and $4,823 for the three months ended and $17,068 and $14,653 for the twelve months ended December 31, 2003 and 2002, respectively. (d) Includes non-cash rental revenue recognized pursuant to SFAS #141 and #142 of $4,528 and $6,837 for the three months ended and $23,504 and $6,837 for the twelve months ended December 31, 2003 and 2002, respectively. (e) As of the first quarter of 2003 and pursuant to SFAS #145 - Rescission of FASB Statements 4,44 and 64 and Technical Corrections, the Company now reflects costs related to the extinguishment of debt as additional interest expense. Previously, such costs were reflected as an extraordinary item. As required, EPS and FFO for the three and twelve months ended December 31, 2002 has been adjusted to maintain comparability. GENERAL GROWTH PROPERTIES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE AND TWELVE MONTHS ENDED DECEMBER 31, 2003 AND 2002 (UNAUDITED) (Dollars in thousands, except per share amounts)
THREE MONTHS ENDED TWELVE MONTHS ENDED DECEMBER 31, DECEMBER 31, 2003 2002 2003 2002 ----------- ----------- ------------ ----------- Revenues: Minimum rents $ 233,300 $ 185,000 $ 781,675 $ 584,260 Tenant recoveries 95,480 71,905 333,712 255,526 Overage rents 18,842 16,515 34,928 28,044 Management and other fees 22,466 20,084 84,138 75,479 Other 14,701 12,960 36,275 33,367 ----------- ----------- ------------ ----------- Total revenues 384,789 306,464 1,270,728 976,676 Expenses: Real estate taxes 24,520 17,360 89,038 61,096 Repairs and maintenance 25,364 19,306 82,217 62,674 Marketing 10,503 10,222 35,797 28,681 Other property operating costs 44,394 29,780 153,786 107,919 Provision for doubtful accounts 1,291 187 7,009 3,859 Property management and other costs 28,424 30,502 109,844 94,795 General and administrative 2,054 4,386 8,533 8,720 Depreciation and amortization 65,155 55,242 231,172 179,542 ----------- ----------- ----------- ----------- Total expenses 201,705 166,985 717,396 547,286 ----------- ----------- ----------- ----------- Operating income 183,084 139,479 553,332 429,390 Interest income 641 475 2,308 3,689 Interest expense (78,905) (61,996) (278,543) (219,029) Income allocated to minority interests (37,933) (33,801) (112,111) (86,670) Equity in income of unconsolidated affiliates 32,500 35,987 94,480 80,825 ----------- ----------- ----------- ----------- Income from continuing operations 99,387 80,144 259,466 208,205 Discontinued operations, net of minority interest: Income from operations - 157 225 1,034 Gain on disposition - - 3,720 19 ----------- ----------- ----------- ----------- Income from discontinued operations, net - 157 3,945 1,053 ----------- ----------- ----------- ----------- Net income 99,387 80,301 263,411 209,258 ----------- ----------- ----------- ----------- Preferred stock dividends - (6,117) (13,030) (24,467) ----------- ----------- ----------- ----------- Net income available to common stockholders $ 99,387 $ 74,184 $ 250,381 $ 184,791 =========== =========== =========== =========== Earnings from continuing operations per share-basic $ 0.46 $ 0.40 $ 1.23 $ 0.98 =========== =========== =========== =========== Earnings from continuing operations per share-diluted $ 0.46 $ 0.38 $ 1.20 $ 0.98 =========== =========== =========== =========== Earnings from discontinued operations, net per share-basic $ - $ - $ 0.02 $ 0.01 =========== =========== =========== =========== Earnings from discontinued operations, net per share-diluted $ - $ - $ 0.02 $ - =========== =========== =========== =========== Earnings per share-basic $ 0.46 $ 0.40 $ 1.25 $ 0.99 =========== =========== =========== =========== Earnings per share-diluted $ 0.46 $ 0.38 $ 1.22 $ 0.98 =========== =========== =========== ===========
GENERAL GROWTH PROPERTIES, INC BREAKDOWN OF COMPANY PORTFOLIO RESULTS AND FUNDS FROM OPERATIONS FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2003 (In thousands, unaudited)
Consolidated Unconsolidated Centers Centers(a) Total ------------ -------------- ----------- Property revenues Minimum rents (b),(c) $ 781,675 $ 286,452 $ 1,068,127 Tenant recoveries 333,712 140,334 474,046 Overage rents 34,928 8,624 43,552 Other (d) 35,378 8,078 43,456 ----------- ----------- ----------- Total property revenues 1,185,693 443,488 1,629,181 Property operating expenses Real estate taxes 89,038 40,056 129,094 Repairs and maintenance 82,217 33,716 115,933 Marketing 35,797 14,137 49,934 Other property operating costs 153,786 60,811 214,597 Provision for doubtful accounts 7,009 1,664 8,673 ----------- ----------- ----------- Total property operating expenses 367,847 150,384 518,231 ----------- ----------- ----------- Real estate property net operating income 817,846 293,104 1,110,950 GGMI fees (e) 84,138 - 84,138 GGMI expenses (e) (79,310) - (79,310) Headquarters/regional costs (30,534) (24,760)(f) (55,294) General and administrative (8,533) (1,052) (9,585) Depreciation that reduces FFO (g) (11,181) - (11,181) Interest income 2,308 1,721 4,029 Interest expense (268,974) (87,399) (356,373) Amortization of deferred finance costs (7,072) (4,994) (12,066) Debt extinguishment costs (h) (2,497) (670) (3,167) Preferred stock dividends (13,030) - (13,030) Preferred unit distributions (40,550) - (40,550) ----------- ----------- ----------- Uncombined Funds From Operations 442,611 175,950 618,561 Equity in Funds from Operations of Unconsolidated Centers 175,950 (175,950) - ----------- ----------- ----------- Operating Partnership Funds From Operations $ 618,561 $ - $ 618,561 =========== =========== ===========
GENERAL GROWTH PROPERTIES, INC BREAKDOWN OF COMPANY PORTFOLIO RESULTS AND FUNDS FROM OPERATIONS FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2002 (In thousands, unaudited)
Consolidated Unconsolidated Centers Centers(a) Total ------------ -------------- ------------ Property revenues Minimum rents (b) $ 584,260 $ 253,872 $ 838,132 Tenant recoveries 255,526 125,538 381,064 Overage rents 28,044 8,407 36,451 Other (d) 33,830 6,406 40,236 ----------- ----------- ----------- Total property revenues 901,660 394,223 1,295,883 Property operating expenses Real estate taxes 61,096 34,336 95,432 Repairs and maintenance 62,674 29,910 92,584 Marketing 28,681 13,280 41,961 Other property operating costs 107,919 53,515 161,434 Provision for doubtful accounts 3,859 1,842 5,701 ----------- ----------- ----------- Total property operating expenses 264,229 132,883 397,112 ----------- ----------- ----------- Real estate property net operating income 637,431 261,340 898,771 GGMI fees (e) 75,479 - 75,479 GGMI expenses (e) (68,962) - (68,962) Headquarters/regional costs (25,833) (20,940)(f) (46,773) General and administrative (8,720) (270) (8,990) Depreciation that reduces FFO (g) (9,714) - (9,714) Interest income 3,688 7,531 11,219 Interest expense (213,882) (90,937) (304,819) Amortization of deferred finance costs (5,096) (1,995) (7,091) Debt extinguishment costs (h) (50) (1,293) (1,343) Preferred stock dividends (24,467) - (24,467) Preferred unit distributions (28,006) - (28,006) ----------- ----------- ----------- Uncombined Funds From Operations 331,868 153,436 485,304 Equity in Funds from Operations of Unconsolidated Centers 153,436 (153,436) - ----------- ----------- ----------- Operating Partnership Funds From Operations $ 485,304 $ - $ 485,304 =========== =========== =========== (a) The Unconsolidated Centers include Quail Springs, Town East, the GGP/Ivanhoe entities, the GGP/Teachers entities and the GGP/Homart entities and are reflected at the Operating Partnership's share of such amounts. (b) Includes straight-line rent of $17,068 and $14,653 for the twelve months ended December 31, 2003 and 2002, respectively. (c) Includes SFAS #141 and #142 minimum rent accretion of $23,504 and $6,837 for the twelve months ended December 31, 2003 and 2002, respectively. (d) Includes $292 and $1,846 for the twelve months ended December 31, 2003 and 2002, respectively, of net FFO of investment property sold in 2003. (e) Represents the revenues and operating expenses of GGMI, the Company's taxable REIT subsidiary. (f) Headquarters/regional costs for the unconsolidated centers include property management and other fees to GGMI. (g) Represents depreciation on non-income producing assets including the Company's headquarters building. (h) As of the first quarter of 2003 and pursuant to SFAS 145 - Rescission of FASB Statements 4,44 and 64 and Technical Corrections, the Company now reflects costs related to the extinguishment of debt as additional interest expense. Previously, such costs were reflected as an extraordinary item. As required, FFO for the twelve months ended December 31, 2002 has been adjusted to maintain comparability.
GENERAL GROWTH PROPERTIES, INC BREAKDOWN OF COMPANY PORTFOLIO RESULTS AND FUNDS FROM OPERATIONS FOR THE THREE MONTHS ENDED DECEMBER 31, 2003 (In thousands, unaudited)
Consolidated Unconsolidated Centers Centers(a) Total ----------- -------------- --------- Property revenues Minimum rents (b),(c) $ 233,300 $ 72,280 $ 305,580 Tenant recoveries 95,480 32,561 128,041 Overage rents 18,842 5,214 24,056 Other (d) 14,174 3,790 17,964 --------- --------- --------- Total property revenues 361,796 113,845 475,641 Property operating expenses Real estate taxes 24,520 9,226 33,746 Repairs and maintenance 25,364 8,957 34,321 Marketing 10,503 3,211 13,714 Other property operating costs 44,394 14,636 59,030 Provision for doubtful accounts 1,291 182 1,473 --------- --------- --------- Total property operating expenses 106,072 36,212 142,284 --------- --------- --------- Real estate property net operating income 255,724 77,633 333,357 GGMI fees (e) 22,466 - 22,466 GGMI expenses (e) (21,771) - (21,771) Headquarters/regional costs (6,653) (6,404)(f) (13,057) General and administrative (2,054) (235) (2,289) Depreciation that reduces FFO (g) (2,907) - (2,907) Interest income 641 440 1,081 Interest expense (76,909) (20,766) (97,675) Amortization of deferred finance costs (1,996) (969) (2,965) Debt extinguishment costs (h) - (13) (13) Preferred stock dividends - - - Preferred unit distributions (10,302) - (10,302) --------- --------- --------- Uncombined Funds From Operations 156,239 49,686 205,925 Equity in Funds from Operations of Unconsolidated Centers 49,686 (49,686) - --------- --------- --------- Operating Partnership Funds From Operations $ 205,925 $ - $ 205,925 ========= ========= =========
GENERAL GROWTH PROPERTIES, INC BREAKDOWN OF COMPANY PORTFOLIO RESULTS AND FUNDS FROM OPERATIONS FOR THE THREE MONTHS ENDED DECEMBER 31, 2002 (In thousands, unaudited)
Consolidated Unconsolidated Centers Centers(a) Total ------------ -------------- --------- Property revenues Minimum rents (b) $ 184,926 $ 78,876 $ 263,802 Tenant recoveries 71,905 35,593 107,498 Overage rents 16,515 5,660 22,175 Other (d) 8,894 3,252 12,146 --------- --------- --------- Total property revenues 282,240 123,381 405,621 Property operating expenses Real estate taxes 17,360 8,454 25,814 Repairs and maintenance 19,306 9,970 29,276 Marketing 10,222 3,741 13,963 Other property operating costs 29,780 16,614 46,394 Provision for doubtful accounts 187 (764) (577) --------- --------- --------- Total property operating expenses 76,855 38,015 114,870 --------- --------- --------- Real estate property net operating income 205,385 85,366 290,751 GGMI fees (e) 23,285 - 23,285 GGMI expenses (e) (16,714) - (16,714) Headquarters/regional costs (13,788) (6,260)(f) (20,048) General and administrative (4,386) - (4,386) Depreciation that reduces FFO (g) (2,673) - (2,673) Interest income 475 1,901 2,376 Interest expense (60,116) (23,252) (83,368) Amortization of deferred finance costs (1,996) (825) (2,821) Debt extinguishment costs (h) - (841) (841) Preferred stock dividends (6,116) - (6,116) Preferred unit distributions (9,728) - (9,728) --------- --------- --------- Uncombined Funds From Operations 113,628 56,089 169,717 Equity in Funds from Operations of Unconsolidated Centers 56,089 (56,089) - --------- --------- --------- Operating Partnership Funds From Operations $ 169,717 $ - $ 169,717 ========= ========= ========= (a) The Unconsolidated Centers include Quail Springs, Town East, the GGP/Ivanhoe entities, the GGP/Teachers entities and the GGP/Homart entities and are reflected at the Operating Partnership's share of such amounts. (b) Includes straight-line rent of $3,679 and $4,823 for the three months ended December 31, 2003 and 2002, respectively. (c) Includes SFAS #141 and #142 minimum rent accretion of $4,528 and $6,837 for the three months ended December 31, 2003 and 2002. (d) Includes zero and $459 for the three months ended December 31, 2003 and 2002, respectively, of net FFO of investment property sold in 2003. (e) Represents the revenues and operating expenses of GGMI, the Company's taxable REIT subsidiary. (f) Headquarters/regional costs for the unconsolidated centers include property management and other fees to GGMI. (g) Represents depreciation on non-income producing assets including the Company's headquarters building. (h) As of the first quarter of 2003 and pursuant to SFAS 145 - Rescission of FASB Statements 4,44 and 64 and Technical Corrections, the Company now reflects costs related to the extinguishment of debt as additional interest expense. Previously, such costs were reflected as an extraordinary item. As required, fourth quarter 2002 FFO has been adjusted to maintain comparability.
RECONCILIATION OF REAL ESTATE PROPERTY NET OPERATING INCOME Three Months Ended Twelve Months Ended TO GAAP OPERATING INCOME (unaudited) December 31, December 31, 2003 2002 2003 2002 Real estate property net operating income, including Unconsolidated Centers $ 333,357 $ 290,751 $ 1,110,950 $ 898,771 Real estate property net operating income - Unconsolidated Centers (77,633) (85,366) (293,104) (261,340) ----------- ----------- ----------- ----------- Real estate property net operating income - Consolidated Centers 255,724 205,385 817,846 637,431 GGMI fees 22,466 23,285 84,138 75,479 GGMI expenses (21,771) (16,714) (79,310) (68,962) Headquarters/regional costs (6,653) (13,788) (30,534) (25,833) General and administrative (2,054) (4,386) (8,533) (8,720) Depreciation and amortization (65,155) (55,242) (231,172) (179,542) Other (*) 527 939 897 (463) ----------- ----------- ----------- ----------- GAAP Operating income - Consolidated General Growth Properties, Inc. $ 183,084 $ 139,479 $ 553,332 $ 429,390 =========== =========== =========== =========== (*) Reflects discontinued operations and minority interest in Consolidated Centers real estate property net operating income RECONCILIATION OF GAAP NET INCOME TO FUNDS FROM OPERATIONS - - (unaudited) (*) Net income (loss) available to common stockholders $ 99,387 $ 74,184 $ 250,381 $ 184,791 Extraordinary items (**) - - - - ----------- ----------- ----------- ----------- Income available to common stockholders before extraordinary items 99,387 74,184 250,381 184,791 Income from discontinued operations, net of minority interest - (157) (3,945) (1,053) ----------- ----------- ----------- ----------- Income from continuing operations 99,387 74,027 246,436 183,738 Allocations to Operating Partnership unitholders 27,374 23,230 71,145 57,821 FFO of property sold in 2003 - 459 292 1,846 Depreciation and amortization of capitalized real estate costs (including SFAS #141 and #142 in-place lease costs) other than amortization of financing costs 79,164 72,001 300,688 241,899 ----------- ----------- ----------- ----------- Funds From Operations - Operating Partnership 205,925 169,717 618,561 485,304 Funds From Operations - Operating Partnership unitholders (43,766) (40,626) (138,568) (116,170) ----------- ----------- ----------- ----------- Funds From Operations - Company stockholders 162,159 129,091 479,993 369,134 =========== =========== =========== =========== (*) Reconciliation of net income determined in accordance with generally accepted accounting principles to FFO (Company non-GAAP supplemental measure of operating performance) as defined by NAREIT and as required by SEC Regulation G. (**) As of the first quarter of 2003 and pursuant to SFAS #145 - Rescission of FASB Statements 4,44 and 64 and Technical Corrections, the Company now reflects costs related to the extinguishment of debt as additional interest expense. Previously, such costs were reflected as an extraordinary item. As required, FFO for the three and twelve months ended December 31, 2002 has been adjusted to maintain comparability. RECONCILIATION OF WEIGHTED AVERAGE SHARES OUTSTANDING FOR GAAP AND FFO PER SHARE COMPUTATIONS - (unaudited) Weighted average number of Company shares outstanding - for GAAP basic EPS(i) 215,785 187,082 200,875 186,544 Full conversion of Operating Partnership units 57,063 58,685 57,990 58,706 ----------- ----------- ----------- ----------- Weighted average number of Company shares outstanding - for basic FFO per share 272,848 245,767 258,865 245,250 =========== =========== =========== =========== Weighted average number of Company shares outstanding - for GAAP diluted EPS(ii) 216,790 213,256 215,079 212,553 Full conversion of Operating Partnership units 57,063 58,685 57,990 58,706 ----------- ----------- ----------- ----------- Weighted average number of Company shares outstanding - for diluted FFO per share 273,853 271,941 273,069 271,259 =========== =========== =========== =========== (i) Due to the three-for-one stock split effective December 5, 2003, all share and per share amounts have been reflected on a post-split basis. (ii) In 2003 and 2002, the PIERS are dilutive for the computation of EPS and are included in the total weighted average outstanding shares for diluted EPS purposes.
COMPANY PORTFOLIO DATA (a) AS OF AND/OR FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2003 (unaudited)
Consolidated Unconsolidated Company Centers Centers Portfolio ------------ ------------- ------------- Space leased at centers not under redevelopment(b) 91.2% 91.4% 91.3% Trailing 12 month total sales per sq. ft. (b)(d) $ 337 $ 376 $ 351 Average annualized in place rent per sq. ft. $ 28.37 $ 32.63 $ 29.90 Average rent per sq. ft. for new/renewal leases(c) $ 31.83 $ 34.71 $ 33.29 Average rent per sq. ft. for leases expiring in 2003(c) $ 22.16 $ 31.29 $ 26.70 % change in total sales(b)(d) 2.7% 3.4% 3.0% % change in comparable sales(b)(d) 0.4% 0.3% 0.4%
(a) Data is for 100% of the Mall GLA in each portfolio, including those centers that are owned in part by unconsolidated affiliates. Data excludes miscellaneous (non-mall) properties. Data presented in the column "Company Portfolio" are weighted average amounts. (b) Data excludes properties currently being redeveloped and/or remerchandised. (c) Excludes 2003 acquisition transactions. (d) Due to tenant sales reporting timelines, data presented is as of November. -----END PRIVACY-ENHANCED MESSAGE-----