Guarantor and Non-Guarantor Financial Statements (Tables)

3 Months Ended

Mar. 31, 2020

Guarantor and Nonguarantor Financial Statements [Abstract]

CONDENSED CONSOLIDATING BALANCE SHEET AS OF MARCH 31, 2020 (Dollars in millions)

	Parent		Kennedy-Wilson, Inc.		Guarantor Subsidiaries		Non-guarantor Subsidiaries		Elimination			Consolidated Total
Assets
Cash and cash equivalents	$	—	$	45.8	$	91.4	$	528.4	$	—		$	665.6
Accounts receivable	—		—		12.9		34.7		—			47.6
Real estate and acquired in place lease values, net of accumulated depreciation and amortization	—		—		2,064.3		2,651.5		—			4,715.8
Unconsolidated investments	—		13.4		473.9		769.1		—			1,256.4
Investments in and advances to consolidated subsidiaries	1,648.1		2,918.6		1,550.7		—		(6,117.4		)	—
Other assets	—		8.9		64.8		188.9		—			262.6
Total assets	$	1,648.1	$	2,986.7	$	4,258.0	$	4,172.6	$	(6,117.4	)	$	6,948.0

Liabilities and equity
Liabilities
Accounts payable	$	—	$	0.5	$	2.0	$	8.4	$	—		$	10.9
Accrued expenses and other liabilities	35.6		209.5		62.2		177.9		—			485.2
Mortgage debt	—		—		1,275.2		1,175.7		—			2,450.9
KW unsecured debt	—		1,128.6		—		—		—			1,128.6
KWE unsecured bonds	—		—		—		1,217.4		—			1,217.4
Total liabilities	35.6		1,338.6		1,339.4		2,579.4		—			5,293.0

Equity
Kennedy-Wilson Holdings, Inc. shareholders' equity	1,612.5		1,648.1		2,918.6		1,550.7		(6,117.4		)	1,612.5
Noncontrolling interests	—		—		—		42.5		—			42.5
Total equity	1,612.5		1,648.1		2,918.6		1,593.2		(6,117.4		)	1,655.0
Total liabilities and equity	$	1,648.1	$	2,986.7	$	4,258.0	$	4,172.6	$	(6,117.4	)	$	6,948.0

CONDENSED CONSOLIDATING BALANCE SHEET AS OF DECEMBER 31, 2019 (Dollars in millions)

	Parent		Kennedy-Wilson, Inc.		Guarantor Subsidiaries		Non-guarantor Subsidiaries		Elimination			Consolidated Total
Assets
Cash and cash equivalents	$	30.8	$	6.4	$	102.7	$	434.0	$	—		$	573.9
Accounts receivable	—		—		13.9		38.2		—			52.1
Real estate and acquired in place lease values, net of accumulated depreciation and amortization	—		—		2,052.3		3,027.9		—			5,080.2
Unconsolidated investments	—		18.2		526.0		790.4		—			1,334.6
Investments in and advances to consolidated subsidiaries	1,682.3		3,037.5		1,660.5		—		(6,380.3		)	—
Other assets	—		—		61.1		202.6		—			263.7
Total assets	$	1,713.1	$	3,062.1	$	4,416.5	$	4,493.1	$	(6,380.3	)	$	7,304.5


Liabilities
Accounts payable	$	—	$	0.9	$	3.4	$	16.1	$	—		20.4
Accrued expense and other liabilities	34.4		247.2		59.7		176.7		—			518.0
Mortgage debt	—		—		1,315.9		1,325.1		—			2,641.0
KW unsecured debt	—		1,131.7		—		—		—			1,131.7
KWE unsecured bonds	—		—		—		1,274.2		—			1,274.2
Total liabilities	34.4		1,379.8		1,379.0		2,792.1		—			5,585.3

Equity
Kennedy-Wilson Holdings, Inc. shareholders' equity	1,678.7		1,682.3		3,037.5		1,660.5		(6,380.3		)	1,678.7
Noncontrolling interests	—		—		—		40.5		—			40.5
Total equity	1,678.7		1,682.3		3,037.5		1,701.0		(6,380.3		)	1,719.2
Total liabilities and equity	$	1,713.1	$	3,062.1	$	4,416.5	$	4,493.1	$	(6,380.3	)	$	7,304.5

Consolidating Statement of Operations

CONSOLIDATING STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2020 (Dollars in millions)

	Parent			Kennedy-Wilson, Inc.			Guarantor Subsidiaries			Non-guarantor Subsidiaries			Elimination			Consolidated Total
Revenue
Rental	$	—		$	—		$	48.3		$	59.4		$	—		$	107.7
Hotel	—			—			—			7.2			—			7.2
Investment management and property services fees	—			—			7.6			0.8			—			8.4
Total revenue	—			—			55.9			67.4			—			123.3
Expenses
Rental	—			—			17.6			19.1			—			36.7
Hotel	—			—			—			6.0			—			6.0
Commission and marketing	—			—			0.7			—			—			0.7
Compensation and related	8.9			9.8			11.2			1.5			—			31.4
General and administrative	—			4.8			3.3			1.4			—			9.5
Depreciation and amortization	—			0.4			19.4			25.7			—			45.5
Total expenses	8.9			15.0			52.2			53.7			—			129.8
Income from unconsolidated subsidiaries	—			(1.0		)	(2.8		)	14.7			—			10.9
Income from consolidated subsidiaries	2.9			33.9			45.5			—			(82.3		)	—
Gain on sale of real estate, net	—			—			—			44.2			—			44.2
Transaction-related expenses	—			—			—			(0.2		)	—			(0.2		)
Interest expense	—			(15.4		)	(12.7		)	(20.7		)	—			(48.8		)
Other income (loss)	—			0.9			—			(0.7		)	—			0.2
Income (loss) before benefit from (provision for) income taxes	(6.0		)	3.4			33.7			51.0			(82.3		)	(0.2		)
Benefit from (provision for) income taxes	—			(0.6		)	0.2			(5.3		)	—			(5.7		)
Net income (loss)	(6.0		)	2.8			33.9			45.7			(82.3		)	(5.9		)
Net income attributable to the noncontrolling interests	—			—			—			0.3			—			0.3
Preferred dividends	(4.3		)	—			—			—			—			(4.3		)
Net income (loss) attributable to Kennedy-Wilson Holdings, Inc. common shareholders	$	(10.3	)	$	2.8		$	33.9		$	46.0		$	(82.3	)	$	(9.9	)

CONSOLIDATING STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2019 (Dollars in millions)

	Parent		Kennedy-Wilson, Inc.			Guarantor Subsidiaries			Non-guarantor Subsidiaries			Elimination			Consolidated Total
Revenue
Rental	$	—	$	—		$	42.3		$	73.5		$	—		$	115.8
Hotel	—		—			—			15.0			—			15.0
Sale of real estate	—		—			—			1.1			—			1.1
Investment management and property services fees	—		—			8.2			0.6			—			8.8
Total revenue	—		—			50.5			90.2			—			140.7
Expenses
Rental	—		—			15.2			25.8			—			41.0
Hotel	—		—			—			14.6			—			14.6
Cost of real estate sold	—		—			—			1.2			—			1.2
Commission and marketing	—		—			1.0			—			—			1.0
Compensation and related	10.4		13.8			9.7			1.4			—			35.3
General and administrative	—		5.0			4.3			1.6			—			10.9
Depreciation and amortization	—		0.3			15.1			33.7			—			49.1
Total expenses	10.4		19.1			45.3			78.3			—			153.1
Income from unconsolidated investments	—		0.2			0.8			40.7			—			41.7
Income from consolidated subsidiaries	12.0		50.7			56.0			—			(118.7		)	—
Gain on sale of real estate, net	—		—			—			34.9			—			34.9
Transaction-related expenses	—		—			(0.1		)	(0.7		)	—			(0.8		)
Interest expense	—		(18.2		)	(12.1		)	(25.0		)	—			(55.3		)
Other income	—		0.3			0.1			(2.9		)	—			(2.5		)
Income before provision for income taxes	1.6		13.9			49.9			58.9			(118.7		)	5.6
Provision for income taxes	—		(1.9		)	0.8			(2.9		)	—			(4.0		)
Net income	1.6		12.0			50.7			56.0			(118.7		)	1.6
Net income attributable to the noncontrolling interests	—		—			—			(6.9		)	—			(6.9		)
Net income (loss) attributable to Kennedy-Wilson Holdings, Inc. common shareholders	$	1.6	$	12.0		$	50.7		$	49.1		$	(118.7	)	$	(5.3	)

Consolidated Statement of Comprehensive Income

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS) FOR THE THREE MONTHS ENDED MARCH 31, 2020 (Dollars in millions)

	Parent			Kennedy-Wilson, Inc.			Guarantor Subsidiaries			Non-guarantor Subsidiaries			Elimination			Consolidated Total
Net (loss) income	$	(6.0	)	$	2.8		$	33.9		$	45.7		$	(82.3	)	$	(5.9	)

Other comprehensive (loss) income, net of tax:
Unrealized foreign currency translation loss	(16.8		)	(16.8		)	(49.3		)	(15.7		)	81.8			(16.8		)
Amounts reclassified out of AOCI during the period	0.2			0.2			—			0.2			(0.4		)	0.2
Unrealized currency derivative contracts gains	13.0			13.0			48.3			(35.3		)	(26.0		)	13.0
Unrealized loss on interest rate swaps	(5.6		)	(5.6		)	—			—			5.6			(5.6		)
Total other comprehensive (loss) income for the period	$	(9.2	)	$	(9.2	)	$	(1.0	)	$	(50.8	)	$	61.0		$	(9.2	)

Comprehensive loss	$	(15.2	)	$	(6.4	)	$	32.9		$	(5.1	)	$	(21.3	)	$	(15.1	)
Comprehensive loss attributable to noncontrolling interests	—			—			—			1.8			—			1.8
Comprehensive income (loss) attributable to Kennedy-Wilson Holdings, Inc.	$	(15.2	)	$	(6.4	)	$	32.9		$	(3.3	)	$	(21.3	)	$	(13.3	)



CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE THREE MONTHS ENDED MARCH 31, 2019 (Dollars in millions)
	Parent			Kennedy-Wilson, Inc.			Guarantor Subsidiaries			Non-guarantor Subsidiaries			Elimination			Consolidated Total
Net income	$	1.6		$	12.0		$	50.7		$	56.0		$	(118.7	)	$	1.6

Other comprehensive income (loss), net of tax:
Unrealized foreign currency translation loss	(18.3		)	(18.3		)	7.9			(18.3		)	28.7			(18.3		)
Unrealized currency derivative contracts gain	32.9			32.9			(8.0		)	40.9			(65.8		)	32.9
Total other comprehensive income for the period	$	14.6		$	14.6		$	(0.1	)	$	22.6		$	(37.1	)	$	14.6

Comprehensive income	$	16.2		$	26.6		$	50.6		$	78.6		$	(155.8	)	$	16.2
Comprehensive income attributable to noncontrolling interests	—			—			—			(4.6		)	—			(4.6		)
Comprehensive income attributable to Kennedy-Wilson Holdings, Inc.	$	16.2		$	26.6		$	50.6		$	74.0		$	(155.8	)	$	11.6

Condensed Consolidated Statement of Cash Flows

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 2020 (Dollars in millions)

	Parent			Kennedy-Wilson, Inc.			Guarantor Subsidiaries			Non-guarantor Subsidiaries			Consolidated Total
Net cash (used in) provided by operating activities	$	(0.1	)	$	(70.3	)	$	(13.8	)	$	47.6		$	(36.6	)
Cash flows from investing activities:
Issuance of loans	—			(6.3		)	—			—			(6.3		)
Proceeds from collection of loans	—			—			—			33.0			33.0
Net proceeds from sale of consolidated real estate	—			—			—			182.0			182.0
Capital expenditures to real estate	—			—			(17.3		)	(20.2		)	(37.5		)
Distributions from unconsolidated investments	—			4.0			31.4			43.9			79.3
Contributions to unconsolidated investments	—			(0.1		)	(13.7		)	(31.5		)	(45.3		)
Proceeds from development project assets	—			—			—			2.3			2.3
Proceeds from settlement of foreign forward contracts	—			—			32.5			—			32.5
Distributions from (investments in) consolidated subsidiaries, net	29.8			116.4			13.0			(159.2		)	—
Net cash provided by investing activities	29.8			114.0			45.9			50.3			240.0
Cash flows from financing activities:
Borrowings under mortgage debt	—			—			6.7			16.0			22.7
Repayment of mortgage debt	—			—			(50.1		)	(1.5		)	(51.6		)
Payment of debt issue costs	—			(4.3		)	—			—			(4.3		)
Repurchase and retirement of common stock	(25.6		)	—			—			—			(25.6		)
Common dividends paid	(31.6		)	—			—			—			(31.6		)
Preferred dividends paid	(3.3		)	—			—			—			(3.3		)
Issuance of shareholder loans from noncontrolling interests	—			—			—			0.3			0.3
Contributions from noncontrolling interests	—			—			—			0.3			0.3
Distributions to noncontrolling interests	—			—			—			(0.2		)	(0.2		)
Net cash (used in) provided by financing activities	(60.5		)	(4.3		)	(43.4		)	14.9			(93.3		)
Effect of currency exchange rate changes on cash and cash equivalents	—			—			—			(18.4		)	(18.4		)
Net change in cash and cash equivalents	(30.8		)	39.4			(11.3		)	94.4			91.7
Cash and cash equivalents, beginning of period	30.8			6.4			102.7			434.0			573.9
Cash and cash equivalents, end of period	$	—		$	45.8		$	91.4		$	528.4		$	665.6

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 2019 (Dollars in millions)

	Parent			Kennedy-Wilson, Inc.			Guarantor Subsidiaries			Non-guarantor Subsidiaries			Consolidated Total
Net cash (used in) provided by operating activities	$	0.2		$	(61.6	)	$	(1.4	)	$	37.7		$	(25.1	)
Cash flows from investing activities:
Issuance of loans	—			—			(0.4		)	—			(0.4		)
Additions to non refundable escrow deposits	—			(5.0		)	—			—			(5.0		)
Net proceeds from sale of consolidated real estate	—			—			—			177.3			177.3
Capital expenditures to real estate	—			—			(10.3		)	(46.6		)	(56.9		)
Distributions from unconsolidated investments	—			0.8			1.7			3.1			5.6
Contributions to unconsolidated investments	—			(0.4		)	(14.2		)	(5.7		)	(20.3		)
Additions to development project assets	—			—			—			(1.2		)	(1.2		)
Proceeds from development project assets	—			—			—			1.7			1.7
Distributions from (investments in) consolidated subsidiaries, net	38.0			100.4			40.0			(178.4		)	—
Net cash provided by (used in) investing activities	38.0			95.8			16.8			(49.8		)	100.8
Cash flows from financing activities:
Repayment of shareholder loans to noncontrolling interests	—			—			—			(10.7		)	(10.7		)
Borrowings under mortgage debt	—			—			—			296.9			296.9
Repayment of mortgage debt	—			—			(0.3		)	(251.1		)	(251.4		)
Payment of debt issue costs	—			—			—			(2.1		)	(2.1		)
Repurchase and retirement of common stock	(7.9		)	—			—			—			(7.9		)
Common dividends paid	(30.3		)	—			—			—			(30.3		)
Contributions from noncontrolling interests	—			—			—			5.3			5.3
Distributions to noncontrolling interests	—			—			—			(122.7		)	(122.7		)
Net cash used in financing activities	(38.2		)	—			(0.3		)	(84.4		)	(122.9		)
Effect of currency exchange rate changes on cash and cash equivalents	—			—			—			2.1			2.1
Net change in cash and cash equivalents	—			34.2			15.1			(94.4		)	(45.1		)
Cash and cash equivalents, beginning of period	—			1.9			101.9			384.2			488.0
Cash and cash equivalents, end of period	$	—		$	36.1		$	117.0		$	289.8		$	442.9