CBL & Associates Properties Reports Fourth Quarter 2012 Results Business Wire CHATTANOOGA, Tenn. -- February 5, 2013 CBL & Associates Properties, Inc. (NYSE:CBL): *FFO per diluted share, as adjusted, increased 5.9% to $2.17 for 2012, compared with $2.05 for the prior-year period. *Same-center NOI, excluding lease termination fees, increased 2.2% in the fourth quarter 2012 and 2.0% for 2012 over the comparable prior-year periods. *Portfolio occupancy at December 31, 2012, increased 100 basis points to 94.6% from 93.6% for the prior-year period. *Average gross rent per square foot for stabilized mall leases signed in 2012 increased 8.4% over the prior gross rent per square foot. *Same-store sales increased 3.6% to $346 per square foot for mall tenants 10,000 square feet or less for stabilized malls for the year ended December31,2012. CBL & Associates Properties, Inc. (NYSE:CBL) announced results for the fourth quarter and year ended December 31, 2012. A description of each non-GAAP financial measure and the related reconciliation to the comparable GAAP measure is located at the end of this news release. Three Months Ended Year Ended December 31, December 31, 2012^(1) 2011 2012^(1) 2011^(1) Funds from Operations $ 0.86 $ 0.60 $ 2.41 $ 2.22 (“FFO”) per diluted share FFO per diluted share, $ 0.62 $ 0.60 $ 2.17 $ 2.05 as adjusted ^FFO, as adjusted, for the three months and year ended December 31, 2012, excludes the $0.24 per share gain on investment. See ACQUISITIONS, for ^(1) more information. FFO, as adjusted, for the year ended December 31, 2011, excludes the gain on extinguishment of debt of $0.17 per share recorded in the first quarter 2011. “We continue to enjoy the benefits of our market-dominant mall portfolio, an expanding pipeline of new growth opportunities and an enhanced capital structure,” said Stephen Lebovitz, CBL’s president and chief executive officer. “With NOI at the top end of our guidance, FFO growth well above our expectations and occupancy up across the board, we are executing well in all areas of the company. The acquisitions of Kirkwood Mall (Bismarck, ND) and the remaining joint venture interest in Imperial Valley Mall (El Centro, CA) in December demonstrate our ability to source attractive off-market opportunities. The recent announcements to expand Cross Creek Mall (Fayetteville, NC) and develop Fremaux Town Center (Slidell, LA) should further accelerate the growth we anticipate in 2013 and beyond. “We are progressing with our plan to achieve an investment grade rating by 2014, using our new unsecured lines of credit completed in the quarter to increase our pool of unencumbered assets. This will allow us to reduce our overall cost of capital over time. The sale of non-core office buildings in Greensboro, NC, in January and the $190 million refinancing on West County Center (St. Louis, MO), at a ten-year fixed-rate of 3.4%, combined with over $818 million of availability on our credit lines position us to improve our credit profile and provide sources for our continued growth.” FFO allocable to common shareholders, as adjusted, for the fourth quarter of 2012 was $99,683,000, or $0.62 per diluted share, compared with $88,686,000, or $0.60 per diluted share, for the fourth quarter of 2011. FFO of the operating partnership, as adjusted, for the fourth quarter of 2012 was $117,968,000, compared with $113,802,000, for the fourth quarter 2011. FFO allocable to common shareholders, as adjusted, for 2012 was $335,871,000, or $2.17 per diluted share, compared with $304,031,000 or $2.05 per diluted share for 2011. FFO of the operating partnership, as adjusted, for 2012 was $412,821,000, compared with $390,234,000, for 2011. Net income attributable to common shareholders for the fourth quarter of 2012 was $52,356,000, or $0.33 per diluted share, compared with net income of $72,373,000, or $0.49 per diluted share for the fourth quarter of 2011. Net income attributable to common shareholders for 2012 was $84,088,000, or $0.54 per diluted share, compared with net income of $91,560,000, or $0.62 per diluted share for 2011. HIGHLIGHTS *Portfolio same-center net operating income (“NOI”), excluding lease termination fees, for the quarter ended December 31, 2012, increased 2.2% compared with an increase of 0.6% for the prior-year period. Same-center NOI, excluding lease terminations fees, for the year ended December 31, 2012, increased 2.0% compared with an increase of 1.4% for the prior-year period. *Average gross rent per square foot on stabilized mall leases signed during the fourth quarter of 2012 for tenants 10,000 square feet or less increased 6.8% over the prior gross rent per square foot. Average gross rent per square foot on stabilized mall leases signed during 2012 for tenants 10,000 square feet or less increased 8.4% over the prior gross rent per square foot. *Same-store sales per square foot for mall tenants 10,000 square feet or less for stabilized malls for the year ended December 31, 2012, increased 3.6% to $346 per square foot compared with $334 per square foot in the prior-year period. *Consolidated and unconsolidated variable rate debt of $1,079,665,000, as of December 31, 2012, represented 10.9% of the total market capitalization for the Company, compared with 10.3% in the prior-year period, and 19.8% of the Company's share of total consolidated and unconsolidated debt, compared with 17.2% in the prior-year period. *Debt-to-total market capitalization was 54.7% as of December 31, 2012, compared with 59.7% as of December 31, 2011. PORTFOLIO OCCUPANCY ^ (1) December 31, 2012 2012 2011 Portfolio occupancy 94.6% 93.6% Mall portfolio 94.6% 94.1% Stabilized malls 94.5% 94.2% Non-stabilized malls 100.0% 92.1% ^(2) Associated centers 95.1% 93.4% Community centers 95.9% 91.5% ^(1) ^Occupancy statistics exclude Kirkwood Mall, which was acquired on December 27, 2012. ^Represents occupancy for The Outlet Shoppes at Oklahoma City ^(2) in 2012. Represents The Outlet Shoppes at Oklahoma City and Pearland Town Center in 2011. ACQUISITIONS In December 2012, CBL invested a total of $96.1 million, including the assumption of debt, to acquire interests in two enclosed regional malls, Kirkwood Mall and Imperial Valley Mall, in two separate transactions. CBL completed the acquisition of a 49% interest in Kirkwood Mall in Bismarck, ND and executed an agreement to acquire the remaining 51% interest. CBL anticipates closing on the remaining 51% interest within 90 days (subject to lender approval), including the assumption of a $40.4 million (at 100%) non-recourse loan secured by the property. The loan bears a fixed interest rate of 5.75% and matures in April 2018. In addition, CBL acquired the remaining 40% interest in its Imperial Valley Mall and Imperial Valley Commons in El Centro, CA from its joint venture partner. Following the transaction, CBL owns 100% of Imperial Valley Mall and Imperial Valley Commons. As a result of the acquisition of the remaining interest in Imperial Valley Mall, CBL recorded a gain on investment of $45.1 million in the fourth quarter 2012. Additionally, CBL recorded a loss on impairment of real estate of $20.3 million related to land that is available for the future expansion of Imperial Valley Commons. DISPOSITION ACTIVITY During the fourth quarter CBL completed the sale of Hickory Hollow Mall in Nashville (Antioch), TN; Towne Mall in Franklin, OH; and Willowbrook Plaza, a community center located in Houston, TX, in three separate transactions, for an aggregate sales price of $25.5 million. In 2012, CBL generated aggregate gross proceeds from dispositions of $70.3 million. Subsequent to the quarter-end, CBL completed the sale of two office buildings located in Greensboro, NC for an aggregate sales price of $30.0 million, which were classified as held for sale as of December 31, 2012. FINANCING ACTIVITY In November, CBL closed on the modification and extension of its two major credit facilities, increasing the aggregate capacity by $155.0 million to $1.2 billion. Both facilities were converted from secured to unsecured and the capacity of each facility was increased to $600 million. The maturities were extended to 2016 and 2017, including extension options, and the average borrowing rate reduced by 60 basis points. The outstanding balances on the two facilities bear interest at an annual rate equal to LIBOR plus a range of 155 to 210 basis points, depending on the Company’s leverage ratio. In December, CBL closed on a 10-year, non-recourse loan secured by West County Center in St. Louis, MO. The new 10-year, non-recourse $190 million loan bears a fixed interest rate of 3.4%, representing the lowest fixed interest rate CBL has ever achieved on a secured mortgage. CBL’s share of the excess proceeds generated after payoff of the existing loan was approximately $23 million, which was used to reduce outstanding balances on the Company’s lines of credit. During 2012, CBL completed more than $558 million of property-specific loan refinancings. CAPITAL MARKETS ACTIVITY On October 5, 2012, CBL closed on an underwritten public offering of 6,900,000 depositary shares, each representing 1/10th of a share of its newly designated 6.625% Series E Cumulative Redeemable Preferred Stock (“Series E Shares”) with a liquidation preference of $25.00 per depositary share, including 900,000 depositary shares sold pursuant to the underwriters’ exercise of their option to purchase additional depositary shares. The offering generated net proceeds to the Company of approximately $166.6 million, after deducting the underwriting discount and estimated offering expenses. On November 5, 2012, CBL completed the redemption of 460,000 outstanding shares of 7.75% Series C Cumulative Redeemable Preferred Stock (“Series C Shares”), and all outstanding depositary shares (“Depositary Shares”), each representing 1/10th of a Series C Share (NYSE: CBLPrC - CUSIP No.: 124830-50-6). The aggregate amount paid to effect the redemption of the Series C Shares (including the Depositary Shares) was approximately $115.9 million, which was funded with a portion of the net proceeds from the issuance of Series E Shares. OUTLOOK AND GUIDANCE Based on today's outlook, the Company is providing 2013 FFO guidance in the range of $2.18 - $2.26 per share. Full-year guidance assumes same-center NOI growth in a range of 1.0% - 3.0%, $2.0 million to $4.0 million of outparcel sales and a 25-50 basis point increase in year-end occupancy. The guidance excludes the impact of any future unannounced acquisitions or dispositions. The Company expects to update its annual guidance after each quarter's results. Low High Expected diluted earnings per common share $0.63 $0.71 Adjust to fully converted shares from common shares (0.10 ) (0.11 ) Expected earnings per diluted, fully converted 0.53 0.60 common share Add: depreciation and amortization 1.55 1.55 Add: noncontrolling interest in earnings of 0.10 0.11 Operating Partnership Expected FFO per diluted, fully converted common $2.18 $2.26 share INVESTOR CONFERENCE CALL AND SIMULCAST CBL & Associates Properties, Inc. will conduct a conference call at 11:00 a.m. ET on Wednesday, February6,2013, to discuss its fourth quarter results. The numbers to call for this interactive teleconference are (800) 734-8592 or (212)231-2900. A seven-day replay of the conference call will be available by dialing (402)977-9140 and entering the passcode 21544170. A transcript of the Company's prepared remarks will be furnished on a Form 8-K following the conference call. To receive the CBL & Associates Properties, Inc., fourth quarter earnings release and supplemental information please visit our website at cblproperties.com or contact Investor Relations at 423-490-8312. The Company will also provide an online web simulcast and rebroadcast of its 2012 fourth quarter earnings release conference call. The live broadcast of the quarterly conference call will be available online at cblproperties.com on Wednesday, February 6, 2013, beginning at 11:00 a.m. ET. The online replay will follow shortly after the call and continue through February 13, 2013. CBL is one of the largest and most active owners and developers of malls and shopping centers in the United States. CBL owns, holds interest in or manages 163 properties, including 94 regional malls/open-air centers. The properties are located in 27 states and total 91.7 million square feet including 9.4 million square feet of non-owned shopping centers managed for third parties. Headquartered in Chattanooga, TN, CBL has regional offices in Boston (Waltham), MA, Dallas (Irving), TX, and St. Louis, MO. Additional information can be found atcblproperties.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 (loss) determined in accordance with GAAP. The National Association of Real Estate Investment Trusts (“NAREIT”) defines FFO as net income (loss) (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 and noncontrolling interests. Adjustments for unconsolidated partnerships and joint ventures and noncontrolling interests are calculated on the same basis. In October 2011, NAREIT clarified that FFO should exclude the impact of losses on impairment of depreciable properties. The Company has calculated FFO for all periods presented in accordance with this clarification. The Company defines FFO allocable to its common shareholders as defined above by NAREIT less dividends on preferred stock. The Company’s method of calculating FFO allocable to its common shareholders may be different from methods used by other REITs and, accordingly, may not be comparable to such other REITs. The Company believes that FFO provides an additional indicator of the operating performance of its properties without giving effect to real estate depreciation and amortization, which assumes the value of real estate assets declines predictably over time. Since values of well-maintained real estate assets have historically risen with market conditions, the Company believes that FFO enhances investors’ understanding of its operating performance. The use of FFO as an indicator of financial performance is influenced not only by the operations of the Company’s properties and interest rates, but also by its capital structure. The Company presents both FFO of its operating partnership and FFO allocable to its common shareholders, as it believes that both are useful performance measures. The Company believes FFO of its operating partnership is a useful performance measure since it conducts substantially all of its business through its operating partnership and, therefore, it reflects the performance of the properties in absolute terms regardless of the ratio of ownership interests of the Company’s common shareholders and the noncontrolling interest in the operating partnership. The Company believes FFO allocable to its common shareholders is a useful performance measure because it is the performance measure that is most directly comparable to net income (loss) attributable to its common shareholders. In the reconciliation of net income attributable to the Company's common shareholders to FFO allocable to its common shareholders, located in this earnings release, the Company makes an adjustment to add back noncontrolling interest in income (loss) of its operating partnership in order to arrive at FFO of its operating partnership. The Company then applies a percentage to FFO of its operating partnership to arrive at FFO allocable to its common shareholders. The percentage is computed by taking the weighted average number of common shares outstanding for the period and dividing it by the sum of the weighted average number of common shares and the weighted average number of operating partnership units outstanding during the period. FFO does not represent cash flows 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 (loss) for purposes of evaluating the Company’s operating performance or to cash flow as a measure of liquidity. During 2012, the Company recorded a gain on investment of $45.1 million related to the acquisition of the remaining interest in Imperial Valley Mall. During 2012 and 2011, the Company recorded gains on extinguishment of debt from both continuing and discontinued operations. Considering the significance and nature of these items, the Company believes that it is important to identify their impact on its FFO measures for a reader to have a complete understanding of the Company’s results of operations. Therefore, the Company has also presented its FFO measures excluding these items. Same-Center Net Operating Income NOI is a supplemental measure of the operating performance of the Company's shopping centers. The Company defines NOI as operating revenues (rental revenues, tenant reimbursements and other income) less property operating expenses (property operating, real estate taxes and maintenance and repairs). Similar to FFO, the Company computes NOI based on its pro rata share of both consolidated and unconsolidated properties. The Company's definition of NOI may be different than that used by other companies and, accordingly, the Company's NOI may not be comparable to that of other companies. A reconciliation of same-center NOI to net income is located at the end of this earnings release. Since NOI includes only those revenues and expenses related to the 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. Additionally, there are instances when tenants terminate their leases prior to the scheduled expiration date and pay the Company one-time, lump-sum termination fees. These one-time lease termination fees may distort same-center NOI trends and may result in same-center NOI that is not indicative of the ongoing operations of the Company's shopping center properties. Therefore, the Company believes that presenting same-center NOI, excluding lease termination fees, is useful to investors. 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 noncontrolling interests' 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" included therein, for a discussion of such risks and uncertainties. CBL & Associates Properties, Inc. Consolidated Statements of Operations (Unaudited; in thousands, except per share amounts) Three Months Ended Year Ended December 31, December 31, 2012 2011 2012 2011 REVENUES: Minimum rents $ 174,236 $ 164,212 $ 663,895 $ 668,628 Percentage rents 9,674 8,364 17,995 17,149 Other rents 8,923 8,743 22,657 22,428 Tenant 74,758 72,913 287,954 301,323 reimbursements Management, development and 3,197 2,121 10,772 6,935 leasing fees Other 7,562 8,490 31,367 34,851 Total revenues 278,350 264,843 1,034,640 1,051,314 OPERATING EXPENSES: Property 36,268 37,199 145,828 148,961 operating Depreciation and 69,517 63,491 265,856 271,458 amortization Real estate 21,986 20,259 90,503 91,723 taxes Maintenance and 12,903 12,835 52,577 55,500 repairs General and 15,287 11,618 51,251 44,751 administrative Loss on impairment of 20,467 - 24,379 51,304 real estate Other 5,890 6,103 25,078 28,898 Total operating 182,318 151,505 655,472 692,595 expenses Income from 96,032 113,338 379,168 358,719 operations Interest and 762 831 3,955 2,583 other income Interest expense (60,766 ) (60,511 ) (244,432 ) (267,072 ) Gain on extinguishment 87 448 265 1,029 of debt Gain on sales of real estate 533 55,794 2,286 59,396 assets Gain on 45,072 - 45,072 - investment Equity in earnings of 2,912 1,916 8,313 6,138 unconsolidated affiliates Income tax (provision) (170 ) (1,501 ) (1,404 ) 269 benefit Income from continuing 84,462 110,315 193,223 161,062 operations Operating income (loss) of 1,665 (319 ) (19,643 ) 23,933 discontinued operations Gain (loss) on discontinued (45 ) (122 ) 938 (1 ) operations Net income 86,082 109,874 174,518 184,994 Net income attributable to noncontrolling interests in: Operating (11,484 ) (20,398 ) (19,267 ) (25,841 ) partnership Other consolidated (6,513 ) (6,509 ) (23,652 ) (25,217 ) subsidiaries Net income attributable to 68,085 82,967 131,599 133,936 the Company Preferred (15,729 ) (10,594 ) (47,511 ) (42,376 ) dividends Net income attributable to $ 52,356 $ 72,373 $ 84,088 $ 91,560 common shareholders Basic per share data attributable to common shareholders: Income from continuing operations, net $ 0.32 $ 0.49 $ 0.64 $ 0.49 of preferred dividends Discontinued 0.01 - (0.10 ) 0.13 operations Net income attributable to $ 0.33 $ 0.49 $ 0.54 $ 0.62 common shareholders Weighted average common shares 160,841 148,364 154,762 148,289 outstanding Diluted earnings per share data attributable to common shareholders: Income from continuing operations, net $ 0.32 $ 0.49 $ 0.64 $ 0.49 of preferred dividends Discontinued 0.01 - (0.10 ) 0.13 operations Net income attributable to $ 0.33 $ 0.49 $ 0.54 $ 0.62 common shareholders Weighted average common and potential 160,881 148,407 154,807 148,334 dilutive common shares outstanding Amounts attributable to common shareholders: Income from continuing operations, net $ 50,987 $ 72,716 $ 99,306 $ 72,914 of preferred dividends Discontinued 1,369 (343 ) (15,218 ) 18,646 operations Net income attributable to $ 52,356 $ 72,373 $ 84,088 $ 91,560 common shareholders The Company's calculation of FFO allocable to its shareholders is as follows: (in thousands, except per share data) Three Months Ended Year Ended December 31, December 31, 2012 2011 2012 2011 Net income attributable $ 52,356 $ 72,373 $ 84,088 $ 91,560 to common shareholders Noncontrolling interest in income of 11,484 20,398 19,267 25,841 operating partnership Depreciation and amortization expense of: Consolidated 69,517 63,491 265,856 271,458 properties Unconsolidated 11,079 11,406 43,956 32,538 affiliates Discontinued 418 1,297 2,778 4,912 operations Non-real (475 ) (529 ) (1,841 ) (2,488 ) estate assets Noncontrolling interests' share of (1,534 ) (403 ) (5,071 ) (919 ) depreciation and amortization Loss on impairment of real estate, 20,409 452 50,343 56,557 net of tax benefit Gain on depreciable (159 ) (54,357 ) (652 ) (56,763 ) property (Gain) loss on discontinued 32 122 (566 ) 1 operations, net of taxes Funds from operations of 163,127 114,250 458,158 422,697 the operating partnership Gain on (45,072 ) - (45,072 ) - investment Gain on extinguishment (87 ) (448 ) (265 ) (32,463 ) of debt Funds from operations of the operating $ 117,968 $ 113,802 $ 412,821 $ 390,234 partnership, as adjusted Funds from operations per $ 0.86 $ 0.60 $ 2.41 $ 2.22 diluted share Gain on (0.24 ) - (0.24 ) - investment Gain on extinguishment - - - (0.17 ) of debt Funds from operations, as $ 0.62 $ 0.60 $ 2.17 $ 2.05 adjusted, per diluted share Weighted average common and potential dilutive common shares 190,383 190,424 190,268 190,380 outstanding with operating partnership units fully converted Reconciliation of FFO of the operating partnership to FFO allocable to common shareholders: Funds from operations of $ 163,127 $ 114,250 $ 458,158 $ 422,697 the operating partnership Percentage allocable to common 84.50 % 77.93 % 81.36 % 77.91 % shareholders ^(1) Funds from operations allocable to $ 137,842 $ 89,035 $ 372,757 $ 329,323 common shareholders Funds from operations of the operating $ 117,968 $ 113,802 $ 412,821 $ 390,234 partnership, as adjusted Percentage allocable to common 84.50 % 77.93 % 81.36 % 77.91 % shareholders ^(1) Funds from operations allocable to $ 99,683 $ 88,686 $ 335,871 $ 304,031 common shareholders, as adjusted Represents the weighted average number of common shares outstanding for the period divided by the sum of the weighted average number of common shares and (1) the weighted average number of operating partnership units outstanding during the period. See the reconciliation of shares and operating partnership units outstanding on page 9. SUPPLEMENTAL FFO INFORMATION: Lease termination $ 846 $ 570 $ 3,819 $ 3,272 fees Lease termination $ - $ - $ 0.02 $ 0.02 fees per share Straight-line $ 174 $ 1,650 $ 4,577 $ 5,387 rental income Straight-line rental income $ - $ 0.01 $ 0.02 $ 0.03 per share Gains on outparcel $ (279 ) $ 1,966 $ 4,849 $ 3,989 sales Gains on outparcel $ - $ 0.01 $ 0.03 $ 0.02 sales per share Net amortization of acquired $ 984 $ 24 $ 2,559 $ 2,107 above- and below-market leases Net amortization of acquired above- and $ 0.01 $ - $ 0.01 $ 0.01 below-market leases per share Net amortization of debt $ 142 $ 871 $ 1,849 $ 2,831 premiums (discounts) Net amortization of debt $ - $ - $ 0.01 $ 0.01 premiums (discounts) per share Income tax (provision) $ (170 ) $ (1,501 ) $ (1,404 ) $ 269 benefit Income tax (provision) $ - $ (0.01 ) $ (0.01 ) $ - benefit per share Loss on impairment of real estate $ (20,467 ) $ - $ (24,379 ) $ (51,304 ) from continuing operations Loss on impairment of real estate from $ (0.11 ) $ - $ (0.13 ) $ (0.27 ) continuing operations per share Gain (loss) on impairment of real estate $ 40 $ (729 ) $ (26,461 ) $ (7,425 ) from discontinued operations Loss on impairment of real estate from $ - $ - $ (0.14 ) $ (0.04 ) discontinued operations per share Gain on extinguishment of debt from $ - $ - $ - $ 31,434 discontinued operations Gain on extinguishment of debt from $ - $ - $ - $ 0.17 discontinued operations per share Gain on $ 45,072 $ - $ 45,072 $ - investment Gain on investment per $ 0.24 $ - $ 0.24 $ - share Origination cost of series $ (3,778 ) $ - $ (3,778 ) $ - C preferred stock Origination cost of series C preferred $ (0.02 ) $ - $ (0.02 ) $ - stock per share Same-Center Net Operating Income (Dollars in thousands) Three Months Ended Year Ended December 31, December 31, 2012 2011 2012 2011 Net income attributable $ 68,085 $ 82,967 $ 131,599 $ 133,936 to the Company Adjustments: Depreciation and 69,517 63,491 265,856 271,458 amortization Depreciation and amortization 11,079 11,406 43,956 32,538 from unconsolidated affiliates Depreciation and amortization 418 1,297 2,778 4,912 from discontinued operations Noncontrolling interests' share of depreciation and (1,534 ) (403 ) (5,071 ) (919 ) amortization in other consolidated subsidiaries Interest 60,766 60,511 244,432 267,072 expense Interest expense from 11,254 11,277 44,543 32,932 unconsolidated affiliates Interest expense from - 1,052 229 4,441 discontinued operations Noncontrolling interests' share of interest (959 ) (529 ) (3,435 ) (1,329 ) expense in other consolidated subsidiaries Abandoned projects 76 43 (39 ) 94 expense Gain on sales of real estate (533 ) (55,794 ) (5,282 ) (59,396 ) assets Gain on sales of real estate assets of (363 ) (118 ) (1,214 ) (1,445 ) unconsolidated affiliates Gain on extinguishment (87 ) (448 ) (265 ) (1,029 ) of debt Gain on extinguishment of debt from - - - (31,434 ) discontinued operations Writedown of mortgage notes - - - 1,900 receivable Loss on impairment of 20,467 - 24,379 51,304 real estate (Gain) loss on impairment of real estate (40 ) 729 26,461 7,425 from discontinued operations Income tax provision 170 1,501 1,404 (269 ) (benefit) Gain on (45,072 ) - (45,072 ) - investment Net income attributable to noncontrolling 11,484 20,398 19,267 25,841 interest in earnings of operating partnership (Gain) loss on discontinued 45 122 (938 ) 1 operations Operating partnership's 204,773 197,502 743,588 738,033 share of total NOI General and administrative 15,287 11,618 51,251 44,751 expenses Management fees and (7,875 ) (5,809 ) (27,728 ) (22,827 ) non-property level revenues Operating partnership's 212,185 203,311 767,111 759,957 share of property NOI Non-comparable (12,196 ) (7,821 ) (36,361 ) (43,981 ) NOI Total same-center $ 199,989 $ 195,490 $ 730,750 $ 715,976 NOI Total same-center 2.3 % 2.1 % NOI percentage change Total same-center $ 199,989 $ 195,490 $ 730,750 $ 715,976 NOI Less lease termination (831 ) (543 ) (3,456 ) (2,945 ) fees Total same-center NOI, excluding $ 199,158 $ 194,947 $ 727,294 $ 713,031 lease termination fees Malls $ 178,168 $ 176,131 $ 653,328 $ 642,541 Associated 8,374 7,889 32,852 31,151 centers Community 4,630 4,129 17,636 16,103 centers Offices and 7,986 6,798 23,478 23,236 other Total same-center NOI, excluding $ 199,158 $ 194,947 $ 727,294 $ 713,031 lease termination fees Percentage Change: Malls 1.2 % 1.7 % Associated 6.1 % 5.5 % centers Community 12.1 % 9.5 % centers Offices and 17.5 % 1.0 % other Total same-center NOI, excluding 2.2 % 2.0 % lease termination fees Company's Share of Consolidated and Unconsolidated Debt (Dollars in thousands) As of December 31, 2012 Fixed Rate Variable Rate Total Consolidated debt $ 3,794,509 $ 951,174 $ 4,745,683 Noncontrolling interests' share of (89,530 ) - (89,530 ) consolidated debt Company's share of unconsolidated 660,563 128,491 789,054 affiliates' debt Company's share of consolidated and $ 4,365,542 $ 1,079,665 $ 5,445,207 unconsolidated debt Weighted average 5.48 % 2.39 % 4.86 % interest rate As of December 31, 2011 Fixed Rate Variable Rate Total Consolidated debt $ 3,733,355 $ 756,000 $ 4,489,355 Noncontrolling interests' share of (30,416 ) (726 ) (31,142 ) consolidated debt Company's share of unconsolidated 658,470 150,171 808,641 affiliates' debt Company's share of consolidated and $ 4,361,409 $ 905,445 $ 5,266,854 unconsolidated debt Weighted average 5.58 % 2.47 % 5.04 % interest rate Debt-To-Total-Market Capitalization Ratio as of December 31, 2012 (In thousands, Shares except stock price) Outstanding Stock Price Value (1) Common stock and operating 190,855 $ 21.21 $ 4,048,035 partnership units 7.375% Series D Cumulative 1,815 250.00 453,750 Redeemable Preferred Stock 6.625% Series E Cumulative 690 250.00 172,500 Redeemable Preferred Stock Total market equity 4,501,785 Company's share of 5,445,207 total debt Total market $ 9,946,992 capitalization Debt-to-total-market 54.7 % capitalization ratio Stock price for common stock and operating partnership units equals the closing (1) price of the common stock on December 31, 2012. The stock prices for the preferred stocks represent the liquidation preference of each respective series. Reconciliation of Shares and Operating Partnership Units Outstanding (In thousands) Three Months Ended Year Ended December 31, December 31, 2012: Basic Diluted Basic Diluted Weighted average 160,841 160,881 154,762 154,807 shares - EPS Weighted average operating 29,502 29,502 35,461 35,461 partnership units Weighted average 190,343 190,383 190,223 190,268 shares- FFO 2011: Weighted average 148,364 148,407 148,289 148,334 shares - EPS Weighted average operating 42,017 42,017 42,046 42,046 partnership units Weighted average 190,381 190,424 190,335 190,380 shares- FFO Dividend Payout Three Months Ended Year Ended Ratio December 31, December 31, 2012 2011 2012 2011 Weighted average cash dividend per $ 0.22838 $ 0.21913 $ 0.91526 $ 0.88773 share FFO per diluted, fully converted $ 0.62 $ 0.60 $ 2.17 $ 2.05 share, as adjusted Dividend payout 36.8 % 36.5 % 42.2 % 43.3 % ratio Consolidated Balance Sheets (Unaudited; in thousands, except share data) As of December 31, December 31, 2012 2011 ASSETS Real estate assets: Land $ 905,339 $ 851,303 Buildings and improvements 7,228,293 6,777,776 8,133,632 7,629,079 Accumulated depreciation (1,972,031 ) (1,762,149 ) 6,161,601 5,866,930 Held for sale 29,425 14,033 Developments in progress 137,956 124,707 Net investment in real estate assets 6,328,982 6,005,670 Cash and cash equivalents 78,248 56,092 Receivables: Tenant, net of allowance for doubtful accounts of $1,977 and $1,760 in 2012 78,963 74,160 and 2011, respectively Other, net of allowance for doubtful accounts of $1,270 and $1,400 in 2012 8,467 11,592 and 2011, respectively Mortgage and other notes receivable 25,967 34,239 Investments in unconsolidated affiliates 259,810 304,710 Intangible lease assets and other assets 309,299 232,965 $ 7,089,736 $ 6,719,428 LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY Mortgage and other indebtedness $ 4,745,683 $ 4,489,355 Accounts payable and accrued liabilities 358,874 303,577 Total liabilities 5,104,557 4,792,932 Commitments and contingencies Redeemable noncontrolling interests: Redeemable noncontrolling partnership 41,762 32,271 interests Redeemable noncontrolling preferred 423,834 423,834 joint venture interest Total redeemable noncontrolling 465,596 456,105 interests Shareholders' equity: Preferred stock, $.01 par value, 15,000,000 shares authorized: 7.75% Series C Cumulative Redeemable Preferred Stock, 460,000 shares - 5 outstanding in 2011 7.375% Series D Cumulative Redeemable Preferred Stock, 1,815,000 shares 18 18 outstanding 6.625% Series E Cumulative Redeemable Preferred Stock, 690,000 shares 7 - outstanding in 2012 Common stock, $.01 par value, 350,000,000 shares authorized, 161,309,652 and 148,364,037 issued and 1,613 1,484 outstanding in 2012 and 2011, respectively Additional paid-in capital 1,772,353 1,657,927 Accumulated other comprehensive income 6,986 3,425 Dividends in excess of cumulative (453,561 ) (399,581 ) earnings Total shareholders' equity 1,327,416 1,263,278 Noncontrolling interests 192,167 207,113 Total equity 1,519,583 1,470,391 $ 7,089,736 $ 6,719,428 Contact: CBL & Associates Properties, Inc. Katie Reinsmidt, 423-490-8301 Senior Vice President - Investor Relations/Corporate Investments firstname.lastname@example.org
CBL & Associates Properties Reports Fourth Quarter 2012 Results
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