-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Ee7cIoIKYFt7auG6drquT+EtpCTNPIyRfM8jvDd4qf8wTPQ68eVC+2NEGwaq4C/+ plQhCJXen6/qyefsOfoNYQ== 0000910612-06-000036.txt : 20060209 0000910612-06-000036.hdr.sgml : 20060209 20060209154259 ACCESSION NUMBER: 0000910612-06-000036 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20060208 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20060209 DATE AS OF CHANGE: 20060209 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CBL & ASSOCIATES PROPERTIES INC CENTRAL INDEX KEY: 0000910612 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 621545718 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-12494 FILM NUMBER: 06592939 BUSINESS ADDRESS: STREET 1: 2030 HAMILTON PLACE BVLD, SUITE 500 STREET 2: CBL CENTER CITY: CHATTANOOGA STATE: TN ZIP: 37421 BUSINESS PHONE: 4238550001 MAIL ADDRESS: STREET 1: 2030 HAMILTON PLACE BVLD, SUITE 500 STREET 2: CBL CENTER CITY: CHATTANOOGA STATE: TN ZIP: 37421 8-K 1 form8k.txt FORM 8K RESULTS OF OPERATIONS UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 Date of report (Date of earliest event reported): February 8, 2006 CBL & ASSOCIATES PROPERTIES, INC. (Exact Name of Registrant as Specified in its Charter) Delaware 1-12494 62-154718 (State or Other (Commission File (I.R.S. Employer Jurisdiction of Incorporation) Number) Identification No.) Suite 500, 2030 Hamilton Place Blvd, Chattanooga, TN 37421 (Address of principal executive office, including zip code) (423) 855-0001 (Registrant's telephone number, including area code) N/A (Former name, former address and former fiscal year, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) 1 ITEM 2.02 Results of Operations and Financial Condition On February 8, 2006, CBL & Associates Properties, Inc. (the "Company") reported its results for the three months and year ended December 31, 2005. The Company's earnings release for the three months and year ended December 31, 2005 is attached as Exhibit 99.1. On February 9, 2006, the Company held a conference call to discuss the results for the three months and year ended December 31, 2005. The transcript of the conference call is attached as Exhibit 99.2. The Company has posted to its website certain supplemental financial and operating information for the three months and year ended December 31, 2005, which is attached as Exhibit 99.3. The information in this Form 8-K and the Exhibits attached hereto shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act 1933, except as shall be expressly set forth by specific reference in such filing. Item 9.01 Financial Statements and Exhibits (a) Financial Statements of Businesses Acquired Not applicable (b) Pro Forma Financial Information Not applicable (c) Exhibits Exhibit Number Description 99.1 Earnings Release - CBL & Associates Properties Reports Fourth Quarter And Annual 2005 Results 99.2 Investor Conference Call Script - Three Months And Year Ended December 31, 2005 99.3 Supplemental Financial and Operating Information - For the Three Months and Year Ended December 31, 2005 2 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. CBL & ASSOCIATES PROPERTIES, INC. /s/ John N. Foy -------------------------------------- John N. Foy Vice Chairman, Chief Financial Officer and Treasurer Date: February 9, 2006 EX-99 3 pressrelease.txt EXHIBIT 99.1 PRESS RELEASE Exhibit 99.1 [CBL & ASSOCIATES PROPERTIES LETTERHEAD] Contact: Katie Reinsmidt Director, Investor Relations (423) 855-0001 CBL & ASSOCIATES PROPERTIES REPORTS FOURTH QUARTER AND ANNUAL 2005 RESULTS o 2005 FFO per share up 23.2% to $3.34 per share. o FFO per share rose 6.0% to $0.89 in the fourth quarter. o Same-center NOI for the quarter and year ended December 31, 2005, rose 3.1% and 5.8%, respectively. o Same store sales improved by 4.1% in 2005. o Portfolio occupancy rose 50bps to 94.5% as of December 31, 2005. CHATTANOOGA, Tenn. (February 8, 2006) - CBL & Associates Properties, Inc. (NYSE:CBL) announced results for the fourth quarter and year ended December 31, 2005. A description of each non-GAAP financial measure and the related reconciliation to the comparable GAAP measure is located at the end of this news release. Per share amounts have been adjusted to reflect the two-for-one split of the Company's common shares, effective June 16, 2005. Net income available to common shareholders for the fourth quarter ended December 31, 2005, was $25,659,000 compared with $31,141,000 for the prior-year period, representing a decline of 17.6%. Net income available to common shareholders per diluted share was $0.40 in the fourth quarter ended December 31, 2005, compared with $0.48 for the prior-year period, representing a decline of 16.7%. Net income available to common shareholders for the quarter ended December 31, 2005, included a one-time charge of approximately $5.2 million for prepayment penalties and the write-off of unamortized deferred financing costs resulting from favorable refinancing completed in the quarter. Net income available to common shareholders for the year ended December 31, 2005, was $131,907,000 compared with $102,802,000 for the year ended December 31, 2004, representing an increase of 28.3%. On a diluted per share basis, net income available to common shareholders for the year ended December 31, 2005, was $2.03 compared with $1.61 in the prior year, representing an increase of 26.1%. Net income available to common shareholders for the year ended December 31, 2005, included gains and fee income of $39.8 million ($72.5 million before deduction for minority interest in earnings of the operating partnership) resulting from the recent transaction with Galileo America, LLC. Net income available to common shareholders for the year ended December 31, 2005, also included a one-time charge of approximately $5.2 million for prepayment penalties and the write-off of unamortized deferred financing costs resulting from favorable refinancing completed in the fourth quarter. Funds from operations (FFO) increased 7.3% to $103,883,000 for the fourth quarter of 2005 from $96,772,000 for the fourth quarter of 2004. FFO per share on a diluted, fully converted basis increased 6.0% to $0.89 for the fourth quarter of 2005 from $0.84 in the prior-year period. FFO increased 25.6% to $389,958,000 for the year ended December 31, 2005, from $310,405,000 for the year ended December 31, 2004. FFO per share increased 23.2% on a diluted, fully converted basis for the year ended December 31, 2005, to $3.34 from $2.71 per share in the prior year. FFO for the year ended December 31, 2005, included gains and fee income of $0.26 per share resulting from the recent transaction with Galileo America, LLC. FFO for the quarter and year ended December 31, 2005, included a one-time charge of approximately $0.045 per share for prepayment penalties and the write-off of unamortized deferred financing costs resulting from favorable refinancing completed in the quarter. -MORE- 1 CBL Reports Fourth Quarter Results Page 2 February 8, 2006 HIGHLIGHTS |X| Total revenues increased 16.9% in the fourth quarter 2005 to $262,611,000 from $224,700,000 in the prior-year period. Total revenues increased 16.3% in the year ended December 31, 2005, to $908,712,000 from $781,433,000 in 2004. |X| Same center net operating income for the portfolio improved for the quarter and year ended December 31, 2005, by 3.1% and 5.8%, respectively, compared with a 6.8% and 3.1% increase, respectively, for the prior-year periods. |X| Same-store sales for mall tenants of 10,000 square feet or less for stabilized malls for the year ended December 31, 2005, increased 4.1% to $331 per square foot for those tenants who have reported sales, compared with a 2.8% increase for the prior year period. |X| The debt-to-total-market capitalization ratio as of December 31, 2005, was 47.8% based on the common stock closing price of $39.51 and a fully converted common stock share count of 115,438,000 shares as of the same date. The debt-to-total-market capitalization ratio as of December 31, 2004, was 42.4% based on the split-adjusted common stock closing price of $38.175 and a fully converted common stock share count of 113,928,000 shares as of the same date. |X| Consolidated and unconsolidated variable rate debt of $1,086,000 represents 11.4% of the total market capitalization for the Company and 24.0% of the Company's share of total consolidated and unconsolidated debt. CBL's Chairman and Chief Executive Officer, Charles B. Lebovitz, said, "The combination of occupancy gains, healthy rental rate increases from leasing, continued growth in mall shop sales, and contributions from new developments and acquisitions led to an impressive performance in the fourth quarter and a strong finish for the year. The impressive results in 2005 are indicative of our opportunistic strategy that emphasizes sustainable long-term growth and financial discipline. We opened 2.5 million square feet of new developments and expansions during the year with initial unleveraged returns ranging from 9% - 11%. We also completed more than $1.0 billion of acquisitions, all of which were immediately accretive to earnings and were consistent with our strict investment criteria and strategic growth objectives. We deployed our capital efficiently to finance this growth on attractive terms. "Looking ahead, we are excited about the continued strength in our business and our focus on dominant regional malls in middle markets where we are well-positioned to take advantage of continuing population and employment growth." PORTFOLIO OCCUPANCY
December 31, 2005 2004 ------------- ------------- Portfolio occupancy 94.5% 94.0% Mall portfolio 94.4% 94.3% Stabilized malls (74) 94.7% 94.4% Non-stabilized malls (5) 89.4% 92.8% Associated centers (30) 94.1% 91.8% Community centers (6) 95.3% 94.0%
ACQUISITIONS In November, CBL announced that it had acquired a portfolio of three malls for a total consideration of $516.9 million. The acquired properties included Oak Park Mall in Overland Park (Kansas City), KS; Hickory Point Mall in Decatur, IL; and Eastland Mall in Bloomington, IL. CBL also announced in November that it had closed on the acquisition of Layton Hills Mall in Layton (Salt Lake City), UT. CBL acquired the mall for approximately $121.4 million. -MORE- 2 CBL Reports Fourth Quarter Results Page 3 February 8, 2006 OTHER SIGNIFICANT EVENTS In November, the Richard E. Jacobs Group, Inc. and CBL announced that they had formed a 50/50 joint venture to own Triangle Town Center and its associated and lifestyle centers, Triangle Town Place and Triangle Town Commons, in Raleigh, NC. The joint venture is valued at $283.5 million. Additionally, during the quarter CBL announced that it had closed on five separate ten-year fixed rate non-recourse loans totaling $452.0 million with a weighted average interest rate of 5.0%. The financings replaced seven loans totaling $289.5 million that had a weighted average interest rate of 7.0% and were maturing over the next 18-months. As a result of the early extinguishment of the loans, CBL incurred a one-time charge of approximately $5.2 million for prepayment penalties and the write-off of unamortized deferred financing costs, which was included in GAAP Net Income and FFO in the fourth quarter and year ended December 31, 2005. OUTLOOK AND GUIDANCE Based on today's outlook and the Company's fourth quarter results, the Company is providing guidance for 2006 FFO in the range of $3.28 to $3.33 per share. The full year guidance assumes same center NOI growth in the range of 2.5% to 3.5% and excludes the impact of any future unannounced acquisitions, lease termination fee income, gains on sales of outparcels, and gains on sales of non-operating properties. The Company expects to update its annual guidance after each quarter's results.
Low High -------- -------- Expected diluted earnings per common share $1.30 $1.35 Adjust to fully converted shares from common shares (0.59) (0.61) -------- -------- Expected earnings per diluted, fully converted common share 0.71 0.74 Add: depreciation and amortization 1.97 1.97 Add: minority interest in earnings of Operating Partnership 0.60 0.62 -------- -------- Expected FFO per diluted, fully converted common share $3.28 $3.33 ======== ========
INVESTOR CONFERENCE CALL AND SIMULCAST CBL & Associates Properties, Inc. will conduct a conference call at 10:00 a.m. EST on February 9, 2006, to discuss the fourth quarter results. The number to call for this interactive teleconference is 913-981-5532. A seven-day replay of the conference call will be available by dialing 719-457-0820 and entering the passcode 1458819. A transcript of the Company's prepared remarks will be furnished on a Form 8-K following the conference call. To receive the CBL & Associates Properties, Inc., fourth quarter earnings release and supplemental information please visit our website at cblproperties.com or contact Investor Relations at 423-490-8292. The Company will also provide an online Web simulcast and rebroadcast of its 2005 fourth quarter earnings release conference call. The live broadcast of CBL's quarterly conference call will be available online at the Company's Web site at cblproperties.com, as well as www.streetevents.com and www.earnings.com, on February 9, 2006, beginning at 10:00 a.m. EST. The online replay will follow shortly after the call and continue through February 23, 2006. CBL is one of the largest and most experienced owners and developers of malls and shopping centers in the country. CBL owns, holds interests in or manages 132 properties, including 79 regional malls/open-air centers. The properties are located in 26 states and total 74.0 million square feet including 2.0 million square feet of non-owned shopping centers managed for third parties. CBL currently has eleven projects under construction totaling 2.3 million square feet including Phase II of Gulf Coast Town Center in Ft. Myers, FL; two open-air shopping centers; a community center, two associated center and five expansions. In addition to its regional office in Boston (Waltham), MA, CBL's corporate office is located in Chattanooga, TN. Additional information can be found at cblproperties.com -MORE- 3 CBL Reports Fourth Quarter Results Page 3 February 8, 2006 NON-GAAP FINANCIAL MEASURES Funds From Operations FFO is a widely used measure of the operating performance of real estate companies that supplements net income determined in accordance with generally accepted accounting principles ("GAAP"). The National Association of Real Estate Investment Trusts defines FFO as net income (computed in accordance with GAAP) excluding gains or losses on sales of operating properties, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. The Company believes that FFO provides an additional indicator of the operating performance of the Company's properties without giving effect to real estate depreciation and amortization, which assumes the value of real estate assets decline predictably over time. Since values of well-maintained real estate assets have historically risen or fallen with market conditions, the Company believes that FFO enhances investors' understanding of the Company's operating performance. FFO does not represent cash flow from operations as defined by accounting principles generally accepted in the United States, is not necessarily indicative of cash available to fund all cash flow needs and should not be considered as an alternative to net income for purposes of evaluating the Company's operating performance or to cash flow as a measure of liquidity. Same-Center Net Operating Income Net operating income ("NOI") is a supplemental measure of the operating performance of the Company's shopping centers. The Company defines NOI as operating revenues (rental revenues, tenant reimbursements and other income) less property operating expenses (property operating, real estate taxes and maintenance and repairs). Similar to FFO, the Company computes NOI based on its pro rata share of both consolidated and unconsolidated properties. The Company's definition of NOI may be different than that used by other companies and, accordingly, the Company's NOI may not be comparable to that of other companies. A reconciliation of same-center NOI to net income is located at the end of this earnings release. Since NOI includes only those revenues and expenses related to the continuing operations of its shopping center properties, the Company believes that same-center NOI provides a measure that reflects trends in occupancy rates, rental rates and operating costs and the impact of those trends on the Company's results of operations. Pro Rata Share of Debt The Company presents debt based on its pro rata ownership share (including the Company's pro rata share of unconsolidated affiliates and excluding minority investors' share of consolidated properties) because it believes this provides investors a clearer understanding of the Company's total debt obligations which affect the Company's liquidity. A reconciliation of the Company's pro rata share of debt to the amount of debt on the Company's consolidated balance sheet is located at the end of this earnings release. Reclassification Certain prior period amounts in the consolidated statements of operations have been reclassified to present marketing fund revenues and expenses on a gross basis in accordance with Emerging Issues Task Force Issue No. 99-19, Reporting Revenue Gross as a Principal versus Net as an Agent. As a result, the following amounts in the consolidated statements of operations have changed from the previously reported amounts for the three months and year ended December 31, 2004: tenant reimbursements have increased by $9,533,000 and $27,281,000 respectively, other revenues have decreased by $789,000 and $3,093,000 respectively, and property operating expenses have increased by $8,744,000 and $24,188,000 respectively. This reclassification did not change previously reported amounts of net income available to common shareholders. Information included herein contains "forward-looking statements" within the meaning of the federal securities laws. Such statements are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual events, financial and otherwise, may differ materially from the events and results discussed in the forward-looking statements. The reader is directed to the Company's various filings with the Securities and Exchange Commission, including without limitation the Company's Annual Report on Form 10-K and the "Management's Discussion and Analysis of Financial Condition and Results of Operations" incorporated by reference therein, for a discussion of such risks and uncertainties. -MORE- 4 CBL Reports Fourth Quarter Results Page 5 February 8, 2006 CBL & Associates Properties, Inc. Consolidated Statements of Operations (Unaudited; in thousands, except per share amounts)
Three Months Ended Year Ended December 31, December 31, ------------------------ ------------------------ 2005 2004 2005 2004 ----------- ----------- ----------- ---------- REVENUES: Minimum rents $ 155,704 $ 133,782 $ 549,368 $ 476,568 Percentage rents 10,194 5,502 23,166 15,951 Other rents 9,354 8,776 17,674 16,102 Tenant reimbursements 78,754 69,718 278,498 246,016 Management, development and leasing fees 2,594 3,412 20,521 9,791 Other 6,011 3,510 19,485 17,005 ----------- ----------- ----------- ---------- Total revenues 262,611 224,700 908,712 781,433 ----------- ----------- ----------- ---------- EXPENSES: Property operating 42,782 38,277 151,280 139,349 Depreciation and amortization 49,564 38,700 179,651 142,012 Real estate taxes 20,741 15,494 68,116 58,066 Maintenance and repairs 13,909 11,879 50,559 43,527 General and administrative 10,556 10,832 39,197 35,338 Loss on impairment of real estate assets 1,072 3,080 1,334 3,080 Other 5,188 2,737 15,444 16,373 ----------- ----------- ----------- ---------- Total expenses 143,812 120,999 505,581 437,745 ----------- ----------- ----------- ---------- Income from operations 118,799 103,701 403,131 343,688 Interest income 617 933 6,831 3,355 Interest expense (56,361) (47,945) (208,183) (177,219) Loss on extinguishment of debt (5,243) - (6,171) - Gain on sales of real estate assets 2 2,970 53,583 29,272 Gain on sales of management contracts - - 21,619 - Equity in earnings of unconsolidated affiliates 1,726 3,355 8,495 10,308 Minority interest in earnings: Operating partnership (24,885) (25,688) (112,061) (85,186) Shopping center properties (1,218) (1,333) (4,879) (5,365) ----------- ----------- ----------- ---------- Income before discontinued operations 33,437 35,993 162,365 118,853 Operating income (loss) of discontinued operations (138) 209 192 1,413 Gain (loss) on discontinued operations 2 - (82) 845 ----------- ----------- ----------- ---------- Net income 33,301 36,202 162,475 121,111 Preferred dividends (7,642) (5,061) (30,568) (18,309) ----------- ----------- ----------- ---------- Net income available to common shareholders $ 25,659 $ 31,141 $ 131,907 $ 102,802 =========== =========== =========== ========== Basic per share data: Income before discontinued operations, net of preferred dividends $ 0.41 $ 0.50 $ 2.09 $ 1.63 Discontinued operations - - 0.01 0.04 ----------- ----------- ----------- ---------- Net income available to common shareholders $ 0.41 $ 0.50 $ 2.10 $ 1.67 =========== =========== =========== ========== Weighted average common shares outstanding 62,806 62,150 62,956 61,602 Diluted per share data: Income before discontinued operations, net of preferred dividends $ 0.40 $ 0.48 $ 2.02 $ 1.57 Discontinued operations - - 0.01 0.04 ----------- ----------- ----------- ---------- Net income available to common shareholders $ 0.40 $ 0.48 $ 2.03 $ 1.61 =========== =========== =========== ========== Weighted average common and potential dilutive common shares outstanding 64,717 64,588 65,115 64,004
5 CBL Reports Fourth Quarter Results Page 6 February 8, 2006 The Company's calculation of FFO is as follows (in thousands, except per share data):
Three Months Ended Year Ended December 31, December 31, ------------------------ ------------------------- 2005 2004 2005 2004 ---------- ----------- ----------- ---------- Net income available to common shareholders $ 25,659 $ 31,141 $131,907 $102,802 Add: Depreciation and amortization from consolidated properties 49,564 38,700 179,651 142,012 Depreciation and amortization from unconsolidated affiliates 3,083 1,539 9,210 6,144 Depreciation and amortization from discontinued operations 1,284 125 1,860 618 Minority interest in earnings of operating partnership 24,885 25,688 112,061 85,186 Less: (Gain) loss on sales of operating real estate assets 146 69 (42,562) (23,696) Minority investors' share of depreciation and amortization (428) (331) (1,390) (1,230) (Gain) loss on discontinued operations (2) - 82 (845) Depreciation and amortization of non-real estate assets (308) (159) (861) (586) ---------- ----------- ----------- ---------- Funds from operations $103,883 $ 96,772 $389,958 $310,405 ========== =========== =========== ========== Funds from operations applicable to Company shareholders $ 56,607 $ 53,028 $213,596 $169,725 ========== =========== =========== ========== Basic per share data: Funds from operations $ 0.90 $ 0.85 $ 3.41 $ 2.76 ========== =========== =========== ========== Weighted average common shares outstanding with operating partnership units fully converted 115,160 113,418 114,440 112,280 Diluted per share data: Funds from operations $ 0.89 $ 0.84 $ 3.34 $ 2.71 ========== =========== =========== ========== Weighted average common and potential dilutive common shares outstanding with operating partnership units fully converted 117,071 115,854 116,599 114,684 SUPPLEMENTAL FFO INFORMATION: Lease termination fees $ 1,892 $ 521 $ 5,540 $ 3,864 Lease termination fees per share $ 0.02 $ - $ 0.05 $ 0.03 Straight-line rental income $ 1,987 $ 484 $ 6,770 $ 2,684 Straight-line rental income per share $ 0.02 $ - $ 0.06 $ 0.02 Gains on outparcel sales $ 1,258 $ 1,226 $ 12,665 $ 3,449 Gains on outparcel sales per share $ 0.01 $ 0.01 $ 0.11 $ 0.03 Amortization of acquired above- and below-market leases $ 1,874 $ 1,280 $ 6,507 $ 3,656 Amortization of acquired above- and below-market leases per share $ 0.02 $ 0.01 $ 0.06 $ 0.03 Amortization of debt premiums $ 1,842 $ 1,698 $ 7,347 $ 5,418 Amortization of debt premiums per share $ 0.02 $ 0.01 $ 0.06 $ 0.05 Gain (loss) on sales of non operating properties $ (274) $ 2,965 $ 2,245 $ 4,285 Gain on sales of non operating properties per share $ - $ 0.03 $ 0.02 $ 0.04 Loss on impairment of real estate assets $ (1,072) $ (3,080) $ (1,334) $ (3,080) Loss on impairment of real estate assets per share $ (0.01) $ (0.03) $ (0.01) $ (0.03)
6 CBL Reports Fourth Quarter Results Page 7 February 8, 2006 Same-Center Net Operating Income (Dollars in thousands)
Three Months Ended Year Ended December 31, December 31, --------------------- -------------------- 2005 2004 2005 2004 ---------- ---------- --------- ---------- Net income $ 33,301 $ 36,202 $162,475 $121,111 Adjustments: Depreciation and amortization 49,564 38,700 179,651 142,012 Depreciation and amortization from unconsolidated affiliates 3,083 1,539 9,210 6,144 Depreciation and amortization from discontinued operations 1,284 125 1,860 618 Minority investors' share of depreciation and amortization in shopping center properties (428) (331) (1,390) (1,230) Interest expense 56,361 47,945 208,183 177,219 Interest expense from unconsolidated affiliates 3,514 2,433 12,583 7,169 Interest expense from discontinued operations - - - 20 Minority investors' share of interest expense in shopping center properties (799) (319) (1,959) (1,451) Loss on extinguishment of debt 5,243 - 6,171 53 Abandoned projects expense 86 400 560 3,714 Gain on sales of real estate assets and management contracts (2) (2,970) (75,202) (29,272) Loss on impairment of real estate assets 1,072 3,080 1,334 3,080 Gain on sales of real estate assets of unconsolidated affiliates (821) (1,147) (3,671) (1,886) Minority interest in earnings of operating partnership 24,885 25,688 112,061 85,186 (Gain) loss on discontinued operations (2) - 82 (845) ---------- ---------- --------- ---------- Operating partnership's share of total NOI 176,341 151,345 611,948 511,642 General and administrative expenses 10,556 10,832 39,197 35,338 Management fees and non-property level revenues (4,916) (5,322) (29,113) (17,878) ---------- ---------- --------- ---------- Operating partnership's share of property NOI 181,981 156,855 622,032 529,102 NOI of non-comparable centers (41,778) (20,886) (120,872) (55,577) ---------- ---------- --------- ---------- Total same center NOI $140,203 $135,969 $501,160 $473,525 ========== ========== ========= ========== Malls $130,365 $127,132 $ 463,475 $437,305 Associated centers 5,101 5,212 21,607 21,723 Community centers 1,166 771 4,668 3,976 Other 3,571 2,854 11,410 10,521 ---------- ---------- --------- ---------- Total same center NOI $140,203 $135,969 $501,160 $473,525 ========== ========== ========= ========== Percentage Change: Malls 2.5% 6.0% Associated centers -2.1% -0.5% Community centers 51.2% 17.4% Other 25.1% 8.4% ---------- --------- Total same center NOI 3.1% 5.8% ========== =========
7 CBL Reports Fourth Quarter Results Page 8 February 8, 2006 Company's Share of Consolidated and Unconsolidated Debt (Dollars in thousands)
December 31, 2005 ------------------------------------------------------ Fixed Rate Variable Rate Total ------------------- ------------- ------------------ Consolidated debt $ 3,281,939 $ 1,059,116 $ 4,341,055 Minority investors' share of consolidated debt (51,950) - (51,950) Company's share of unconsolidated affiliates' debt 216,026 26,600 242,626 ------------------- ------------- ------------------ Company's share of consolidated and unconsolidated debt $ 3,446,015 $ 1,085,716 $ 4,531,731 =================== ============= ================== Weighted average interest rate 5.99% 5.33% 5.83% =================== ============= ================== December 31, 2004 ------------------------------------------------------ Fixed Rate Variable Rate Total ------------------- ------------- ------------------ Consolidated debt $ 2,688,186 $ 683,493 $ 3,371,679 Minority investors' share of consolidated debt (52,914) - (52,914) Company's share of unconsolidated affiliates' debt 104,114 68,908 173,022 ------------------- ------------- ------------------ Company's share of consolidated and unconsolidated debt $ 2,739,386 $ 752,401 $ 3,491,787 =================== ============= ================== Weighted average interest rate 6.35% 3.44% 5.72% =================== ============= ==================
Debt-To-Total-Market Capitalization Ratio as of December 31, 2005 (In thousands, except stock price)
Shares Outstanding Stock Price (1) Value ------------------- ------------- ------------------ Common stock and operating partnership units 115,438 $ 39.51 $ 4,560,955 8.75% Series B Cumulative Redeemable Preferred Stock 2,000 $ 50.00 100,000 7.75% Series C Cumulative Redeemable Preferred Stock 460 $ 250.00 115,000 7.375% Series D Cumulative Redeemable Preferred Stock 700 $ 250.00 175,000 ------------------ Total market equity 4,950,955 Company's share of total debt 4,531,731 ------------------ Total market capitalization $ 9,482,686 ================== Debt-to-total-market capitalization ratio 47.8% ================== (1) Stock price for common stock and operating partnership units equals the closing price of the common stock on December 30, 2005. The stock price for the preferred stock represents the liquidation preference of each respective series of preferred stock.
Reconciliation of Shares and Operating Partnership Units Outstanding (In thousands)
Three Months Ended Year Ended December 31, December 31, ---------------------------------- --------------------------------- 2005: Basic Diluted Basic Diluted ------------- ------------------- ------------- ------------------ Weighted average shares - EPS 62,806 64,717 62,956 65,115 Weighted average operating partnership units 52,354 52,354 51,484 51,484 ------------- ------------------- ------------- ------------------ Weighted average shares- FFO 115,160 117,071 114,440 116,599 ============= =================== ============= ================== 2004: Weighted average shares - EPS 62,150 64,588 61,602 64,004 Weighted average operating partnership units 51,268 51,266 50,678 50,680 ------------- ------------------- ------------- ------------------ Weighted average shares- FFO 113,418 115,854 112,280 114,684 ============= =================== ============= ==================
Dividend Payout Ratio
Three Months Ended Year Ended December 31, December 31, ---------------------------------- --------------------------------- 2005 2004 2005 2004 ------------- ------------------- ------------- ------------------ Weighted average dividend per share $ 0.5478 $ 0.4094 $ 1.7769 $ 1.5012 FFO per diluted, fully converted share $ 0.89 $ 0.84 $ 3.34 $ 2.71 ------------- ------------------- ------------- ------------------ Dividend payout ratio 61.6% 48.7% 53.2% 55.4% ============= =================== ============= ==================
8 CBL Reports Fourth Quarter Results Page 9 February 8, 2006 Consolidated Balance Sheets (Preliminary and unaudited, in thousands)
December 31, December 31, 2005 2004 ------------ ------------ ASSETS Real estate assets: Land $ 776,989 $ 659,782 Buildings and improvements 5,698,669 4,670,462 ------------ ------------ 6,475,658 5,330,244 Less: accumulated depreciation (727,907) (575,464) ------------ ------------ 5,747,751 4,754,780 Real estate assets held for sale 63,168 61,607 Developments in progress 133,509 78,393 ------------ ------------ Net investment in real estate assets 5,944,428 4,894,780 Cash and cash equivalents 30,056 25,766 Receivables: Tenant, net of allowance 55,038 38,409 Other 6,235 13,706 Mortgage notes receivable 18,117 27,804 Investment in unconsolidated affiliates 84,138 84,782 Other assets 214,292 119,253 ------------ ------------ $6,352,304 $5,204,500 ============ ============ LIABILITIES AND SHAREHOLDERS' EQUITY Mortgage and other notes payable $4,341,055 $3,359,466 Mortgage notes payable on real estate assets held for sale - 12,213 Accounts payable and accrued liabilities 320,252 212,064 ------------ ------------ Total liabilities 4,661,307 3,583,743 ------------ ------------ Commitments and contingencies Minority interests 609,475 566,606 ------------ ------------ Shareholders' equity: Preferred stock, $.01 par value 32 32 Common stock, $.01 par value 625 626 Additional paid-in capital 1,037,764 1,025,479 Deferred compensation (8,895) (3,081) Other comprehensive income 288 - Retained earnings 51,708 31,095 ------------ ------------ Total shareholders' equity 1,081,522 1,054,151 ------------ ------------ $6,352,304 $5,204,500 ============ ============
9 EX-99 4 confcall.txt EXHIBIT 99.2 CONFERENCE CALL SCRIPT Exhibit 99.2 CBL & ASSOCIATES PROPERTIES, INC. CONFERENCE CALL, FOURTH QUARTER FEBRUARY 9, 2006 @ 10:00 AM EDT Stephen: Thank you and good morning. We appreciate your participation in the CBL & Associates Properties Inc., conference call to discuss fourth-quarter and year-end 2005 results. Joining me today is John Foy, the Company's Chief Financial Officer and Katie Reinsmidt, Director of Investor Relations who will begin by reading our Safe Harbor disclosure. Katie: This conference call contains "forward-looking statements" within the meaning of the federal securities laws. Such statements are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual results, financial and otherwise, may differ materially from the events and results discussed in the forward-looking statements. During our discussion today, references made to per share are adjusted to account for the 2-for1 stock split of the Company's common stock and based upon a fully diluted converted share. Also, references made to community centers are only those that are wholly owned or owned in partnerships by CBL & Associates Properties, Inc. We direct you to the Company's various filings with the Securities and Exchange Commission including, without limitation, the Company's Annual Report on Form 10-K and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included therein for a discussion of such risks and uncertainties. A transcript of today's comments including the earnings release and additional supplemental schedules will be furnished to the SEC on Form 8-K and will be available on our website. This call will also be available for replay on the Internet through a link on our website at cblproperties.com. This conference call is the property of CBL & Associates Properties, Inc. Any redistribution, retransmission or rebroadcast of this call without the express written consent of CBL is strictly prohibited. During this conference call, the Company may discuss non-GAAP financial measures as defined by SEC Regulation G. A description of each non-GAAP measure and a reconciliation of each non-GAAP financial measure to the comparable GAAP financial measure will be included in the earnings release on the Form 8-K. 1 Stephen: Thank you, Katie. In 2005, our focus and hard work paid off, allowing CBL to post another year of strong results. Through our investing activities we focused on creating and enhancing value in our properties. This value flowed through to our shareholders in the form of a 12.6% dividend increase and a one-time nine-cent special dividend. Our success in the year was the result of a number of factors: o We achieved strong internal growth through occupancy gains and rental rate increases. o We completed over $1.0 billion of value-added acquisitions and joint ventures that provide both near-term and long-term growth potential. o We opened a near record 2.5 million square feet of new developments and completed the timely and profitable sale of our Australian joint venture. Although we are proud of our accomplishments in 2005, we have already set our sights on achieving another year of strong growth in 2006. We realize that our performance over the years has only set the bar higher for future results and our goals and targets are focused on continuing this growth. We are committed to maintaining our proactive approach and building on our past accomplishments. DEVELOPMENT: - ------------ 2005 was a phenomenal year for CBL on the development front. We invested over $280.0 million in approximately 2.5 million square feet of new and redevelopment projects which opened in the year. Major developments included our first California property, Imperial Valley Mall in El Centro, CA; Phase I of Gulf Coast Town Center in Ft. Myers, FL, our joint venture development with the Richard E. Jacobs Group; Southaven Town Center located near Memphis, TN in Southaven, MS - which opened 100% leased and committed; as well as a number of other exciting projects. Going forward, we have announced over 1.6 million square feet of new developments and redevelopments scheduled to open in 2006, comprising a total investment of approximately $220 million. In addition, we have already announced nearly 1.9 million square feet of projects opening in 2007 and beyond and expect to announce additional projects in the coming months. In November, we celebrated both the Grand Opening of the 440,000 square foot Phase One and the ground breaking for Phase Two of Gulf Coast Town Center, in Ft. Myers, FL. Once completed, this development will feature a total of 1.7 million square feet of retail and restaurants. Phase Two contains approximately 740,000 square feet and includes the regions first Bass Pro Shop, as well as 2 JCPenney, Belk, Borders, Best Buy, Ross Dress For Less, with more tenant announcements to follow. Early in 2007, we will open a 156,000 square foot Costco with approximately 50,000 square feet of additional shops and restaurants following later that year. High Point Commons, our 297,000 square foot shopping center development in Harrisburg, PA is a 50/50 joint venture with High Real Estate Group of Lancaster, PA. The community center will feature Target and JCPenney as well as approximately 73,000 square feet of shop space. The project is scheduled to open in October 2006. In Stillwater, OK, we began construction on a 207,000 square foot community center, which will be anchored by Belk, Ross Dress for Less, Linens N' Things, and two additional junior anchor stores. The center will offer shoppers over 70,000 square feet of shop space and is scheduled to open in October 2006. Also under construction isThe Plaza at Fayette Mall, a 190,000 square foot associated center adjacent to Fayette Mall in Lexington, KY. Phase One of the project will include a 59,000 square foot 16-screen Cinemark Theater, approximately 14,000 square feet of small shop space and several restaurants. This project is expected to open in Summer 2006. Construction for Phase Two, comprising 117,000 square feet, will commence later this year. At our recently opened Southaven Towne Center, located just South of Memphis in Southaven, MS, we will open a 159,000 square foot Dillard's in March, followed by a 59,000 square foot Gordmans in April and a 15,000 square foot Books-A-Million later this year. We have announced several projects opening in 2007 and 2008, including The Shoppes at St. Clair Square in Fairview Heights, IL, where construction commenced in the fourth quarter. This 75,000 square foot associated center will be located next to the 1.1 million square foot St. Clair Square Mall and will open with retailers such as Barnes & Noble, Ann Taylor LOFT, Aveda, Chico's, Coldwater Creek, J. Jill, Joseph A. Banks, Talbots, and other exciting stores. The development is approximately 70% leased and committed and is scheduled to open in Spring 2007. Sitework has commenced for Alamance Crossing, an 870,000 square foot open-air center located in Burlington, NC. This development will feature six anchors and approximately 190,000 square feet of small shops and is scheduled to open in 2007. In 2008, we plan to open another open-air project. The 700,000 square foot Pearland Town Center will be located near Houston in Pearland, TX. This center will feature Dillard's and Macy's, several junior anchors and approximately 3 300,000 square feet of small shop space. This project will also include office, entertainment, hotel, and multi-family components. We have always placed a great deal of importance on keeping our malls fresh and up-to-date. In keeping with this, we recently announced a total of eight mall renovations to be completed in 2006. Including the previously announced renovation of CoolSprings Galleria in Nashville, TN, Chapel Hill Mall in Akron, OH; Harford Mall in Bel Air, MD; Honey Creek Mall in Terre Haute, IN; Madison Square in Huntsville, AL; Northpark Mall in Joplin, MO; Park Plaza in Little Rock, AR; and Wausau Center in Wausau, WI. Total renovation costs are estimated at $69.2 million. CoolSprings Galleria's renovation will be completed in May with the other malls finishing their upgrades this fall. LEASING: - -------- For 2005 we signed approximately 2.7 million square feet of leases in our operating portfolio, including 1.1 million square feet of new leases and 1.6 million square feet of renewal leases. This compares with 2.5 million square feet completed in 2004, of which 1.0 million square feet were new leases and 1.5 million square feet were renewals. In addition to the leasing completed in our operating portfolio, we also completed approximately 1.8 million square feet of leasing on development projects in 2005. This compares with approximately 1.6 million square feet of leasing on development projects in 2004. We disclose spreads in two different ways: total leasing and comparable space leasing. Both are for leases on shop space of 20,000 square feet and less. For total leasing, we achieved an average increase of 9.3% over the average base rent per square foot of expiring leases in the year. For comparable space leasing, we achieved an average increase of 6.5% over the average base rent per square foot in the prior leases. As a result of some of the comments we received from our analyst survey, we have implemented some changes to leasing information included in our supplemental package. We have removed the extraneous information while still providing a complete picture of our leasing activity. Maintaining high occupancy in our malls as well as the right mix of goods and services is very important in creating an inviting and exciting environment for our mall customers. In some cases retaining certain tenants in order to enhance the tenant mix is as important as growth in rental rates and as such can impact the renewal spreads in the short term. In our new leases we have been able to achieve substantial double-digit increases, which we believe is indicative of the strength of our malls. 4 Total portfolio occupancy at year-end 2005 increased 50 bps to 94.5% from 94.0% at the end of 2004. Stabilized mall occupancy at the end of 2005 was 94.7%, a 30 basis point increase over the close of 2004. Occupancy in the associated centers increased 240 basis points to 94.1% at year-end. BANKRUPTCY UPDATE: - ------------------ ICSC recently noted in their Retail Real Estate Business Conditions that store-closing announcements in 2005 were down 33% from the prior year making 2005 the lowest level since ICSC began compiling the data. This rang true in our portfolio as well. For 2005, 23 stores closed due to bankruptcy, representing 97,000 square feet and $1.1 million in annual base rent. Unfortunately, 2006 has started off with a number of significant bankruptcy filings. In January, Musicland filed for Chapter 11 bankruptcy protection. We currently have 53 Suncoast Motion Picture and Sam Goody stores comprising 179,000 square feet and $4.0 million in annual base rent. Musicland recently announced that they would be closing a number of stores and a Court approved list was issued. In our portfolio there were 21 stores comprising 81,400 square feet and $1.8 million in annual base rents included on the list. Three stores included on the list had lease expirations as of the end of January. As the Musicland filing does not come as a complete surprise to us, our leasing teams have been working for several months to find replacement tenants and have lined up retailers to take several locations. G+G Retail, the owner and operator of Rave, recently filed for bankruptcy protection. We currently have 42 Rave locations totaling 101,000 square feet and representing $2.3 million in annual base rent. Wet Seal and BCBG have announced that they are interested in acquiring the retailer. Wet Seal has done a great job of turning their company around and we view the possible acquisition by either retailer favorably. Although they did not file for bankruptcy protection, Retail Brand Alliance has closed their Casual Corner and Petite Sophisticate stores. We have 26 locations comprising 147,000 square feet and representing $3.4 million in annual base rent. RETAIL SALES - ------------ Holiday sales were healthy this season. Same store sales for 2005 for mall tenants 10,000 square feet or less in stabilized malls increased 4.1% over the prior year to an average of $331 per square foot. A number of our malls along the Gulf Coast benefited from increased demand resulting from the aftermath of the hurricanes. 5 Occupancy costs, as a percent of sales, were 11.8% for 2005, compared with 12.0% in 2004. I will now turn the call over to John for our financial review. JOHN: - ----- Thank you, Stephen. ACQUISITIONS: - ------------- As Stephen noted earlier, in 2005 we completed the acquisition and joint venture of seven malls totaling over $1.0 billion including approximately $780.0 million completed in the fourth quarter. As the acquisition environment has become more challenging, our strategy is to continue to maintain our focus on acquiring properties that are dominant in their markets and offer significant long-term growth potential. With the number of opportunities available to us in our existing portfolio of dominant mall properties, we believe we will be able to continue to garner significant growth through expansion and redevelopment. Oak Park Mall in Overland Park, KS, is a prime illustration of the potential available within our existing portfolio. The recent acquisition of Oak Park not only broadens our retailer base, but also presents a number of opportunities for additional near-term growth through new leasing, specialty leasing and sponsorships, as well as long-term growth through redevelopment and expansion. STOCK REPURCHASE PLAN: - ---------------------- In December, we completed our previously announced stock repurchase plan. In total, we have repurchased 1,371,034 shares at an average cost of $40.11 per share. We have retired these shares. FINANCIAL REVIEW: - ----------------- During the fourth quarter 2005, FFO per share increased 6.0% to $0.89 per share from $0.84 per share in the prior year period. For 2005, FFO per share increased 23.2% to $3.34 from $2.71 in the prior year period. As previously announced, we recorded a one-time charge of $5.2 million or $0.045 per share of FFO in prepayment penalties and write-off of unamortized deferred financing costs in the fourth quarter, as a result of favorable refinancing activity. Additionally, FFO per share for the year included approximately $30.0 million or $0.26 per share in one-time gains and fee income resulting from the recent transaction with Galileo America, LLC. Excluding the prepayment penalty and the gains from Galileo, FFO per share for 2005 would have increased 15.3% over the prior year 6 period. In 2005, excluding the prepayment penalty, 31% of the increase in FFO was attributable to internal sources and 69% from external sources. Additional highlights for the quarter and year included: o Same center NOI increased 3.1% for the quarter, and 5.8% for the year. o For the year, G&A represented approximately 4.3% of total revenues, compared with 4.5% in the prior year period. o Our cost recovery ratio was 103.2% for 2005 compared with 102.1% in the prior year period. o Our debt-to-total market capitalization ratio was 47.8% at the close of 2005 compared with 42.4% at the close of the prior year period. Variable rate debt represented approximately 11.5% of the total market capitalization at year-end and 24.0% of total debt. o Our EBITDA to interest coverage ratio at the end of 2005 was 2.87 times, compared with 2.85 times for the prior year period. o Outparcel sales were $0.01 in the quarter compared with $0.01 in the prior year period and $0.11 for 2005 as compared with $0.03 for the prior year period. o Gains on sales of non-operating properties were $0.00 in the fourth quarter and $0.03 in the year, compared with $0.02 and $0.04, respectively, in the prior year periods. Please note that we have reclassified certain prior period amounts in our consolidated financial statements of operations to present marketing fund revenues and expenses on a gross basis in accordance with Emerging Issues Task Force Issue No. 99-19, Reporting Revenue Gross as a Principal versus Net as an Agent. As a result, the following amounts in our consolidated statements of operations have changed from the previously reported amounts for the three months and year ended December 31, 2004: tenant reimbursements have increased by $9.5 million and $27.3 million, respectively, other revenues have decreased by $0.8 million and $3.1 million, respectively, and property operating expenses have increased by $8.7 million and $24.2 million, respectively. This reclassification did not change our previously reported amounts of net income available to common shareholders and funds from operations. GUIDANCE UPDATE: - ---------------- As indicated in our press release, we are providing an initial guidance range for 2006 FFO per share of $3.28 to $3.33 per share, which excludes the impact of any future unannounced acquisitions, lease termination fee income, gains on sales of outparcels, and gains on sales of non-operating properties. We expect 2006 same property NOI growth to be in the range of 2.5% to 3.5%. 7 CONCLUSION: - ----------- As we hear talk of a cutback in consumer spending and the effect that will have on malls, we would like to reiterate our continued confidence in our dominant mall strategy. Over the years, we have been extremely selective in choosing to acquire or build properties that are the foremost retail facility in a defined trade-area. In addition, we look for markets that are healthy, growing and boast a diverse employment base. Our properties are often in state capitals, university towns, or are a regional hub for healthcare and other services. They are well insulated from the boom or bust phenomenon created by the swings in the economy. Over the years, through various stages of economic health, our strategy has consistently been proven right and as a result we have been able to provide our shareholders with impressive growth. Despite this track record of success, there are still a few skeptics that continue to insist that our markets and properties are more susceptible to decline during an economic downturn. We have found that this simply isn't true. Our properties are an embedded and vital part of the communities they serve. We would like to invite everyone to join us for a tour of three of our market dominant properties on April 4th in Raleigh, North Carolina. We will be visiting Cary Town Center, Cross Creek Mall, and Triangle Town Center. Following the tour we will host a dinner featuring guest speaker, Bill Wilson, EVP of real estate and store planning for Belk Department Stores. We hope you all will have the opportunity to participate. Thank you again for joining us today, we appreciate your continued support and would now be happy to answer any questions you may have. EX-99 5 supplemental.txt EXHIBIT 99.3 SUPPLEMENTAL INFORMATION Exhibit 99.3 CBL & Associates Properties, Inc. Supplemental Financial and Operating Information For the Three Months and Year Ended December 31, 2005 Consolidated Statements of Operations (Unaudited; in thousands, except per share amounts)
Three Months Ended Year Ended December 31, December 31, ------------------------ ------------------------ 2005 2004 2005 2004 ----------- ----------- ----------- ---------- REVENUES: Minimum rents $ 155,704 $ 133,782 $ 549,368 $ 476,568 Percentage rents 10,194 5,502 23,166 15,951 Other rents 9,354 8,776 17,674 16,102 Tenant reimbursements 78,754 69,718 278,498 246,016 Management, development and leasing fees 2,594 3,412 20,521 9,791 Other 6,011 3,510 19,485 17,005 ----------- ----------- ----------- ---------- Total revenues 262,611 224,700 908,712 781,433 ----------- ----------- ----------- ---------- EXPENSES: Property operating 42,782 38,277 151,280 139,349 Depreciation and amortization 49,564 38,700 179,651 142,012 Real estate taxes 20,741 15,494 68,116 58,066 Maintenance and repairs 13,909 11,879 50,559 43,527 General and administrative 10,556 10,832 39,197 35,338 Loss on impairment of real estate assets 1,072 3,080 1,334 3,080 Other 5,188 2,737 15,444 16,373 ----------- ----------- ----------- ---------- Total expenses 143,812 120,999 505,581 437,745 ----------- ----------- ----------- ---------- Income from operations 118,799 103,701 403,131 343,688 Interest income 617 933 6,831 3,355 Interest expense (56,361) (47,945) (208,183) (177,219) Loss on extinguishment of debt (5,243) - (6,171) - Gain on sales of real estate assets 2 2,970 53,583 29,272 Gain on sales of management contracts - - 21,619 - Equity in earnings of unconsolidated affiliates 1,726 3,355 8,495 10,308 Minority interest in earnings: Operating partnership (24,885) (25,688) (112,061) (85,186) Shopping center properties (1,218) (1,333) (4,879) (5,365) ----------- ----------- ----------- ---------- Income before discontinued operations 33,437 35,993 162,365 118,853 Operating income (loss) of discontinued operations (138) 209 192 1,413 Gain (loss) on discontinued operations 2 - (82) 845 ----------- ----------- ----------- ---------- Net income 33,301 36,202 162,475 121,111 Preferred dividends (7,642) (5,061) (30,568) (18,309) ----------- ----------- ----------- ---------- Net income available to common shareholders $ 25,659 $ 31,141 $ 131,907 $ 102,802 =========== =========== =========== ========== Basic per share data: Income before discontinued operations, net of preferred dividends $ 0.41 $ 0.50 $ 2.09 $ 1.63 Discontinued operations - - 0.01 0.04 ----------- ----------- ----------- ---------- Net income available to common shareholders $ 0.41 $ 0.50 $ 2.10 $ 1.67 =========== =========== =========== ========== Weighted average common shares outstanding 62,806 62,150 62,956 61,602 Diluted per share data: Income before discontinued operations, net of preferred dividends $ 0.40 $ 0.48 $ 2.02 $ 1.57 Discontinued operations - - 0.01 0.04 ----------- ----------- ----------- ---------- Net income available to common shareholders $ 0.40 $ 0.48 $ 2.03 $ 1.61 =========== =========== =========== ========== Weighted average common and potential dilutive common shares outstanding 64,717 64,588 65,115 64,004
1 CBL & Associates Properties, Inc. Supplemental Financial and Operating Information For the Three Months and Year Ended December 31, 2005 The Company's calculation of FFO is as follows (in thousands, except per share data):
Three Months Ended Year Ended December 31, December 31, ------------------------ ------------------------- 2005 2004 2005 2004 ---------- ----------- ----------- ---------- Net income available to common shareholders $ 25,659 $ 31,141 $131,907 $102,802 Add: Depreciation and amortization from consolidated properties 49,564 38,700 179,651 142,012 Depreciation and amortization from unconsolidated affiliates 3,083 1,539 9,210 6,144 Depreciation and amortization from discontinued operations 1,284 125 1,860 618 Minority interest in earnings of operating partnership 24,885 25,688 112,061 85,186 Less: (Gain) loss on sales of operating real estate assets 146 69 (42,562) (23,696) Minority investors' share of depreciation and amortization (428) (331) (1,390) (1,230) (Gain) loss on discontinued operations (2) - 82 (845) Depreciation and amortization of non-real estate assets (308) (159) (861) (586) ---------- ----------- ----------- ---------- Funds from operations $103,883 $ 96,772 $389,958 $310,405 ========== =========== =========== ========== Funds from operations applicable to Company shareholders $ 56,607 $ 53,028 $213,596 $169,725 ========== =========== =========== ========== Basic per share data: Funds from operations $ 0.90 $ 0.85 $ 3.41 $ 2.76 ========== =========== =========== ========== Weighted average common shares outstanding with operating partnership units fully converted 115,160 113,418 114,440 112,280 Diluted per share data: Funds from operations $ 0.89 $ 0.84 $ 3.34 $ 2.71 ========== =========== =========== ========== Weighted average common and potential dilutive common shares outstanding with operating partnership units fully converted 117,071 115,854 116,599 114,684 SUPPLEMENTAL FFO INFORMATION: Lease termination fees $ 1,892 $ 521 $ 5,540 $ 3,864 Lease termination fees per share $ 0.02 $ - $ 0.05 $ 0.03 Straight-line rental income $ 1,987 $ 484 $ 6,770 $ 2,684 Straight-line rental income per share $ 0.02 $ - $ 0.06 $ 0.02 Gains on outparcel sales $ 1,258 $ 1,226 $ 12,665 $ 3,449 Gains on outparcel sales per share $ 0.01 $ 0.01 $ 0.11 $ 0.03 Amortization of acquired above- and below-market leases $ 1,874 $ 1,280 $ 6,507 $ 3,656 Amortization of acquired above- and below-market leases per share $ 0.02 $ 0.01 $ 0.06 $ 0.03 Amortization of debt premiums $ 1,842 $ 1,698 $ 7,347 $ 5,418 Amortization of debt premiums per share $ 0.02 $ 0.01 $ 0.06 $ 0.05 Gain (loss) on sales of non operating properties $ (274) $ 2,965 $ 2,245 $ 4,285 Gain on sales of non operating properties per share $ - $ 0.03 $ 0.02 $ 0.04 Loss on impairment of real estate assets $ (1,072) $ (3,080) $ (1,334) $ (3,080) Loss on impairment of real estate assets per share $ (0.01) $ (0.03) $ (0.01) $ (0.03)
2 CBL & Associates Properties, Inc. Supplemental Financial and Operating Information For the Three Months and Year Ended December 31, 2005 Same-Center Net Operating Income (Dollars in thousands)
Three Months Ended Year Ended December 31, December 31, --------------------- -------------------- 2005 2004 2005 2004 ---------- ---------- --------- ---------- Net income $ 33,301 $ 36,202 $162,475 $121,111 Adjustments: Depreciation and amortization 49,564 38,700 179,651 142,012 Depreciation and amortization from unconsolidated affiliates 3,083 1,539 9,210 6,144 Depreciation and amortization from discontinued operations 1,284 125 1,860 618 Minority investors' share of depreciation and amortization in shopping center properties (428) (331) (1,390) (1,230) Interest expense 56,361 47,945 208,183 177,219 Interest expense from unconsolidated affiliates 3,514 2,433 12,583 7,169 Interest expense from discontinued operations - - - 20 Minority investors' share of interest expense in shopping center properties (799) (319) (1,959) (1,451) Loss on extinguishment of debt 5,243 - 6,171 53 Abandoned projects expense 86 400 560 3,714 Gain on sales of real estate assets and management contracts (2) (2,970) (75,202) (29,272) Loss on impairment of real estate assets 1,072 3,080 1,334 3,080 Gain on sales of real estate assets of unconsolidated affiliates (821) (1,147) (3,671) (1,886) Minority interest in earnings of operating partnership 24,885 25,688 112,061 85,186 (Gain) loss on discontinued operations (2) - 82 (845) ---------- ---------- --------- ---------- Operating partnership's share of total NOI 176,341 151,345 611,948 511,642 General and administrative expenses 10,556 10,832 39,197 35,338 Management fees and non-property level revenues (4,916) (5,322) (29,113) (17,878) ---------- ---------- --------- ---------- Operating partnership's share of property NOI 181,981 156,855 622,032 529,102 NOI of non-comparable centers (41,778) (20,886) (120,872) (55,577) ---------- ---------- --------- ---------- Total same center NOI $140,203 $135,969 $501,160 $473,525 ========== ========== ========= ========== Malls $130,365 $127,132 $ 463,475 $437,305 Associated centers 5,101 5,212 21,607 21,723 Community centers 1,166 771 4,668 3,976 Other 3,571 2,854 11,410 10,521 ---------- ---------- --------- ---------- Total same center NOI $140,203 $135,969 $501,160 $473,525 ========== ========== ========= ========== Percentage Change: Malls 2.5% 6.0% Associated centers -2.1% -0.5% Community centers 51.2% 17.4% Other 25.1% 8.4% ---------- --------- Total same center NOI 3.1% 5.8% ========== =========
3 CBL & Associates Properties, Inc. Supplemental Financial and Operating Information For the Three Months and Year Ended December 31, 2005 Company's Share of Consolidated and Unconsolidated Debt (Dollars in thousands)
December 31, 2005 ------------------------------------------------------ Fixed Rate Variable Rate Total ------------------- ------------- ------------------ Consolidated debt $ 3,281,939 $ 1,059,116 $ 4,341,055 Minority investors' share of consolidated debt (51,950) - (51,950) Company's share of unconsolidated affiliates' debt 216,026 26,600 242,626 ------------------- ------------- ------------------ Company's share of consolidated and unconsolidated debt $ 3,446,015 $ 1,085,716 $ 4,531,731 =================== ============= ================== Weighted average interest rate 5.99% 5.33% 5.83% =================== ============= ================== December 31, 2004 ------------------------------------------------------ Fixed Rate Variable Rate Total ------------------- ------------- ------------------ Consolidated debt $ 2,688,186 $ 683,493 $ 3,371,679 Minority investors' share of consolidated debt (52,914) - (52,914) Company's share of unconsolidated affiliates' debt 104,114 68,908 173,022 ------------------- ------------- ------------------ Company's share of consolidated and unconsolidated debt $ 2,739,386 $ 752,401 $ 3,491,787 =================== ============= ================== Weighted average interest rate 6.35% 3.44% 5.72% =================== ============= ==================
Debt-To-Total-Market Capitalization Ratio as of December 31, 2005 (In thousands, except stock price)
Shares Outstanding Stock Price (1) Value ------------------- ------------- ------------------ Common stock and operating partnership units 115,438 $ 39.51 $ 4,560,955 8.75% Series B Cumulative Redeemable Preferred Stock 2,000 $ 50.00 100,000 7.75% Series C Cumulative Redeemable Preferred Stock 460 $ 250.00 115,000 7.375% Series D Cumulative Redeemable Preferred Stock 700 $ 250.00 175,000 ------------------ Total market equity 4,950,955 Company's share of total debt 4,531,731 ------------------ Total market capitalization $ 9,482,686 ================== Debt-to-total-market capitalization ratio 47.8% ================== (1) Stock price for common stock and operating partnership units equals the closing price of the common stock on December 30, 2005. The stock price for the preferred stock represents the liquidation preference of each respective series of preferred stock.
Reconciliation of Shares and Operating Partnership Units Outstanding (In thousands)
Three Months Ended Year Ended December 31, December 31, ---------------------------------- --------------------------------- 2005: Basic Diluted Basic Diluted ------------- ------------------- ------------- ------------------ Weighted average shares - EPS 62,806 64,717 62,956 65,115 Weighted average operating partnership units 52,354 52,354 51,484 51,484 ------------- ------------------- ------------- ------------------ Weighted average shares- FFO 115,160 117,071 114,440 116,599 ============= =================== ============= ================== 2004: Weighted average shares - EPS 62,150 64,588 61,602 64,004 Weighted average operating partnership units 51,268 51,266 50,678 50,680 ------------- ------------------- ------------- ------------------ Weighted average shares- FFO 113,418 115,854 112,280 114,684 ============= =================== ============= ==================
Dividend Payout Ratio
Three Months Ended Year Ended December 31, December 31, ---------------------------------- --------------------------------- 2005 2004 2005 2004 ------------- ------------------- ------------- ------------------ Weighted average dividend per share $ 0.5478 $ 0.4094 $ 1.7769 $ 1.5012 FFO per diluted, fully converted share $ 0.89 $ 0.84 $ 3.34 $ 2.71 ------------- ------------------- ------------- ------------------ Dividend payout ratio 61.6% 48.7% 53.2% 55.4% ============= =================== ============= ==================
4 CBL & Associates Properties, Inc. Supplemental Financial and Operating Information For the Three Months and Year Ended December 31, 2005 Consolidated Balance Sheets (Preliminary and unaudited, in thousands)
December 31, December 31, 2005 2004 ------------ ------------ ASSETS Real estate assets: Land $ 776,989 $ 659,782 Buildings and improvements 5,698,669 4,670,462 ------------ ------------ 6,475,658 5,330,244 Less: accumulated depreciation (727,907) (575,464) ------------ ------------ 5,747,751 4,754,780 Real estate assets held for sale 63,168 61,607 Developments in progress 133,509 78,393 ------------ ------------ Net investment in real estate assets 5,944,428 4,894,780 Cash and cash equivalents 30,056 25,766 Receivables: Tenant, net of allowance 55,038 38,409 Other 6,235 13,706 Mortgage notes receivable 18,117 27,804 Investment in unconsolidated affiliates 84,138 84,782 Other assets 214,292 119,253 ------------ ------------ $6,352,304 $5,204,500 ============ ============ LIABILITIES AND SHAREHOLDERS' EQUITY Mortgage and other notes payable $4,341,055 $3,359,466 Mortgage notes payable on real estate assets held for sale - 12,213 Accounts payable and accrued liabilities 320,252 212,064 ------------ ------------ Total liabilities 4,661,307 3,583,743 ------------ ------------ Commitments and contingencies Minority interests 609,475 566,606 ------------ ------------ Shareholders' equity: Preferred stock, $.01 par value 32 32 Common stock, $.01 par value 625 626 Additional paid-in capital 1,037,764 1,025,479 Deferred compensation (8,895) (3,081) Other comprehensive income 288 - Retained earnings 51,708 31,095 ------------ ------------ Total shareholders' equity 1,081,522 1,054,151 ------------ ------------ $6,352,304 $5,204,500 ============ ============
5 CBL & Associates Properties, Inc. Supplemental Financial and Operating Information For the Three Months and Year Ended December 31, 2005 The Company presents the ratio of earnings before interest, taxes, depreciation and amortization (EBITDA) to interest because the Company believes that the EBITDA to interest coverage ratio, along with cash flows from operating activities, investing activities and financing activities, provides investors an additional indicator of the Company's ability to incur and service debt. Ratio of EBITDA to Interest Expense (Dollars in thousands)
Three Months Ended Year Ended December 31, December 31, --------------------- --------------------- 2005 2004 2005 2004 ---------- --------- --------- ---------- EBITDA: Net Income $ 33,301 $ 36,202 $162,475 $121,111 Adjustments: Depreciation and amortization 49,564 38,700 179,651 142,012 Depreciation and amortization from unconsolidated affiliates 3,083 1,539 9,210 6,144 Depreciation and amortization from discontinued operations 1,284 125 1,860 618 Minority investors' share of depreciation and amortization in shopping center properties (428) (331) (1,390) (1,230) Interest expense 56,361 47,945 208,183 177,219 Interest expense from unconsolidated affiliates 3,514 2,433 12,583 7,169 Interest expense from discontinued operations - - - 20 Minority investors' share of interest expense in shopping center properties (799) (319) (1,959) (1,451) Income taxes 268 493 1,938 2,066 Loss on extinguishment of debt 5,243 - 6,171 - Loss on impairment of real estate assets 1,072 3,080 1,334 3,080 Abandoned projects expense 86 400 560 3,714 (Gain) loss on sales of operating real estate assets 146 69 (42,562) (23,696) Gain on sales management contracts - - (21,619) - Minority interest in earnings of operating partnership 24,885 25,688 112,061 85,186 (Gain) loss on discontinued operations (2) - 82 (845) ---------- --------- --------- ---------- Company's share of total EBITDA $177,578 $156,024 $628,578 $521,117 ========== ========= ========= ========== Interest Expense: Interest expense $ 56,361 $ 47,945 $ 208,183 $177,219 Interest expense from discontinued operations - - - 20 Interest expense from unconsolidated affiliates 3,514 2,433 12,583 7,169 Minority investors' share of interest expense in shopping center properties (799) (319) (1,959) (1,451) ---------- --------- --------- ---------- Company's share of total interest expense $ 59,076 $ 50,059 $ 218,807 $182,957 ========== ========= ========= ========== Ratio of EBITDA to Interest Expense 3.01 3.12 2.87 2.85 ========== ========= ========= ==========
Reconciliation of EBITDA to Cash Flows Provided By Operating Activities (In thousands)
Three Months Ended Year Ended December 31, December 31, ---------------------- ---------------------- 2005 2004 2005 2004 ---------- ---------- ---------- ---------- Company's share of total EBITDA $ 177,578 $ 156,024 $ 628,578 $ 521,117 Interest expense (56,361) (47,945) (208,183) (177,239) Minority investors' share of interest expense in shopping center properties 799 319 1,959 1,451 Income taxes (268) (493) (1,938) (2,066) Amortization of deferred financing costs and non-real estate 2,013 1,864 7,701 7,199 depreciation included in operating expense Amortization of debt premiums (1,842) (1,660) (7,347) (5,262) Amortization of above and below market leases (1,874) (1,240) (6,507) (3,515) Depreciation and interest expense from unconsolidated affiliates (6,597) (3,972) (21,793) (13,313) Minority investors' share of depreciation and amortization in 428 331 1,390 1,230 shopping center properties Minority interest in earnings - shopping center properties 1,218 1,333 4,879 5,365 Equity in earnings of unconsolidated affiliates (1,726) - (8,495) - Distributions of equity in earnings from unconsolidated affiliates 1,721 - 7,359 - Gains on outparcel sales (148) (3,048) (11,021) (5,887) Accelerated vesting of stock-based compensation - - 736 - Issuances of stock under incentive plan (242) 517 609 1,870 Amortization of deferred compensation 553 203 1,826 655 Accrual of deferred compensation 120 431 780 776 Changes in operating assets and liabilities 31,650 7,291 26,932 6,816 ---------- ---------- ---------- ---------- Cash flows provided by operating activities $ 147,022 $ 109,955 $ 417,465 $ 339,197 ========== ========== ========== ==========
6 CBL & Associates Properties, Inc. Supplemental Financial and Operating Information For the Three Months and Year Ended December 31, 2005 New and Renewal Leasing Activity of Same Small Shop Space Less Than 20,000 Square Feet Excluding Junior Anchors
New New Square Prior Base Initial Base % Change Average Base % Change Property Type Feet Rent PSF Rent PSF Initial Rent PSF Average - ----------------------- ------------ -------------- ----------- ---------- ----------- ----------- Quarter: Stabilized Malls 609,354 $ 24.15 $ 24.43 1.2% $ 24.87 3.0% Associated centers 15,723 15.88 20.40 28.5% 20.52 29.2% Community centers 8,469 18.76 18.51 -1.3% 18.51 -1.3% Other 3,942 12.50 13.59 8.7% 13.59 8.7% TOTAL 637,488 $ 23.80 $ 24.18 1.6% $ 24.61 3.4% Year To Date: Stabilized Malls 2,235,715 $ 25.18 $ 26.10 3.7% $ 26.72 6.1% Associated centers 101,624 13.54 16.91 24.9% 17.26 27.5% Community centers 54,469 16.56 16.67 0.7% 16.69 0.8% Other 8,364 15.69 17.66 12.5% 17.89 14.0% TOTAL 2,400,172 $ 24.46 $ 25.47 4.1% $ 26.06 6.5%
Stabilized Mall Leasing Activity of Same Small Shop Space Less Than 20,000 Square Feet Excluding Junior Anchors
New New Square Prior Base Initial Base % Change Average Base % Change Stabilized Malls Feet Rent PSF Rent PSF Initial Rent PSF Average - ----------------------- ------------ -------------- ----------- ---------- ----------- ----------- Quarter: New leases 196,454 $ 26.94 $ 28.03 4.0% $ 28.92 7.3% Renewal leases 412,900 22.82 22.72 -0.4% 22.95 0.6% 609,354 $ 24.15 $ 24.43 1.2% $ 24.87 3.0% Year To Date: New leases 730,243 $ 26.73 $ 28.97 8.4% $ 30.17 12.9% Renewal leases 1,505,470 24.43 24.72 1.2% 25.04 2.5% 2,235,713 $ 25.18 $ 26.10 3.7% $ 26.72 6.1%
Total Leasing Activity of All Small Shop Spaces Compared to Expiring Tenants of Small Shop Space Less Than 20,000 Square Feet Excluding Junior Anchors
% Change of Total Total Leased to Total Leased Total Expiring Expiring Leased Average Base Expiring Average Base Average Base Property Type Square Feet Rent PSF Square Feet Rent PSF Rent PSF - ----------------------- ------------ -------------- ----------- ---------- ------------------ Quarter: Stabilized Malls 672,349 $ 25.42 549,517 $ 24.27 4.8% Associated centers 35,103 15.94 28,978 14.32 11.3% Community centers 7,369 20.13 7,369 20.23 -0.5% Other 3,942 13.59 2,106 12.50 8.7% TOTAL 718,763 $ 24.84 587,970 $ 23.68 4.9% Year To Date: Stabilized Malls 2,469,878 $ 26.81 2,534,655 $ 24.50 9.4% Associated centers 125,354 16.36 116,488 14.04 16.5% Community centers 61,819 15.66 56,650 13.06 19.9% Other 12,205 18.24 6,827 17.04 7.0% TOTAL 2,669,256 $ 26.02 2,714,620 $ 23.80 9.3%
Total Leasing Activity of All Small Shop Spaces Compared to Expiring Tenants of Small Shop Space Less Than 20,000 Square Feet Excluding Junior Anchors
% Change Over Average % Change Average Expiring Base of New Leases Base Rent Leases Rent Renewal --------------------------- PFS of Average ------------------------- PSF of Average Average Base Expiring Base Average Base Expiring Base Square Feet Rent PSF Leases(1) Rent PSF Square Feet Rent PSF Renewals Rent PSF ------------ -------------- ----------- ---------- ----------- ------------ --------- --------- Quarter: Stabilized Malls 259,449 $ 29.35 $ 28.63 2.5% 412,900 $ 22.95 $ 22.82 0.6% Associated centers 25,375 14.29 14.72 -2.9% 9,728 20.24 13.51 49.8% Community centers 1,200 17.70 19.08 -7.2% 6,169 20.60 20.46 0.7% Other 1,836 13.33 N/A N/A 2,106 13.82 12.50 10.6% TOTAL 287,860 $ 27.88 $ 26.85 3.8% 430,903 $ 22.81 $ 22.52 1.3% Year To Date: Stabilized Malls 964,408 $ 29.56 $ 24.61 20.1% 1,505,470 $ 25.04 $ 24.43 2.5% Associated centers 74,002 16.42 14.18 15.8% 51,352 16.28 13.86 17.4% Community centers 23,000 18.12 14.99 20.9% 38,819 14.21 12.18 16.7% Other 7,951 18.01 17.68 1.8% 4,254 18.67 16.65 12.1% TOTAL 1,069,361 $ 28.32 $ 23.83 18.8% 1,599,895 $ 24.48 $ 23.77 3.0% (1) Excluding Renewals
Average Annual Base Rents Per Square Foot By Property Type of Small Shop Space Less Than 20,000 Square Feet Excluding Junior Anchors
As of December 31 --------------------------- 2005 2004 ------------ -------------- Stabilized Malls $ 26.87 $ 25.60 Non-stabilized Malls 27.41 26.33 Associated centers 10.55 9.77 Community centers 9.61 8.12 Other 19.33 19.10
7 CBL & Associates Properties, Inc. Supplemental Financial and Operating Information For the Three Months and Year Ended December 31, 2005 Schedule of Mortgage and Other Notes Payable as of December 31, 2005 (Dollars In thousands )
Balance Maturity Interest ------------------------- Location Property Date Rate Balance Fixed Variable - ----------------------- ---------------------------- --------- -------- ---------- -------- --------- Operating Properties: Layton, UT Layton Hills Mall Mar-06 5.290% $ 102,850 $ - $ 102,850 Chesapeake, VA Greenbrier Mall Apr-06 5.370% 92,650 - 92,650 Akron, OH Chapel Hill Mall May-06 5.320% 64,000 - 64,000 Akron, OH Chapel Hill Surburban May-06 5.370% 2,500 - 2,500 Midland, MI Midland Mall Jun-06 5.375% 30,000 - 30,000 Chattanooga, TN Hamilton Place Mar-07 7.000% 61,640 61,640 - Cincinnati, OH Eastgate Crossing Apr-07 6.380% 9,980 9,980 - Charleston, SC Citadel Mall May-07 7.390% 29,939 29,939 - Highpoint, NC Oak Hollow Mall Feb-08 7.310% 43,073 43,073 - Winston-Salem, NC Hanes Mall Jul-08 7.310% 105,990 105,990 - Nashville, TN Courtyard At Hickory Hollow Aug-08 6.770% 4,010 4,010 - Nashville, TN Hickory Hollow Mall Aug-08 6.770% 86,136 86,136 - Nashville, TN Rivergate Mall Aug-08 6.770% 69,614 69,614 - Nashville, TN Village At Rivergate Aug-08 6.770% 3,288 3,288 - Lansing, MI Meridian Mall Oct-08 4.520% 91,090 91,090 - Cary, NC Cary Towne Center Mar-09 6.850% 86,114 86,114 - Joplin, MO Northpark Mall Mar-09 5.500% 40,682 40,682 - Daytona Beach, FL Volusia Mall Mar-09 4.750% 53,721 53,721 - Fairview Heights, IL St. Clair Square Apr-09 7.000% 65,596 65,596 - Terre Haute, IN Honey Creek Mall Apr-09 4.750% 32,178 32,178 - Meridian, MS Bonita Lakes Crossing Oct-09 6.820% 8,081 8,081 - Meridian, MS Bonita Lakes Mall Oct-09 6.820% 25,789 25,789 - Cincinnati, OH Eastgate Mall (a) Dec-09 4.550% 56,335 56,335 - Little Rock, AR Park Plaza Mall May-10 4.900% 40,757 40,757 - Spartanburg, SC Westgate Crossing Jul-10 8.420% 9,483 9,483 - Burnsville, MN Burnsville Center Aug-10 8.000% 68,272 68,272 - Roanoke, VA Valley View Mall Sep-10 5.100% 43,840 43,840 - Beaumont, TX Parkdale Crossing Sep-10 5.010% 8,570 8,570 - Beaumont, TX Parkdale Mall Sep-10 5.010% 54,274 54,274 - Nashville, TN Coolsprings Galleria Sep-10 6.222% 128,574 128,574 - Stroud, PA Stroud Mall Dec-10 8.420% 31,252 31,252 - Wausau, WI Wausau Center Dec-10 6.700% 12,927 12,927 - York, PA York Galleria Dec-10 8.340% 49,965 49,965 - Lexington, KY Fayette Mall Jul-11 7.000% 93,028 93,028 - Chattanooga, TN Hamilton Corner Aug-11 10.125% 2,023 2,023 - Asheville, NC Asheville Mall Sep-11 6.980% 67,780 67,780 - Ft. Smith, AR Massard Crossing Feb-12 7.540% 5,792 5,792 - Houston, TX Willowbrook Plaza Feb-12 7.540% 29,636 29,636 - 8 Balance Maturity Interest ------------------------- Location Property Date Rate Balance Fixed Variable - ----------------------- ---------------------------- --------- -------- ---------- -------- --------- Vicksburg, MS Pemberton Plaza Feb-12 7.540% 1,979 1,979 - Fayetteville, NC Cross Creek Mall Apr-12 5.000% 62,645 62,645 - Colonial Heights, VA Southpark Mall May-12 5.100% 36,655 36,655 - Asheboro, NC Randolph Mall Jul-12 6.500% 14,740 14,740 - Douglasville, GA Arbor Place Jul-12 6.510% 76,525 76,525 - Douglasville, GA The Landing At Arbor Place Jul-12 6.510% 8,638 8,638 - Jackson, TN Old Hickory Mall Jul-12 6.510% 33,803 33,803 - Louisville, KY Jefferson Mall Jul-12 6.510% 42,629 42,629 - North Charleston, SC Northwoods Mall Jul-12 6.510% 61,033 61,033 - Racine, WI Regency Mall Jul-12 6.510% 33,427 33,427 - Saginaw, MI Fashion Square Jul-12 6.510% 58,591 58,591 - Spartanburg, SC Westgate Mall Jul-12 6.500% 52,953 52,953 - Chattanooga, TN CBL Center Aug-12 6.250% 14,369 14,369 - Panama City, FL Panama City Mall Aug-12 7.300% 39,290 39,290 - Livonia, MI Laurel Park Place Dec-12 5.000% 50,297 50,297 - Monroeville, PA Monroeville Mall Jan-13 5.300% 129,990 129,990 - Greensburg, PA Westmoreland Mall Jan-13 5.050% 79,996 79,996 - Columbia, SC Columbia Place Oct-13 5.450% 32,471 32,471 - Laredo, TX Mall del Norte Dec-14 5.040% 113,400 113,400 - Brookfield, WI Brookfield Square Nov-15 5.075% 104,876 104,876 - Madison, WI East Towne Mall Nov-15 5.000% 79,807 79,807 - Madison, WI West Towne Mall Nov-15 5.000% 112,728 112,728 - Rockford, IL Cherryvale Mall Nov-15 5.000% 93,774 93,774 - Bloominton, IL Eastland Mall Dec-15 5.850% 59,400 59,400 - Decatur, IL Hickory Point Mall Dec-15 5.850% 33,116 33,116 - Overland Park, KS Oak Park Mall Dec-15 5.850% 275,700 275,700 - Janesville, WI Janesville Mall Apr-16 8.375% 12,816 12,816 - ----------- ----------- --------- 3,527,077 3,235,077 292,000 ----------- ----------- --------- Weighted average interest rate 5.98% 6.04% 5.33% Debt Premiums: Colonial Heights, VA Southpark Mall May-12 5.100% 3,538 3,538 - Daytona Beach, FL Volusia Mall Apr-09 4.750% 3,085 3,085 - Fayetteville, NC Cross Creek Mall Apr-12 5.000% 7,800 7,800 - Joplin, MO Northpark Mall Jul-12 5.500% 612 612 - Little Rock, AR Park Plaza Mall May-10 4.900% 5,849 5,849 - Livonia, MI Laurel Park Place Dec-12 5.000% 9,806 9,806 - Monroeville, PA Monroeville Mall Jan-13 5.300% 3,063 3,063 - Roanoke, VA Valley View Mall Sep-10 5.100% 6,273 6,273 - Terre Haute, IN Honey Creek Mall Apr-09 4.750% 2,161 2,161 - ----------- ----------- --------- 42,187 42,187 - ----------- ----------- --------- Weighted average interest rate 5.01% 5.01% - Total Loans On Operating Properties And Debt Premiums 3,569,258 3,277,258 292,000 ----------- ----------- --------- Weighted average interest rate 5.97% 6.02% 5.33% Construction Loans: Lexington, KY The Plaza at Fayette Dec-06 5.910% 8,550 - 8,550 9 Balance Maturity Interest ------------------------- Location Property Date Rate Balance Fixed Variable - ----------------------- ---------------------------- --------- -------- ---------- -------- --------- Southaven, MS Southaven Towne Center Jun-07 5.970% 23,649 - 23,649 Ft. Myers, FL Gulf Coast Town Center Sep-08 5.625% 42,020 - 42,020 Stillwater, OK Lakeview Pointe Nov-08 5.487% 2,612 - 2,612 ----------- ----------- --------- 76,831 - 76,831 ----------- ----------- --------- Lines of Credit 5.300% 690,285 - 690,285 ----------- ----------- --------- Weighted average interest rate Other 4,681 4,681 - ----------- ----------- --------- Total Consolidated Debt $ 4,341,055 $ 3,281,939 $ 1,059,116 Weighted average interest rate 5.85% 6.02% 5.33% Plus CBL'S Share Of Unconsolidated Affiliates' Debt: Paducah, KY Kentucky Oaks Mall Jun-07 9.000% 15,254 15,254 - Huntsville, AL Parkway Place Jun-08 5.300% 26,600 - 26,600 Del Rio, TX Plaza del Sol Aug-10 9.150% 1,524 1,524 - Myrtle Beach, SC Coastal Grand-Myrtle Beach Oct-14 5.090% 48,808 48,808 - El Centro, CA Imperial Valley Mall Sep-15 4.985% 35,913 35,913 - Raleigh, NC Triangle Town Center Dec-15 5.737% 100,000 100,000 - Clarksville, TN Governor's Square Mall Sep-16 8.230% 14,527 14,527 - ----------- ----------- --------- 242,626 216,026 26,600 ----------- ----------- --------- Less Minority Interests' Share Of Consolidated Debt: Minority Interest % Chattanooga, TN CBL Center 8.0000% 6.250% (1,150) (1,150) - Chattanooga, TN Hamilton Corner 10.0000% 10.125% (202) (202) - Chattanooga, TN Hamilton Place 10.0000% 7.000% (6,164) (6,164) - Ft. Smith, AR Massard Crossing 10.0000% 7.540% (5,213) (5,213) - Highpoint, NC Oak Hollow Mall 25.0000% 7.310% (10,768) (10,768) - Houston, TX Willowbrook Plaza 10.0000% 7.540% (26,672) (26,672) - Vicksburg, MS Pemberton Plaza 10.0000% 7.310% (1,781) (1,781) - ----------- ----------- --------- (51,950) (51,950) - ----------- ----------- --------- Company's Share Of Consolidated And Unconsolidated Debt $ 4,531,731 $ 3,446,015 $ 1,085,716 =========== ============ =========== Weighted average interest rate 5.83% 5.99% 5.33% Total Debt of Unconsolidated Affiliates: Paducah, KY Kentucky Oaks Mall Jun-07 9.000% $ 30,507 $ 30,507 $ - Huntsville, AL Parkway Place Jun-08 5.300% 53,200 - 53,200 Del Rio, TX Plaza del Sol Aug-10 9.150% 3,012 3,012 - Myrtle Beach, SC Coastal Grand-Myrtle Beach (b) Oct-14 5.090% 97,615 97,615 - El Centro, CA Imperial Valley Mall Sep-15 4.985% 59,855 59,855 - Releigh, NC Triangle Town Center Dec-15 9.000% 200,000 200,000 - Clarksville, TN Governor's Square Mall Sep-16 8.230% 30,584 30,584 - ----------- ----------- --------- $ 474,773 $ 421,573 $ 53,200 ========== ========== ========= Weighted average interest rate 5.85% 5.92% 5.30% (a) Eastgate Mall - Represents a first mortgage securing the property. In addition to the first mortgage, there is also a $7,750 B-note that is held by the Company. (b) Coastal Grand-Myrtle Beach - Represents a first mortgage securing the property. In addition to the first mortgage, there is also $18,000 of B-notes that are payable to the Company and its joint venture partner, each of which hold $9,000.
10 CBL & Associates Properties, Inc. Supplemental Financial and Operating Information For the Three Months and Year Ended December 31, 2005 Top 25 Based On Percentage Of Total Revenues As Of December 31, 2005:
Annual Percentage Number of Gross of Total Tenant Stores Square Feet Rentals (1) Revenues -------------------------------------------- --------- ------------- ------------- ----------- 1 Limited Brands, Inc. 235 1,451,230 $49,816,597 5.6% 2 Foot Locker, Inc. 193 760,487 28,743,398 3.2% 3 The Gap, Inc. 106 1,052,246 24,849,474 2.8% 4 Luxottica Group, S.P.A. (2) 77 362,187 16,993,141 1.9% 5 Abercrombie & Fitch, Co. 197 479,638 16,737,262 1.9% 6 AE Outfitters Retail Company 73 384,206 15,162,552 1.7% 7 Signet Group PLC (3) 104 158,906 14,502,975 1.6% 8 Zale Corporation 148 148,800 13,637,113 1.5% 9 JC Penney Co. Inc. (4) 69 7,701,909 13,273,150 1.5% 10 Finish Line, Inc. 68 356,479 12,948,490 1.5% 11 New York & Company, Inc. 45 348,612 11,031,050 1.2% 12 The Regis Corporation 198 230,075 11,014,242 1.2% 13 Hallmark Cards, Inc. 88 309,068 10,310,067 1.2% 14 The Children's Place Retail Stores, Inc. (5) 61 258,951 9,898,797 1.1% 15 Genesco Inc. (6) 139 178,211 9,801,639 1.1% 16 Charming Shoppes, Inc. (7) 58 344,733 9,789,050 1.1% 17 Pacific Sunwear of California 81 279,350 9,625,585 1.1% 18 Dick's Sporting Goods, Inc. 11 654,686 9,085,563 1.0% 19 Aeropostale, Inc. 66 223,772 8,736,517 1.0% 20 Trans World Entertainment (8) 50 259,060 8,364,797 0.9% 21 Sun Capital Partners, Inc. (9) 65 441,360 7,988,783 0.9% 22 Federated Department Stores, Inc. (10) 86 6,228,826 7,951,723 0.9% 23 Christopher & Banks, Inc. 67 231,681 7,736,242 0.9% 24 Claire's Stores, Inc. 117 132,167 7,537,292 0.9% 25 The Buckle, Inc. 44 214,094 7,377,496 0.8% --------- ------------- ------------- ----------- 2,446 23,190,735 $342,912,995 38.5% ========= ============= ============= =========== (1) Includes annual minimum rent and tenant reimbursements based on amounts in effect at December 31, 2005. (2) Luxottica was previously Lenscrafters and Sunglass Hut. Luxottica purchased Cole National Corporation, which operates Pearl Vision and Things Remembered in October 2004. (3) Signet Group was previously Sterling, Inc. They operate Kay Jewelers, Marks & Morgan, JB Robinson, Shaw's Jewelers, Osterman's Jewelers, LeRoy's Jewelers, Jared Jewelers, Belden Jewelers and Rogers Jewelers. (4) J.C. Penney owns 29 of these stores. (5) The Children's Place Retail Stores, Inc. purchased The Disney Store in November 2004. (6) Genesco Inc. operates Journey's, Jarman and Underground Station. Genesco purchased Hat World, which operates Hat World, Lids, Hat Zone and Cap Factory, as of April 2, 2004. (7) Charming Shoppes, Inc. operates Lane Bryant, Fashion Bug and Catherine's. (8) Trans World Entertainment operates FYE (formerly Camelot Music and Record Town) and Saturday Matinee. (9) Sun Capital Partners, Inc. operates Sam Goody, Suncoast Motion Pictures, Musicland, Life Uniform, Anchor Blue, Mervyn's, Bruegger's Bagels, Wick's Furniture and the Mattress Firm. Musicland Group, wich includes Sam Goody and Suncoast, recently filed for bankruptcy under Chapter 11. They represent 178,776 square feet and $6,535,866 in total annual revenue. (10) Federated Department Stores merged with May Company in 2005. They now operate After Hours Formalwear, Desmond's Formal Wear, Mithchell's Formal Wear, Tuxedo World, David's Bridal, Burdine's, Famous Barr, Foley's, Hecht's, Kaufmann's, Lazarus, L.S. Ayers, Macy's, Marshall Field's, Meier & Frank, Rich's-Macy's, Robinson's May, & The Jones Store.
11 CBL & Associates Properties, Inc. Supplemental Financial and Operating Information For the Three Months and Year Ended December 31, 2005 Capital Expenditures for Three Months and Year Ended December 31 , 2005 (In thousands)
Three Months Year To Date -------------------------- Tenant allowances $ 18,486 $ 52,773 ------------- ------------ Renovations 5,391 27,514 ------------- ------------ Deferred maintenance: Parking lot and parking lot lighting 4,731 12,360 Roof repairs and replacements 2,966 11,727 Other capital expenditures 2,736 7,401 ------------- ------------ Total deferred maintenancee expenditures 10,433 31,488 ------------- ------------ Total capital expenditures $ 34,310 $ 111,775 ============= ============ The capital expenditures incurred for maintenance such as parking lot repairs, parking lot lighting and roofs are classified as deferred maintenance expenditures. These expenditures are billed to tenants as common area maintenance expense and the majority is recovered over a five to fifteen year period. Renovation capital expenditures are for remodelings and upgrades for enhancing our competitive position in the market area. A portion of these expenditures covering items such as new floor coverings, painting, lighting and new seating areas are also recovered through tenant billings. The costs of other items such as new entrances, new ceilings and skylights are not recovered from tenants. We estimate that 30% of our renovation expenditures are recoverable from our tenants over a ten to fifteen year period. The third category of capital expenditures is tenant allowances, sometimes made to third-generation tenants. Tenant allowances are recovered through minimum rents from the tenants over the term of the term of the lease.
Deferred Leasing Costs Capitalized (In thousands)
2005 2004 ------------- ------------ Quarter ended: March 31, $ 374 $ 492 June 30, 699 242 September 30, 629 524 December 31, 581 628 ------------- ------------ $ 2,283 $ 1,886 ============= ============
12 CBL & Associates Properties, Inc. Supplemental Financial and Operating Information For the Three Months and Year Ended December 31, 2005 Properties Under Development at December 31, 2005 (Dollars in thousands)
CBL's Share of -------------------------- Square Total Costs Opening Initial Property Location Feet Costs To Date Date Yield - -------------------------------------- ----------------- ------------ ------------ ----------- ---------------- ------ Mall Expansions: Burnsville Center - Phase II Burnsville, MN 82,900 $ 13,000 $ 1,244 April-06 9% Hanes Mall - Dick's Sporting Goods Winston-Salem, NC 66,000 10,150 3,632 July-06 10% Open-Air Centers: Southaven Town Center - Gordman's Southaven, MS 59,400 7,190 1,405 April-06 9% Lakeview Point Stillwater, OK 207,300 21,095 5,940 October-06 9% Gulf Coast Town Center - Phase II Ft. Myers, FL 739,000 109,641 (a) 14,500 (a) October-06 9% Associated Centers: The Plaza at Fayette - Phase I Lexington, KY 73,400 24,414 15,058 July-06 9% The Shoppes at St. Clair Fairview Heights, IL 75,000 26,957 9,933 March-07 7% Community Center: High Pointe Commons Harrisburg, PA 297,100 7,271 2,787 October-06 10% ------------ ------------ ----------- 1,600,100 $ 219,718 $ 54,499 ============ ============ =========== (a) Amounts shown are 100% of the cost and cost to date.
-----END PRIVACY-ENHANCED MESSAGE-----