EX-99.1 2 skt8kex991december312014.htm EXHIBIT 99.1 SKT 8K EX 99.1 December 31, 2014


EXHIBIT 99.1

News Release
TANGER REPORTS YEAR END RESULTS FOR 2014
Adjusted Funds From Operations Per Share Increases 4.8% YTD
New Center Openings and Robust Development Pipeline Continues
Asset Recycling Activity Resumes
Greensboro, NC, February 10, 2015, Tanger Factory Outlet Centers, Inc. (NYSE:SKT) today reported adjusted funds from operations ("AFFO") available to common shareholders increased 4.8% to $1.97 per share, or $194.9 million for the year ended December 31, 2014. AFFO for the three months ended December 31, 2014, was $0.53 per share, or $52.9 million. A reconciliation of funds from operations ("FFO"), a widely accepted supplemental measure of REIT performance, to AFFO is shown in the table below.

"2014 was a terrific year for Tanger. We reported 4.8% growth in AFFO per share for the year, sold a non-core property in December, put a plan in place to divest of four additional non-core properties and one joint venture interest, and delivered new developments and expansion projects that resulted in a 7.3% increase in our total footprint," commented Steven B. Tanger, President & Chief Executive Officer. "Tenant demand for space in Tanger Outlet Centers remains strong, as evidenced by our 23.0% average leasing spreads on lease renewals and released space during 2014, and year end occupancy of 98.0%," he added.

In thousands, except per share amounts:
Three months ended
 
Year Ended
 
December 31,
 
December 31,
 
2014
2013
 
2014
2013
FFO as reported
$
39,382

$
52,271

 
$
179,974

$
192,026

As adjusted for:
 
 
 
 
Acquisition costs
—

240

 
7

1,203

 
Demolition costs
—

—

 
—

140

 
Abandoned pre-development costs
769

—

 
2,365

—

 
Casualty gain
(157
)
—

 
(486
)
—

 
Make-whole premium on early redemption of senior notes
13,140

—

 
13,140

—

 
AFFO adjustments from unconsolidated joint ventures (1)
—

—

 
237

(7,422
)
 
Impact of above adjustments to the allocation of earnings to participating securities
(271
)
(3
)
 
(302
)
67

Adjusted FFO ("AFFO")
$
52,863

$
52,508

 
$
194,935

$
186,014

Diluted weighted average common shares
99,023

99,499

 
98,954

99,129

FFO per share
$
0.40

$
0.53

 
$
1.82

$
1.94

AFFO per share
$
0.53

$
0.53

 
$
1.97

$
1.88

(1)
Includes abandoned pre-development costs, and for the year ended December 31, 2013, includes acquisition costs as well as our share of litigation settlement proceeds totaling $3.4 million and gain on early extinguishment of debt totaling $4.6 million related to the reorganization of the Deer Park joint venture prior to the company's acquisition of a controlling interest.

1


Net income available to common shareholders for the three months ended December 31, 2014 was $17.1 million, or $0.18 per share, as compared to $21.7 million, or $0.23 per share, for the three months ended December 31, 2013. For the year ended December 31, 2014, net income available to common shareholders was $72.1 million, or $0.77 per share, as compared to $106.4 million, or $1.13 per share for the year ended December 31, 2013. In addition to the charges described in the footnotes above, net income available to common shareholders for the three months and twelve months ended December 31, 2014 was impacted by a $7.5 million gain on the sale of the company's outlet center in Lincoln City, Oregon. Net income available to common shareholders for the twelve months ended December 31, 2013 was impacted by a $26.0 million gain on fair value measurement related to the company's acquisition of an additional one-third interest in the Deer Park property on August 30, 2013.

Net income, FFO and AFFO per share are on a diluted basis. FFO and AFFO are supplemental non-GAAP financial measures used in the real estate industry to measure and compare the operating performance of real estate companies. Complete reconciliations containing adjustments from GAAP net income to FFO and to AFFO are included in this release.
Highlights for 2014
•
Same center net operating income increased 2.7% during the quarter, and 2.6% for the year, marking the 40th consecutive quarter of same center net operating income growth
•
Blended increase in average base rental rates on space renewed and released throughout the consolidated portfolio of 23.0%
•
Period-end consolidated portfolio occupancy rate of 98.0% at December 31, 2014, marking the 34th consecutive year with occupancy of 95% or greater at year end
•
Average tenant sales for the consolidated portfolio increased approximately 2% to $393 per square foot for the year ended December 31, 2014
•
Total market capitalization increased 14% to $5.2 billion as of December 31, 2014, compared to $4.5 billion as of December 31, 2013
•
Debt-to-total market capitalization ratio of 28% as of December 31, 2014
•
Interest coverage ratio of 4.09 times
•
Raised quarterly common share cash dividend by 6.7% in April 2014, marking the 21st consecutive year of increased cash dividends
•
Announced joint venture agreement to develop Tanger Outlets Savannah in January 2014
•
Opened a new outlet center in Charlotte, NC in July 2014
•
Commenced construction of Tanger Outlets Grand Rapids in August 2014
•
Opened Tanger Outlets Ottawa in October 2014
•
Opened a major expansion and renovation of Tanger Outlets Cookstown in November 2014
•
Completed several smaller expansions at other Tanger Outlet Centers during 2014
•
Continued construction of Tanger Outlets Foxwoods throughout 2014
•
Commenced construction of Tanger Outlets Southaven (Memphis) in January 2015
•
Completed the sale of an outlet center in Lincoln City, Oregon in December 2014
•
Completed a recast of $250 million unsecured term loan in July 2014, reducing overall borrowing costs
•
Completed a 10-year, 3.75% coupon, $250 million Senior Notes offering in November 2014
•
Completed the early redemption of 6.15%, $250 million Senior Notes in December 2014, originally scheduled to mature in November 2015
Core Portfolio Drives Operating Results
During 2014, Tanger executed 409 leases totaling 1,711,000 square feet throughout its consolidated portfolio. Lease renewals accounted for 1,241,000 square feet, which generated a 17.1% increase in average base rental rate. Leases renewed represent 77.0% of the space originally scheduled to expire in 2014, slightly lower than the company's typical renewal rate, as Tanger intentionally opted to not renew certain leases in order to have space available for higher volume tenants. Base rental rate increases on space re-tenanted during 2014 averaged 36.1% and accounted for the remaining 470,000 square feet.


2


Negatively impacted by a decrease in average occupancy rates of approximately 1%, consolidated portfolio same center net operating income increased 2.7% for the fourth quarter and 2.6% for the year ended December 31, 2014. The company's long-term, ongoing strategy is to provide the consumer with the best overall shopping experience. As Tanger upgrades its tenant mix to position its centers for long-term growth, overall occupancy and same center net operating income growth may decrease slightly in the short term. However tenant demand for space continues to be very strong. For the year ended December 31, 2014, consolidated portfolio average tenant sales increased approximately 2% to $393 per square foot.

Investment Activities Provide Potential Future Growth
Development activity completed in 2014 expanded the company's total footprint by approximately 7.3% over its footprint at December 31, 2013. Tanger opened 2 new developments and 6 expansions during 2014, and currently has 4 additional new development projects under construction with plans to open during 2015.
In July 2014, the company and its 50/50 joint venture partner opened a new outlet center eight miles southwest of uptown Charlotte, North Carolina. In October 2014, Tanger and its 50/50 co-owner opened Tanger Outlets Ottawa. Located in Ottawa, Ontario, this property is the first ground-up development of a Tanger Outlet Center in Canada.
Also located in Ontario, on the northern end of the Greater Toronto Area, Tanger Outlets Cookstown underwent a major expansion and renovation project that nearly doubled its size, while creating an updated exterior for the existing space consistent with that of the expansion. Tanger and its 50/50 co-owner opened the newly expanded property in November 2014.
During 2014, the company also completed several smaller expansion projects totaling approximately 125,000 square feet, including properties located in Branson, Missouri; Charleston, South Carolina; Park City, Utah; Sevierville, Tennessee and Glendale, Arizona.
During the fourth quarter of 2014, Tanger decided to abandon a pre-development stage project in Cheshire, Connecticut. As a result of no longer pursuing this project, the company recorded a $769,000 charge during the quarter, representing the cumulative related costs.
In January 2015, the Company and its 50/50 joint venture partner commenced construction on the newest Tanger Outlet center located 4.5 miles south of Memphis in Southaven, Mississippi. Memphis attracts over 9 million visitors annually and more than 1.5 million people live within an hour of the development site. Tanger currently expects the center to be completed in time for a holiday 2015 opening. Construction of the other new developments the company intends to open in 2015 is ongoing. Current plans include an April 2015 grand opening at Tanger Outlets Savannah, a May 2015 grand opening at Tanger Outlets Foxwoods, at Foxwoods Resort Casino in Mashantucket, Connecticut and a third quarter 2015 grand opening at Tanger Outlets Grand Rapids, in Grand Rapids, Michigan. The company and its 50/50 joint venture partner currently expect to be able to commence construction of Tanger Outlets Columbus, a pre-development stage project in Columbus, Ohio, in time to complete construction and open the center in the first half of 2016.
Asset Recycling Activity Strengthens Portfolio & Generates Capital
In keeping with the company's ongoing practice of actively managing its assets, the company entered into an agreement in the fourth quarter of 2014 with a private buyer for the sale of up to five Tanger Outlet Centers. On December 13, 2014, the buyer acquired the company's outlet center in Lincoln City, Oregon for $39.5 million, and as a result, Tanger recognized a gain of $7.5 million on the transaction in the fourth quarter. The buyer is currently conducting due diligence on three additional properties. The average sales productivity for the property sold in 2014 and the three properties which may be sold to this buyer during 2015 was approximately $249 per square foot, 37% below the average sales within Tanger's consolidated portfolio. Should the buyer choose to acquire these properties during the first quarter of 2015, the agreement provides the option to acquire the fifth and final property in the first quarter of 2016. All four of the remaining potential disposition properties are classified as rental properties held for sale as of December 31, 2014.
In addition, Tanger initiated the buy-sell provision for the partnership that owns an outlet center in Wisconsin Dells, Wisconsin. The company's joint venture partner has decided to acquire Tanger's 50% equity interest in the venture. The company currently expects to close on the transaction during the first quarter of 2015.

3


Balance Sheet Summary
In July 2014, the company amended its $250 million unsecured term loan due February 2019. The amendment reduced the interest rate to LIBOR plus 105 basis points, from LIBOR plus 160 basis points, and eliminated the prepayment penalty.
On November 21, 2014, Tanger completed a $250 million Senior Notes offering. The Notes mature December 1, 2024, bear interest at 3.75% and were priced at 99.429% of the principal amount to yield 3.819%. The net proceeds were used to redeem the company's $250 million, 6.15% Senior Notes due November 2015. The company recorded a charge of approximately $13.1 million for the make-whole premium related to the early redemption, which was completed December 15, 2014. In addition, during the interim 24 day period, Tanger incurred incremental interest expense of approximately $625,000 related to the 3.75% Notes in addition to interest expense on the 6.15% Notes.
As of December 31, 2014, Tanger had a total market capitalization of approximately $5.2 billion including $1.4 billion of debt outstanding, equating to a 28% debt-to-total market capitalization ratio. The company had $111.0 million outstanding on its $520.0 million in available unsecured lines of credit. For the year ended December 31, 2014, Tanger maintained an interest coverage ratio of 4.09 times.

Tanger Expects Solid FFO Per Share Growth In 2015
Based on Tanger's internal budgeting process, the company's view on current market conditions, and the strength and stability of its core portfolio, management currently believes its net income available to common shareholders and funds from operations for 2015 will be as follows:
For the year ended December 31, 2015:
 
 
 
Low Range
High Range
Estimated diluted net income per share
$1.47
$1.53
Noncontrolling interest, depreciation and amortization
 
 
 
of real estate assets including noncontrolling interest
 
 
 
share and our share of unconsolidated joint ventures,
 
 
 
and gain on sale of real estate
0.60
0.60
Estimated diluted FFO per share
$2.07
$2.13
 
 
 
 
 
 

The company's earnings estimates reflect a projected increase in same-center net operating income of approximately 3.0% to 3.5%, and average general and administrative expense of approximately $11.5 million to $12.0 million per quarter.  The company's estimates include an approximate $0.02 per share dilution associated with the strengthening dollar as it relates to its Canadian investments and also include an approximate $0.10 per share dilution from the 2014 sale of the center in Lincoln City, Oregon as well as the expected closing on the sale of the company's 50% interest in its Wisconsin Dells joint venture and the expected closing on the sale of three additional properties. Both transactions are expected to close on or before March 31, 2015. The company's estimates do not include the impact of any potential refinancing transactions, the sale of any out parcels of land, any property acquisitions, or the sale of any additional properties.


4


Year End Conference Call

Tanger will host a conference call to discuss its fourth quarter results for analysts, investors and other interested parties on Wednesday, February 11, 2015, at 10 a.m. Eastern Time. To access the conference call, listeners should dial 1-877-277-5113 and provide conference ID # 34699252 to be connected to the Tanger Factory Outlet Centers Fourth Quarter 2014 Financial Results call. Alternatively, the call will be web cast by SNL IR Solutions and can be accessed at Tanger Factory Outlet Centers, Inc.'s web site by clicking the Investor Relations link at www.tangeroutlet.com. A telephone replay of the call will be available from February 11, 2015 at 1:00 p.m. through 11:59 p.m., February 27, 2015 by dialing 1-855-859-2056, conference ID # 34699252. An online archive of the broadcast will also be available through February 27, 2015.

About Tanger Factory Outlet Centers

Tanger Factory Outlet Centers, Inc. (NYSE:SKT), is a publicly-traded REIT headquartered in Greensboro, North Carolina that presently operates and owns, or has an ownership interest in, a portfolio of 45 upscale outlet shopping centers in 25 states coast to coast and in Canada, totaling approximately 14.0 million square feet leased to over 2,900 stores operated by more than 450 different brand name companies. More than 185 million shoppers visit Tanger Factory Outlet Centers, Inc. annually. Tanger is filing a Form 8-K with the Securities and Exchange Commission that includes a supplemental information package for the quarter ended December 31, 2014. For more information on Tanger Outlet Centers, call 1-800-4TANGER or visit the company's web site at www.tangeroutlet.com.

This news release contains forward-looking statements within the meaning of federal securities laws. These statements include, but are not limited to, estimates of future net income and FFO per share, same center net operating income, general and administrative expenses, the dilutive impact from expected foreign currency exchange rates, and the dilutive impact from recent sales and expected sales of certain properties and our equity interest in the Wisconsin Dells joint venture; plans for new developments, expansions, and dispositions; the expected timing of the commencement of construction and the openings of the current and new developments; whether or not potential dispositions close, the timing of such closings, and the proceeds to the company; tenant demand for space; the renewal and re-tenanting of space; tenant sales and sales trends; as well as other statements regarding plans, estimates, intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. 

These forward-looking statements are subject to risks and uncertainties. Actual results could differ materially from those projected due to various factors including, but not limited to, the risks associated with general economic and real estate conditions in the United States and Canada, the company's ability to meet its obligations on existing indebtedness or refinance existing indebtedness on favorable terms, the availability and cost of capital, whether projects in our pipeline convert into successful developments, the company's ability to lease its properties, the company's ability to implement its plans and strategies for joint venture properties that it does not fully control, the company's inability to collect rent due to the bankruptcy or insolvency of tenants or otherwise, and competition. For a more detailed discussion of the factors that affect our operating results, interested parties should review the Tanger Factory Outlet Centers, Inc. Annual Report on Form 10-K for the fiscal year ended December 31, 2013, and December 31, 2014 when available.

5


TANGER FACTORY OUTLET CENTERS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(Unaudited)
 
 
Three months ended
 
Year ended
 
 
December 31,
 
December 31,
 
 
2014
 
2013
 
2014
 
2013
REVENUES
 
 
 
 
 
 
 
 
Base rentals (a)
 
$
69,732

 
$
68,811

 
$
274,480

 
$
253,402

Percentage rentals
 
3,675

 
4,295

 
10,307

 
11,251

Expense reimbursements
 
32,075

 
31,110

 
122,532

 
109,654

Management, leasing and other services
 
1,043

 
1,244

 
3,591

 
3,080

Other income
 
1,849

 
1,865

 
7,648

 
7,432

Total revenues
 
108,374

 
107,325

 
418,558

 
384,819

EXPENSES
 
 
 
 
 
 
 
 
Property operating
 
34,968

 
34,227

 
137,422

 
121,046

General and administrative
 
11,652

 
9,879

 
44,469

 
39,119

Acquisition costs (b)
 
—

 
240

 
7

 
1,203

Abandoned pre-development costs (c)
 
769

 
—

 
2,365

 
—

Depreciation and amortization
 
25,398

 
27,063

 
102,432

 
95,746

Total expenses
 
72,787

 
71,409

 
286,695

 
257,114

Operating income
 
35,587

 
35,916


131,863


127,705

 
 
 
 
 
 
 
 
 
OTHER INCOME/(EXPENSE)
 
 
 
 
 
 
 
 
Interest expense
 
(14,527
)
 
(13,790
)
 
(57,931
)
 
(51,616
)
Loss on early extinguishment of debt
 
(13,140
)
 
—

 
(13,140
)
 
—

Gain on sale of real estate
 
7,513

 
—

 
7,513

 
—

Gain on previously held interest in acquired joint venture (d)
 
—

 
—

 
—

 
26,002

Interest and other income
 
234

 
77

 
794

 
190

Income before equity in earnings of unconsolidated joint ventures
 
15,667

 
22,203

 
69,099

 
102,281

Equity in earnings of unconsolidated joint ventures
 
2,853

 
933

 
9,053

 
11,040

Net income
 
18,520

 
23,136

 
78,152

 
113,321

Noncontrolling interests in Operating Partnership
 
(954
)
 
(1,208
)
 
(4,037
)
 
(5,643
)
Noncontrolling interests in other consolidated partnerships
 
(24
)
 
8

 
(104
)
 
(121
)
Net income attributable to Tanger Factory Outlet Centers, Inc.
 
17,542

 
21,936

 
74,011

 
107,557

Allocation of earnings to participating securities
 
(481
)
 
(230
)
 
(1,872
)
 
(1,126
)
Net income available to common shareholders of
Tanger Factory Outlet Centers, Inc.
 
$
17,061

 
$
21,706

 
$
72,139

 
$
106,431

 
 
 
 
 
 
 
 
 
Basic earnings per common share:
 
 
 
 
 
 
 
 
Net income
 
$
0.18

 
$
0.23

 
$
0.77

 
$
1.14

 
 
 
 
 
 
 
 
 
Diluted earnings per common share:
 
 
 
 
 
 
 
 
Net income
 
$
0.18

 
$
0.23

 
$
0.77

 
$
1.13

 
 
 
 
 
 
 
 
 
a.
Includes straight-line rent and market rent adjustments of $202 and $823 for the three months ended and $3,319 and $4,842 for the years ended December 31, 2014 and 2013, respectively.
b.
Represents potential acquisition related expenses incurred during the periods presented.
c.
Represents costs related to pre-development projects no longer considered probable.
d.
Represents gain on fair value measurement of our previously held interest in the Deer Park joint venture recognized upon the Company's acquisition of a controlling interest on August 30, 2013.

6


TANGER FACTORY OUTLET CENTERS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
(Unaudited)
 
December 31,
 
December 31,
 
2014
 
2013
ASSETS
 
 
 
   Rental property
 
 
 
   Land
$
217,994

 
$
230,415

   Buildings, improvements and fixtures
1,947,083

 
2,009,971

   Construction in progress
98,526

 
9,433

 
2,263,603

 
2,249,819

   Accumulated depreciation
(662,236
)
 
(654,631
)
      Total rental property, net
1,601,367

 
1,595,188

   Cash and cash equivalents
16,875

 
15,241

   Rental property held for sale
46,005

 
—

   Investments in unconsolidated joint ventures
208,050

 
140,214

   Deferred lease costs and other intangibles, net
140,883

 
163,581

   Deferred debt origination costs, net
12,126

 
10,818

   Prepaids and other assets
72,354

 
81,414

         Total assets
$
2,097,660

 
$
2,006,456

 
 
 
 
LIABILITIES AND EQUITY
 
 
 
Liabilities
 
 
 
   Debt
 
 
 
Senior, unsecured notes (net of discount of $6,426 and $5,752, respectively)
$
793,574

 
$
794,248

Unsecured term loans (net of discount of $241 and $396, respectively)
267,259

 
267,104

Mortgages payable (including premiums of $3,031 and $3,799, respectively)
271,361

 
250,497

Unsecured lines of credit
111,000

 
16,200

Total debt
1,443,194

 
1,328,049

     Accounts payable and accrued expenses
69,558

 
59,462

   Deferred financing obligation
28,388

 
28,388

     Other liabilities
32,634

 
32,962

         Total liabilities
1,573,774

 
1,448,861

Commitments and contingencies
—

 
—

Equity
 
 
 
Tanger Factory Outlet Centers, Inc.
 
 
 
Common shares, $.01 par value, 300,000,000 authorized, 95,509,781 and 94,505,685 shares issued and outstanding at December 31, 2014 and 2013, respectively
955

 
945

   Paid in capital
791,566

 
788,984

   Accumulated distributions in excess of net income
(281,679
)
 
(265,242
)
   Accumulated other comprehensive loss
(14,023
)
 
(2,428
)
         Equity attributable to Tanger Factory Outlet Centers, Inc.
496,819

 
522,259

Equity attributable to noncontrolling interests
 
 
 
Noncontrolling interests in Operating Partnership
26,417

 
28,432

Noncontrolling interests in other consolidated partnerships
650

 
6,904

         Total equity
523,886

 
557,595

            Total liabilities and equity
$
2,097,660

 
$
2,006,456



7


TANGER FACTORY OUTLET CENTERS, INC. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
(in thousands, except per share, state and center information)
(Unaudited)
 
 
Three months ended
 
Year ended
 
 
December 31,
 
December 31,
 
 
2014
 
2013
 
2014
 
2013
FUNDS FROM OPERATIONS (a)
 
 
 
 
 
 
 
 
Net income
 
$
18,520

 
$
23,136

 
$
78,152

 
$
113,321

Adjusted for:
 
 
 
 
 
 
 
 
Depreciation and amortization of real estate assets - consolidated
 
25,052

 
26,717

 
100,961

 
94,515

Depreciation and amortization of real estate assets - unconsolidated joint ventures
 
4,164

 
2,954

 
12,212

 
12,419

Gain on sale of real estate
 
(7,513
)
 
—

 
(7,513
)
 
—

Gain on previously held interest in acquired joint venture
 
—

 
—

 
—

 
(26,002
)
Funds from operations (FFO)
 
40,223

 
52,807

 
183,812

 
194,253

FFO attributable to noncontrolling interests in other consolidated partnerships
 
(46
)
 
(12
)
 
(185
)
 
(202
)
Allocation of earnings to participating securities
 
(795
)
 
(524
)
 
(3,653
)
 
(2,025
)
Funds from operations available to common shareholders
 
$
39,382

 
$
52,271

 
$
179,974

 
$
192,026

Funds from operations available to common shareholders per share - diluted
 
$
0.40

 
$
0.53

 
$
1.82

 
$
1.94

 
 
 
 
 
 
 
 
 
WEIGHTED AVERAGE SHARES
 
 
 
 
 
 
 
 
Basic weighted average common shares
 
93,851

 
93,408

 
93,769

 
93,311

Effect of notional units (b)
 
—

 
871

 
—

 
849

Effect of outstanding options and restricted common shares
 
71

 
75

 
70

 
87

Diluted weighted average common shares (for earnings per share computations)
 
93,922

 
94,354

 
93,839

 
94,247

Exchangeable operating partnership units (c)
 
5,101

 
5,145

 
5,115

 
4,882

Diluted weighted average common shares (for funds from operations per share computations)
 
99,023

 
99,499

 
98,954

 
99,129

 
 
 
 
 
 
 
 
 
OTHER INFORMATION
 
 
 
 
 
 
 
 
Gross leasable area open at end of period -
 
 
 
 
 
 
 
 
Consolidated
 
11,346

 
11,537

 
11,346

 
11,537

Partially owned - unconsolidated
 
2,606

 
1,719

 
2,606

 
1,719

 
 
 
 
 
 
 
 
 
Outlet centers in operation at end of period -
 
 
 
 
 
 
 
 
Consolidated
 
36

 
37

 
36

 
37

Partially owned - unconsolidated
 
9

 
7

 
9

 
7

 
 
 
 
 
 
 
 
 
States operated in at end of period (d)
 
23

 
24

 
23

 
24

Occupancy at end of period (d)
 
98.0
%
 
98.9
%
 
98.0
%
 
98.9
%

8




a.
FFO is a non-GAAP financial measure. The most directly comparable GAAP measure is net income (loss), to which it is reconciled. We believe that for a clear understanding of our operating results, FFO should be considered along with net income as presented elsewhere in this report. FFO is presented because it is a widely accepted financial indicator used by certain investors and analysts to analyze and compare one equity REIT with another on the basis of operating performance. FFO is generally defined as net income (loss), computed in accordance with generally accepted accounting principles, before extraordinary items and gains (losses) on sale or disposal of depreciable operating properties, plus depreciation and amortization of real estate assets, impairment losses on depreciable real estate of consolidated real estate and after adjustments for unconsolidated partnerships and joint ventures, including depreciation and amortization, and impairment losses on investments in unconsolidated joint ventures driven by a measurable decrease in the fair value of depreciable real estate held by the unconsolidated joint ventures. We caution that the calculation of FFO may vary from entity to entity and as such the presentation of FFO by us may not be comparable to other similarly titled measures of other reporting companies. FFO does not represent net income or cash flow from operations as defined by accounting principles generally accepted in the United States of America and should not be considered an alternative to net income as an indication of operating performance or to cash flows from operations as a measure of liquidity. FFO is not necessarily indicative of cash flows available to fund dividends to shareholders and other cash needs.

b.
Notional units granted in 2010 were converted into 933,769 restricted common shares in January 2014 which vested on December 31, 2014. The restricted common shares were considered participating securities through the vesting date.

c.
The exchangeable operating partnership units (noncontrolling interest in operating partnership) are not dilutive on earnings per share computed in accordance with generally accepted accounting principles.

d.
Excludes the centers in which we have ownership interests in but are held in unconsolidated joint ventures.



    


9