|
| Simon Property Group Announces Third Quarter Results and Quarterly Dividends |
INDIANAPOLIS, Oct. 29 /PRNewswire-FirstCall/ -- Simon Property Group, Inc. (the "Company" or "Simon") (NYSE: SPG) today announced results for the quarter ended September 30, 2007:
-- Funds from operations ("FFO") of the Simon portfolio for the quarter
increased 13.3% to $418.7 million from $369.5 million in the third
quarter of 2006. On a diluted per share basis the increase was 12.3% to
$1.46 from $1.30 in 2006. FFO of the Simon portfolio for the nine
months increased 8.9% to $1.184 billion from $1.087 billion in 2006. On
a diluted per share basis the increase was 8.4% to $4.14 per share from
$3.82 per share in 2006.
-- Net income available to common stockholders for the quarter increased
74.3% to $164.9 million from $94.6 million in the third quarter of
2006. On a diluted per share basis the increase was 72.1% to $0.74 from
$0.43 in 2006. Net income available to common stockholders for the nine
months increased 14.8% to $323.2 million from $281.5 million in 2006.
On a diluted per share basis the increase was 14.2% to $1.45 per share
from $1.27 per share in 2006. The increase in net income for the
quarter and nine months is primarily attributable to higher gains
recognized in 2007 on the sale of assets and interests in
unconsolidated entities partially offset by lower income from
unconsolidated entities as a result of increased depreciation expense
attributable to the acquisition of the Mills portfolio of assets.
As of As of
September 30, September 30,
2007 (4) 2006 Change
Occupancy
Regional Malls(1) 92.7% 92.5% 20 basis point
increase
Premium Outlet Centers(R) (2) 99.6% 99.3% 30 basis point
increase
Community/Lifestyle Centers(2) 92.8% 90.7% 210 basis point
increase
Comparable Sales per Sq. Ft.
Regional Malls(3) $491 $474 3.6% increase
Premium Outlet Centers(2) $499 $462 8.0% increase
Average Rent per Sq. Ft.
Regional Malls(1) $36.92 $35.23 4.8% increase
Premium Outlet Centers(2) $25.45 $24.05 5.8% increase
Community/Lifestyle Centers(2) $12.15 $11.69 3.9% increase
(1) For mall and freestanding stores.
(2) For all owned gross leasable area (GLA).
(3) For mall and freestanding stores with less than 10,000 square feet.
(4) Statistics do not include the Mills portfolio of assets.
Dividends
Today the Company announced a quarterly common stock dividend of $0.84 per share. This dividend will be paid on November 30, 2007 to stockholders of record on November 16, 2007. The Company also declared dividends on its two outstanding public issues of preferred stock:
-- 6% Series I Convertible Perpetual Preferred (NYSE: SPGPrI) dividend of
$0.75 per share is payable on November 30, 2007 to stockholders of
record on November 16, 2007.
-- 8 3/8% Series J Cumulative Redeemable Preferred (NYSE: SPGPrJ) dividend
of $1.046875 per share is payable on December 31, 2007 to stockholders
of record on December 17, 2007.
2007 Guidance
Today the Company announced that it expects to achieve at least the high end of its previously updated guidance range of $5.83 to $5.88 per share for diluted FFO for the year ending December 31, 2007. The Company's original guidance for 2007 diluted FFO was a range of $5.70 to $5.80 per share. The Company expects diluted net income available to common stockholders for 2007 to be approximately $2.13 per share. The following table provides the reconciliation of estimated diluted net income available to common stockholders per share to estimated diluted FFO per share.
For the year ending December 31, 2007
Estimated diluted net income available to common
stockholders per share $2.13
Depreciation and amortization including our
share of joint ventures 4.15
Gain on sale of assets and interests in
unconsolidated entities, net (0.29)
Impact of additional dilutive securities (0.11)
Estimated diluted FFO per share $5.88
U.S. Development Activity
The Company continues construction on:
-- Philadelphia Premium Outlets - a 425,000 square foot upscale
manufacturers' outlet center in Limerick, Pennsylvania, 35 miles
northwest of Philadelphia. The center is scheduled to open on November
8, 2007. It is 98% leased to tenants including Ann Taylor, Banana
Republic, Burberry, Coach, Elie Tahari, Kate Spade, Michael Kors,
Neiman Marcus Last Call and Sony. Phase II of this project comprising
120,000 square feet is under construction and scheduled to open in
April of 2008.
-- Palms Crossing - a 396,000 square foot community center in McAllen,
Texas. The first phase of the center is scheduled to open 92% leased on
November 15, 2007. The center is anchored by Beall's, DSW, Barnes &
Noble, Babies "R" Us, Sports Authority, Ulta Cosmetics and Ashley
Furniture. Restaurants include P.F. Chang's, B.J.'s Restaurant and
Brewery, Macaroni Grill and Houlihan's.
-- Pier Park - a 920,000 square foot community/lifestyle center in Panama
City Beach, Florida. Target and a 16-screen theater have already opened
at the center. The remainder of the project is scheduled to open in
May of 2008.
-- Hamilton Town Center - a 950,000 square foot open-air retail center in
Noblesville, Indiana. JCPenney opened at the project in October. The
remainder of the 690,000 square foot first phase of the center is
scheduled to open in May of 2008.
-- Houston Premium Outlets - a 433,000 square foot upscale manufacturers'
outlet center in Houston, Texas. The center is scheduled to open in
March of 2008.
-- Jersey Shore Premium Outlets - a 435,000 square foot upscale
manufacturers' outlet center in Tinton Falls, New Jersey. The center is
scheduled to open in the fall of 2008.
International Activity
Recent international activities include:
-- On July 5th, the Company's Chelsea division opened Kobe-Sanda Premium
Outlets, the sixth Premium Outlet Center in Japan and the second in the
Kansai region. The project is located 22 miles north of downtown Kobe
and 30 miles northwest of central Osaka. The 195,000 square-foot first
phase of the project opened 100% leased to 90 tenants. Approximately
70% of the center has been leased to international brands and the
balance to Japanese domestic brands.
Kobe-Sanda Premium Outlets was developed by Chelsea Japan Co., Ltd., a
joint venture of Simon Property Group (40% interest), Mitsubishi Estate
Co., Ltd. and Sojitz Corporation (each 30%), and brings the joint
venture's operating portfolio of Premium Outlet Centers to 1.6 million
square feet of gross leasable area.
-- On July 26th, the Company announced that the Porta di Roma shopping
center in Rome, Italy opened to the public. The center is located on
the north side of Rome adjacent to the Grande Annulare, the peripheral
highway which circles the city. The 1.3 million square foot center
(Italy's largest shopping center) opened 97% leased and is anchored by
Auchan, LeRoy Merlin, IKEA and a 14-screen UGC Movie Theatre. The
center's 210 small shops have been leased to significant national and
international retailers. The trade area for Porta di Roma contains
approximately 1.3 million people.
The center is the joint development of the Lamaro Group, a major Rome-
based construction and development organization, and Gallerie
Commerciali Italia ("GCI"), Simon's Italian joint venture partnership
with Groupe Auchan. GCI owns 40% of this project.
-- On September 27th, GCI opened its 100% owned Cinisello shopping center
in Milan, Italy. The 400,000 square foot center opened fully leased, is
anchored by Auchan, and contains approximately 100 shops including H&M,
Darty, Scarpe Scarpe, Nike, Calvin Klein, and Conbipel.
Development projects:
-- Construction continues on two shopping center projects in Italy
partially owned by GCI - Nola (Naples) is expected to open in December
of 2007 and Argine (Naples) is scheduled to open in late 2008. After
the opening of these two projects, GCI will own interests in 45
shopping centers in Italy comprising approximately 10.6 million square
feet of gross leasable area.
-- Construction also continues on five projects in China located in
Changshu, Hangzhou, Hefei, Suzhou, and Zhengzhou. The centers range in
size from 300,000 to 720,000 square feet and will be anchored by Wal-
Mart. A 2008 opening is scheduled for Changshu, followed by anticipated
2009 openings for Hangzhou, Hefei, Suzhou and Zhengzhou. Simon owns
32.5% of these projects through its partnership with Morgan Stanley
Real Estate Fund and Shenzhen International Trust and Investment
Company CP.
Dispositions
During the quarter, the Company continued its program to divest non-core assets in the U.S. with the disposition of four properties:
-- Alton Square - a regional mall in the St. Louis suburb of Alton,
Illinois
-- University Mall - a regional mall in Little Rock, Arkansas
-- Boardman Plaza - a community center in Youngstown, Ohio
-- Griffith Park Plaza - a community center in the Chicago suburb of
Griffith, Indiana
On July 5th, the Company's Simon Ivanhoe joint venture completed the sale of five non-core assets in Poland. The net gain from these dispositions was $82.2 million. Financing Activity On August 22nd, the Company announced the syndication of a senior loan facility for The Mills Limited Partnership ("TMLP"), an entity owned by SPG- FCM Ventures, LLC (a joint venture between a Simon subsidiary and funds managed by Farallon Capital Management, L.L.C.). The facility was initially closed for $925 million in June of 2007 by JPMorgan Chase and Bank of America, Joint Arrangers and Joint Book Managers, and included a $50 million revolving credit facility. As part of the syndication, the senior loan facility was increased to $1.025 billion, consisting of a $975 million senior term loan and a $50 million revolving credit facility. The facility matures in June 2009 and contains three, one-year extensions, at TMLP's option. The interest rate for the facility is LIBOR plus 125 basis points. On October 4th, the Company announced the successful implementation of the $500 million accordion feature in its existing unsecured corporate credit facility, thereby increasing the Company's revolving borrowing capacity from $3.0 billion to $3.5 billion. The expanded credit facility includes a larger $875 million multi-currency tranche for Euro, Yen and Sterling borrowings. The facility will mature in January 2010 and contains a one-year extension at the Company's sole option. The base interest rate on the Company's facility is currently LIBOR plus 37.5 basis points. On October 2nd, the Company announced the completion of the redemption of all 3,000,000 of the outstanding shares of its 7.89% Series G Cumulative Step- Up Premium Rate Preferred Stock. The Series G Preferred was redeemed at a redemption price of $50.00 per share plus accrued and unpaid distributions to the redemption date, or a total of $50.011 per share. The Company sold a new issue of preferred stock to an institutional investor in a private transaction and used the proceeds to pay the aggregate redemption price. Conference Call The Company will provide an online simulcast of its quarterly conference call at www.simon.com (Investor Relations tab), www.earnings.com, and www.streetevents.com. To listen to the live call, please go to any of these websites at least fifteen minutes prior to the call to register, download and install any necessary audio software. The call will begin at 11:00 a.m. Eastern Daylight Time today, October 29, 2007. An online replay will be available for approximately 90 days at www.simon.com, www.earnings.com, and www.streetevents.com. A fully searchable podcast of the conference call will also be available at www.REITcafe.com shortly after completion of the call. Supplemental Materials The Company will publish a supplemental information package which will be available at www.simon.com in the Investor Relations section, Financial Information tab. It will also be furnished to the SEC as part of a current report on Form 8-K. If you wish to receive a copy via mail or email, please call 800-461-3439. Forward-Looking Statements Certain statements made in this press release may be deemed "forward- looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Although the Company believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, the Company can give no assurance that our expectations will be attained, and it is possible that actual results may differ materially from those indicated by these forward-looking statements due to a variety of risks and uncertainties. Those risks and uncertainties include, but are not limited to: the Company's ability to meet debt service requirements, the availability of financing, changes in the Company's credit rating, changes in market rates of interest and foreign exchange rates for foreign currencies, the ability to hedge interest rate risk, risks associated with the acquisition, development and expansion of properties, general risks related to retail real estate, the liquidity of real estate investments, environmental liabilities, international, national, regional and local economic climates, changes in market rental rates, trends in the retail industry, relationships with anchor tenants, the inability to collect rent due to the bankruptcy or insolvency of tenants or otherwise, risks relating to joint venture properties, costs of common area maintenance, competitive market forces, risks related to international activities, insurance costs and coverage, impact of terrorist activities, inflation and maintenance of REIT status. The Company discusses these and other risks and uncertainties under the heading "Risk Factors" in its annual and quarterly periodic reports filed with the SEC that could cause the Company's actual results to differ materially from the forward-looking statements that the Company makes. The Company may update that discussion in its periodic reports, but otherwise the Company undertakes no duty or obligation to update or revise these forward-looking statements, whether as a result of new information, future developments, or otherwise. Funds from Operations ("FFO") The Company considers FFO a key measure of its operating performance that is not specifically defined by accounting principles generally accepted in the United States ("GAAP"). The Company believes that FFO is helpful to investors because it is a widely recognized measure of the performance of real estate investment trusts ("REITs") and provides a relevant basis for comparison among REITs. The Company determines FFO in accordance with the definition set forth by the National Association of Real Estate Investment Trusts ("NAREIT"). About Simon Simon Property Group, Inc. is an S&P 500 company and the largest public U.S. real estate company. Simon is a fully integrated real estate company which operates from five retail real estate platforms: regional malls, Premium Outlet Centers(R), The Mills(R), community/lifestyle centers and international properties. It currently owns or has an interest in 378 properties comprising 257 million square feet of gross leasable area in North America, Europe and Asia. The Company is headquartered in Indianapolis, Indiana and employs more than 5,000 people worldwide. Simon Property Group, Inc. is publicly traded on the NYSE under the symbol SPG. For further information, visit the Company's website at www.simon.com.
SIMON
Consolidated Statements of Operations
Unaudited
(In thousands)
For the Three Months Ended For the Nine Months Ended
September 30, September 30,
2007 2006 2007 2006
REVENUE:
Minimum rent $536,377 $500,589 $1,569,328 $1,474,503
Overage rent 27,049 21,931 63,575 53,287
Tenant reimbursements 262,183 233,278 730,780 681,090
Management fees and
other revenues 34,952 20,780 73,369 60,348
Other income 46,584 42,158 178,166 135,895
Total revenue 907,145 818,736 2,615,218 2,405,123
EXPENSES:
Property operating 121,698 118,185 343,047 331,389
Depreciation and
amortization 224,662 211,390 670,544 632,200
Real estate taxes 77,939 73,427 236,184 225,636
Repairs and maintenance 26,322 23,910 84,073 74,704
Advertising and
promotion 22,192 17,718 61,486 55,661
Provision for credit
losses 3,134 393 5,100 4,853
Home and regional
office costs 32,976 32,703 95,945 95,691
General and
administrative 4,887 4,422 14,905 13,920
Other 14,636 15,264 42,718 40,492
Total operating
expenses 528,446 497,412 1,554,002 1,474,546
OPERATING INCOME 378,699 321,324 1,061,216 930,577
Interest expense (238,155) (206,195) (704,287) (611,010)
Minority interest in
income of
consolidated entities (3,052) (3,154) (9,098) (7,512)
Income tax expense of
taxable REIT
subsidiaries (648) (2,536) (1,405) (7,395)
Income from
unconsolidated
entities, net 8,491 25,898 37,723 75,703
Gain on sale of assets
and interests in
unconsolidated
entities, net 82,197 9,457 82,697 51,406
Limited Partners'
interest in the
Operating
Partnership (42,897) (24,951) (84,223) (74,429)
Preferred distributions
of the Operating
Partnership (5,382) (6,893) (16,218) (20,647)
Income from continuing
operations 179,253 112,950 366,405 336,693
Discontinued operations,
net of Limited
Partners' interest (26) 45 (171) 89
Gain on sale of
discontinued operations,
net of Limited Partners'
interest - - - 66
NET INCOME 179,227 112,995 366,234 336,848
Preferred dividends (14,290) (18,403) (42,999) (55,371)
NET INCOME AVAILABLE
TO COMMON
STOCKHOLDERS $164,937 $ 94,592 $323,235 $281,477
PER SHARE DATA:
Basic Earnings per
Common Share $0.74 $0.43 $1.45 $1.27
Diluted Earnings per
Common Share $0.74 $0.43 $1.45 $1.27
SIMON
Consolidated Balance Sheets
Unaudited
(In thousands, except as noted)
September 30, December 31,
2007 2006
ASSETS:
Investment properties, at cost $24,138,267 $22,863,963
Less - accumulated depreciation 5,139,607 4,606,130
18,998,660 18,257,833
Cash and cash equivalents 389,968 929,360
Tenant receivables and accrued
revenue, net 370,443 380,128
Investment in unconsolidated
entities, at equity 1,996,540 1,526,235
Deferred costs and other assets 1,133,175 990,899
Notes receivable from related
parties 769,580 -
Total assets $23,658,366 $22,084,455
LIABILITIES:
Mortgages and other indebtedness $17,266,451 $15,394,489
Accounts payable, accrued expenses,
intangibles, and deferred revenue 1,131,257 1,109,190
Cash distributions and losses in
partnerships and joint ventures, at
equity 231,972 227,588
Other liabilities, minority interest
and accrued dividends 182,019 178,250
Total liabilities 18,811,699 16,909,517
COMMITMENTS AND CONTINGENCIES
LIMITED PARTNERS' INTEREST IN THE
OPERATING PARTNERSHIP 761,238 837,836
LIMITED PARTNERS' PREFERRED INTEREST
IN THE OPERATING PARTNERSHIP 308,393 357,460
STOCKHOLDERS' EQUITY
CAPITAL STOCK OF SIMON PROPERTY
GROUP, INC. (750,000,000 total
shares authorized, $.0001 par
value, 237,996,000 shares of
excess common stock):
All series of preferred stock,
100,000,000 shares authorized,
17,812,029 and 17,578,701 issued
and outstanding, respectively,
and with liquidation values of
$890,601 and $878,935,
respectively 897,197 884,620
Common stock, $.0001 par value,
400,000,000 shares authorized,
227,691,621 and 225,797,566
issued and outstanding,
respectively 23 23
Class B common stock, $.0001 par
value, 12,000,000 shares
authorized, 8,000 issued and
outstanding - -
Class C common stock, $.0001 par
value, 4,000 shares authorized,
issued and outstanding - -
Capital in excess of par value 5,051,664 5,010,256
Accumulated deficit (1,979,517) (1,740,897)
Accumulated other comprehensive
income 21,275 19,239
Common stock held in treasury at
cost, 4,697,332 and 4,378,495
shares, respectively (213,606) (193,599)
Total stockholders' equity 3,777,036 3,979,642
Total liabilities and stockholders'
equity $23,658,366 $22,084,455
SIMON
Joint Venture Statements of Operations
Unaudited
(In thousands)
For the Three Months Ended For the Nine Months Ended
September 30, September 30,
2007 2006 2007 2006
Revenue:
Minimum rent $466,933 $262,417 $1,184,208 $771,054
Overage rent 26,448 19,094 64,090 51,518
Tenant
reimbursements 220,621 136,080 572,820 386,064
Other income 47,841 40,138 136,707 107,979
Total revenue 761,843 457,729 1,957,825 1,316,615
Operating Expenses:
Property operating 165,419 98,716 407,021 267,767
Depreciation and
amortization 160,403 79,035 400,234 230,018
Real estate taxes 60,073 34,073 160,989 99,194
Repairs and
maintenance 24,672 20,065 77,691 60,549
Advertising and
promotion 14,997 11,029 38,037 24,569
Provision for
credit losses 7,416 2,389 14,139 3,821
Other 35,494 26,265 103,853 86,417
Total operating
expenses 468,474 271,572 1,201,964 772,335
Operating Income 293,369 186,157 755,861 544,280
Interest expense (248,588) (105,417) (594,093) (307,150)
Income from
unconsolidated
entities 545 480 458 719
Gain on sale of
assets 198,135 - 193,376 94
Income from
Continuing
Operations 243,461 81,220 355,602 237,943
Income from
consolidated joint
venture interests(A) (28) 4,058 2,562 9,565
Income from
discontinued joint
venture interests(B) - 129 176 631
Gain (loss) on
disposal or sale
of discontinued
operations, net - (329) 19 20,375
Net Income $243,433 $85,078 $358,359 $268,514
Third-Party
Investors' Share
of Net Income $133,705 $51,049 $194,377 $160,488
Our Share of Net
Income 109,728 34,029 163,982 108,026
Amortization of
Excess Investment (11,014) (12,164) (36,036) (37,056)
Income from
Beneficial
Interests and
Other, Net - 4,033 - 15,309
Write-off of
Investment Related
to Properties Sold - 135 - (2,842)
Our Share of Net
Gain Related to
Properties Sold (90,223) (135) (90,223) (7,734)
Income from
Unconsolidated
Entities and
Beneficial
Interests, Net $8,491 $25,898 $37,723 $75,703
SIMON
Joint Venture Balance Sheets
Unaudited
(In thousands)
September 30, December 31,
2007 2006
Assets:
Investment properties, at cost $20,913,688 $10,669,967
Less - accumulated depreciation 3,077,050 2,206,399
17,836,638 8,463,568
Cash and cash equivalents 680,139 354,620
Tenant receivables 346,567 258,185
Investment in unconsolidated
entities 228,871 176,400
Deferred costs and other assets 847,169 307,468
Total assets $19,939,384 $9,560,241
Liabilities and Partners' Equity:
Mortgages and other indebtedness $16,049,363 $8,055,855
Accounts payable, accrued expenses,
and deferred revenue 987,600 513,472
Other liabilities 1,008,096 255,633
Total liabilities 18,045,059 8,824,960
Preferred units 67,450 67,450
Partners' equity 1,826,875 667,831
Total liabilities and partners'
equity $19,939,384 $9,560,241
Our Share of:
Total assets $8,150,966 $4,113,051
Partners' equity $994,310 $380,150
Add: Excess Investment (C) 770,258 918,497
Our net Investment in Joint Ventures $1,764,568 $1,298,647
Mortgages and other indebtedness $6,416,329 $3,472,228
SIMON
Footnotes to Financial Statements
Unaudited
Notes:
(A) Consolidation occurs when the Company acquires an additional ownership
interest in a joint venture and, as a result, gains control of the
joint venture. These interests have been separated from operational
interests to present comparative results of operations. As a result of
the consolidation of Mall of Georgia during the fourth quarter of 2006
and Town Center at Cobb and Gwinnett Mall as of March 31, 2007, we
reclassified our share of the pre-consolidation earnings from these
properties.
(B) Discontinued joint venture interests represent assets and partnership
interests that have been sold.
(C) Excess investment represents the unamortized difference of the
Company's investment over equity in the underlying net assets of the
partnerships and joint ventures. The Company generally amortizes
excess investment over the life of the related properties, typically
no greater than 40 years, and the amortization is included in income
from unconsolidated entities.
SIMON
Reconciliation of Net Income to FFO (1)
Unaudited
(In thousands, except as noted)
For the Three Months For the Nine Months
Ended Ended
September 30, September 30,
2007 2006 2007 2006
Net Income(2)(3)(4)(5) $179,227 $112,995 $366,234 $336,848
Adjustments to Net Income to
Arrive at FFO:
Limited Partners' interest
in the Operating
Partnership and preferred
distributions of the
Operating Partnership 48,279 31,844 100,441 95,076
Limited Partners' interest
in discontinued operations (6) 11 (44) 23
Depreciation and
amortization from
consolidated properties
and discontinued
operations 220,984 209,023 660,325 633,013
Simon's share of
depreciation and
amortization from
unconsolidated entities 74,397 52,477 205,697 155,555
Gain on sales of assets
and interests in
unconsolidated entities
and discontinued
operations, net of Limited
Partners' interest (82,197) (9,457) (82,697) (51,472)
Minority interest portion
of depreciation and
amortization (2,302) (2,091) (6,595) (6,222)
Preferred distributions and
dividends (19,672) (25,296) (59,217) (76,018)
FFO of the Simon Portfolio $418,710 $369,506 $1,184,144 $1,086,803
Per Share Reconciliation:
Diluted net income available
to common stockholders per
share $0.74 $0.43 $1.45 $1.27
Adjustments to net income to
arrive at FFO:
Depreciation and
amortization from
consolidated properties
and Simon's share of
depreciation and
amortization from
unconsolidated entities,
net of minority interest
portion of depreciation
and amortization 1.04 0.92 3.05 2.80
Gain on sales of assets and
interests in unconsolidated
entities and discontinued
operations, net of Limited
Partners' interest (0.29) (0.03) (0.29) (0.18)
Impact of additional
dilutive securities for
FFO per share (0.03) (0.02) (0.07) (0.07)
Diluted FFO per share $1.46 $1.30 $4.14 $3.82
Details for per share
calculations:
FFO of the Simon Portfolio $418,710 $369,506 $1,184,144 $1,086,803
Adjustments for dilution
calculation:
Impact of preferred stock and
preferred unit conversions
and option exercises (6) 12,843 14,092 38,731 42,407
Diluted FFO of the Simon
Portfolio 431,553 383,598 1,222,875 1,129,210
Diluted FFO allocable to
unitholders (84,635) (75,785) (240,259) (223,432)
Diluted FFO allocable to
common stockholders $346,918 $307,813 $982,616 $905,778
Basic weighted average shares
outstanding 223,103 221,198 222,993 220,925
Adjustments for dilution
calculation:
Effect of stock options 746 872 814 911
Impact of Series C
preferred unit conversion 89 1,041 136 1,050
Impact of Series I
preferred unit conversion 2,414 3,261 2,510 3,270
Impact of Series I
preferred stock conversion 11,081 10,724 11,052 10,796
Diluted weighted average
shares outstanding 237,433 237,096 237,505 236,952
Weighted average limited
partnership units outstanding 57,925 58,375 58,073 58,450
Diluted weighted average
shares and units outstanding 295,358 295,471 295,578 295,402
Basic FFO per share $1.49 $1.32 $4.21 $3.89
Percent Increase 12.9% 8.2%
Diluted FFO per share $1.46 $1.30 $4.14 $3.82
Percent Increase 12.3% 8.4%
SIMON
Footnotes to Reconciliation of Net Income to FFO
Unaudited
Notes:
(1) The Company considers FFO a key measure of its operating performance
that is not specifically defined by GAAP and believes that FFO is
helpful to investors because it is a widely recognized measure of the
performance of REITs and provides a relevant basis for comparison
among REITs. The Company also uses this measure internally to measure
the operating performance of the portfolio. The Company's computation
of FFO may not be comparable to FFO reported by other REITs.
As defined by NAREIT, FFO is consolidated net income computed in
accordance with GAAP, excluding real estate related depreciation and
amortization, excluding gains and losses from extraordinary items,
excluding gains and losses from the sales of real estate, plus the
allocable portion of FFO of unconsolidated joint ventures based upon
economic ownership interest, and all determined on a consistent basis
in accordance with GAAP. The Company has adopted NAREIT's
clarification of the definition of FFO that requires it to include the
effects of nonrecurring items not classified as extraordinary,
cumulative effect of accounting change or resulting from the sale of
depreciable real estate. However, you should understand that FFO does
not represent cash flow from operations as defined by GAAP, should not
be considered as an alternative to net income determined in accordance
with GAAP as a measure of operating performance, and is not an
alternative to cash flows as a measure of liquidity.
(2) Includes the Company's share of gains on land sales of $0.5 million
and $8.3 million for the three months ended September 30, 2007 and
2006, respectively, and $11.8 million and $34.6 million for the nine
months ended September 30, 2007 and 2006, respectively.
(3) Includes the Company's share of straight-line adjustments to minimum
rent of $8.3 million and $7.8 million for the three months ended
September 30, 2007 and 2006, respectively and $19.0 million and $13.1
million for the nine months ended September 30, 2007 and 2006,
respectively.
(4) Includes the Company's share of the fair market value of leases from
acquisitions of $15.1 million and $17.4 million for the three months
ended September 30, 2007 and 2006, respectively, and $41.3 million and
$52.6 million for the nine months ended September 30, 2007 and 2006,
respectively.
(5) Includes the Company's share of debt premium amortization of $4.1
million and $9.4 million for the three months ended September 30, 2007
and 2006, respectively, and $26.1 million and $22.8 million for the
nine months ended September 30, 2007 and 2006, respectively.
(6) Includes dividends and distributions of Series I preferred stock and
Series C and Series I preferred units.
SOURCE Simon Property Group, Inc.
|