-----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, CsMypvPs/qdfO8AK1DBTPn3OUV7dCf+sto/96U2ji6V0CJlbPXTCdtsqZAQFu2NF be0UY4k+ARC3wW1lfPUgLA== 0000910612-05-000047.txt : 20050504 0000910612-05-000047.hdr.sgml : 20050504 20050504154412 ACCESSION NUMBER: 0000910612-05-000047 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20050331 ITEM INFORMATION: Results of Operations and Financial Condition FILED AS OF DATE: 20050504 DATE AS OF CHANGE: 20050504 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: 05799053 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 EARNINGS RELEASE 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): May 3, 2005 CBL & ASSOCIATES PROPERTIES, INC. (Exact Name of Registrant as Specified in its Charter) Delaware 1-12494 62-154718 (State or Other Jurisdiction of (Commission File Number) (I.R.S. Employer Incorporation) 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)) ITEM 2.02 Results of Operations and Financial Condition On May 3, 2005, CBL & Associates Properties, Inc. (the "Company") reported its results for the first quarter ended March 31, 2005. The Company's earnings release for the first quarter ended March 31, 2005 is attached as Exhibit 99.1. On May 4, 2005, the Company held a conference call to discuss the first quarter results. 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 ended March 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 - First Quarter Ended March 31, 2005 99.2 Investor Conference Call Script - First Quarter Ended March 31, 2005 99.3 Supplemental Financial and Operating Information - For the Three Months Ended March 31, 2005 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 (Authorized Officer of the Registrant, Principal Financial Officer and Principal Accounting Officer) Date: May 4, 2005 EX-99 3 earningsrelease.txt EXHIBIT 99.1 EARNINGS RELEASE Exhibit 99.1 [CBL & ASSOCIATES PROPERTIES, INC. LETTERHEAD] Contact: Katie Knight Director, Investor Relations (423) 855-0001 CBL & ASSOCIATES PROPERTIES REPORTS FIRST QUARTER RESULTS o FFO per share rose 23.6% to $1.52 in the first quarter. o Same-center NOI for the first quarter rose 10.7%. o Same store sales improved by 4.5% year-to-date. o Portfolio occupancy rose to 91.3% in the first quarter. CHATTANOOGA, Tenn. (May 3, 2005) CBL & Associates Properties, Inc. (NYSE:CBL) announced results for the first quarter ended March 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 release. Net income available to common shareholders for the first quarter ended March 31, 2005, was $25,371,000 compared with $30,189,000 for the prior-year period representing a decline of 16.0%. Net income available to common shareholders per diluted share was $0.78 in the first quarter ended March 31, 2005, compared with $0.96 for the prior-year period, representing a decline of 18.8%. Net income available to common shareholders in the first quarter 2004 of $0.96 per share included one-time gains from the sale of six community and power centers to the Galileo America joint venture of $0.32 per share. There was no gain associated with the sale of four community centers in the final phase of the Galileo America joint venture which closed in January 2005. Funds from operations (FFO) increased 27.0% to $88,461,000 for the first quarter of 2005 from $69,660,000 for the first quarter of 2004. FFO per share on a diluted fully converted basis increased 23.6% to $1.52 for the first quarter of 2005 from $1.23 in the prior-year period. HIGHLIGHTS o Total revenues increased 22.5% in the first quarter 2005 to $210,905,000 from $172,159,000 in the prior-year period. o Same center net operating income for the portfolio improved in the first quarter of 2005 by 10.7% compared with a 1.7% increase for the prior-year period. Significant factors positively impacting the first quarter 2005 NOI growth of $12.2 million over the prior year period included: i) Approximately $6.1 million related to improvements in bad debt expense and other charges against revenues; ii) Approximately $400,000 related to accounting for rent holidays; iii) Approximately $1.0 million more in percentage rents compared with the first quarter of 2004 related to malls acquired in 2003. o Same-store sales for mall tenants of 10,000 square feet or less for stabilized malls as of March 31, 2005, increased 4.5% for those tenants who have reported sales compared with a 7.5% increase for the first quarter of 2004. o The debt-to-total-market capitalization ratio as of March 31, 2005, was 44.0% based on the common stock closing price of $71.51 and a fully converted common stock share count of 57,035,000 as of the same date. The debt-to-total-market capitalization ratio as of March 31, 2004, was 44.5% based on the common stock closing price of $61.34 and a fully converted common stock share count of 55,808,000 as of the same date. o Variable rate debt of $789,185,000 represents 9.9% of the total market capitalization for the Company and 22.5% of the Company's share of total consolidated and unconsolidated debt. -MORE- CBL Reports First Quarter Results Page 2 May 3, 2005 CBL's Chairman and Chief Executive Officer, Charles B. Lebovitz, said, "With such a strong, well-balanced first quarter, we are fortunate to be able to point to many factors that positively influenced our performance. We generated impressive same-center NOI growth in our existing portfolio from improvements in several areas including increases in occupancy, specialty leasing and sponsorship income. Additionally, the impact from continuously redeveloping our portfolio has led to significant new rental income as we proactively converted several department stores to large space users and mall shop expansions. "A year ago, the prevailing theme in the mall industry was the large number of tenant bankruptcies. We have proven quite convincingly that this challenge could be converted into opportunities to enhance our tenant base. We have backfilled over 230,000 square feet of space lost to bankruptcies over the past two years leading to significant improvement in overall tenant quality and increases in rental rates. We are now benefiting from a more favorable environment with more productive tenants, retailers pursuing expansion plans and a stronger economy overall. "Much of the current industry discussion has focused on department store consolidation, select retailers moving to off-mall venues and the appeal of lifestyle-oriented centers to consumers. We look at these trends as opportunities to continue to recapture underperforming department store space, add exterior-oriented restaurants and upscale lifestyle elements to each of our malls, and convert outparcels and adjoining property into new development projects. In each instance, these initiatives align perfectly with our focus to continuously redevelop and retenant our properties in an effort to offer consumers the most exciting shopping venues available. We expect to continue to successfully execute these initiatives in 2005 and beyond." PORTFOLIO OCCUPANCY*
March 31, 2005 2004 ------------- ------------- Portfolio occupancy 91.3% 90.8% Mall portfolio 91.5% 91.0% Stabilized malls (67) 91.9% 91.5% Non-stabilized malls (3) 81.8% 81.5% Associated centers (26) 91.9% 88.7% Community centers (5) 82.9% 91.6% * Figures exclude the community centers that were contributed into the Galileo America joint venture.
PROPERTY SALES In January, the Company completed the final phase of the Galileo America joint venture. The Company transferred two power centers, one community center and one community center expansion to the joint venture for total consideration of $58.6 million. The Company recognized an impairment loss of $1.95 million in the fourth quarter 2004 and an additional impairment loss of $262,000 in the first quarter 2005 related to the properties in this transaction. The Company also completed the sale of five community center properties located throughout Michigan for a total sales price of $12.1 million. The Company previously took an impairment loss of $617,000 in the fourth quarter of 2004 and took an additional loss of $32,000 in the first quarter 2005 related to the properties in this transaction. OUTLOOK AND GUIDANCE Based on today's outlook and the Company's first quarter results, the Company is offering guidance for 2005 FFO in the range of $5.88 to $5.96 per share. The full year guidance assumes NOI growth in the range of 3% to 4% and excludes the impact of any future acquisitions, termination fee income, gains on sales of outparcels, or gains on sales of non-operating properties. The Company expects to update its annual guidance after each quarter's results. -MORE- CBL Reports First Quarter Results Page 3 May 3, 2005
Low High ----- ----- Expected diluted earnings per common share $2.97 $3.05 Adjust to fully converted shares from common shares (1.31) (1.35) ----- ----- Expected earnings per diluted, fully converted common share 1.66 1.70 Add: depreciation and amortization 2.91 2.91 Add: minority interest in earnings of Operating Partnership 1.31 1.35 ----- ------ Expected FFO per diluted, fully converted common share $5.88 $5.96 ===== =====
INVESTOR CONFERENCE CALL AND SIMULCAST CBL & Associates Properties, Inc. will conduct a conference call at 10:00 am EDT on May 4, 2005, to discuss the first quarter results. The number to call for this interactive teleconference is 913-981-5509. A seven-day replay of the conference call will be available by dialing 719-457-0820 and entering the passcode 7513644. 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., first 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 first 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.fulldisclosure.com, on May 4, 2005, beginning at 10:00 a.m. EDT. The online replay will follow shortly after the call and continue through May 18, 2005. CBL & Associates Properties, Inc. is the fourth largest mall REIT in North America and the largest owner of malls and shopping centers in the Southeast, ranked by GLA. CBL owns, holds interests in or manages 167 properties, including 70 enclosed regional malls. The properties are located in 29 states and total 73.5 million square feet including 2.0 million square feet of non-owned shopping centers managed for third parties. CBL currently has nine projects under construction totaling approximately 1.5 million square feet. The projects include two open-air shopping centers located in Ft. Myers, Fl and Memphis (Southaven, MS), TN, one associated center, three community centers and three expansions. In addition to its office in Chattanooga, TN, CBL has a regional office in Boston (Waltham), MA. Additional information can be found at cblproperties.com 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). -MORE- CBL Reports First Quarter Results Page 4 May 3, 2005 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. 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- CBL Reports First Quarter Results Page 5 May 3, 2005 CBL & ASSOCIATES PROPERTIES, INC. Consolidated Statements of Operations (Unaudited; in thousands, except per share amounts)
Three Months Ended March 31, ------------------------- 2005 2004 ----------- ----------- REVENUES: Minimum rents $ 130,431 $ 108,450 Percentage rents 8,099 6,685 Other rents 3,125 2,786 Tenant reimbursements 60,786 47,996 Management, development and leasing fees 3,045 1,795 Other 5,419 4,447 ----------- ----------- Total revenues 210,905 172,159 ----------- ----------- EXPENSES: Property operating 31,665 27,645 Depreciation and amortization 41,286 32,556 Real estate taxes 15,451 13,081 Maintenance and repairs 12,345 10,194 General and administrative 9,186 8,233 Loss on impairment of real estate assets 262 - Other 3,430 3,032 ----------- ----------- Total expenses 113,625 94,741 ----------- ----------- Income from operations 97,280 77,418 Interest income 1,683 880 Interest expense (48,921) (40,434) Loss on extinguishment of debt (884) - Gain on sales of real estate assets 2,714 19,825 Equity in earnings of unconsolidated affiliates 3,091 2,864 Minority interest in earnings: Operating partnership (20,826) (25,034) Shopping center properties (1,397) (1,238) ----------- ----------- Income before discontinued operations 32,740 34,281 Operating income of discontinued operations 305 329 Loss on discontinued operations (32) (5) ----------- ----------- Net income 33,013 34,605 Preferred dividends (7,642) (4,416) ----------- ----------- Net income available to common shareholders $ 25,371 $ 30,189 =========== =========== Basic per share data: Income before discontinued operations, net of preferred dividends $ 0.80 $ 0.98 Discontinued operations 0.01 0.02 ----------- ----------- Net income available to common shareholders $ 0.81 $ 1.00 =========== =========== Weighted average common shares outstanding 31,224 30,324 Diluted per share data: Income before discontinued operations, net of preferred dividends $ 0.77 $ 0.95 Discontinued operations 0.01 0.01 ----------- ----------- Net income available to common shareholders $ 0.78 $ 0.96 =========== =========== Weighted average common and potential dilutive common shares outstanding 32,397 31,567
-MORE- CBL Reports First Quarter Results Page 6 May 3, 2005 The Company's calculation of FFO is as follows (in thousands, except per share data):
Three Months Ended March 31, ------------------------ 2005 2004 ---------- ---------- Net income available to common shareholders $ 25,371 $ 30,189 Add: Depreciation and amortization from consolidated properties 41,286 32,556 Depreciation and amortization from unconsolidated affiliates 1,710 1,196 Depreciation and amortization from discontinued operations - 189 Minority interest in earnings of operating partnership 20,826 25,034 Less: Gain on sales of operating real estate assets (223) (19,081) Minority investors' share of depreciation and amortization (362) (293) Loss on discontinued operations 32 5 Depreciation and amortization of non-real estate assets (179) (135) ---------- ---------- Funds from operations $ 88,461 $ 69,660 ========== ========== Funds from operations applicable to Company shareholders $ 48,582 $ 38,082 ========== ========== Basic per share data: Funds from operations $ 1.56 $ 1.26 ========== ========== Weighted average common shares outstanding with operating partnership units fully converted 56,854 55,471 Diluted per share data: Funds from operations $ 1.52 $ 1.23 ========== ========== Weighted average common and potential dilutive common shares outstanding with operating partnership units fully converted 58,028 56,713 SUPPLEMENTAL FFO INFORMATION: Lease termination fees $ 2,249 $ 1,143 Lease termination fees per share $ 0.04 $ 0.02 Straight-line rental income $ 1,767 $ 650 Straight-line rental income per share $ 0.03 $ 0.01 Gains on outparcel sales $ 2,610 $ 1,339 Gains on outparcel sales per share $ 0.04 $ 0.02 Amortization of acquired above- and below-market leases $ 1,164 $ 638 Amortization of acquired above- and below-market leases per share $ 0.02 $ 0.01 Amortization of debt premiums $ 1,709 $ 973 Amortization of debt premiums per share $ 0.03 $ 0.02 Gain on sales of non operating properties $ 816 $ - Gain on sales of non operating properties per share $ 0.01 $ - Loss on impairment of real estate assets $ (262) $ - Loss on impairment of real estate assets per share $ - $ -
-MORE- CBL Reports First Quarter Results Page 7 May 3, 2005 Same-Center Net Operating Income (Dollars in thousands)
Three Months Ended March 31, ---------------------- 2005 2004 ---------------------- Net income $ 33,013 $ 34,605 Adjustments: Depreciation and amortization 41,286 32,556 Depreciation and amortization from unconsolidated affiliates 1,710 1,196 Depreciation and amortization from discontinued operations - 189 Minority investors' share of depreciation and amortization in shopping center properties (362) (293) Interest expense 48,921 40,434 Interest expense from unconsolidated affiliates 2,522 1,417 Interest expense from discontinued operations - 11 Minority investors' share of interest expense in shopping center properties (378) (415) Loss on extinguishment of debt 884 - Abandoned projects expense 121 441 Gain on sales of real estate assets (2,714) (19,825) Loss on impairment of real estate assets 262 - Gain on sales of real estate assets of unconsolidated affiliates (934) (592) Minority interest in earnings of operating partnership 20,826 25,034 Loss on discontinued operations 32 5 ----------- ---------- Operating partnership's share of total NOI 145,189 114,763 General and administrative expenses 9,186 8,233 Management fees and non-property level revenues (5,539) (4,970) ----------- ---------- Operating partnership's share of property NOI 148,836 118,026 NOI of non-comparable centers (23,128) (4,505) ----------- ---------- Total same center NOI $125,708 $113,521 =========== ========== Malls $115,896 $104,459 Associated centers 5,706 6,593 Community centers 1,309 512 Other 2,797 1,957 ----------- ---------- Total same center NOI $125,708 $113,521 =========== ========== Percentage Change: Malls 10.9% Associated centers -13.5% Community centers 155.7% Other 42.9% ----------- Total same center NOI 10.7% ===========
-MORE- CBL Reports First Quarter Results Page 8 May 3, 2005 Company's Share of Consolidated and Unconsolidated Debt (Dollars in thousands)
March 31, 2005 ---------------------------------------------------- Fixed Rate Variable Rate Total ------------------ --------------------------------- Consolidated debt $ 2,660,174 $ 709,128 $ 3,369,302 Minority investors' share of consolidated debt (52,667) - (52,667) Company's share of unconsolidated affiliates' debt 107,219 80,057 187,276 ------------------ -------------- ----------------- Company's share of consolidated and unconsolidated debt $ 2,714,726 $ 789,185 $ 3,503,911 ================== ============== ================= Weighted average interest rate 6.34% 3.70% 5.75% ================== ============== =================
March 31, 2004 ---------------------------------------------------- Fixed Rate Variable Rate Total ------------------ -------------- ----------------- Consolidated debt $ 2,369,807 $ 446,075 $ 2,815,882 Minority investors' share of consolidated debt (53,683) - (53,683) Company's share of unconsolidated affiliates' debt 59,311 98,877 158,188 ------------------ -------------- ----------------- Company's share of consolidated and unconsolidated debt $ 2,375,435 $ 544,952 $ 2,920,387 ================== ============== ================= Weighted average interest rate 6.56% 2.46% 5.80% ================== ============== =================
Debt-To-Total-Market Capitalization Ratio as of March 31, 2005 (In thousands, except stock price) Shares Outstanding Stock Price (1) Value ------------------ -------------- ----------------- Common stock and operating partnership units 57,035 $ 71.51 $ 4,078,573 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 4,468,573 Company's share of total debt 3,503,911 ----------------- Total market capitalization $ 7,972,484 ================= Debt-to-total-market capitalization ratio 44.0% ================= (1) Stock price for common stock and operating partnership units equals the closing price of the common stock on March 31, 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 March 31, ---------------------------------- 2005: Basic Diluted -------------- ------------------ Weighted average shares - EPS 31,224 32,397 Weighted average operating partnership units 25,630 25,631 -------------- ------------------ Weighted average shares - FFO 56,854 58,028 ============== ================== 2004: Weighted average shares - EPS 30,324 31,567 Weighted average operating partnership units 25,147 25,146 -------------- ------------------ Weighted average shares - FFO 55,471 56,713 ============== ==================
Dividend Payout Ratio Three Months Ended March 31, ---------------------------------- 2005 2004 -------------- ------------------ Dividend per share $ 0.8125 $ 0.725 FFO per diluted, fully converted share $ 1.52 $ 1.23 -------------- ------------------ Dividend payout ratio 53.5% 58.9% ============== ==================
-MORE- CBL Reports First Quarter Results Page 9 May 3, 2005 Consolidated Balance Sheets (Preliminary and unaudited, in thousands)
March 31, December 31, 2005 2004 ------------ ------------ ASSETS Real estate assets: Land $ 659,719 $ 659,782 Buildings and improvements 4,689,107 4,670,462 ------------ ------------ 5,348,826 5,330,244 Less: accumulated depreciation (612,957) (575,464) ------------ ------------ 4,735,869 4,754,780 Real estate assets held for sale - 61,607 Developments in progress 99,976 78,393 ------------ ------------ Net investment in real estate assets 4,835,845 4,894,780 Cash and cash equivalents 58,935 25,766 Receivables: Tenant, net of allowance 34,183 38,409 Other 12,214 13,706 Mortgage notes receivable 29,889 27,804 Investment in unconsolidated affiliates 94,704 84,782 Other assets 113,010 119,253 ------------ ------------ $ 5,178,780 $ 5,204,500 ============ ============ LIABILITIES AND SHAREHOLDERS' EQUITY Mortgage and other notes payable $ 3,369,302 $ 3,359,466 Mortgage notes payable on real estate assets held for sale - 12,213 Accounts payable and accrued liabilities 186,365 212,064 ------------ ------------ Total liabilities 3,555,667 3,583,743 ------------ ------------ Commitments and contingencies Minority interests 567,110 566,606 ------------ ------------ Shareholders' equity: Preferred stock, $.01 par value 32 32 Common stock, $.01 par value 314 313 Additional paid-in capital 1,027,589 1,025,792 Deferred compensation (2,883) (3,081) Retained earnings 30,951 31,095 ------------ ------------ Total shareholders' equity 1,056,003 1,054,151 ------------ ------------ $ 5,178,780 $ 5,204,500 ============ ============ The balance sheet above is preliminary as of the date of this report. Please refer to the Company's Quarterly Report on Form 10-Q when filed for a complete balance sheet as of March 31, 2005.
-END- EX-99 4 conferencecall.txt EXHIBIT 99.2 CONFERENCE CALL Exhibit 99.2 CBL & ASSOCIATES PROPERTIES, INC. CONFERENCE CALL, FIRST QUARTER MAY 4, 2005 @ 10:00 AM EDT Stephen: Thank you. Good morning. We appreciate your participation in CBL & Associates Properties Inc., conference call to discuss first quarter 2005 results. Joining me today is John Foy, the Company's Chief Financial Officer and Katie Knight, 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 based upon a fully diluted converted share. Also, references made to community centers are only those that are wholly owned 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. Stephen: Thank you, Katie. The first quarter was a great quarter for CBL with a 23.6% increase in FFO per share, an impressive 10.7% increase in same-center NOI, a 4.5% comp-store sales increase, and a 50 bps increase in occupancy. A significant portion of our success this quarter is attributable to a full quarter contribution from our 2004 activities including 1.9 million square feet of new developments, highlighted by the opening of Coastal Grand - Myrtle Beach and the nearly $1 billion in acquisitions we completed in the year. We expect that our 2005 development pipeline, which includes over 2.5 million square feet, coupled with selective acquisitions should contribute meaningfully to the continued growth of our Company. DEVELOPMENT Many of our development projects are the result of our focus on identifying opportunities within our existing portfolio for re-tenanting, redevelopment, expansion and renovation. This focus allows us to keep our tenant-mix attractive and current with the latest trends. To this end, we have opened or have plans to add big box retailers, "lifestyle" retailers, and restaurant locations at many of our properties. A prime example of this strategy is the redevelopment of Hamilton Corner in Chattanooga, TN. We have redeveloped this Hamilton Place associated center into a 68,000 square foot lifestyle shopping center offering many national retailers new to the Chattanooga market including Ann Taylor Loft, Chico's, Coldwater Creek, J.Jill and Liz Claiborne Shoes. We held the grand re-opening celebration in mid-March and sales results to-date have been outstanding. Another example is The District at Monroeville, a lifestyle expansion at Monroeville Mall located in a suburb of Pittsburgh. We have already opened several exciting new retailers including a 26,000 square foot Barnes & Noble, a 10,400 square foot Ulta Cosmetics and a Johnny Carino's Restaurant. Additional committed tenants include Chico's, Coldwater Creek, and Monterey Bay Fish Grotto. -1- Other redevelopments and expansions include the recently opened Tweeter's at CoolSprings Crossing, the associated center for CoolSprings Galleria in Nashville, TN. Additionally, in April we opened Coastal Grand's associated center, Coastal Grand Crossing located in Myrtle Beach, SC, anchored by Lifeway Christian Bookstore. Later this year we will open a 45,000 square foot, free standing Dick's Sporting Goods at Citadel Mall in Charleston, SC, a J. Buck's restaurant at St. Clair Square in Fairview Heights, IL, a Garfield's restaurant at Stroud Mall in Stroudsburg, PA and a Steve & Barry's at Burnsville Center in Burnsville, MN. We are adding 18,000 square feet of restaurants and small shop space to Fashion Square, our community center in Orange Park, FL, which we purchased in May 2004. The expansion is scheduled to open in July. We currently have two renovation projects underway for a total investment of approximately $28.0 million. The renovation of CoolSprings Galleria in Nashville, TN is expected to be completed in Spring 2006 and the renovation of Fayette Mall in Lexington, KY is scheduled for completion in the fourth quarter of 2005. Concurrent with its renovation, Fayette Mall is undergoing a 144,000 square foot expansion including the addition of a two-level, 75,000 square foot Dick's Sporting Goods, 14,000 square feet of exterior-oriented restaurants and approximately 55,000 square feet of small shop space. The expansion is currently over 96% leased and committed. We also opened one new anchor store during the quarter, JC Penney at Greenbriar Mall in Chesapeake, VA. We plan to open or have already opened several new, ground-up developments in 2005. We completed the grand opening of Imperial Valley Mall in El Centro, CA in March of this year. The grand opening was a success and we are extremely pleased with the malls performance to-date. Another anchor, the 14-screen UltraStar Theater opened last week. We continue to hear many positive comments from the mall retailers and traffic and sales have both exceeded expectations. Occupancy is currently 88%, with a number of new stores interested in coming into the mall. We are excited at Imperial Valley Mall's initial success and believe it is another solid addition to the CBL portfolio. We currently have two community center developments under construction, Cobblestone Village at Royal Palm in Royal Palm Beach, FL and Chicopee Marketplace in Chicopee, MA. Cobblestone Village is a 225,000 square foot project anchored by Target with approximately 40,000 square feet of specialty shops opening in July. The project is over 83% leased and committed today. Chicopee Marketplace is a 152,000 square foot community shopping center that is currently 93% leased and committed. The center will feature an iParty, Staples, Marshall's, and Sleepy's and is scheduled to open in September. In October, we plan to hold the grand opening celebration for the 420,000 square foot Southaven Towne Center located south of Memphis in Southaven, MS. The property is currently 90% leased and committed and is anchored by JCPenney, Linens N' Things and Circuit City with Dillard's opening next spring. Last week we announced a 50/50 joint venture with The Jacobs Group to develop Gulf Coast Town Center, a three-phase, 1.7 million square foot open-air shopping center located in Ft. Myers, FL. Our initial commitment of approximately $41 million funded most of the cost invested to-date by The Jacobs Group. Phase I, with a total cost of approximately $77 million, is under construction and is scheduled to open in October of this year. The 425,000 square foot phase I is 98.0% leased and committed and includes a 185,000 square foot Super Target, Babies "R" Us, Linens N' Things, a 16-screen Regal Cinema, Petco, Staples, JoAnn's and several thousand square feet of small shop space. Phase II, which will open in fall 2006, will include the regions first Bass Pro Shop as well as JCPenney, Belk, and numerous national retailers and restaurants. The overall project will ultimately feature more than ten anchors and approximately 120 specialty shops and restaurants. The total project is expected to cost approximately $150 - $180 million and should provide an unleveraged initial return of 9%. CBL will be responsible for development of Phase II and Phase III as well as leasing and management of the entire project. We will fund the equity for this development over and above the financing and will receive an 11% preferred return on the equity funded. We will also receive management and financing fees. We are pleased to be partnering with The Jacobs Group on this project. The Jacobs Group secured an incredible location at the intersection of I-75 at Alico Road with approximately one mile of highway frontage. The site is only five minutes from the Southwest Florida International Airport, which is currently undergoing a major expansion to add 70 gates. Immediately adjacent to the project is Florida's Gulf Coast University, with an annual enrollment of 6,200 that is projected to double over the next five years. The Ft. Myers/Lee County area has one of the highest growth rates in the country, with the majority of housing growth occurring around the I-75 corridor. The population in the primary trade area increased 97% between 1990-2003 and is projected to increase 29% through 2010. Gulf Coast will also serve the more than 2.0 million tourists that visit southwest Florida each year. While we realize there are questions regarding the competitive dynamics of our project with Simon's Coconut Point project in Bonita Springs, we are confident that the market has the capacity and the growth to make both projects successful. -2- LEASING Moving on, leasing is off to a strong start for us in 2005. We accomplished more than 940,000 square feet of leasing in the quarter, including 388,000 square feet of new leases and 552,000 square feet of renewal leases. This is a notable increase from the 673,000 square feet completed in the prior year period with 247,000 square feet of new leases and 426,000 square feet of renewal. Both periods exclude centers sold to Galileo. For the first quarter, leases for the same small shop space of 20,000 square feet and less, were signed at an average increase of 4.3% over the average base rent per square foot of the prior leases. Leases for both same space and non-comparable space of 20,000 square feet and less were signed at an average increase of 6.8% over the average base rent per square foot of expiring leases in the quarter. Total portfolio occupancy in the first quarter 2005 increased 50 bps to 91.3% from 90.8% in the first quarter 2004. Mall occupancy ended the quarter at 91.5%, a 50 basis point increase from 91.0% occupancy at March 31, 2004. Occupancy in the associated centers increased 320 basis points to 91.9%. Much of the increase in occupancy in the associated centers was a result of the completion of the redevelopment of Hamilton Corner. Over the past few quarters we have enjoyed a strengthening retail landscape with fewer bankruptcy announcements and store closures. Since June 2003, 136 stores have closed totaling approximately 511,000 square feet and representing $9.4 million in lost annual base rent. We have replaced approximately 46% of this space at increases of 3.3% in annual base rent per square foot. RETAIL SALES We were also pleased with our sales performance this quarter and anticipate continued positive results by our retailers. Same store sales in the first quarter 2005 for mall tenants 10,000 square feet or less in stabilized malls increased 4.5% over the prior year. Occupancy costs as a percent of sales was 13.9% for the three-months ended March 31, 2005 as compared with 14.2% for the prior year period. ACQUISITIONS We did not complete any acquisitions in the first quarter. However, yesterday, we announced that we would be acquiring a 70% joint venture interest in Laurel Park Place in Livonia, MI for $82.2 million, including closing costs. The mall is anchored by two upscale, highly productive department stores, Von Maur and Parisian. Mall sales for 2004 were $409 per square foot, and the tenant mix features high quality stores such as Williams - Sonoma, Talbots, and Chico's. The $82.2 million includes approximately $50.9 million of non-recourse debt held by the joint venture. CBL will receive a preferred return of 100% of the property's net cash flow. Additionally, we have retained the right to purchase the remaining joint venture interest for $14.0 million in cash or SCU's of the Operating Partnership, at our option. As we indicated on the fourth quarter conference call, the acquisition environment remains highly competitive. However, as evidenced by this latest acquisition, we are still confident that we will be able to complete selective acquisitions. I would now like to turn the call over to John for the financial review. John: Thank you, Stephen. We are pleased with our first quarter 2005 results. FFO per share was $1.52 for the first quarter 2005 a 23.6% increase from FFO per share of $1.23 in the prior year period. Approximately 54% of the increase in FFO was funded from external growth and 46% through internal growth. -3- In response to the letter issued by the Office of the Chief Accountant of the SEC in February of this year, we reviewed our practices related to accounting for rent holidays. We determined that while our accounting practices were consistent with industry standards we would revise our accounting policy going forward to include the period of rent holidays in the term of the lease over which straight-line rent is recognized. The results for the first quarter included an increase of $400,000 in minimum rents as a result of this revision. This added less than a penny to FFO per share in the quarter. We also determined that prior period adjustments were immaterial. FINANCIAL REVIEW Additional highlights in the quarter included: A debt-to-total-market capitalization ratio of 44.0% for the first quarter 2005 compared with 44.5% in the prior year period. Our balance sheet remains healthy providing us with a tremendous amount of flexibility to complete transactions and grow our company. Variable rate debt comprised 9.9% of total market capitalization at quarter-end and 22.5% of total debt. With our active development program, variable rate debt will remain at this approximate level. Our EBITDA to interest coverage ratio was 2.9 times for the first quarter 2005 compared with 2.8 times in the prior-year period. For the first quarter G&A represented 4.4% of total revenues in the quarter. This compares favorably with 4.8% in the prior year period. Same-center NOI rose 10.7% over first quarter 2004. The $12.2 million increase in same-center NOI is attributable to several factors including: o Properties acquired in 2003 were included in the same-center comparison this quarter. For these properties we received $1.0 million in percentage rents in the first quarter of 2005 compared with none in the first quarter of the prior year. o In the first quarter 2004 we took approximately $4.7 million in bad debt reserve and other charges against revenue. Since that time we have had greater than expected recoveries of $1.4 million. The overall result is a $6.1 million positive swing. o $400,000 of base rent increase was a result of the rent holiday adjustment. The remainder of the increase resulted from increases in occupancy, specialty leasing and sponsorship income, rental rates, and contributions from other comparable portfolio improvements. Our cost recovery ratio was 102% in the first quarter 2005 compared with 94% for the first quarter 2004. The increase in recoveries was primarily a result of: o Occupancy increases and profit from utility reimbursements from the tenants at the newly acquired malls and from the existing malls due to the implementation of efficiency optimizing utility systems. o As we stated earlier, we were successful in the recovery of bad debt expenses and other charges to revenues that were recorded in prior periods, thus reporting a favorable variance of $6.1 million. On our last conference call we were asked how much of our CAM reimbursements come from the recovery of capital expenditures. We have performed an analysis and have determined that on average 4.5% to 5.0% of our reimbursements are attributable to the depreciation of capex. This estimated range was derived based on 2004 results and is consistent with historical levels. -4- GUIDANCE UPDATE As noted in our earnings release we have increased our earnings guidance to account for first quarter results. We are increasing our guidance to a range of $5.88 to $5.96 per share from the previously issued range of $5.66 to $5.74. Our guidance does not include any acquisitions, outparcel sales, gains from the sale of non-operating properties, or termination fee income. The guidance assumes NOI growth of 3% - 4% for 2005, a 100 bps increase from our prior guidance. Additionally, our guidance does not include the acquisition of Laurel Park, which we announced yesterday. We anticipate that this acquisition will add approximately $0.03 to FFO per share in 2005 based on the transaction closing within the next 30 days. We will include this transaction in our second quarter guidance updates. CONCLUSION We believe that the healthy momentum we gained in the first quarter 2005 will continue. With over 2.5 million square feet of developments coming on-line in 2005, this is one of our biggest development years as a public company. With approximately 800,000 square feet of developments already announced for 2006, including Phase II of Gulf Coast Towne Center and Lakeview Point in Stillwater, OK, we already have a great foundation for growth in 2006. We are continually looking at new possibilities and avenues of growth for our Company. Thank you again for joining our call today and Stephen and I would be happy to answer any questions you may have. -5- EX-99 5 supplemental.txt EXHIBIT 99.3 SUPPLEMENTAL INFORMAION Exhibit 99.3 CBL & ASSOCIATES PROPERTIES, INC. Supplemental Financial and Operating Information For the Three Months Ended March 31, 2005 Consolidated Statements of Operations (Unaudited; in thousands, except per share amounts)
Three Months Ended March 31, ------------------------- 2005 2004 ----------- ----------- REVENUES: Minimum rents $ 130,431 $ 108,450 Percentage rents 8,099 6,685 Other rents 3,125 2,786 Tenant reimbursements 60,786 47,996 Management, development and leasing fees 3,045 1,795 Other 5,419 4,447 ----------- ----------- Total revenues 210,905 172,159 ----------- ----------- EXPENSES: Property operating 31,665 27,645 Depreciation and amortization 41,286 32,556 Real estate taxes 15,451 13,081 Maintenance and repairs 12,345 10,194 General and administrative 9,186 8,233 Loss on impairment of real estate assets 262 - Other 3,430 3,032 ----------- ----------- Total expenses 113,625 94,741 ----------- ----------- Income from operations 97,280 77,418 Interest income 1,683 880 Interest expense (48,921) (40,434) Loss on extinguishment of debt (884) - Gain on sales of real estate assets 2,714 19,825 Equity in earnings of unconsolidated affiliates 3,091 2,864 Minority interest in earnings: Operating partnership (20,826) (25,034) Shopping center properties (1,397) (1,238) ----------- ----------- Income before discontinued operations 32,740 34,281 Operating income of discontinued operations 305 329 Loss on discontinued operations (32) (5) ----------- ----------- Net income 33,013 34,605 Preferred dividends (7,642) (4,416) ----------- ----------- Net income available to common shareholders $ 25,371 $ 30,189 =========== =========== Basic per share data: Income before discontinued operations, net of preferred dividends $ 0.80 $ 0.98 Discontinued operations 0.01 0.02 ----------- ----------- Net income available to common shareholders $ 0.81 $ 1.00 =========== =========== Weighted average common shares outstanding 31,224 30,324 Diluted per share data: Income before discontinued operations, net of preferred dividends $ 0.77 $ 0.95 Discontinued operations 0.01 0.01 ----------- ----------- Net income available to common shareholders $ 0.78 $ 0.96 =========== =========== Weighted average common and potential dilutive common shares outstanding 32,397 31,567
-1- CBL & ASSOCIATES PROPERTIES, INC. Supplemental Financial and Operating Information For the Three Months Ended March 31, 2005 The Company's calculation of FFO is as follows (in thousands, except per share data):
Three Months Ended March 31, ------------------------ 2005 2004 ---------- ---------- Net income available to common shareholders $ 25,371 $ 30,189 Add: Depreciation and amortization from consolidated properties 41,286 32,556 Depreciation and amortization from unconsolidated affiliates 1,710 1,196 Depreciation and amortization from discontinued operations - 189 Minority interest in earnings of operating partnership 20,826 25,034 Less: Gain on sales of operating real estate assets (223) (19,081) Minority investors' share of depreciation and amortization (362) (293) Loss on discontinued operations 32 5 Depreciation and amortization of non-real estate assets (179) (135) ---------- ---------- Funds from operations $ 88,461 $ 69,660 ========== ========== Funds from operations applicable to Company shareholders $ 48,582 $ 38,082 ========== ========== Basic per share data: Funds from operations $ 1.56 $ 1.26 ========== ========== Weighted average common shares outstanding with operating partnership units fully converted 56,854 55,471 Diluted per share data: Funds from operations $ 1.52 $ 1.23 ========== ========== Weighted average common and potential dilutive common shares outstanding with operating partnership units fully converted 58,028 56,713 SUPPLEMENTAL FFO INFORMATION: Lease termination fees $ 2,249 $ 1,143 Lease termination fees per share $ 0.04 $ 0.02 Straight-line rental income $ 1,767 $ 650 Straight-line rental income per share $ 0.03 $ 0.01 Gains on outparcel sales $ 2,610 $ 1,339 Gains on outparcel sales per share $ 0.04 $ 0.02 Amortization of acquired above- and below-market leases $ 1,164 $ 638 Amortization of acquired above- and below-market leases per share $ 0.02 $ 0.01 Amortization of debt premiums $ 1,709 $ 973 Amortization of debt premiums per share $ 0.03 $ 0.02 Gain on sales of non operating properties $ 816 $ - Gain on sales of non operating properties per share $ 0.01 $ - Loss on impairment of real estate assets $ (262) $ - Loss on impairment of real estate assets per share $ - $ -
-2- CBL & ASSOCIATES PROPERTIES, INC. Supplemental Financial and Operating Information For the Three Months Ended March 31, 2005 Same-Center Net Operating Income (Dollars in thousands)
Three Months Ended March 31, ---------------------- 2005 2004 ---------------------- Net income $ 33,013 $ 34,605 Adjustments: Depreciation and amortization 41,286 32,556 Depreciation and amortization from unconsolidated affiliates 1,710 1,196 Depreciation and amortization from discontinued operations - 189 Minority investors' share of depreciation and amortization in shopping center properties (362) (293) Interest expense 48,921 40,434 Interest expense from unconsolidated affiliates 2,522 1,417 Interest expense from discontinued operations - 11 Minority investors' share of interest expense in shopping center properties (378) (415) Loss on extinguishment of debt 884 - Abandoned projects expense 121 441 Gain on sales of real estate assets (2,714) (19,825) Loss on impairment of real estate assets 262 - Gain on sales of real estate assets of unconsolidated affiliates (934) (592) Minority interest in earnings of operating partnership 20,826 25,034 Loss on discontinued operations 32 5 ----------- ---------- Operating partnership's share of total NOI 145,189 114,763 General and administrative expenses 9,186 8,233 Management fees and non-property level revenues (5,539) (4,970) ----------- ---------- Operating partnership's share of property NOI 148,836 118,026 NOI of non-comparable centers (23,128) (4,505) ----------- ---------- Total same center NOI $125,708 $113,521 =========== ========== Malls $115,896 $104,459 Associated centers 5,706 6,593 Community centers 1,309 512 Other 2,797 1,957 ----------- ---------- Total same center NOI $125,708 $113,521 =========== ========== Percentage Change: Malls 10.9% Associated centers -13.5% Community centers 155.7% Other 42.9% ----------- Total same center NOI 10.7% ===========
-3- CBL & ASSOCIATES PROPERTIES, INC. Supplemental Financial and Operating Information For the Three Months Ended March 31, 2005 Company's Share of Consolidated and Unconsolidated Debt (Dollars in thousands)
March 31, 2005 ---------------------------------------------------- Fixed Rate Variable Rate Total ------------------ --------------------------------- Consolidated debt $ 2,660,174 $ 709,128 $ 3,369,302 Minority investors' share of consolidated debt (52,667) - (52,667) Company's share of unconsolidated affiliates' debt 107,219 80,057 187,276 ------------------ -------------- ----------------- Company's share of consolidated and unconsolidated debt $ 2,714,726 $ 789,185 $ 3,503,911 ================== ============== ================= Weighted average interest rate 6.34% 3.70% 5.75% ================== ============== =================
March 31, 2004 ---------------------------------------------------- Fixed Rate Variable Rate Total ------------------ -------------- ----------------- Consolidated debt $ 2,369,807 $ 446,075 $ 2,815,882 Minority investors' share of consolidated debt (53,683) - (53,683) Company's share of unconsolidated affiliates' debt 59,311 98,877 158,188 ------------------ -------------- ----------------- Company's share of consolidated and unconsolidated debt $ 2,375,435 $ 544,952 $ 2,920,387 ================== ============== ================= Weighted average interest rate 6.56% 2.46% 5.80% ================== ============== =================
Debt-To-Total-Market Capitalization Ratio as of March 31, 2005 (In thousands, except stock price) Shares Outstanding Stock Price (1) Value ------------------ -------------- ----------------- Common stock and operating partnership units 57,035 $ 71.51 $ 4,078,573 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 4,468,573 Company's share of total debt 3,503,911 ----------------- Total market capitalization $ 7,972,484 ================= Debt-to-total-market capitalization ratio 44.0% ================= (1) Stock price for common stock and operating partnership units equals the closing price of the common stock on March 31, 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 March 31, ---------------------------------- 2005: Basic Diluted -------------- ------------------ Weighted average shares - EPS 31,224 32,397 Weighted average operating partnership units 25,630 25,631 -------------- ------------------ Weighted average shares - FFO 56,854 58,028 ============== ================== 2004: Weighted average shares - EPS 30,324 31,567 Weighted average operating partnership units 25,147 25,146 -------------- ------------------ Weighted average shares - FFO 55,471 56,713 ============== ==================
Dividend Payout Ratio Three Months Ended March 31, ---------------------------------- 2005 2004 -------------- ------------------ Dividend per share $ 0.8125 $ 0.725 FFO per diluted, fully converted share $ 1.52 $ 1.23 -------------- ------------------ Dividend payout ratio 53.5% 58.9% ============== ==================
-4- CBL & ASSOCIATES PROPERTIES, INC. Supplemental Financial and Operating Information For the Three Months Ended March 31, 2005 Consolidated Balance Sheets (Preliminary and unaudited, in thousands)
March 31, December 31, 2005 2004 ------------ ------------ ASSETS Real estate assets: Land $ 659,719 $ 659,782 Buildings and improvements 4,689,107 4,670,462 ------------ ------------ 5,348,826 5,330,244 Less: accumulated depreciation (612,957) (575,464) ------------ ------------ 4,735,869 4,754,780 Real estate assets held for sale - 61,607 Developments in progress 99,976 78,393 ------------ ------------ Net investment in real estate assets 4,835,845 4,894,780 Cash and cash equivalents 58,935 25,766 Receivables: Tenant, net of allowance 34,183 38,409 Other 12,214 13,706 Mortgage notes receivable 29,889 27,804 Investment in unconsolidated affiliates 94,704 84,782 Other assets 113,010 119,253 ------------ ------------ $ 5,178,780 $ 5,204,500 ============ ============ LIABILITIES AND SHAREHOLDERS' EQUITY Mortgage and other notes payable $ 3,369,302 $ 3,359,466 Mortgage notes payable on real estate assets held for sale - 12,213 Accounts payable and accrued liabilities 186,365 212,064 ------------ ------------ Total liabilities 3,555,667 3,583,743 ------------ ------------ Commitments and contingencies Minority interests 567,110 566,606 ------------ ------------ Shareholders' equity: Preferred stock, $.01 par value 32 32 Common stock, $.01 par value 314 313 Additional paid-in capital 1,027,589 1,025,792 Deferred compensation (2,883) (3,081) Retained earnings 30,951 31,095 ------------ ------------ Total shareholders' equity 1,056,003 1,054,151 ------------ ------------ $ 5,178,780 $ 5,204,500 ============ ============ The balance sheet above is preliminary as of the date of this report. Please refer to the Company's Quarterly Report on Form 10-Q when filed for a complete balance sheet as of March 31, 2005.
-5- CBL & ASSOCIATES PROPERTIES, INC. Supplemental Financial and Operating Information For the Three Months Ended March 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 March 31, --------------------- 2005 2004 --------- ---------- EBITDA: Net Income $ 33,013 $ 34,605 Adjustments: Depreciation and amortization 41,286 32,556 Depreciation and amortization from unconsolidated affiliates 1,710 1,196 Depreciation and amortization from discontinued operations - 189 Minority investors' share of depreciation and amortization in shopping center properties (362) (293) Interest expense 48,921 40,434 Interest expense from unconsolidated affiliates 2,522 1,417 Interest expense from discontinued operations - 11 Minority investors' share of interest expense in shopping center properties (378) (415) Income taxes 355 446 Loss on extinguishment of debt 884 - Loss on impairment of real estate assets 262 - Abandoned projects expense 121 441 Gain on sales of operating real estate assets (223) (19,081) Minority interest in earnings of operating partnership 20,826 25,034 Loss on discontinued operations 32 5 --------- ---------- Company's share of total EBITDA $148,969 $ 116,545 ========= ========== Interest Expense: Interest expense $ 48,921 $ 40,434 Interest expense from discontinued operations - 11 Interest expense from unconsolidated affiliates 2,522 1,417 Minority investors' share of interest expense in shopping center properties (378) (415) --------- ---------- Company's share of total interest expense $ 51,065 $ 41,447 ========= ========== Ratio of EBITDA to Interest Expense 2.92 2.81 ========= ==========
Reconciliation of EBITDA to Cash Flows Provided By Operating Activities (In thousands)
Three Months Ended March 31, --------------------- 2005 2004 --------- ---------- Company's share of total EBITDA $148,969 $ 116,545 Interest expense (48,921) (40,445) Minority interest's share of interest expense 378 415 Income taxes (355) (446) Amortization of deferred financing costs and non real estate 2,021 1,754 depreciation included in operating expense Amortization of debt premiums (1,678) (932) Amortization of above and below market leases (1,531) (603) Depreciation and interest expense from unconsolidated affiliates (4,232) (2,613) Minority investors' share of depreciation and amortization in 362 293 shopping center properties Minority interest in earnings - shopping center properties 1,397 1,248 Gains on outparcel sales (2,491) (744) Issuances of stock under incentive plan 810 999 Amortization of deferred compensation 199 119 Accrual of deferred compensation 122 93 Changes in operating assets and liabilities (18,703) 3,070 --------- ---------- Cash flows provided by operating activities $ 76,347 $ 78,753 ========= ==========
-6- CBL & ASSOCIATES PROPERTIES, INC. Supplemental Financial and Operating Information For the Three Months Ended March 31, 2005 Schedule of Mortgage and Other Notes Payable as of March 31, 2005 (Dollars In thousands)
Balance Maturity Interest Balance ---------------------------- Location Property Date Rate March 31, 2005 Fixed Variable - -------------------------------------------------------------------------------------------------------------------------- Midland MI Midland Mall Jun-05 3.875% $ 30,000 $ - $ 30,000 Hattiesburg, MS Turtle Creek Mall Mar-06 7.400% 30,213 30,213 - Chesapeake, VA Greenbrier Mall Apr-06 3.875% 92,650 - 92,650 Akron, OH Chapel Hill Mall May-06 3.670% 64,000 - 64,000 Akron, OH Chapel Hill Surburban May-06 3.750% 2,500 - 2,500 Brookfield, IL Brookfield Square Jul-06 7.498% 69,321 69,321 - Rockford, IL Cherryvale Mall Jul-06 7.375% 44,062 44,062 - Lexington KY Fayette Mall Development Dec-06 4.350% 8,550 - 8,550 Lynchburg, VA River Ridge Mall Jan-07 4.000% 21,659 21,659 - Madison, WI East Towne Mall Jan-07 8.010% 26,946 26,946 - Madison, WI West Towne Mall Jan-07 8.010% 41,659 41,659 - Chattanooga, TN Hamilton Place Mar-07 7.000% 63,131 63,131 - Cincinnati, OH Eastgate Crossing Apr-07 6.380% 10,142 10,142 - Charleston, SC Citadel Mall May-07 7.390% 30,704 30,704 - Highpoint, NC Oak Hollow Mall Feb-08 7.310% 44,197 44,197 - Winston-Salem NC Hanes Mall Jul-08 7.310% 108,157 108,157 - Nashville, TN Hickory Hollow Mall Aug-08 6.770% 87,438 87,438 - Nashville, TN Courtyard At Hickory Aug-08 6.770% 4,071 4,071 - Nashville, TN Rivergate Mall Aug-08 6.770% 70,667 70,667 - Nashville, TN Village At Rivergate Aug-08 6.770% 3,338 3,338 - Lansing MI Meridian Mall Oct-08 4.520% 92,783 92,783 - Cary , NC Cary Towne Ctr Mar-09 6.850% 86,973 86,973 - Joplin, MO North Park Mall Mar-09 5.500% 41,259 41,259 - Fairview Heights, IL St. Claire Square Apr-09 7.000% 66,885 66,885 - Daytona Beach, FL Volusia Mall Apr-09 4.750% 54,202 54,202 - Terre Haute, IN Honey Creek Mall Apr-09 4.750% 32,579 32,579 - Meridian, MS Bonita Lakes Mall Oct-09 6.820% 26,332 26,332 - Meridian, MS Bonita Lakes Crossing Oct-09 6.820% 8,251 8,251 - Cincinnati, OH Eastgate Mall Dec-09 4.550% 57,032 (a) 57,032 - Little Rock, AR Park Plaza Mall May-10 4.900% 41,035 41,035 - Spartanburg, SC Westgate Crossing Jul-10 8.420% 9,551 9,551 - Burnsville, MN Burnsville Center Aug-10 8.000% 69,316 69,316 - Roanoke, VA Valley View Mall Sep-10 5.100% 44,264 44,264 - Beaumont, TX Parkdale Mall Sep-10 5.010% 55,217 55,217 - Beaumont, TX Parkdale Crossing Sep-10 5.010% 8,719 8,719 - Nashville, TN Coolsprings Galleria Sep-10 8.290% 58,161 58,161 - Stroud, PA Stroud Mall Dec-10 8.420% 31,467 31,467 - Wausau WI Wausau Center Dec-10 6.700% 13,198 13,198 - York, PA York Galleria Dec-10 8.340% 50,308 50,308 - Lexington KY Fayette Mall Jul-11 7.000% 93,984 93,984 - Chattanooga, TN Hamilton Corner Aug-11 10.125% 2,215 2,215 - Asheville, NC Asheville Mall Sep-11 6.980% 68,470 68,470 - Ft Smith, AR Massard Crossing Feb-12 7.540% 5,836 5,836 - Houston, TX Willowbrook Plaza Feb-12 7.540% 29,861 29,861 - Vicksburg, MS Pemberton Plaza Feb-12 7.540% 1,994 1,994 - Fayetteville, NC Cross Creek Mall Apr-12 5.000% 63,208 63,208 - -7- Schedule of Mortgage and Other Notes Payable as of March 31, 2005 (Dollars In thousands) Balance Maturity Interest Balance ---------------------------- Location Property Date Rate March 31, 2005 Fixed Variable - -------------------------------------------------------------------------------------------------------------------------- Colonial Heights, VA Southpark Mall May-12 5.100% 37,195 37,195 - Asheboro, NC Randolph Mall Jul-12 6.500% 14,970 14,970 - Douglasville, GA Arbor Place Mall Jul-12 6.510% 77,714 77,714 - Douglasville, GA The Landing At Arbor Jul-12 6.510% 8,773 8,773 - Jackson, TN Old Hickory Mall Jul-12 6.510% 34,328 34,328 - Louisville, KY Jefferson Mall Jul-12 6.510% 43,291 43,291 - N Charleston SC Northwoods Mall Jul-12 6.510% 61,980 61,980 - Racine, WI Regency Mall Jul-12 6.510% 33,946 33,946 - Saginaw, MI Fashion Square Jul-12 6.510% 59,501 59,501 - Spartanburg, SC Westgate Mall Jul-12 6.500% 53,776 53,776 - Chattanooga, TN CBL Center Aug-12 6.250% 14,523 14,523 - Panama City, FL Panama City Mall Aug-12 7.300% 39,618 39,618 - Monroeville, PA Monroeville Mall Jan-13 5.300% 132,020 132,020 - Greensburg PA Westmoreland Mall Jan-13 5.050% 81,430 81,430 - Columbia, SC Columbia Mall Oct-13 5.450% 33,002 33,002 - Laredo, TX Mall Del Norte Dec-14 5.040% 113,400 113,400 - Janesville WI Janesville Mall Apr-16 8.375% 13,384 13,384 - ----------- ----------- --------- 2,819,356 2,621,656 197,700 ----------- ----------- --------- Weighted average interest rate 6.21% 6.39% 3.83% Debt Premiums: Lynchburg, VA River Ridge Mall Jan-07 4.000% 1,509 1,509 - Joplin, MO North Park Mall Mar-09 5.500% 663 663 - Daytona Beach, FL Volusia Mall Apr-09 4.750% 3,752 3,752 - Terre Haute, IN Honey Creek Mall Apr-09 4.750% 2,610 2,610 - Little Rock, AR Park Plaza Mall May-10 4.900% 6,899 6,899 - Roanoke, VA Valley View Mall Sep-10 5.100% 7,175 7,175 - Fayetteville, NC Cross Creek Mall Apr-12 5.000% 8,624 8,624 - Colonial Heights, VA Southpark Mall May-12 5.100% 3,921 3,921 - Monroeville, PA Monroeville Mall Jan-13 5.300% 3,365 3,365 - ----------- ----------- --------- 38,518 38,518 - ----------- ----------- --------- Weighted average interest rate 4.96% SUBTOTAL 2,857,874 2,660,174 197,700 ----------- ----------- --------- Weighted average interest rate 6.17% 6.38% 3.45% CONSTRUCTION LOAN: Southaven, MS Southaven Towne Center Jun-07 4.350% 17,207 - 17,207 ----------- ----------- --------- LINES OF CREDIT 3.558% 494,221 - 494,221 ----------- ----------- --------- TOTAL BALANCE SHEET $ 3,369,302 $ 2,660,174 $ 709,128 Weighted average interest rate 5.80% 6.37% 3.65% -8- Schedule of Mortgage and Other Notes Payable as of March 31, 2005 (Dollars In thousands) Balance Maturity Interest Balance ---------------------------- Location Property Date Rate March 31, 2005 Fixed Variable - -------------------------------------------------------------------------------------------------------------------------- Plus CBL Share Of Unconsolidated Affiliates: Huntsville, AL Parkway Place Dec-05 4.3750% 26,662 - 26,662 El Centro, CA Imperial Valley Mall Dec-06 4.0900% 48,070 - 48,070 Paducah, KY Kentucky Oaks Jun-07 9.0000% 15,565 15,565 - Del Rio, TX Plaza Del Sol Aug-10 9.1500% 1,714 1,714 - Myrtle Beach, SC Coastal Grand Oct-14 5.0900% 49,582 49,582 - Clarksville, TN Governors Square Sep-16 8.2300% 14,816 14,816 - Galileo America LLC Portfolio various 4.8237% 30,867 25,542 5,325 ----------- ----------- --------- 187,276 107,219 80,057 ----------- ----------- --------- Minority Less Minority Interests' Share: Interest % Chattanooga, TN CBL Center 8.0% 6.250% (1,162) (1,162) - Chattanooga, TN Hamilton Corner 10.0% 10.125% (221) (221) - Chattanooga, TN Hamilton Place 10.0% 7.000% (6,313) (6,313) - Ft Smith AR Massard Crossing 10.0% 7.540% (5,252) (5,252) - Highpoint, NC Oak Hollow Mall 25.0% 7.310% (11,049) (11,049) - Houston, TX Willowbrook Plaza 25.0% 7.540% (26,875) (26,875) - Vicksburg, MS Pemberton Plaza 25.0% 7.310% (1,795) (1,795) - ------------ ------------ --------- (52,667) (52,667) - ------------ ------------ --------- TOTAL OBLIGATIONS $ 3,503,911 $ 2,714,726 $ 789,185 ============ ============ ========= Weighted average interest rate 5.75% 6.34% 3.70% Total Debt of Unconsolidated Affiliates Huntsville, AL Parkway Place Dec-05 2.780% $ 53,324 $ - $ 53,324 El Centro, CA Imperial Valley Mall Dec-06 2.840% 48,070 - 48,070 Paducah, KY Kentucky Oaks Jun-07 9.000% 31,129 31,129 - Del Rio, TX Plaza Del Sol Aug-10 9.150% 3,388 3,388 0 Myrtle Beach, SC Coastal Grand Oct-14 5.090% 99,165 (b) 99,165 - Clarksville, TN Governors Square Sep-16 8.230% 31,192 31,192 - Galileo America LLC Portfolio various 5.074% 371,887 307,737 64,150 ----------- ----------- --------- $ 638,155 $ 472,611 $ 165,544 =========== =========== ========= Weighted average interest rate 4.95% 5.57% 3.19% (a) 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) 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.
-9- CBL & ASSOCIATES PROPERTIES, INC. Supplemental Financial and Operating Information For the Three Months Ended March 31, 2005 New and Renewal Leasing Activity of Same Small Shop Space Less Than 20,000 Square Feet Excluding Junior Anchors
Prior New New Base Initial Average Square Rent Base % Change Base % Change Property Type Feet PSF Rent PSF Initial Rent PSF Average - ------------------- -------- ---------- ------------ --------- ---------- ---------- Stabilized malls 688,306 $ 24.30 $ 24.60 1.2% $ 25.14 3.5% Associated centers 26,466 11.83 16.80 42.0% 17.19 45.3% Community centers 11,200 8.18 8.34 2.0% 8.44 3.2% Other 3,087 20.83 24.35 16.9% 24.97 19.9% TOTAL 729,059 $ 23.58 $ 24.07 2.1% $ 24.59 4.3%
Stabilized Mall Leasing Activity of Same Small Shop Space Less Than 20,000 Square Feet Excluding Junior Anchors
Prior New New Base Initial Average Square Rent Base % Change Base % Change Stabilized Malls Feet PSF Rent PSF Initial Rent PSF Average - ------------------- -------- ---------- ------------ --------- ---------- ---------- New leases 168,219 $ 24.93 $ 26.69 7.1% $ 27.82 11.6% Renewal leases 520,087 24.09 23.92 -0.7% 24.27 0.7% TOTAL 688,306 $ 24.30 $ 24.60 1.2% $ 25.14 3.5%
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 Scheduled Unscheduled Total Leased Lease Scheduled Expiring Unscheduled Expiring To Total Leased Average Expiring Average Expiring Average Expiring Square Base Square Base Square Base Average Base Property Type Feet Rent PSF Feet Rent PSF Feet Rent PSF Rent PSF - ------------------ --------- ----------- --------------------- ----------- ---------- ------------ Stabilized Malls 764,381 $ 25.29 724,661 $ 23.85 214,458 $ 22.44 7.5% Associated centers 28,266 17.05 15,690 15.18 1,025 17.03 11.5% Community centers 19,650 8.25 19,650 8.10 3,060 9.76 -0.8% Other 3,087 24.97 2,148 20.72 1,695 20.00 22.4% TOTAL 815,384 $ 24.59 762,149 $ 23.26 220,238 $ 22.22 6.8%
Leasing Activity of Small Shop Space Less Than 20,000 Square Feet Excluding Junior Anchors
New Leases Renewal Leases Total --------------------- --------------------- --------------------- Average Average Average Square Base Square Base Square Base Feet Rent PSF Feet Rent PSF Feet Rent PSF --------- ---------- --------- ---------- ---------- ---------- Stabilized Malls 244,294 $ 27.45 520,087 $ 24.27 764,381 $ 25.29 Associated centers 17,933 17.86 10,333 15.64 28,266 17.05 Community centers - - 19,650 8.25 19,650 8.25 Other 939 28.51 2,148 23.43 3,087 24.98 TOTAL 263,166 $ 26.80 552,218 $ 23.54 815,384 $ 24.59
Total Leasing Activity of Small Shop Space and Junior Anchors
New Leases Renewal Leases Total --------------------- --------------------- --------------------- Average Average Average Square Base Square Base Square Base Feet Rent PSF Feet Rent PSF Feet Rent PSF --------- ---------- --------- ---------- ---------- ---------- Stabilized Malls 369,205 $ 21.94 520,087 $ 24.27 889,292 $ 23.30 Associated centers 17,933 17.86 10,333 15.64 28,266 17.05 Community centers - - 19,650 8.25 19,650 8.25 Other 939 28.51 2,148 23.43 3,087 24.98 TOTAL 388,077 $ 21.77 552,218 $ 23.54 940,295 $ 22.81
Average Annual Base Rents Per Square Foot By Property Type of Small Shop Space Less Than 20,000 Square Feet Excluding Junior Anchors
March 31, --------------------- 2005 2004 --------- ---------- Stabalized malls $ 25.45 $ 25.03 Non-stabalized malls 26.92 27.37 Associated centers 10.05 10.05 Community centers (1) 14.55 10.45 (1) Excludes community centers that were contributed to Galileo America
-10- CBL & ASSOCIATES PROPERTIES, INC. Supplemental Financial and Operating Information For the Three Months Ended March 31, 2005 Top 25 Based On Percentage Of Total Revenues For The Three Months Ended March 31, 2005:
Annual Percentage Number of Gross of Total Tenant Stores Square Feet Rentals (1) Revenues - ---------------------------------- ----------- --------------- --------------- -------------- 1 Limited Brands, Inc. 214 1,325,490 $44,389,305 5.9% 2 Foot Locker, Inc. 182 717,151 26,419,652 3.5% 3 The Gap, Inc. 89 907,105 21,753,278 2.9% 4 Luxottica Group, S.P.A. (2) 184 330,855 15,159,120 2.0% 5 Abercrombie & Fitch, Co. 59 403,129 14,565,508 1.9% 6 American Eagle Outfitters, Inc. 65 340,384 13,441,475 1.8% 7 Signet Group PLC (3) 95 142,633 12,874,016 1.7% 8 JC Penney Co. Inc. (4) 66 7,220,834 12,248,851 1.6% 9 Zale Corporation 133 131,400 11,922,855 1.6% 10 Finish Line, Inc. 57 304,047 11,224,826 1.5% 11 The Regis Corporation 178 204,472 9,928,301 1.3% 12 Lerner New York, Inc. 39 310,413 9,056,187 1.2% 13 Charming Shoppes, Inc. (5) 53 323,222 8,980,638 1.2% 14 Genesco Inc. (6) 126 163,125 8,658,520 1.1% 15 Hallmark Cards, Inc. 77 269,065 8,602,278 1.1% 16 Pacific Sunwear of California 69 232,675 8,013,509 1.1% 17 Trans World Entertainment (7) 47 240,214 7,986,136 1.1% 18 Borders Group, Inc. 44 264,806 7,051,429 0.9% 19 The Shoe Show of Rocky Mount, Inc.49 265,199 6,817,168 0.9% 20 Sun Capital Partners, Inc. (8) 58 335,025 6,754,043 0.9% 21 Christopher & Banks, Inc. 56 194,824 6,654,286 0.9% 22 The Buckle, Inc. 39 190,977 6,602,961 0.9% 23 Claire's Stores, Inc. 103 115,698 6,558,597 0.9% 24 Aeropostale, Inc. 50 168,319 6,491,311 0.9% 25 Barnes & Noble, Inc. 49 269,070 6,281,878 0.8% ----------- --------------- --------------- ------------- 2,181 15,370,132 $298,436,128 39.6% =========== =============== =============== ============= (1) Includes annual minimum rent and tenant reimbursements based on amounts in effect at March 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, & Rogers Jewelers. (4) J.C. Penney owns 28 of these stores. (5) Charming Shoppes, Inc. operates Lane Bryant, Fashion Bug and Catherine's. (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) Trans World Entertainment operates FYE (formerly Camelot Music and Record Town) and Saturday Matinee. (8) 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.
-11- CBL & ASSOCIATES PROPERTIES, INC. Supplemental Financial and Operating Information For the Three Months Ended March 31, 2005 Capital Expenditures for Three Months Ended March 31, 2005 (In thousands)
Tenant allowances $ 8,668 ------------- Renovations 1,343 ------------- Deferred maintenance: Parking lot and parking lot lighting 190 Roof repairs and replacements 1,243 Other capital expenditures 1,148 ------------- Total deferred maintenancee expenditures 2,581 ------------- Total capital expenditures $ 12,592 ============= 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 lease.
Deferred Leasing Costs Capitalized (In thousands)
2005 2004 ------------- ------------ Quarter ended: March 31, $ 374 $ 492 ============= ============
-12- CBL & ASSOCIATES PROPERTIES, INC. Supplemental Financial and Operating Information For the Three Months Ended March 31, 2005 Properties Under Development at March 31, 2005 (Dollars in thousands)
CBL's Share of Project -------------------------- Square Total Cost Opening Initial Property Location Feet Cost To Date Date Yield - ----------------------------------- ---------------------- ------------ ------------ ------------ ------------------- -------- Mall Expansions: The District at Monroeville Mall Monroeville, PA 75,000 $ 20,588 $ 13,674 Nov-04/May-05 8% Citadel Mall Charleston, SC 46,000 6,549 1,539 August-05 9% Fayette Mall Lexington, KY 144,000 25,532 8,715 October-05 11% Burnsville Center Burnsville, MN 146,000 24,612 5,786 Nov-05/Mar-06 9% Open Air Centers: Southaven Towne Center Southaven, MS 437,600 26,303 24,089 October-05 10% Associated Centers: Coastal Grand Crossing Myrtle Beach, SC 15,000 1,946 773 May-05 10% Community Centers: Cobblestone Village at Royal Palm Royal Palm, FL 225,000 10,003 6,880 July-05 9% Chicopee Marketplace Chicopee, MA 156,000 19,743 9,019 September-05 9% Community Center Expansion: Fashion Square Orange Park, FL 18,000 6,066 671 July-05 10% ------------ ------------ ------------ 1,262,600 $ 141,342 $ 71,146 ============ ============ ============
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