EX-99.1 2 a4697106ex991.txt NEWS RELEASE Exhibit 99.1 Camden Property Trust Announces Second Quarter 2004 Operating Results HOUSTON--(BUSINESS WIRE)--Aug. 5, 2004--Camden Property Trust (NYSE:CPT) announced that its net income ("EPS") for the second quarter of 2004 was $7.7 million or $0.18 per diluted share compared to $5.9 million or $0.14 per diluted share for the same period in 2003. For the six months ended June 30, 2004, EPS totaled $17.0 million or $0.40 per diluted share compared to $14.2 million or $0.35 per diluted share for the same period in 2003. Funds from operations ("FFO") for the second quarter of 2004 totaled $0.79 per diluted share or $35.1 million, as compared to $0.75 per diluted share or $32.4 million reported for the same period in 2003. FFO for the six months ended June 30, 2004 totaled $1.63 per diluted share or $71.9 million, as compared to $1.54 per diluted share or $66.0 million reported for the same period in 2003. FFO for the six months ended June 30, 2004 included $1.7 million or $0.04 per diluted share related to an insurance settlement for lost rents related to a fire in one of Camden's communities in 2000, and $0.9 million or $0.02 per diluted share associated with the sale of an e-commerce investment that had previously been written off. 2003 FFO has been adjusted from amounts previously reported to include gains on sale of undepreciated property in accordance with the National Association of Real Estate Investment Trusts ("NAREIT") definition of FFO. A reconciliation of net income to FFO is included in the financial tables accompanying this press release. Physical occupancy levels averaged 94.3% during both the first and second quarters of 2004 as compared to 91.4% and 92.4% in the first and second quarters of 2003 respectively. For the 44,481 apartment homes included in "same-property" results, second quarter 2004 revenues increased 0.6% while operating expenses increased 2.8%, producing a 0.9% decline in same-property net operating income ("NOI") compared to the second quarter of 2003. On a sequential basis, second quarter 2004 same-property NOI declined 2.2% compared to first quarter 2004, with revenues declining 0.2% and expenses increasing 3.0% compared to the prior quarter. On a year-to-date basis, 2004 same-property NOI increased 1.2%, with a revenue increase of 1.8% and expense growth of 2.7% compared to the same period in 2003. A reconciliation of net income to net operating income and same-property net operating income is included in the financial tables accompanying this press release. During the quarter, lease-ups were completed at Camden Oak Crest in Houston, TX and Camden Sierra at Otay Ranch in Chula Vista, CA, and the properties are currently 93% and 95% occupied, respectively. The Company also completed construction at Camden Harbor View in Long Beach, CA during the quarter, and that community is currently 69% leased and 66% occupied. Construction continued on Camden Westwind in Ashburn, VA, Camden Lee Vista II in Orlando, FL and Camden Farmers Market II in Dallas, TX, with initial occupancies expected at all three communities during early to mid-2005. Camden Westwind is being developed in a joint venture format, with Camden retaining a 20% ownership interest. In addition, construction recently began on an additional phase at Camden Miramar in Corpus Christi, TX, which will add 126 student housing units to the existing community in time for the 2004 fall semester. The Company also acquired two tracts of undeveloped land in the Washington DC/Northern Virginia area during the quarter for approximately $29 million. Pre-development activities are currently underway on both sites, and Camden plans to develop two multifamily communities containing 747 apartment homes on those sites in late 2004 or early 2005. Subsequent to quarter-end, the Company issued $100 million of senior unsecured notes under its existing shelf registration. These five-year notes, rated Baa2 by Moody's and BBB by Standard & Poor's and Fitch, were issued at 99.841% of par value with a coupon of 4.70%. Interest on the notes is payable semi-annually on January 15 and July 15, and the notes will mature on July 15, 2009. The Company used the net proceeds to reduce the balance outstanding under its unsecured credit facility. Camden expects 2004 FFO between $3.15 and $3.30 per diluted share and 2004 EPS between $0.63 and $0.78 per diluted share, excluding any future gains from potential property sales. For 2004, 11 research analysts have contributed FFO estimates on CPT to First Call ranging from $3.10 to $3.30 per diluted share, for a mean of $3.25 per diluted share. The Company also provided guidance for the third quarter of 2004 of $0.75 to $0.80 per diluted share for FFO and $0.11 to $0.16 per diluted share for EPS. Camden updates its earnings guidance to the market on a quarterly basis. A reconciliation of expected net income to expected FFO is included in the financial tables accompanying this press release. The Company will hold a conference call on Friday, August 6, 2004 at 11:00 AM Central Time to review its second quarter results and discuss its outlook for future performance. To participate in the call, please dial (888) 482-0024 (domestic) or (617) 801-9702 (international) by 10:50 AM Central Time and request the Camden Property Trust Second Quarter Earnings Call, Conference Passcode #90094069, or join the live webcast of the conference call by accessing the Investor Relations section of the Company's website at www.camdenliving.com. Supplemental financial information is available in the Investor Relations section of the Company's website or by calling Camden's Investor Relations Department at (800) 922-6336. 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. Camden Property Trust is a real estate company engaged in the ownership, development, acquisition, management and disposition of multifamily apartment communities. Camden owns interests in and operates 145 properties containing 51,882 apartment homes in the Sunbelt and Midwestern markets from Florida to California. Upon completion of three properties under development and the expansion of an existing property, the Company's portfolio will increase to 53,122 apartment homes in 148 properties. For additional information, please contact Camden's Investor Relations Department at (800) 922-6336 or (713) 354-2787 or access our Web site at http://www.camdenliving.com. CAMDEN OPERATING RESULTS (In thousands, except per share and property data amounts) --------------------------------------------------------------------- (Unaudited) Three Months Ended Six Months Ended June 30, June 30, ------------------- -------------------- OPERATING DATA 2004 2003 2004 2003 -------------- ------------------- -------------------- Revenues Rental revenues $95,970 $91,600 $192,275 $181,701 Other property revenues 8,756 8,856 17,221 16,447 ------------------- -------------------- Total property revenues 104,726 100,456 209,496 198,148 ------------------- -------------------- Development and construction fees 2,071 1,257 3,832 2,593 Management fees 425 431 845 865 Other revenues 1,801 1,033 6,082 2,645 ------------------- -------------------- Total revenues 109,023 103,177 220,255 204,251 Expenses Property operating and maintenance 31,576 29,798 61,970 58,154 Real estate taxes 11,839 11,081 23,349 22,245 ------------------- -------------------- Total property expenses 43,415 40,879 85,319 80,399 ------------------- -------------------- Property management 2,742 2,424 5,611 4,961 Fee and asset management 1,006 1,068 1,995 2,631 General and administrative 4,140 4,437 8,326 8,048 Other expenses - 312 - 1,389 Interest 19,261 18,519 40,396 36,875 Amortization of deferred financing costs 719 639 1,483 1,265 Depreciation 26,541 26,417 53,150 52,346 ------------------- -------------------- Total expenses 97,824 94,695 196,280 187,914 ------------------- -------------------- Income before gain on sale of land, impairment loss on land held for sale, equity in income of joint ventures and minority interests 11,199 8,482 23,975 16,337 Gain on sale of land - 659 1,255 2,082 Impairment loss on land held for sale - - (1,143) - Equity in income of joint ventures 67 505 166 3,148 Income allocated to minority interests Distributions on units convertible into perpetual preferred shares (2,843) (3,218) (5,686) (6,436) Income allocated to units convertible into common shares (769) (520) (1,525) (889) ------------------- -------------------- Net income $7,654 $5,908 $17,042 $14,242 =================== ==================== FUNDS FROM OPERATIONS --------------------- Net income $7,654 $5,908 $17,042 $14,242 Real estate depreciation 26,126 25,896 52,246 51,285 Adjustments for unconsolidated joint ventures 525 524 1,047 1,059 (Gain) on sale of properties held in joint ventures - (451) - (1,436) Income allocated to units convertible into common shares 769 520 1,525 889 ------------------- -------------------- Funds from operations - diluted $35,074 $32,397 $71,860 $66,039 =================== ==================== PER SHARE DATA -------------- Net income - basic $0.19 $0.15 $0.42 $0.36 Net income - diluted 0.18 0.14 0.40 0.35 Funds from operations - diluted 0.79 0.75 1.63 1.54 Cash distributions 0.64 0.64 1.27 1.27 Weighted average number of common and common equivalent shares outstanding: Basic 40,291 39,218 40,161 39,191 Diluted 42,419 41,169 42,283 41,019 FFO - diluted 44,295 43,047 44,160 42,900 PROPERTY DATA --------------------------- Total operating properties (end of period) (a) 145 142 145 142 Total operating apartment homes in operating properties (end of period) (a) 51,882 50,762 51,882 50,762 Total operating apartment homes (weighted average) 47,013 46,218 46,962 46,065 (a) Includes joint venture investments. Note: Please refer to the following pages for definitions and reconciliations of all non-GAAP financial measures presented in this document. CAMDEN BALANCE SHEETS (In thousands) --------------------------------------------------------------------- (Unaudited) Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, 2004 2004 2003 2003 2003 ------------------------------------------------------- ASSETS Real estate assets, at cost Land $406,626 $404,113 $400,490 $397,006 $396,527 Buildings and improvements 2,573,099 2,538,193 2,499,214 2,462,252 2,437,833 ------------------------------------------------------- 2,979,725 2,942,306 2,899,704 2,859,258 2,834,360 Accumulated depreciation (653,581) (627,808) (601,688) (575,459) (549,769) ------------------------------------------------------- Net operating real estate assets 2,326,144 2,314,498 2,298,016 2,283,799 2,284,591 Properties under development, including land 163,326 156,466 189,119 236,529 242,682 Investment in joint ventures 10,371 10,754 11,033 9,994 10,247 Land held for sale 1,800 1,800 - - - ------------------------------------------------------- Total real estate assets 2,501,641 2,483,518 2,498,168 2,530,322 2,537,520 Accounts receivable - affiliates 29,981 28,984 25,997 7,141 6,736 Notes receivable Affiliates 9,665 9,335 9,017 - - Other 48,333 41,685 41,416 24,289 21,314 Other assets, net (a) 48,063 42,922 40,951 39,497 40,959 Cash and cash equivalents 1,922 3,836 3,357 2,341 1,550 Restricted cash 4,841 6,794 6,655 4,058 4,258 ------------------------------------------------------- Total assets $2,644,446 $2,617,074 $2,625,561 $2,607,648 $2,612,337 ======================================================= LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities Notes payable Unsecured $1,332,216 $1,291,074 $1,277,879 $1,248,852 $1,236,681 Secured 229,423 230,622 231,798 232,953 240,711 Accounts payable 31,309 26,112 26,150 24,025 34,580 Accrued real estate taxes 21,935 14,165 27,407 31,444 20,822 Accrued expenses and other liabilities 43,957 54,397 50,111 51,266 44,226 Distributions payable 31,038 30,974 30,946 30,698 30,663 ------------------------------------------------------- Total liabilities 1,689,878 1,647,344 1,644,291 1,619,238 1,607,683 Commitments and contingencies Minority interests Units convertible into perpetual preferred shares 149,815 149,815 149,815 149,815 149,815 Units convertible into common shares 44,884 45,711 46,570 47,382 48,354 ------------------------------------------------------- Total minority interests 194,699 195,526 196,385 197,197 198,169 Shareholders' equity Common shares of beneficial interest 485 484 483 481 480 Additional paid-in capital 1,344,366 1,340,564 1,330,512 1,321,103 1,320,045 Distributions in excess of net income (333,416) (314,720) (297,808) (281,256) (261,577) Unearned restricted share awards (15,384) (15,937) (11,875) (12,667) (15,477) Treasury shares, at cost (236,182) (236,187) (236,427) (236,448) (236,986) ------------------------------------------------------- Total shareholders' equity 759,869 774,204 784,885 791,213 806,485 ------------------------------------------------------- Total liabilities and shareholders' equity $2,644,446 $2,617,074 $2,625,561 $2,607,648 $2,612,337 ======================================================= (a) includes net deferred charges of: $8,756 $9,313 $9,558 $8,691 $9,268 CAMDEN NON-GAAP FINANCIAL MEASURES DEFINITIONS & RECONCILIATIONS (In thousands, except per share amounts) ---------------------------------------------------------------------- (Unaudited) This document contains certain non-GAAP financial measures that 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 generally accepted accounting principles ("GAAP"), excluding gains or losses from of depreciable operating property sales, plus real estate depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Camden's definition of diluted FFO also assumes conversion of all dilutive convertible securities, including minority interests, which are convertible into common equity. The Company considers FFO to be an appropriate supplemental measure of operating performance because, by excluding gains or losses on dispositions of operating properties and excluding depreciation, FFO can help one compare the operating performance of a company's real estate between periods or as compared to different companies. A reconciliation of net income to FFO is provided below: Three Months Ended Six Months Ended June 30, June 30, ------------------ ---------------- 2004 2003 (a) 2004 2003 (a) ------------------ ---------------- Net income $7,654 $5,908 $17,042 $14,242 Real estate depreciation 26,126 25,896 52,246 51,285 Adjustments for unconsolidated joint ventures 525 524 1,047 1,059 (Gain) on sale of properties held in joint ventures - (451) - (1,436) Income allocated to units convertible into common shares 769 520 1,525 889 ------------------ ---------------- Funds from operations - diluted $35,074 $32,397 $71,860 $66,039 ================== ================ Weighted average number of common and common equivalent shares outstanding: EPS diluted 42,419 41,169 42,283 41,019 FFO diluted 44,295 43,047 44,160 42,900 Net income per common share - diluted $0.18 $0.14 $0.40 $0.35 FFO per common share - diluted $0.79 $0.75 $1.63 $1.54 (a) FFO for the three months ended and six months ended June 30, 2003 previously included a reduction of $0.7 million and $2.1 million respectively from gains on sales of undepreciated property. We have adjusted FFO to include these types of gains as they currently do not meet NAREITs definition of gains that should be adjusted from net income in calculating FFO. 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 net income (EPS). A reconciliation of the ranges provided for expected net income per diluted share to expected FFO per diluted share is provided below: 3Q04 Range 2004 Range Low High Low High ------------------ ---------------- Expected net income per share - diluted $0.11 $0.16 $0.63 $0.78 Expected real estate depreciation 0.61 0.61 2.42 2.42 Expected adjustments for unconsolidated joint ventures 0.02 0.02 0.05 0.05 Expected income allocated to units convertible into common shares 0.01 0.01 0.05 0.05 ------------------ ---------------- Expected FFO per share - diluted $0.75 $0.80 $3.15 $3.30 Note: This table contains forward-looking statements. Please see the paragraph regarding forward-looking statements on preceding pages. 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 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 to net operating income is provided below: Three Months Ended Six Months Ended June 30, June 30, ------------------ ------------------ 2004 2003 2004 2003 ------------------ ------------------ Net income $7,654 $5,908 $17,042 $14,242 Development and construction fees (2,071) (1,257) (3,832) (2,593) Management fees (425) (431) (845) (865) Other income (1,801) (1,033) (6,082) (2,645) Property management expense 2,742 2,424 5,611 4,961 Fee and asset management expense 1,006 1,068 1,995 2,631 General and administrative expense 4,140 4,437 8,326 8,048 Other expenses - 312 - 1,389 Interest expense 19,261 18,519 40,396 36,875 Amortization of deferred financing costs 719 639 1,483 1,265 Depreciation 26,541 26,417 53,150 52,346 Gain on sale of land - (659) (1,255) (2,082) Impairment loss on land held for sale - - 1,143 - Equity in income of joint ventures (67) (505) (166) (3,148) Distributions on units convertible into perpetual preferred shares 2,843 3,218 5,686 6,436 Income allocated to units convertible into common shares 769 520 1,525 889 ------------------ ------------------ Net Operating Income (NOI) $61,311 $59,577 $124,177 $117,749 "Same Property" net operating income $56,797 $57,312 $114,899 $113,556 Non-"Same Property" net operating income 3,661 2,167 7,696 4,085 Development and Lease-Up net operating income 903 107 1,605 110 Dispositions / Other net operating income (50) (9) (23) (2) ------------------ ------------------ Net Operating Income (NOI) $61,311 $59,577 $124,177 $117,749 EBITDA ------ EBITDA is defined by the Company as earnings before interest, taxes, depreciation and amortization, including net operating income from discontinued operations, excluding equity in income of joint ventures, gain on sale of real estate assets, and income allocated to minority interests. The Company considers EBITDA to be an appropriate supplemental measure of operating performance to net income 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 to EBITDA is provided below: Three Months Ended Six Months Ended June 30, June 30, ------------------ ------------------ 2004 2003 2004 2003 ------------------ ------------------ Net income $7,654 $5,908 $17,042 $14,242 Interest expense 19,261 18,519 40,396 36,875 Amortization of deferred financing costs 719 639 1,483 1,265 Depreciation 26,541 26,417 53,150 52,346 Distributions on units convertible into perpetual preferred shares 2,843 3,218 5,686 6,436 Income allocated to units convertible into common shares 769 520 1,525 889 Gain on sale of land - (659) (1,255) (2,082) Impairment loss on land held for sale - - 1,143 - Equity in income of joint ventures (67) (505) (166) (3,148) ------------------ ------------------ EBITDA $57,720 $54,057 $119,004 $106,823 CONTACT: Camden Property Trust, Houston Investor Relations Kim Callahan, 800-922-6336 or 713-354-2787 http://www.camdenliving.com