EX-99.1 2 exhibit991earningsreleaseq.htm EXHIBIT 99.1 Exhibit 99.1 Earnings Release Q215




CAMDEN PROPERTY TRUST ANNOUNCES SECOND QUARTER 2015 OPERATING RESULTS
 

Houston, TEXAS (July 30, 2015) - Camden Property Trust (NYSE:CPT) today announced operating results for the three and six months ended June 30, 2015.

Funds from Operations (“FFO”), Adjusted Funds from Operations (“AFFO”), and Net Income Attributable to Common Shareholders (“EPS”) for the three and six months ended June 30, 2015 are detailed below.

 
Three Months Ended
Six Months Ended
 
June 30
June 30
Per Diluted Share
2015
2014
2015
2014
FFO
$1.12
$1.05
$2.20
$2.10
AFFO
$0.91
$0.86
$1.86
$1.82
EPS
$0.40
$0.40
$1.68
$0.85

A reconciliation of EPS to FFO is included in the financial tables accompanying this press release.

Same Property Results
 
Quarterly Growth

Sequential Growth

Year to Date Growth

 
2Q15 vs. 2Q14

2Q15 vs. 1Q15

2015 vs. 2014

Revenues
5.2
%
2.2
%
4.9
%
Expenses
3.9
%
0.3
%
5.0
%
Net Operating Income ("NOI")
5.9
%
3.3
%
4.8
%

 
2Q15

2Q14

1Q15

Occupancy
96.0
%
95.6
%
95.5
%

“Operating performance remains strong across our markets, with continued demand for well-located apartment homes,” said Richard Campo, Camden’s Chairman and CEO. “As a result, we are raising our 2015 projections for both FFO and same property growth for the second time this year.”

The Company defines same property communities as communities owned and stabilized as of January 1, 2014. A reconciliation of net income to NOI and same property NOI is included in the financial tables accompanying this press release.

Development Activity
Construction was completed during the second quarter at Camden Hayden located in Tempe, AZ, and construction commenced at Camden Shady Grove in Rockville, MD.





1





Development Communities - Construction Completed and Projects in Lease-Up ($ in millions)
 
 
Total
Total
CPT %

% Leased

Community Name
Location
Units
Cost
Owned

as of 7/26/2015

Camden Foothills
Scottsdale, AZ
220
$44.6
100
%
89
%
Camden Hayden
Tempe, AZ
234
44.2
100
%
67
%
     TOTAL
 
454
$88.8
 
 

Development Communities - Construction Ongoing ($ in millions)
 
 
Total
Total
CPT %

% Leased

Community Name
Location
Units
Budget
Owned

as of 7/26/2015

Camden Flatirons
Denver, CO
424
$79
100
%
79
%
Camden Paces
Atlanta, GA
379
117
100
%
57
%
Camden Southline
Charlotte, NC
266
48
31.3
%
50
%
Camden Chandler
Chandler, AZ
380
73
100
%
38
%
Camden Glendale
Glendale, CA
303
115
100
%
33
%
Camden Gallery
Charlotte, NC
323
58
100
%
 
Camden Victory Park
Dallas, TX
423
82
100
%
 
The Camden
Los Angeles, CA
287
145
100
%
 
Camden Lincoln Station
Denver, CO
267
56
100
%
 
Camden McGowen Station
Houston, TX
315
90
100
%
 
Camden NoMa II
Washington, DC
405
115
100
%
 
Camden Shady Grove
Rockville, MD
457
116
100
%
 
   TOTAL
 
4,229
$1,094
 
 

Acquisition/Disposition Activity
During the quarter, Camden acquired a 49.6-acre land parcel in Phoenix, AZ and a 2.7-acre land parcel in Los Angeles, CA for the future development of up to 1,274 apartment homes.

Earnings Guidance
Camden updated its earnings guidance for 2015 based on its current and expected views of the apartment market and general economic conditions, and provided guidance for third quarter 2015 as detailed below.

Per Diluted Share
3Q15
2015
FFO
$1.12 - $1.16
$4.47 - $4.57
EPS
$0.38 - $0.42
$2.45 - $2.55
Same Property Growth
2015 Range
2015 Midpoint
Revenue
4.75% - 5.25%
5.00%
Expenses
4.75% - 5.25%
5.00%
NOI
4.75% - 5.25%
5.00%

Camden intends to update its earnings guidance to the market on a quarterly basis. Additional information on the Company’s 2015 financial outlook and a reconciliation of expected EPS to expected FFO are included in the financial tables accompanying this press release.


2


Conference Call
The Company will hold a conference call on Friday, July 31, 2015 at 11:00 a.m. Central Time to review its second quarter 2015 results and discuss its outlook for future performance. To participate in the call, please dial (888) 317-6003 (Domestic) or (412) 317-6061 (International) by 10:50 a.m. Central Time and enter passcode: 6772868, or join the live webcast of the conference call by accessing the Investor Relations section of the Company’s website at camdenliving.com. Supplemental financial information is available in the Investor Relations section of the Company’s website under Earnings Releases or by calling Camden’s Investor Relations Department at (800) 922-6336.

Forward-Looking Statements
In addition to historical information, this press release contains forward-looking statements under the federal securities law. These statements are based on current expectations, estimates and projections about the industry and markets in which Camden operates, management's beliefs, and assumptions made by management. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties which are difficult to predict. Factors which may cause the Company’s actual results or performance to differ materially from those contemplated by forward-looking statements are described under the heading “Risk Factors” in Camden’s Annual Report on Form 10-K and in other filings with the Securities and Exchange Commission (SEC). Forward-looking statements made in today’s press release represent management’s current opinions, and the Company assumes no obligation to update or supplement these statements because of subsequent events.

About Camden
Camden Property Trust, an S&P 400 Company, is a real estate company engaged in the ownership, management, development, redevelopment, acquisition, and construction of multifamily apartment communities. Camden owns interests in and operates 169 properties containing 58,680 apartment homes across the United States. Upon completion of 12 properties under development, the Company’s portfolio will increase to 62,909 apartment homes in 181 properties. Camden was recently named by FORTUNE® Magazine for the eighth consecutive year as one of the “100 Best Companies to Work For” in America, ranking #10.

For additional information, please contact Camden’s Investor Relations Department at (800) 922-6336 or (713) 354-2787 or access our website at camdenliving.com.






3


 
 
 
CAMDEN
 
OPERATING RESULTS
 
 
(In thousands, except per share amounts)
 
 
 
(Unaudited)
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2015
2014
 
2015
2014
OPERATING DATA
 
 
 
 
 
Property revenues
 
 
 
 
 
Rental revenues

$190,089


$180,438

 

$376,946


$359,402

Other property revenues
30,562

28,054

 
59,139

55,019

Total property revenues
220,651

208,492

 
436,085

414,421

 
 
 
 
 
 
Property expenses
 
 
 
 
 
Property operating and maintenance
53,472

52,264

 
106,470

103,011

Real estate taxes
25,317

23,616

 
50,730

47,193

Total property expenses
78,789

75,880

 
157,200

150,204

 
 
 
 
 
 
Non-property income
 
 
 
 
 
Fee and asset management
1,618

2,147

 
3,181

5,170

Interest and other income
141

44

 
201

332

Income/(loss) on deferred compensation plans
(297
)
2,018

 
1,567

2,699

Total non-property income
1,462

4,209

 
4,949

8,201

 
 
 
 
 
 
Other expenses
 
 
 
 
 
Property management
6,082

5,853

 
12,044

11,692

Fee and asset management
1,121

1,247

 
2,197

2,506

General and administrative
11,582

10,534

 
21,330

20,079

Interest
24,411

22,746

 
49,023

45,879

Depreciation and amortization
63,728

57,953

 
125,258

115,349

Amortization of deferred financing costs
620

816

 
1,418

1,657

Expense/(benefit) on deferred compensation plans
(297
)
2,018

 
1,567

2,699

Total other expenses
107,247

101,167

 
212,837

199,861

 
 
 
 
 
 
Gain on sale of operating properties, including land
—

1,447

 
85,192

1,801

Impairment associated with land holdings
—

(1,152
)
 
—

(1,152
)
Equity in income of joint ventures
1,531

736

 
2,913

5,026

Income from continuing operations before income taxes
37,608

36,685

 
159,102

78,232

Income tax expense
(407
)
(401
)
 
(836
)
(875
)
Net income
37,201

36,284

 
158,266

77,357

Less income allocated to non-controlling interests from continuing operations
(1,122
)
(1,012
)
 
(6,588
)
(2,049
)
Net income attributable to common shareholders

$36,079


$35,272

 

$151,678


$75,308

 
 
 
 
 
 
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
 
 
 
 
 
Net income
$37,201
$36,284
 
$158,266
$77,357
Other comprehensive income
 
 
 
 
 
Reclassification of net loss on cash flow hedging activities, prior service cost and net loss on post retirement obligation
37

14

 
74

29

Comprehensive income
37,238

36,298

 
158,340

77,386

Less income allocated to non-controlling interests from continuing operations
(1,122
)
(1,012
)
 
(6,588
)
(2,049
)
Comprehensive income attributable to common shareholders

$36,116


$35,286

 

$151,752


$75,337

 
 
 
 
 
 
PER SHARE DATA
 
 
 
 
 
Total earnings per common share – basic

$0.40


$0.40

 

$1.69


$0.85

Total earnings per common share – diluted
0.40

0.40

 
1.68

0.85

 
 
 
 
 
 
Weighted average number of common shares outstanding:
 
 
 
 
 
     Basic
89,153

87,845

 
89,071

87,748

     Diluted
90,252

88,972

 
90,496

88,899















Note: Please refer to the following pages for definitions and reconciliations of all non-GAAP financial measures presented in this document.

4


 
 
 
CAMDEN
 
FUNDS FROM OPERATIONS
 
 
(In thousands, except per share and property data amounts)
 
 
 
(Unaudited)
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2015
2014
 
2015
2014
FUNDS FROM OPERATIONS
 
 
 
 
 
 
 
 
 
 
 
Net income attributable to common shareholders

$36,079


$35,272

 

$151,678


$75,308

 Real estate depreciation from continuing operations
62,603

56,556

 
122,966

112,567

 Adjustments for unconsolidated joint ventures
2,237

1,326

 
4,482

2,640

 Income allocated to non-controlling interests
1,122

1,012

 
6,588

2,049

 Gain on sale of unconsolidated joint venture properties
—

—

 
—

(3,566
)
 Gain on sale of operating properties, net of tax
—

—

 
(85,145
)
—

     Funds from operations

$102,041


$94,166

 

$200,569


$188,998

 
 
 
 
 
 
     Less: recurring capitalized expenditures (a)
(19,233
)
(17,011
)
 
(30,494
)
(25,410
)
 
 
 
 
 
 
     Adjusted funds from operations - diluted

$82,808


$77,155

 

$170,075


$163,588

 
 
 
 
 
 
PER SHARE DATA
 
 
 
 
 
Funds from operations - diluted

$1.12


$1.05

 

$2.20


$2.10

Adjusted funds from operations - diluted
0.91

0.86

 
1.86

1.82

Distributions declared per common share
0.70

0.66

 
1.40

1.32

 
 
 
 
 
 
Weighted average number of common shares outstanding:
 
 
 
 
 
FFO/AFFO - diluted
91,338

90,058

 
91,307

89,985

 
 
 
 
 
 
PROPERTY DATA
 
 
 
 
 
Total operating properties (end of period) (b)
169

170

 
169

170

Total operating apartment homes in operating properties (end of period) (b)
58,680

59,963

 
58,680

59,963

Total operating apartment homes (weighted average)
51,762

52,709

 
51,660

52,684


(a) Capital expenditures necessary to help preserve the value of and maintain the functionality at our communities.

(b) Includes joint ventures and properties held for sale.






























Note: Please refer to the following pages for definitions and reconciliations of all non-GAAP financial measures presented in this document.


5


 
 
 
CAMDEN
 
BALANCE SHEET
 
 
(In thousands)
 
 
 
(Unaudited)
 
Jun 30,
2015

Mar 31,
2015

Dec 31,
2014

Sep 30,
2014

Jun 30,
2014

ASSETS
 
 
 
 
 
Real estate assets, at cost
 
 
 
 
 
Land

$1,034,649


$1,012,684


$1,003,422


$997,349


$985,444

Buildings and improvements
6,134,510

5,979,985

5,890,498

5,894,453

5,762,428

 
7,169,159

6,992,669

6,893,920

6,891,802

6,747,872

Accumulated depreciation
(1,860,923
)
(1,798,955
)
(1,738,862
)
(1,813,124
)
(1,755,086
)
Net operating real estate assets
5,308,236

5,193,714

5,155,058

5,078,678

4,992,786

Properties under development, including land
488,565

519,454

527,596

576,269

599,139

Investments in joint ventures
35,731

36,526

36,429

35,180

36,167

Properties held for sale
—

—

27,143

—

—

Total real estate assets
5,832,532

5,749,694

5,746,226

5,690,127

5,628,092

Accounts receivable – affiliates
25,855

25,652

25,977

25,954

26,501

Other assets, net (a)
120,082

122,326

124,888

123,999

114,002

Cash and cash equivalents
16,508

174,353

153,918

66,127

16,069

Restricted cash
5,791

5,034

5,898

5,769

5,424

Total assets
$6,000,768
$6,077,059
$6,056,907
$5,911,976
$5,790,088
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
LIABILITIES AND EQUITY
 
 
 
 
 
Liabilities
 
 
 
 
 
Notes payable
 
 
 
 
 
Unsecured
$1,770,491
$1,838,203
$1,837,911
$1,837,621
$1,769,287
Secured
904,196

904,914

905,628

906,328

930,952

Accounts payable and accrued expenses
128,532

134,438

157,232

147,255

122,307

Accrued real estate taxes
43,905

23,269

39,149

54,369

40,232

Distributions payable
64,253

64,261

60,386

60,265

59,770

Other liabilities (b)
100,515

102,163

100,058

94,230

90,944

Total liabilities
3,011,892

3,067,248

3,100,364

3,100,068

3,013,492

 
 
 
 
 
 
Commitments and contingencies
 
 
 
 
 
Non-qualified deferred compensation share awards
69,791

69,902

68,134

60,363

61,727

 
 
 
 
 
 
Equity
 
 
 
 
 
Common shares of beneficial interest
976

976

976

974

967

Additional paid-in capital
3,657,537

3,656,105

3,667,448

3,649,750

3,595,315

Distributions in excess of net income attributable to common shareholders
(426,614
)
(403,518
)
(453,777
)
(568,142
)
(550,050
)
Treasury shares, at cost
(387,172
)
(388,181
)
(396,626
)
(397,497
)
(398,474
)
Accumulated other comprehensive loss (c)
(2,345
)
(2,382
)
(2,419
)
(1,474
)
(1,077
)
Total common equity
2,842,382

2,863,000

2,815,602

2,683,611

2,646,681

Non-controlling interests
76,703

76,909

72,807

67,934

68,188

Total equity
2,919,085

2,939,909

2,888,409

2,751,545

2,714,869

Total liabilities and equity

$6,000,768


$6,077,059


$6,056,907


$5,911,976


$5,790,088

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(a) Includes net deferred charges of:

$11,921


$12,432


$13,219


$14,361


$12,747

 
 
 
 
 
 
(b) Includes deferred revenues of:

$843


$1,728


$1,848


$1,734


$1,070

 
 
 
 
 
 
(c) Represents the unrealized net loss and unamortized prior service costs on post retirement obligation, and unrealized loss on cash flow hedging activities.


6


 
 
CAMDEN
 
NON-GAAP FINANCIAL MEASURES
 
 
DEFINITIONS & RECONCILIATIONS
 
 
(In thousands, except per share amounts)
 
 
 
(Unaudited)

This document contains certain non-GAAP financial measures management believes are useful in evaluating an equity REIT's performance. Camden's definitions and calculations of non-GAAP financial measures may differ from those used by other REITs, and thus may not be comparable. The non-GAAP financial measures should not be considered as an alternative to net income as an indication of our operating performance, or to net cash provided by operating activities as a measure of our liquidity.

FFO
The National Association of Real Estate Investment Trusts (“NAREIT”) currently defines FFO as net income (computed in accordance with accounting principles generally accepted in the United States of America ("GAAP")), excluding gains (or losses) associated with previously depreciated operating properties, real estate depreciation and amortization, impairments of depreciable assets, and adjustments for unconsolidated joint ventures. Our calculation of diluted FFO also assumes conversion of all potentially dilutive securities, including certain non-controlling interests, which are convertible into common shares. We consider FFO to be an appropriate supplemental measure of operating performance because, by excluding gains or losses on dispositions of operating properties, and depreciation, FFO can assist in the comparison of the operating performance of a company’s real estate investments between periods or to different companies. A reconciliation of net income attributable to common shareholders to FFO is provided below:

Adjusted FFO

In addition to FFO, we compute Adjusted FFO ("AFFO") as a supplemental measure of operating performance. AFFO is calculated utilizing FFO less recurring capital expenditures which are necessary to help preserve the value of and maintain the functionality at our communities. Definitions of recurring capital expenditures are subjective. Accordingly, there can be no assurance our basis for computing this non-GAAP measure is comparable with that of other REITs. A reconciliation of FFO to AFFO is provided below:
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2015
2014
 
2015
2014
Net income attributable to common shareholders

$36,079


$35,272

 

$151,678


$75,308

 Real estate depreciation and amortization
62,603

56,556

 
122,966

112,567

 Adjustments for unconsolidated joint ventures
2,237

1,326

 
4,482

2,640

 Income allocated to non-controlling interests
1,122

1,012

 
6,588

2,049

 Gain on sale of unconsolidated joint venture properties
—

—

 
—

(3,566
)
 Gain on sale of operating properties, net of tax
—

—

 
(85,145
)
—

Funds from operations

$102,041


$94,166

 

$200,569


$188,998

 
 
 
 
 
 
Less: recurring capitalized expenditures
(19,233
)
(17,011
)
 
(30,494
)
(25,410
)
 
 
 
 
 
 
Adjusted funds from operations

$82,808


$77,155

 

$170,075


$163,588

 
 
 
 
 
 
Weighted average number of common shares outstanding:
 
 
 
 
 
EPS diluted
90,252

88,972

 
90,496

88,899

FFO/AFFO diluted
91,338

90,058

 
91,307

89,985

 
 
 
 
 
 
Earnings per common share - diluted

$0.40


$0.40

 

$1.68


$0.85

FFO per common share - diluted

$1.12


$1.05

 

$2.20


$2.10

AFFO per common share - diluted

$0.91


$0.86

 

$1.86


$1.82

 
Expected FFO

Expected FFO is calculated in a method consistent with historical FFO, and is considered an appropriate supplemental measure of expected operating performance when compared to expected earnings per common share (EPS). A reconciliation of the ranges provided for diluted EPS to expected FFO per diluted share is provided below:
 
3Q15

Range
 
2015

Range
 
Low
High
 
Low
High
Expected earnings per common share - diluted

$0.38


$0.42

 

$2.45


$2.55

Expected real estate depreciation and amortization
0.70

0.70

 
2.75

2.75

Expected adjustments for unconsolidated joint ventures
0.03

0.03

 
0.10

0.10

Expected income allocated to non-controlling interests
0.01

0.01

 
0.10

0.10

(Gain) on sale of unconsolidated joint venture property
—

—

 
—

—

Realized (gain) on sale of operating properties
—

—

 
(0.93
)
(0.93
)
Expected FFO per share - diluted

$1.12


$1.16

 

$4.47


$4.57






Note: This table contains forward-looking statements. Please see the paragraph regarding forward-looking statements earlier in this document.

7


 
 
 
CAMDEN
 
NON-GAAP FINANCIAL MEASURES
 
 
DEFINITIONS & RECONCILIATIONS
 
 
(In thousands, except per share amounts)
 
 
 
(Unaudited)

Net Operating Income (NOI)

NOI is defined by the Company as total property income less property operating and maintenance expenses less real estate taxes. The Company considers NOI to be an appropriate supplemental measure of operating performance to net income attributable to common shareholders because it reflects the operating performance of our communities without allocation of corporate level property management overhead or general and administrative costs. A reconciliation of net income attributable to common shareholders to net operating income is provided below:
 
Three months ended June 30,
 
Six months ended June 30,
 
2015
2014
 
2015
2014
Net income attributable to common shareholders

$36,079


$35,272

 

$151,678


$75,308

Less: Fee and asset management
(1,618
)
(2,147
)
 
(3,181
)
(5,170
)
Less: Interest and other income
(141
)
(44
)
 
(201
)
(332
)
Less: Income/(loss) on deferred compensation plans
297

(2,018
)
 
(1,567
)
(2,699
)
Plus: Property management
6,082

5,853

 
12,044

11,692

Plus: Fee and asset management
1,121

1,247

 
2,197

2,506

Plus: General and administrative
11,582

10,534

 
21,330

20,079

Plus: Interest
24,411

22,746

 
49,023

45,879

Plus: Depreciation and amortization
63,728

57,953

 
125,258

115,349

Plus: Amortization of deferred financing costs
620

816

 
1,418

1,657

Plus: Expense/(benefit) on deferred compensation plans
(297
)
2,018

 
1,567

2,699

Less: Gain on sale of operating properties, including land
—

(1,447
)
 
(85,192
)
(1,801
)
Less: Impairment associated with land holdings
—

1,152

 
—

1,152

Less: Equity in income of joint ventures
(1,531
)
(736
)
 
(2,913
)
(5,026
)
Plus: Income tax expense
407

401

 
836

875

Plus: Income allocated to non-controlling interests from continuing operations
1,122

1,012

 
6,588

2,049

Net Operating Income (NOI)

$141,862


$132,612

 

$278,885


$264,217

 
 
 
 
 
 
"Same Property" Communities

$130,446


$123,151

 

$256,753


$244,899

Non-"Same Property" Communities
8,515

3,565

 
16,789

7,504

Development and Lease-Up Communities
2,162

31

 
3,338

30

Dispositions/Other
739

5,865

 
2,005

11,784

Net Operating Income (NOI)

$141,862


$132,612

 

$278,885


$264,217


EBITDA

EBITDA is defined by the Company as earnings before interest, taxes, depreciation and amortization, excluding equity in (income) loss of joint ventures, (gain) loss on sale of unconsolidated joint venture interests, gain on acquisition of controlling interest in joint ventures, gain on sale of operating properties including land, net of tax, and income (loss) allocated to non-controlling interests. The Company considers EBITDA to be an appropriate supplemental measure of operating performance to net income attributable to common shareholders because it represents income before non-cash depreciation and the cost of debt, and excludes gains or losses from property dispositions. A reconciliation of net income attributable to common shareholders to EBITDA is provided below:
 
Three months ended June 30,
 
Six months ended June 30,
 
2015
2014
 
2015
2014
Net income attributable to common shareholders

$36,079


$35,272

 

$151,678


$75,308

Plus: Interest
24,411

22,746

 
49,023

45,879

Plus: Amortization of deferred financing costs
620

816

 
1,418

1,657

Plus: Depreciation and amortization
63,728

57,953

 
125,258

115,349

Plus: Income allocated to non-controlling interests from continuing operations
1,122

1,012

 
6,588

2,049

Plus: Income tax expense
407

401

 
836

875

Less: Gain on sale of operating properties, including land
—

(1,447
)
 
(85,192
)
(1,801
)
Less: Impairment associated with land holdings
—

1,152

 
—

1,152

Less: Equity in income of joint ventures
(1,531
)
(736
)
 
(2,913
)
(5,026
)
EBITDA

$124,836


$117,169

 

$246,696


$235,442



8