Camden Property Trust Announces First Quarter 2014 Operating Results

  Camden Property Trust Announces First Quarter 2014 Operating Results  Business Wire  HOUSTON -- May 6, 2014  Camden Property Trust (NYSE: CPT) today announced operating results for the three months ended March 31, 2014.  Funds from Operations (“FFO”)  FFO for the first quarter of 2014 totaled $1.05 per diluted share or $94.8 million, as compared to $0.97 per diluted share or $86.6 million for the same period in 2013. FFO for the three months ended March 31, 2014 and 2013 included a $0.4 million and $0.7 million, respectively, gain on sale of undeveloped land.  Net Income Attributable to Common Shareholders (“EPS”)  The Company reported EPS of $40.0 million or $0.45 per diluted share for the first quarter of 2014, as compared to $63.5 million or $0.72 per diluted share for the same period in 2013. EPS for the three months ended March 31, 2014 included a $3.6 million or $0.04 per diluted share gain on sale of unconsolidated joint venture properties, and a $0.4 million gain on sale of undeveloped land. EPS for the three months ended March 31, 2013 included a $31.8 million or $0.36 per diluted share gain on sale of discontinued operations, and a $0.7 million or $0.01 per diluted share gain on sale of undeveloped land.  A reconciliation of net income attributable to common shareholders to FFO is included in the financial tables accompanying this press release.  Same Property Results  For the 47,915 apartment homes included in consolidated same property results, first quarter 2014 same property net operating income (“NOI”) increased 6.3% compared to the first quarter of 2013, with revenues increasing 4.7% and expenses increasing 2.1%. On a sequential basis, first quarter 2014 same property NOI declined 0.3% compared to the fourth quarter of 2013, with revenues increasing 0.6% and expenses increasing 2.3% compared to the prior quarter. Same property physical occupancy levels for the portfolio averaged 95.6% during the first quarter of 2014, compared to 95.7% in the fourth quarter of 2013 and 94.9% in the first quarter of 2013.  The Company defines same property communities as communities owned and stabilized since January 1, 2013. A reconciliation of net income to net operating income and same property net operating income is included in the financial tables accompanying this press release.  Disposition Activity  Camden disposed of two joint venture apartment communities during the quarter for a total of $65.6 million: Camden Braun Station, a 240-home community in San Antonio, TX, and Camden Piney Point, a 318-home community in Houston, TX. Camden’s proportionate share of the gain on sale was $3.6 million. The Company also sold approximately 3.0 acres of land adjacent to a current development community in Atlanta, Georgia for $6.3 million, recognizing a gain of $0.4 million.  Development Activity  Construction began during the quarter at Camden Chandler in Chandler, AZ, a $75 million project with 380 apartment homes. Construction continued at 13 additional wholly-owned development communities: Camden NOMA in Washington, DC, a $110 million project with 320 apartment homes which is currently 40% leased; Camden Lamar Heights in Austin, TX, a $47 million project with 314 apartment homes; Camden Flatirons in Denver, CO, a $78 million project with 424 apartment homes; Camden Glendale in Glendale, CA, a $115 million project with 303 apartment homes; Camden Boca Raton in Boca Raton, FL, a $54 million project with 261 apartment homes; Camden Paces in Atlanta, GA, a $110 million project with 379 apartment homes; Camden La Frontera in Round Rock, TX, a $36 million project with 300 apartment homes; Camden Foothills in Scottsdale, AZ, a $50 million project with 220 apartment homes; Camden Hayden in Tempe, AZ, a $48 million project with 234 apartment homes; Camden Gallery in Charlotte, NC, a $58 million project with 323 apartment homes; The Camden in Los Angeles, CA, a $145 million project with 287 apartment homes; Camden Victory Park in Dallas, TX, an $82 million project with 423 apartment homes; and Camden Miramar Phase IXB in Corpus Christi, TX, an $8 million 75-unit expansion of an existing community.  Lease-up continued during the quarter at Camden South Capitol in Washington, DC, a $78 million joint venture project with 276 apartment homes which is currently 82% leased; and Camden Waterford Lakes in Orlando, FL, a $37 million joint venture project with 300 apartment homes which completed construction during the quarter and is currently 71% leased. Construction also continued at Camden Southline in Charlotte, NC, a $48 million joint venture project with 266 apartment homes.  During the quarter Camden acquired 2.9 acres of land in Houston, TX for $15.6 million for the future development of a two-phased apartment community. Subsequent to quarter-end, the Company acquired 7.6 acres of land in Montgomery County, MD for $23.8 million for the future development of an apartment community.  Earnings Guidance  Camden maintained its FFO earnings guidance for 2014 based on its current and expected views of the apartment market and general economic conditions. Full-year 2014 FFO is expected to be $4.10 to $4.30 per diluted share, and full-year 2014 EPS is now expected to be $1.48 to $1.68 per diluted share. Second quarter 2014 earnings guidance is $1.02 to $1.06 per diluted share for FFO and $0.37 to $0.41 per diluted share for EPS. Guidance for EPS excludes future gains on real estate transactions.  The Company’s 2014 earnings guidance is based on projections of same property revenue growth between 3.5% and 4.5%, expense growth between 3.25% and 4.25%, and NOI growth between 3.25% and 5.25%.  Camden intends to update its earnings guidance to the market on a quarterly basis. Additional information on the Company’s 2014 financial outlook and a reconciliation of expected net income attributable to common shareholders to expected FFO are included in the financial tables accompanying this press release.  Conference Call  The Company will hold a conference call on Wednesday, May 7, 2014 at 11:00 a.m. Central Time to review its first quarter 2014 results and discuss its outlook for future performance. To participate in the call, please dial (888) 317-6003 (Domestic) or (412) 317-6061 (International) by 10:50 a.m. Central Time and enter passcode: 3295566, or join the live webcast of the conference call by accessing the Investor Relations section of the Company’s website at camdenliving.com. Supplemental financial information is available in the Investor Relations section of the Company’s website under Earnings Releases or by calling Camden’s Investor Relations Department at (800) 922-6336.  Forward-Looking Statements  In addition to historical information, this press release contains forward-looking statements under the federal securities law. These statements are based on current expectations, estimates and projections about the industry and markets in which Camden operates, management's beliefs, and assumptions made by management. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties which are difficult to predict. Factors which may cause the Company’s actual results or performance to differ materially from those contemplated by forward-looking statements are described under the heading “Risk Factors” in Camden’s Annual Report on Form 10-K and inother filings with the Securities and Exchange Commission (SEC). Forward-looking statements made in today’s press release represent management’s current opinions, and the Company assumes no obligation to update or supplement these statements because of subsequent events.  About Camden  Camden Property Trust, an S&P 400 Company, is a real estate company engaged in the ownership, development, acquisition, management and disposition of multifamily apartment communities. Camden owns interests in and operates 169 properties containing 59,641 apartment homes across the United States. Upon completion of 14 properties under development and the expansion of an existing community, the Company’s portfolio will increase to 64,150 apartment homes in 183 properties. Camden was recently named by FORTUNE® Magazine for the seventh consecutive year as one of the “100 Best Companies to Work For” in America, ranking #11.  For additional information, please contact Camden’s Investor Relations Department at (800) 922-6336 or (713) 354-2787 or access our website at camdenliving.com.                                                                 CAMDEN                                         OPERATING RESULTS (In thousands, except per share and property data amounts)                                                               (Unaudited)                                          Three Months Ended                                                      March 31, OPERATING DATA                                       2014         2013 Property revenues Rental revenues                                      $ 178,964     $ 164,393 Other property revenues                               26,965     25,418   Total property revenues                               205,929    189,811                                                                      Property expenses Property operating and maintenance                     50,747        48,263 Real estate taxes                                     23,577     21,183   Total property expenses                               74,324     69,446                                                                       Non-property income Fee and asset management                               3,023         2,894 Interest and other income                              288           52 Income on deferred compensation plans                 681        2,999    Total non-property income                             3,992      5,945                                                                        Other expenses Property management                                    5,839         5,983 Fee and asset management                               1,259         1,477 General and administrative                             9,545         9,794 Interest                                               23,133        24,895 Depreciation and amortization                          57,396        51,603 Amortization of deferred financing costs               841           916 Expense on deferred compensation plans                681        2,999    Total other expenses                                  98,694     97,667                                                                                                                                           Gain on sale of land                                   354           698 Equity in income of joint ventures                    4,290      934      Income from continuing operations before               41,547        30,275 income taxes Income tax expense                                    (474    )   (399    ) Income from continuing operations                      41,073        29,876 Income from discontinued operations                    -             2,774 Gain on sale of discontinued operations,              -          31,783   net of tax Net income                                             41,073        64,433 Less income allocated to non-controlling               (1,037  )     (864    ) interests from continuing operations Less income, including gain on sale, allocated to non-controlling interests from           -          (93     ) discontinued operations Net income attributable to common                    $ 40,036    $ 63,476   shareholders                                                                                                                                         CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Net income                                           $ 41,073      $ 64,433 Other comprehensive income Reclassification of prior service cost and             15            14 net loss on post retirement obligation Comprehensive income                                   41,088        64,447 Less income allocated to non-controlling               (1,037  )     (864    ) interests from continuing operations Less income, including gain on sale, allocated to non-controlling interests from           -          (93     ) discontinued operations Comprehensive income attributable to common          $ 40,051    $ 63,490   shareholders                                                                                                                                         PER SHARE DATA Net income attributable to common                    $ 0.45        $ 0.72 shareholders - basic Net income attributable to common                      0.45          0.72 shareholders - diluted Income from continuing operations                      0.45          0.33 attributable to common shareholders - basic Income from continuing operations attributable to common shareholders -                  0.45          0.33 diluted                                                                     Weighted average number of common and common equivalent shares outstanding: Basic                                                  87,651        86,703 Diluted                                                88,824        87,276                                                                                                                                                                                                             Note: Please refer to the following pages for definitions and reconciliations of all non-GAAP financial measures presented in this document.                                                          CAMDEN                       FUNDS FROM OPERATIONS (In thousands, except per share and property data amounts)                                                                                                                                                                                      (Unaudited)                            Three Months Ended                                        March 31, FUNDS FROM OPERATIONS                  2014                 2013                                                               Net income attributable to             $    40,036           $   63,476 common shareholders Real estate depreciation                    56,011               50,506 from continuing operations Real estate depreciation and amortization from                           -                    1,867 discontinued operations Adjustments for unconsolidated joint                        1,314                1,608 ventures Income allocated to                         1,037                957 non-controlling interests (Gain) on sale of unconsolidated joint venture                (3,566   )           - properties (Gain) on sale of discontinued operations, net               -                 (31,783   ) of tax Funds from operations -                $    94,832         $   86,631     diluted                                                               PER SHARE DATA Funds from operations -                $    1.05             $   0.97 diluted Cash distributions                          0.66                 0.63                                                               Weighted average number of common and common equivalent shares outstanding: FFO - diluted                               89,910               89,177                                                               PROPERTY DATA Total operating properties                  169                  192 (end of period) ^(a) Total operating apartment homes in operating                          59,641               65,005 properties (end of period) ^(a) Total operating apartment                   52,659               54,311 homes (weighted average) Total operating apartment homes - excluding                           52,659               51,018 discontinued operations (weighted average)                                                                                                                             ^(a) Includes joint ventures and properties held for sale.   Note:Please refer to the following pages for definitions and reconciliations of all non-GAAP financial measures presented in this document.                                                                                    CAMDEN              BALANCE SHEETS                     (In thousands)                                                                               (Unaudited)         Mar 31,          Dec 31,          Sep 30,          Jun 30,          Mar 31,                     2014            2013            2013            2013            2013 ASSETS Real estate assets, at cost Land                $ 978,770        $ 969,711        $ 967,121        $ 965,257        $ 949,244 Buildings and        5,691,619     5,629,904     5,596,754     5,552,095     5,404,616   improvements                       6,670,389        6,599,615        6,563,875        6,517,352        6,353,860 Accumulated          (1,698,724 )   (1,643,713 )   (1,619,325 )   (1,604,402 )   (1,552,499 ) depreciation Net operating real estate           4,971,665        4,955,902        4,944,550        4,912,950        4,801,361 assets Properties under                 515,141          472,566          438,968          393,694          339,848 development, including land Investments in        36,719           42,155           43,338           44,630           45,260 joint ventures Properties held      -             -             58,765        -             14,986      for sale Total real            5,523,525        5,470,623        5,485,621        5,351,274        5,201,455 estate assets Accounts receivable -          26,145           27,724           27,474           27,274           26,948 affiliates Other assets,         107,862          109,401          112,520          94,847           89,233 net ^(a) Cash and cash         16,768           17,794           4,707            6,506            59,642 equivalents Restricted cash      5,549         6,599         60,889        6,381         5,578       Total assets        $ 5,679,849    $ 5,632,141    $ 5,691,211    $ 5,486,282    $ 5,382,856                                                                                                                                                                                                                                                                              LIABILITIES AND EQUITY Liabilities Notes payable Unsecured           $ 1,649,041      $ 1,588,798      $ 1,721,998      $ 1,579,733      $ 1,538,471 Secured               940,881          941,968          943,039          944,090          945,134 Accounts payable and           124,981          113,307          124,336          100,279          102,307 accrued expenses Accrued real          21,922           35,648           50,247           36,863           20,683 estate taxes Distributions         59,728           56,787           56,793           56,821           56,559 payable Other liabilities ^        88,693        88,272        69,716        63,366        69,679      (b) Total                 2,885,246        2,824,780        2,966,129        2,781,152        2,732,833 liabilities                                                                                          Commitments and contingencies Non-Qualified deferred              55,498           47,180           47,092           -                - compensation share awards                                                                                          Equity Common shares of beneficial         966              967              967              967              962 interest Additional            3,593,633        3,596,069        3,595,536        3,625,283        3,590,261 paid-in capital Distributions in excess of net income            (523,321   )     (494,167   )     (571,935   )     (574,286   )     (590,831   ) attributable to common shareholders Treasury              (399,510   )     (410,227   )     (410,309   )     (410,665   )     (412,643   ) shares, at cost Accumulated other                (1,091     )   (1,106     )   (1,021     )   (1,035     )   (1,048     ) comprehensive loss ^(c) Total common          2,670,677        2,691,536        2,613,238        2,640,264        2,586,701 equity Non-controlling      68,428        68,645        64,752        64,866        63,322      interests Total equity         2,739,105     2,760,181     2,677,990     2,705,130     2,650,023   Total liabilities and     $ 5,679,849    $ 5,632,141    $ 5,691,211    $ 5,486,282    $ 5,382,856   equity                                                                                                                                                                                                                                                                            (a) Includes: net deferred        $ 13,615         $ 14,497         $ 13,243         $ 14,008         $ 14,861 charges of:                                                                                          (b) Includes: deferred            $ 1,786          $ 1,886          $ 1,979          $ 1,336          $ 2,158 revenues of: distributions in excess of investments in      $ -              $ -              $ -              $ -              $ 9,718 joint ventures of: fair value adjustment of       $ -              $ -              $ -              $ -                ($2        ) derivative instruments:                                                                                          (c) Represents the unrealized loss and unamortized prior service costs on post retirement obligations.                                                             CAMDEN              NON-GAAP FINANCIAL MEASURES                    DEFINITIONS & RECONCILIATIONS                     (In thousands, except per share amounts)                                                                                                                                                                                              (Unaudited)                                                                   This document contains certain non-GAAP financial measures management believes are useful in evaluating an equity REIT's performance. Camden's definitions and calculations of non-GAAP financial measures may differ from those used by other REITs, and thus may not be comparable. The non-GAAP financial measures should not be considered as an alternative to net income as an indication of our operating performance, or to net cash provided by operating activities as a measure of our liquidity.                                                                                                                                     FFO The National Association of Real Estate Investment Trusts (“NAREIT”) currently defines FFO as net income attributable to common shares computed in accordance with generally accepted accounting principles (“GAAP”), excluding gains or losses from depreciable operating property sales, plus real estate depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Camden’s definition of diluted FFO also assumes conversion of all dilutive convertible securities, including minority interests, which are convertible into common equity. The Company considers FFO to be an appropriate supplemental measure of operating performance because, by excluding gains or losses on dispositions of operating properties and excluding depreciation, FFO can help one compare the operating performance of a company's real estate between periods or as compared to different companies. A reconciliation of net income attributable to common shareholders to FFO is provided below:                                                                                                                  Three Months Ended                                                March 31,                                                2014             2013 Net income attributable to                                $  40,036         $  63,476 common shareholders Real estate depreciation                                      56,011            50,506 from continuing operations Real estate depreciation and amortization                                      -                 1,867 from discontinued operations Adjustments for unconsolidated                                    1,314             1,608 joint ventures Income allocated to                                                1,037             957 non-controlling interests (Gain) on sale of unconsolidated                                    (3,566   )        - joint venture properties (Gain) on sale of discontinued                                  -              (31,783  ) operations, net of tax Funds from operations -                                   $  94,832       $  86,631    diluted                                                                   Weighted average number of common and common equivalent shares outstanding: EPS diluted                                       88,824            87,276 FFO diluted                                       89,910            89,177                                                                   Net income attributable to common                                         $  0.45           $  0.72 shareholders - diluted FFO per common                                 $  1.05           $  0.97 share - diluted                                                                                                                                                                                                                                                                         Expected FFO Expected FFO is calculated in a method consistent with historical FFO, and is considered an appropriate supplemental measure of expected operating performance when compared to expected net income attributable to common shareholders (EPS). A reconciliation of the ranges provided for expected net income attributable to common shareholders per diluted share to expected FFO per diluted share is provided below:                                                                                       2Q14 Range                 2014 Range                     Low        High           Low              High                                                                   Expected net income attributable to     $  0.37     $  0.41        $  1.48           $  1.68 common shareholders per share - diluted Expected real estate                 0.63        0.63           2.56              2.56 depreciation Expected adjustments for        0.01        0.01           0.05              0.05 unconsolidated joint ventures Expected income allocated to           0.01        0.01           0.05              0.05 non-controlling interests (Gain) on sale of unconsolidated        0.00      0.00          (0.04    )      (0.04    ) joint venture property Expected FFO per    $  1.02     $  1.06        $  4.10           $  4.30 share - diluted                                                                                                                                      Note: This table contains forward-looking statements. Please see the paragraph regarding forward-looking statements earlier in this document.                                                                                                                                     Net Operating Income (NOI) NOI is defined by the Company as total property income less property operating and maintenance expenses less real estate taxes. The Company considers NOI to be an appropriate supplemental measure of operating performance to net income attributable to common shareholders because it reflects the operating performance of our communities without allocation of corporate level property management overhead or general and administrative costs. A reconciliation of net income attributable to common shareholders to net operating income is provided below:                                                                                                                  Three Months Ended                                                March 31,                                                2014             2013 Net income attributable to                                $  40,036         $  63,476 common shareholders Less: Fee and asset management                                  (3,023   )        (2,894   ) income Less: Interest and other                                         (288     )        (52      ) (income) loss Less: Income on deferred                                          (681     )        (2,999   ) compensation plans Plus: Property management                                        5,839             5,983 expense Plus: Fee and asset management                                  1,259             1,477 expense Plus: General and                                               9,545             9,794 administrative expense Plus: Interest                                    23,133            24,895 expense Plus: Depreciation and                                  57,396            51,603 amortization Plus: Amortization of                                   841               916 deferred financing costs Plus: Expense on deferred                                          681               2,999 compensation plans Less: Gain on                                     (354     )        (698     ) sale of land Less: Equity in income of joint                                   (4,290   )        (934     ) ventures Plus: Income tax                                  474               399 expense Less: Income from                                              -                 (2,774   ) discontinued operations Less: Gain on sale of discontinued                                      -                 (31,783  ) operations, net of tax Plus: Income allocated to non-controlling                                   1,037             864 interests from continuing operations Plus: Income, including gain on sale, allocated to                                     -              93        non-controlling interests from discontinued operations Net Operating                                  $  131,605        $  120,365 Income (NOI)                                                                   "Same Property"                                $  118,643        $  111,646 Communities Non-"Same Property"                                         12,313            7,924 Communities Development and Lease-Up                                          (5       )        (6       ) Communities Other                                            654            801       Net Operating                                  $  131,605        $  120,365 Income (NOI)                                                                                                                                     EBITDA EBITDA is defined by the Company as earnings before interest, taxes, depreciation and amortization, including net operating income from discontinued operations, excluding equity in (income) loss of joint ventures, (gain) loss on sale of unconsolidated joint venture interests, gain on acquisition of controlling interest in joint ventures, gain on sale of discontinued operations, net of tax, and income (loss) allocated to non-controlling interests. The Company considers EBITDA to be an appropriate supplemental measure of operating performance to net income attributable to common shareholders because it represents income before non-cash depreciation and the cost of debt, and excludes gains or losses from property dispositions. A reconciliation of net income attributable to common shareholders to EBITDA is provided below:                                                                                                                  Three Months Ended                                                March 31,                                                2014             2013 Net income attributable to                                $  40,036         $  63,476 common shareholders Plus: Interest                                    23,133            24,895 expense Plus: Amortization of                                   841               916 deferred financing costs Plus: Depreciation and                                  57,396            51,603 amortization Plus: Income allocated to non-controlling                                   1,037             864 interests from continuing operations Plus: Income, including gain on sale, allocated to                                      -                 93 non-controlling interests from discontinued operations Plus: Income tax                                  474               399 expense Plus: Real estate depreciation and amortization                                      -                 1,867 from discontinued operations Less: Gain on                                     (354     )        (698     ) sale of land Less: Equity in income of joint                                   (4,290   )        (934     ) ventures Less: Gain on sale of discontinued                                     -              (31,783  ) operations, net of tax EBITDA                                         $  118,273        $  110,698  Contact:  Camden Property Trust Kim Callahan, 713-354-2549