EX-99.1 2 a5745777ex99_1.htm EXHIBIT 99.1

EXHIBIT 99.1

Camden Property Trust Announces Second Quarter 2008 Operating Results

HOUSTON--(BUSINESS WIRE)--Camden Property Trust (NYSE:CPT) announced that its funds from operations (“FFO”) for the second quarter of 2008 totaled $0.94 per diluted share or $54.9 million, as compared to $0.92 per diluted share or $57.8 million for the same period in 2007. FFO for the six months ended June 30, 2008 totaled $1.83 per diluted share or $107.2 million, as compared to $1.81 per diluted share or $113.7 million for the same period in 2007. FFO for the three and six months ended June 30, 2008 included a $0.04 per diluted share impact from gains related to repurchase of unsecured senior notes.

Net Income (“EPS”)

The Company reported net income (“EPS”) of $17.3 million or $0.31 per diluted share for the second quarter of 2008, as compared to $42.6 million or $0.71 per diluted share for the same period in 2007. EPS for the three months ended June 30, 2008 included a $0.15 per diluted share impact from gain on sale of discontinued operations, and a $0.04 per diluted share impact from gains related to repurchase of unsecured senior notes. EPS for the three months ended June 30, 2007 included a $0.52 per diluted share impact from gain on sale of discontinued operations.

For the six months ended June 30, 2008, net income totaled $32.2 million or $0.58 per diluted share, as compared to $55.6 million or $0.93 per diluted share for the same period in 2007. EPS for the six months ended June 30, 2008 included a $0.28 per diluted share impact from gain on sale of properties including discontinued operations, and a $0.04 per diluted share impact from gains related to repurchase of unsecured senior notes. EPS for the six months ended June 30, 2007 included a $0.52 per diluted share impact from gain on sale of properties including discontinued operations.

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

Same-Property Results

For the 42,166 apartment homes included in consolidated same-property results, second quarter 2008 same-property net operating income (“NOI”) increased 0.8% compared to the second quarter of 2007, with revenues increasing 1.6% and expenses increasing 3.0%. On a sequential basis, second quarter 2008 same-property NOI increased 1.7% compared to the first quarter of 2008, with revenues increasing 1.8% and expenses increasing 2.1% compared to the prior quarter. Same-property physical occupancy levels for the portfolio averaged 94.6% during the second quarter of 2008, compared to 94.8% in the second quarter of 2007 and 93.8% in the first quarter of 2008.

The Company defines same-property communities as communities owned and stabilized as of January 1, 2007, excluding properties held for sale and communities under redevelopment. 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.

Development Activity

During the second quarter, lease-up was completed at Camden Monument Place in Fairfax, VA, a $62.7 million project that is currently 96% occupied, and Camden Plaza in Houston, TX, a $40.8 million joint venture project that is currently 93% occupied. As of June 30, 2008, Camden had five wholly-owned apartment communities which were completed and in lease-up: Camden Royal Oaks in Houston, TX, a $21.0 million project that is currently 94% leased; Camden City Centre in Houston, TX, a $51.6 million project that is currently 93% leased; Camden Potomac Yard in Arlington, VA, a $104.2 million project that is currently 63% leased; Camden Summerfield in Landover, MD, a $62.0 million project that is currently 57% leased; and Camden Orange Court in Orlando, FL, a $45.1 million project that is currently 44% leased.

The Company has five additional communities currently under construction and in lease-up: Camden Dulles Station in Oak Hill, VA, a $77.0 million project that is currently 30% leased; Camden Cedar Hills in Austin, TX, a $27.0 million project that is currently 47% leased; Camden Whispering Oaks in Houston, TX, a $30.0 million project that is currently 32% leased; Camden College Park in College Park, MD, a $139.9 million joint venture project that is currently 56% leased; and Camden Main & Jamboree in Irvine, CA, a $115.0 million joint venture project that is currently 65% leased.

Camden’s current development pipeline also includes three joint venture communities which are under construction but have not yet begun leasing. These projects comprise 807 apartment homes with a total budgeted cost of $121.8 million.

Camden’s future development pipeline currently consists of 18 potential developments comprising 5,855 apartment homes and a total estimated cost of $1.5 billion. The future pipeline represents projects in the early phase of development, for which Camden owns the land but has not yet begun construction.

Disposition Activity

During the quarter, the Company disposed of Oasis Sands, a 48-home apartment community in Las Vegas, NV and Camden Towne Village, a 188-home apartment community in Mesquite, TX for a total of $14.0 million, resulting in a gain on sale of $8.6 million. Subsequent to quarter-end, the Company completed the sales of: Camden Lakeview, a 476-home apartment community in Irving, TX; Camden Woodview, a 283-home apartment community in Austin, TX; Camden Briar Oaks, a 430-home apartment community in Austin, TX; and Camden Arbors, a 358-home apartment community in Westminster, CO. The four communities were sold for a total of $94.9 million.

Properties and Land Held for Sale

At June 30, 2008, Camden had two operating communities consisting of 834 apartment homes held for sale: Camden Lakeview, a 476-home apartment community in Irving, TX; and Camden Arbors, a 358-home apartment community in Westminster, CO. Both communities were disposed of subsequent to quarter-end.

The Company also had 4.6 acres of undeveloped land in Boca Raton, FL and Dallas, TX classified as held for sale at quarter-end.

Stock Repurchase

During the first quarter of 2008, Camden repurchased 690,400 common shares at an average price per share of $43.41, for a total of $30.0 million. No shares were repurchased during the second quarter of 2008. The Company has completed a total of $230.1 million of common share repurchases during 2007 and 2008.

Earnings Guidance

Camden’s earnings guidance for 2008 is based on its current and expected views of the apartment market and general economic conditions. Full-year 2008 FFO is expected to be $3.55 to $3.65 per diluted share, and full-year 2008 EPS is expected to be $0.72 to $0.82 per diluted share. The Company’s revised 2008 earnings guidance is based on projections of same-property revenue growth of 2.0% to 2.75%, expense growth of 4.25% to 5.25%, and NOI growth of 0.5% to 1.5%. Third quarter 2008 earnings guidance is $0.85 to $0.89 per diluted share for FFO and $0.06 to $0.10 per diluted share for EPS. Guidance for EPS excludes potential future gains on the sale of properties. Camden intends to update 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.

Conference Call

The Company will hold a conference call on Friday, August 1, 2008 at 10:00 a.m. Central Time to review its second quarter 2008 results and discuss its outlook for future performance. To participate in the call, please dial (800) 860-2442 (domestic) or (412) 858-4600 (international) by 9:50 a.m. Central Time and request the Camden Property Trust Second Quarter 2008 Earnings Call, 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 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.

About Camden

Camden Property Trust, an S&P 400 Company, is a real estate company engaged in the ownership, development, acquisition, management and disposition of multifamily apartment communities. Camden owns interests in and operates 178 properties containing 62,065 apartment homes across the United States. Upon completion of eight properties under development, the Company’s portfolio will increase to 64,518 apartment homes in 186 properties. Camden was recently named to FORTUNE® Magazine’s list of the “100 Best Companies to Work For.”

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

2008   2007 2008   2007
Property revenues
Rental revenues $ 139,628 $ 133,798 $ 276,951 $ 265,450
Other property revenues   19,488       15,989     37,179       30,426  
Total property revenues 159,116 149,787 314,130 295,876
 
Property expenses
Property operating and maintenance 41,464 38,293 81,852 76,338
Real estate taxes   18,237       16,892     35,919       32,722  
Total property expenses 59,701 55,185 117,771 109,060
 
Non-property income
Fee and asset management income 2,131 2,420 4,543 4,806
Interest and other income 1,092 1,810 2,425 3,372
Income on deferred compensation plans   (639 )     4,835     (9,180 )     7,141  
Total non-property income 2,584 9,065 (2,212 ) 15,319
 
Other expenses
Property management 5,281 4,800 10,181 9,528
Fee and asset management 1,696 811 3,421 2,431
General and administrative 8,414 7,912 16,374 15,966
Interest 33,378 29,243 66,044 57,003
Depreciation and amortization 43,983 38,905 86,288 77,627
Amortization of deferred financing costs 592 901 1,329 1,812
Expense on deferred compensation plans   (639 )     4,835     (9,180 )     7,141  
Total other expenses   92,705       87,407     174,457       171,508  

 

Income from continuing operations before gain on sale of properties, gains related to early retirement of debt, equity in income of joint ventures, minority interests and income taxes

9,294 16,260 19,690 30,627
Gain on sale of properties, including land - - 1,106 -
Gains related to early retirement of debt 2,298 - 2,298 -
Equity in income (loss) of joint ventures (474 ) 484 (521 ) 1,219
Minority interests
Distributions on perpetual preferred units (1,750 ) (1,750 ) (3,500 ) (3,500 )
Income allocated to common units and other minority interests   (1,126 )     (1,343 )   (2,395 )     (2,130 )
Income from continuing operations before income taxes 8,242 13,651 16,678 26,216
Income tax expense   (160 )     (316 )   (433 )     (2,221 )
Income from continuing operations 8,082 13,335 16,245 23,995
Income from discontinued operations 663 2,800 1,288 5,447
Gain on sale of discontinued operations 8,549 30,976 14,676 30,976
Income from discontinued operations allocated to common units   -       (4,519 )   -       (4,789 )
Net income $ 17,294     $ 42,592   $ 32,209     $ 55,629  
 

PER SHARE DATA

Net income - basic $ 0.31 $ 0.72 $ 0.58 $ 0.95
Net income - diluted 0.31 0.71 0.58 0.93
Income from continuing operations - basic 0.15 0.23 0.29 0.41
Income from continuing operations - diluted 0.15 0.22 0.29 0.40
 

Weighted average number of common and common equivalent shares outstanding:

Basic 55,351 58,894 55,158 58,854
Diluted 56,033 59,929 55,829 59,961
 

PROPERTY DATA

Total operating properties (end of period) (a) 182 186 182 186
Total operating apartment homes in operating properties (end of period) (a) 63,612 64,191 63,612 64,191
Total operating apartment homes (weighted average) 51,957 53,424 51,860 53,260
Total operating apartment homes - excluding discontinued operations (weighted average) 50,919 49,375 50,750 49,091
 
 
(a) 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.
CAMDEN FUNDS FROM OPERATIONS
(In thousands, except per share and property data amounts)
   
       
 
(Unaudited) Three Months Ended Six Months Ended
June 30, June 30,

FUNDS FROM OPERATIONS

2008   2007 2008   2007
 
Net income $ 17,294 $ 42,592 $ 32,209 $ 55,629
Real estate depreciation and amortization from continuing operations 43,088 38,213 84,530 76,220
Real estate depreciation from discontinued operations 321 1,191 817 2,790
Adjustments for unconsolidated joint ventures 1,715 1,225 3,254 2,311
Income from continuing operations allocated to common units 1,004 1,048 2,160 1,784
Income from discontinued operations allocated to common units - 4,519 - 4,789
(Gain) loss on sale of operating properties, net of taxes - - (1,106 ) 1,184
(Gain) on sale of discontinued operations   (8,554 )     (30,976 )   (14,666 )     (30,976 )

Funds from operations - diluted

$ 54,868     $ 57,812   $ 107,198     $ 113,731  
 

PER SHARE DATA

Funds from operations - diluted $ 0.94 $ 0.92 $ 1.83 $ 1.81
Cash distributions 0.70 0.69 1.40 1.38
 

Weighted average number of common and common equivalent shares outstanding:

FFO - diluted 58,612 62,914 58,578 62,967
 

PROPERTY DATA

Total operating properties (end of period) (a) 182 186 182 186
Total operating apartment homes in operating properties (end of period) (a) 63,612 64,191 63,612 64,191
Total operating apartment homes (weighted average) 51,957 53,424 51,860 53,260
Total operating apartment homes - excluding discontinued operations (weighted average) 50,919 49,375 50,750 49,091
 
 
(a) 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.

CAMDEN BALANCE SHEETS
(In thousands)
   
       
(Unaudited) Jun 30, Mar 31, Dec 31, Sep 30, Jun 30,
2008   2008   2007   2007   2007
ASSETS
Real estate assets, at cost
Land $ 755,200 $ 749,664 $ 730,548 $ 714,044 $ 713,084
Buildings and improvements   4,474,749       4,435,787       4,316,472       4,215,662       4,144,075  
5,229,949 5,185,451 5,047,020 4,929,706 4,857,159
Accumulated depreciation   (935,640 )     (907,643 )     (868,074 )     (827,944 )     (788,318 )
Net operating real estate assets 4,294,309 4,277,808 4,178,946 4,101,762 4,068,841
Properties under development, including land 333,419 358,994 446,664 488,620 454,617
Investments in joint ventures 14,773 12,526 8,466 12,243 12,722
Properties held for sale, including land   36,152       23,299       25,253       73,325       72,577  
Total real estate assets 4,678,653 4,672,627 4,659,329 4,675,950 4,608,757
Accounts receivable - affiliates 36,556 36,166 35,940 36,171 35,341
Notes receivable
Affiliates 53,849 52,331 50,358 48,172 45,560
Other 8,710 8,710 11,565 11,565 11,565
Other assets, net (a) 117,599 116,010 126,996 129,810 136,524
Cash and cash equivalents 1,242 947 897 1,207 3,058
Restricted cash   4,687       5,325       5,675       5,904       20,053  
Total assets $ 4,901,296     $ 4,892,116     $ 4,890,760     $ 4,908,779     $ 4,860,858  
 
 
 
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Notes payable
Unsecured $ 2,400,027 $ 2,351,006 $ 2,265,319 $ 2,198,628 $ 2,065,175
Secured 539,328 559,952 562,776 565,564 566,001
Accounts payable and accrued expenses 77,441 90,779 107,403 110,643 128,892
Accrued real estate taxes 30,664 17,769 24,943 42,151 29,785
Other liabilities (b) 129,471 146,817 136,365 117,317 115,547
Distributions payable   42,965       42,942       42,689       44,180       44,982  
Total liabilities 3,219,896 3,209,265 3,139,495 3,078,483 2,950,382
 
Commitments and contingencies
 
Minority interests
Perpetual preferred units 97,925 97,925 97,925 97,925 97,925
Common units 96,249 97,416 111,624 104,176 105,353
Other minority interests   8,572       8,537       10,403       10,740       10,916  
Total minority interests 202,746 203,878 219,952 212,841 214,194
 
Shareholders' equity
Common shares of beneficial interest 660 660 654 654 654
Additional paid-in capital 2,230,119 2,227,256 2,209,631 2,207,333 2,204,525
Distributions in excess of net income (272,294 ) (250,845 ) (227,025 ) (269,667 ) (241,711 )
Employee notes receivable (302 ) (306 ) (1,950 ) (1,963 ) (1,976 )
Treasury shares, at cost (463,574 ) (463,574 ) (433,874 ) (318,902 ) (265,210 )
Other comprehensive loss (c)   (15,955 )     (34,218 )     (16,123 )     -       -  
Total shareholders' equity   1,478,654       1,478,973       1,531,313       1,617,455       1,696,282  
Total liabilities and shareholders' equity $ 4,901,296     $ 4,892,116     $ 4,890,760     $ 4,908,779     $ 4,860,858  
 
 
 
(a) includes:
net deferred charges of: $ 9,434 $ 10,287 $ 10,811 $ 10,308 $ 11,565
value of in place leases of: - $ 62 $ 258 $ 703 $ 1,091
 
(b) includes:
deferred revenues of: $ 2,747 $ 2,575 $ 2,459 $ 2,738 $ 2,937
above/below market leases of: - ($6 ) ($13 ) $ 25 $ 43
distributions in excess of investments in joint ventures of: $ 26,022 $ 25,065 $ 23,653 $ 20,867 $ 19,549
fair value adjustment of derivative instrument: $ 15,955 $ 34,218 $ 16,123 - -
 
(c) Represents the fair value adjustment of the derivative instrument.
 

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 generally accepted accounting principles (“GAAP”), excluding gains or losses from 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,
2008 2007 2008 2007
Net income $ 17,294 $ 42,592 $ 32,209 $ 55,629
Real estate depreciation and amortization from continuing operations 43,088 38,213 84,530 76,220
Real estate depreciation from discontinued operations 321 1,191 817 2,790
Adjustments for unconsolidated joint ventures 1,715 1,225 3,254 2,311
Income from continuing operations allocated to common units 1,004 1,048 2,160 1,784
Income from discontinued operations allocated to common units - 4,519 - 4,789
(Gain) loss on sale of operating properties, net of taxes - - (1,106 ) 1,184
(Gain) on sale of discontinued operations   (8,554 )   (30,976 )   (14,666 )   (30,976 )
Funds from operations - diluted $ 54,868   $ 57,812   $ 107,198   $ 113,731  
 

Weighted average number of common and common equivalent shares outstanding:

EPS diluted 56,033 59,929 55,829 59,961
FFO diluted 58,612 62,914 58,578 62,967
 
Net income per common share - diluted $ 0.31 $ 0.71 $ 0.58 $ 0.93
FFO per common share - diluted $ 0.94 $ 0.92 $ 1.83 $ 1.81
 

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:
 
3Q08 Range 2008 Range
Low High Low High
 
Expected net income per share - diluted $ 0.06 $ 0.10 $ 0.72 $ 0.82
Expected difference between EPS and fully diluted FFO shares (0.01 ) (0.01 ) (0.03 ) (0.03 )
Expected real estate depreciation 0.74 0.74 2.94 2.94
Expected adjustments for unconsolidated joint ventures 0.03 0.03 0.12 0.12
Expected income allocated to common units 0.03 0.03 0.08 0.08
Expected (gain) on sale of properties and properties held for sale   0.00     0.00     (0.28 )   (0.28 )
Expected FFO per share - diluted $ 0.85 $ 0.89 $ 3.55 $ 3.65
 
 
 
Note: This table contains forward-looking statements. Please see the paragraph regarding forward-looking statements on page 1 of this document.
 
 

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,
2008 2007 2008 2007
Net income $ 17,294 $ 42,592 $ 32,209 $ 55,629
Fee and asset management income (2,131 ) (2,420 ) (4,543 ) (4,806 )
Interest and other income (1,092 ) (1,810 ) (2,425 ) (3,372 )
Income on deferred compensation plans 639 (4,835 ) 9,180 (7,141 )
Property management expense 5,281 4,800 10,181 9,528
Fee and asset management expense 1,696 811 3,421 2,431
General and administrative expense 8,414 7,912 16,374 15,966
Interest expense 33,378 29,243 66,044 57,003
Depreciation and amortization 43,983 38,905 86,288 77,627
Amortization of deferred financing costs 592 901 1,329 1,812
Expense on deferred compensation plans (639 ) 4,835 (9,180 ) 7,141
(Gain) loss on sale of properties, including land - - (1,106 ) -
Gains related to early retirement of debt (2,298 ) - (2,298 ) -
Equity in income (loss) of joint ventures 474 (484 ) 521 (1,219 )
Distributions on perpetual preferred units 1,750 1,750 3,500 3,500
Income allocated to common units and other minority interests 1,126 1,343 2,395 2,130
Income tax expense 160 316 433 2,221
Income from discontinued operations (663 ) (2,800 ) (1,288 ) (5,447 )
Gain on sale of discontinued operations (8,549 ) (30,976 ) (14,676 ) (30,976 )
Income from discontinued operations allocated to common units   -     4,519     -     4,789  
Net Operating Income (NOI) $ 99,415 $ 94,602 $ 196,359 $ 186,816
 
"Same Property" Communities $ 81,246 $ 80,579 $ 161,150 $ 159,483
Non-"Same Property" Communities 9,634 7,109 19,327 13,506
Development and Lease-Up Communities 726 (23 ) 1,004 (114 )
Redevelopment Communities 6,925 6,301 13,351 12,794
Dispositions / Other   884     636     1,527     1,147  
Net Operating Income (NOI) $ 99,415 $ 94,602 $ 196,359 $ 186,816
 
 

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,
2008 2007 2008 2007
Net income $ 17,294 $ 42,592 $ 32,209 $ 55,629
Interest expense 33,463 29,398 66,239 57,306
Amortization of deferred financing costs 592 901 1,329 1,812
Depreciation and amortization 43,983 38,905 86,288 77,627
Distributions on perpetual preferred units 1,750 1,750 3,500 3,500
Income allocated to common units and other minority interests 1,126 1,343 2,395 2,130
Income tax expense 160 316 433 2,221
Real estate depreciation and amortization from discontinued operations 325 1,196 826 2,800
(Gain) loss on sale of properties, including land - - (1,106 ) -
Gains related to early retirement of debt (2,298 ) - (2,298 ) -
Equity in income(loss) of joint ventures 474 (484 ) 521 (1,219 )
Gain on sale of discontinued operations (8,549 ) (30,976 ) (14,676 ) (30,976 )
Income from discontinued operations allocated to common units   -     4,519     -     4,789  
EBITDA $ 88,320 $ 89,460 $ 175,660 $ 175,619

CONTACT:
Camden Property Trust, Houston
Kim Callahan, 713-354-2549