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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 For the fiscal year
ended October 31, 2002
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _____ to _____
Commission File No. 1-12803
URSTADT BIDDLE PROPERTIES INC.
(Exact name of registrant as specified in its charter)
MARYLAND 04-2458042
-------- -------------
(State of Incorporation) (I.R.S. Employer
Identification No.)
321 RAILROAD AVENUE
GREENWICH, CONNECTICUT 06830
---------------------- ---------------
(Address of Principal Executive Offices) (Zip code)
Registrant's telephone number, including area code: (203) 863-8200
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
------------------- -------------------
Common Stock, par value $.01 per share New York Stock Exchange
Class A Common Stock, par value $.01 per share New York Stock Exchange
Preferred Share Purchase Rights New York Stock Exchange
Securities registered pursuant to Section 12 (g) of the Act: None
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes x No
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of the Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. x
The aggregate market value of the voting stock held by non-affiliates of
the Registrant as of January 10, 2003: Common Shares, par value $.01 per share-
$41,421,486; Class A Common Shares, par value $.01 per share - $196,835,514.
Indicate the number of shares outstanding of each of the Registrant's
classes of Common Stock and Class A Common Stock, as of January 10, 2003 (latest
date practicable): 6,738,072 Common Shares, par value $.01 per share, and
18,505,672 Class A Common Shares, par value $.01 per share.
DOCUMENTS INCORPORATED BY REFERENCE
Proxy Statement for Annual Meeting of Stockholders to be held on March 12,
2003 (certain parts as indicated herein) (Part III).
1
TABLE OF CONTENTS
Form 10-K
Item No. Report Page
PART I
1. Business 3
2. Properties 8
3. Legal Proceedings 11
4. Submission of Matters to a Vote of Security Holders 11
PART II
5. Market for the Registrant's Common Equity and Related
Shareholder Matters 11
6. Selected Financial Data 14
7. Management's Discussion and Analysis of
Financial Condition and Results of Operations 15
7.A Quantitative and Qualitative Disclosures about Market Risk 22
8. Consolidated Financial Statements and Supplementary Data 22
9. Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure 22
PART III
10. Directors and Executive Officers of the Registrant 23
11. Executive Compensation 23
12. Security Ownership of Certain Beneficial Owners and
Management 23
13. Certain Relationships and Related Transactions 24
PART IV
14. Exhibits, Financial Statements, Schedules and Reports
on Form 8-K 24
Signatures
2
PART I
Forward-Looking Statements
This Annual Report on Form 10-K, together with other statements and information
publicly disseminated by Urstadt Biddle Properties Inc. (the "Company"),
contains certain forward-looking statements within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities Exchange Act of
1934. Such statements are based on assumptions and expectations which may not be
realized and are inherently subject to risks, uncertainties and other factors,
many of which cannot be predicted with accuracy and some of which might not even
be anticipated. Future events and actual results, performance or achievements,
financial and otherwise, may differ materially from the results, performance or
achievements expressed or implied by the forward-looking statements. Risk,
uncertainties and other factors that might cause such differences, some of which
could be material, include, but are not limited to economic and other market
conditions; financing risks, such as the inability to obtain debt or equity
financing on favorable terms; the level and volatility of interest rates;
financial stability of tenants; the inability of the Company's properties to
generate revenue increases to offset expense increases; governmental approvals,
actions and initiatives; environmental/safety requirements; risks of real estate
acquisitions (including the failure of acquisitions to close); risks of
disposition strategies; as well as other risks identified in this Annual Report
on Form 10-K and in the other reports filed by the Company with the Securities
and Exchange Commission (the "SEC") or otherwise publicly disseminated by the
Company.
Item 1. Business.
Organization
Urstadt Biddle Properties Inc., a Maryland Corporation (the "Company"), is a
real estate investment trust engaged in the acquisition, ownership and
management of commercial real estate. The Company was organized as an
unincorporated business trust (the "Trust") under the laws of the Commonwealth
of Massachusetts on July 7, 1969. In 1997, the shareholders of the Trust
approved a plan of reorganization of the Trust from a Massachusetts business
Trust to a corporation organized in Maryland. The plan of reorganization was
effected by means of a merger of the Trust into the Company. As a result of the
plan of reorganization, the Trust was merged with and into the Company, the
separate existence of the Trust ceased, the Company was the surviving entity in
the merger and each issued and outstanding common share of beneficial interest
of the Trust was converted into one share of Common Stock, par value $.01 per
share, of the Company.
Tax Status - Qualification as a Real Estate Investment Trust
The Company elected to be taxed as a real estate investment trust ("REIT") under
Sections 856-860 of the Internal Revenue Code of 1986, as amended (the "Code")
beginning with its taxable year ended October 31, 1970. Pursuant to such
provisions of the Code, a REIT which distributes at least 90% of its real estate
investment trust taxable income to its shareholders each year and which meets
certain other conditions regarding the nature of its income and assets will not
be taxed on that portion of its taxable income which is distributed to its
shareholders. Although the Company believes that it qualifies as a real estate
investment trust for federal income tax purposes no assurance can be given that
the Company will continue to qualify as a REIT.
Description of Business
The Company's sole business is the ownership of real estate investments which
consist principally of investments in income-producing properties, with primary
emphasis on properties in the northeastern part of the United States with a
concentration in Fairfield County, Connecticut and Westchester and Putnam
Counties, New York. The Company's core properties consist principally of
neighborhood and community shopping centers. The remaining properties include
office and retail buildings and industrial properties. The Company seeks to
identify desirable properties for acquisition which it acquires in the normal
course of business. In addition, the Company regularly reviews its portfolio and
from time to time may sell certain of its properties.
3
The Company intends to continue to invest substantially all of its assets in
income producing real estate, with an emphasis on neighborhood and community
shopping centers, although the Company will retain the flexibility to invest in
other types of real property. While the Company is not limited to any
geographical location, the Company's current strategy is to invest primarily in
properties located in the northeastern region of the United States with a
concentration in Fairfield County, Connecticut and Westchester and Putnam
Counties, New York.
At October 31, 2002, the Company owned or had an equity interest in twenty six
properties comprised of neighborhood and community shopping centers, office and
retail buildings and service and distribution facilities located in nine states
throughout the United States, containing a total of 3.0 million square feet of
gross leasable area ("GLA"). For a description of the Company's individual
investments, see Item 2.
Investment and Operating Strategy
The Company's investment objective is to increase the cash flow and consequently
the value of its properties, and seeks growth through (i) the strategic
re-tenanting, renovation and expansion of its existing properties, and (ii) the
selective acquisition of income-producing properties, primarily neighborhood and
community shopping centers, in its targeted geographic region. The Company may
also invest in other types of real estate in the targeted geographic region.
The Company invests in properties where cost effective renovation and expansion
programs combined with effective leasing and operating strategies, can improve
the properties' values and economic returns. Retail properties are typically
adaptable for varied tenant layouts and can be reconfigured to accommodate new
tenants or the changing space needs of existing tenants. In determining whether
to proceed with a renovation or expansion, the Company considers both the cost
of such expansion or renovation and the increase in rent attributable to such
expansion or renovation. The Company believes that its properties provide
opportunities for future renovation and expansion.
When evaluating potential acquisitions, the Company will consider such factors
as (i) economic, demographic, and regulatory conditions in the property's local
and regional market; (ii) the location, construction quality, and design of the
property; (iii) the current and projected cash flow of the property and the
potential to increase cash flow; (iv) the potential for capital appreciation of
the property; (v) the terms of tenant leases, including the relationship between
the property's current rents and market rents and the ability to increase rents
upon lease rollover; (vi) the occupancy and demand by tenants for properties of
a similar type in the market area; (vii) the potential to complete a strategic
renovation, expansion or re-tenanting of the property; (viii) the property's
current expense structure and the potential to increase operating margins; and
(ix) competition from comparable properties in the market area.
The Company may from time to time enter into arrangements for the acquisition of
properties with unaffiliated property owners through the issuance of units of
limited partnership interests in entities that the Company controls. These units
may be redeemable for cash or for shares of the Company's Common stock or Class
A Common stock. The Company believes that this acquisition method may permit the
Company to acquire properties at attractive prices from property owners wishing
to enter into tax-deferred transactions.
4
Core Properties
The Company considers those properties which are directly managed by the
Company, concentrated in the retail sector and located close to the Company's
headquarters in Fairfield County, Connecticut, to be core properties. Of the
twenty six properties in the Company's portfolio, twenty two properties are
considered core properties consisting of seventeen retail properties and five
office buildings (including the Company's executive headquarters). At October
31, 2002, these properties contained in the aggregate 2,216,000 square feet of
gross leaseable area ("GLA"). The Company's core properties collectively had 398
tenants providing a wide range of products and services. Tenants include
regional supermarkets, national and regional discount department stores, other
local retailers and office tenants. At October 31, 2002, the core properties
were 96% leased.
Three of the core properties in the Company's portfolio are owned by
partnerships in which the Company is the sole general partner.
A substantial portion of the Company's operating lease income is derived from
tenants under leases with terms greater than one year. Certain of the leases
provide for the payment of fixed base rentals monthly in advance and for the
payment of a pro-rata share of the real estate taxes, insurance, utilities and
common area maintenance expenses incurred in operating the properties.
Non-Core Properties
In a prior year, the Board of Directors of the Company expanded and refined the
strategic objectives of the Company to concentrate the real estate portfolio
into one of primarily retail properties located in the Northeast and authorized
a plan to sell its non-core properties in the normal course of business over a
period of several years given prevailing market conditions and the
characteristics of each property.
Through this strategy, the Company seeks to update its core property portfolio
by disposing of properties which have limited growth potential and redeploying
capital into properties in its target geographic region and product type where
the Company's management skills may enhance property values. The Company may
engage from time to time in like-kind property exchanges which allow the Company
to dispose of properties and redeploy proceeds in a tax efficient manner.
At October 31, 2002, the Company's non-core properties consisted of one office
building, containing 202,000 square feet of GLA, one retail property totaling
126,000 square feet and two industrial facilities with a total of 447,000 square
feet of GLA. The non-core properties collectively had 7 tenants and were 92%
leased at October 31, 2002.
The office property has three tenants which offer a range of services, including
engineering, management and administrative.
The retail property, located in Tempe, Arizona, is leased to two tenants under
long term leases. The leases obligate these tenants to pay all taxes, insurance,
maintenance and other operating costs on their portion of the property leased
during the term of the lease.
The two industrial facilities are 100% occupied and consist of automobile and
truck parts distribution warehouses. The facilities are net leased to
DaimlerChrysler Corporation under long-term lease arrangements whereby the
tenant pays all taxes, insurance, maintenance and other operating costs of the
property during the term of the lease.
At October 31, 2002, the Company also holds two fixed rate mortgage notes and a
promissory note with a total book value of $3,447,000. The mortgages are secured
by retail properties that were previously owned and sold by the Company. The
promissory note is secured by a security interest in the ownership of the entity
that acquired a property previously owned by the Company.
5
Financing Strategy
The Company intends to finance future acquisitions with the most advantageous
sources of capital which it believes are available to the Company at the time,
and which may include the sale of common equity through public offerings or
private placements, the incurrence of additional indebtedness through secured or
unsecured borrowings, and the reinvestment of proceeds from the disposition of
assets. The Company's financing strategy is to maintain a strong and flexible
financial position by (i) maintaining a prudent level of leverage, and (ii)
minimizing its exposure to interest rate risk represented by floating rate debt.
Recent Developments
In December 2002, the Company acquired in separate transactions, two shopping
center properties totaling 263,186 square feet of leasable area for an aggregate
purchase price of $51 million. The purchase price was financed from available
short-term investments and cash. The properties which are located in the
Company's preferred geographic region of New York and Connecticut contain a
total of 15 national, regional and local retailers.
One of the properties was acquired at a cost of $39.9 million. The property
acquired contains 173,569 square feet of leasable space and approximately 12,000
square feet of developable space, is located in Westchester County, New York and
is situated on 3.6 acres of land. The shopping center contains 8 retail tenants.
Tenants, who lease more than 10% of the property's leasable area, consist of
Toys `R Us (46,850 sf), The Sports Authority (43,000 sf), Borders Books (35,000
sf), and OfficeMax (25,750 sf). The property is currently 100% leased.
The Company, in separate transactions, has contracted to purchase two additional
retail properties for an aggregate purchase price of $33 million. The properties
are located in the Company's preferred geographic region and contain
approximately 169,000 square feet of leasable area. The acquisitions are
expected to be financed with available cash and borrowings.
Matters Relating to the Real Estate Business
The Company is subject to certain business risks arising in connection with
owning real estate which include, among others, (1) the bankruptcy or insolvency
of, or a downturn in the business of, any of its major tenants, (2) the
possibility that such tenants will not renew their leases as they expire, (3)
vacated anchor space affecting the entire shopping center because of the loss of
the departed anchor tenant's customer drawing power, (4) risks relating to
leverage, including uncertainty that the Company will be able to refinance its
indebtedness, and the risk of higher interest rates, (5) potential liability for
unknown or future environmental matters, and (6) the risk of uninsured losses.
Unfavorable economic conditions could also result in the inability of tenants in
certain retail sectors to meet their lease obligations and otherwise could
adversely affect the Company's ability to attract and retain desirable tenants.
The Company believes that its shopping centers are relatively well positioned to
withstand adverse economic conditions since they typically are anchored by
grocery stores, drug stores and discount department stores that offer day-to-day
necessities rather than luxury goods.
Compliance with Governmental Regulations
The Company, like others in the commercial real estate industry, is subject to
numerous environmental laws and regulations. Although potential liability could
exist for unknown or future environmental matters, the Company believes that its
tenants are operating in accordance with current laws and regulations and has
established procedures to monitor these operations.
6
Competition
The real estate investment business is highly competitive. The Company competes
for real estate investments with investors of all types, including domestic and
foreign corporations, financial institutions, other real estate investment
trusts and individuals. In addition, the Company's properties are subject to
local competitors from the surrounding areas. The Company does not consider its
real estate business to be seasonal in nature. The Company's shopping centers
compete for tenants with other regional, community or neighborhood shopping
centers in the respective areas where Company retail properties are located. The
Company's office buildings compete for tenants principally with office buildings
throughout the respective areas in which they are located. In most areas where
the Company's office buildings are located, competition for tenants is intense.
Leasing space to prospective tenants is generally determined on the basis of,
among other things, rental rates, location, physical quality of the property and
availability of space.
Since the Company's industrial properties are net leased under long-term lease
arrangements which are not due to expire in the near future, the Company does
not currently face any immediate competitive re-leasing pressures with respect
to such properties.
Property Management
The Company actively manages and supervises the operations and leasing at all of
its core properties. Three of the Company's non-core properties are net leased
to tenants under long-term lease arrangements, in which case, property
management is provided by the tenants. The Company's remaining property is
managed by an independent property management company. The Company supervises
the property management company that manages the property.
Employees
The Company's executive offices are located at 321 Railroad Avenue, Greenwich,
Connecticut. It occupies approximately 5,000 square feet in a two story office
building owned by the Company. The Company has 22 employees. The Company
believes that its relationship with its employees is good.
Financial Information About Industry Segments
The Company operates in one industry segment, ownership of commercial real
estate properties which are located principally in the northeastern United
States. Management reviews operating and financial data for each property
separately and independently from all other properties when making resource
allocation decisions and measuring performance.
7
Item 2. Properties.
Core Properties
The Company considers those properties which are directly managed by the
Company, concentrated in the retail sector and located close to the Company's
headquarters in Fairfield County, Connecticut, to be core properties. Of the
twenty six properties in the Company's portfolio, twenty two properties are
considered core properties consisting of seventeen retail properties and five
office buildings (including the Company's executive headquarters). At October
31, 2002, these properties contained in the aggregate 2,216,000 square feet of
gross leaseable area ("GLA"). The Company's core properties collectively had 398
tenants providing a wide range of products and services. Tenants include
regional supermarkets, national and regional discount department stores, other
local retailers and office tenants. At October 31, 2002, the core properties
were 96% leased. The Company believes the core properties are adequately covered
by insurance.
In June 2002, the Company acquired a 90% interest in the Ridgeway Shopping
Center (Ridgeway) located in Stamford, Connecticut. Ridgeway was developed in
the 1950's and redeveloped in the mid-1990's. Ridgeway contains 331,000 square
feet of leasable space and 29,000 square feet of office space. It is the
dominant grocery anchored center and the largest non-mall shopping center
located in the City of Stamford, Fairfield County, Connecticut. For the year
ended October 31, 2002, Ridgeway revenues represented approximately 9% of the
Company's total revenues and approximately 25% of the Company's total assets at
October 31, 2002. The loss of this center or a material decrease in revenues
from the center for any reason might have a material adverse effect on the
Company.
As of October 31, 2002, Ridgeway retail space was 96% leased. The Property's
largest tenants are: The Stop & Shop Company, a division of the Dutch food
conglomerate, Ahold, occupying 60,000 square feet of sales floor area of the
Property (approximately 17% of the Ridgeway's gross leasable area (GLA)) and
Bed, Bath and Beyond, a retailer who leases 47,000 square feet of sales floor
area (approximately 13% of GLA). Other than The Stop & Shop Company (22%), Bed
Bath & Beyond (16%) and Marshall's Inc, a division of the TJX Companies (11%),
no tenant accounts for more than 10% of the Ridgeway's annual base rents.
The following table sets out a schedule of the annual lease expirations for
retail leases at Ridgeway executed as of October 31, 2002 with respect to each
of the next ten years and thereafter (assuming that no tenants exercise renewal
or cancellation options and that there are no tenant bankruptcies or other
tenant defaults):
Year of Lease Number of Square Footage of Expiring Minimum Annual Base Percentage of
Expiration Expiring Leases Leases Rentals Base Rent (%)
- ---------- --------------- ------ ------- -------------
2003 3 1,775 $ 56,172 0.7%
2004 1 235 5,640 0.1%
2005 1 2,375 120,246 1.5%
2006 1 1,400 49,000 0.6%
2007 4 9,400 333,300 4.3%
2008 10 69,071 1,655,351 21.2%
2009 2 2,209 101,553 1.3%
2010 4 42,240 641,833 8.2%
2011 1 3,040 98,678 1.3%
2012 4 21,567 653,654 8.4%
Thereafter 4 145,156 4,098,030 52.4%
--- ------- --------- ------
35 298,468 7,813,457 100.0%
== ======= ========= ======
8
The following table sets forth information concerning each core property at
October 31, 2002. Except as otherwise noted, all core properties are 100% owned
by the Company.
Gross
Year Year Year Leasable Number of
Location Renovated Completed Acquired Square Feet Acres Tenants Leased Principal Tenant
-------- --------- --------- -------- ----------- ----- ------- ------ ----------------
Retail Properties:
Stamford, CT (1) 1997 1950 2002 360,000 13.6 35 88% Stop & Shop Supermarket
Springfield, MA 1996 1970 1970 316,000 26.0 27 94% A&P Supermarket
Meriden, CT 2001 1989 1993 313,000 29.2 25 99% ShopRite Supermarket
Danbury, CT - 1989 1995 194,000 19.3 21 100% Christmas Tree Shops
Briarcliff Manor, NY (1) 2000 1978 1998 161,000 11.4 29 93% Stop & Shop Supermarket
Carmel, NY 1999 1983 1995 126,000 19.0 18 100% ShopRite Supermarket
Wayne, NJ 1992 1959 1992 102,000 9.0 46 100% A&P Supermarket
Newington, NH - 1975 1979 102,000 14.3 10 99% Linens `N Things
Darien, CT 1992 1955 1998 95,000 9.5 19 100% Shaw's Supermarket
Somers, NY - 1991 1999 78,000 10.8 35 98% Gristede's Supermarket
Farmingdale, NY 1993 1981 1993 70,000 5.6 15 100% King Kullen Supermarket
Eastchester, NY (1) 2002 1978 1997 70,000 4.0 11 100% Food Emporium
(Division of A&P)
Ridgefield, CT 1999 1930 1998 51,000 2.1 52 89% Chico's
Briarcliff Manor, NY - 1975 2001 38,000 1.0 18 94% Dress Barn
Danbury, CT - 1988 2002 33,000 2.7 6 100% Gateway
Briarcliff Manor, NY 2001 1981 1999 29,000 4.0 3 100% Westchester
Community College
Somers, NY - 1987 1992 19,000 4.9 12 100% Putnam County Savings Bank
Office Properties:
Greenwich, CT - 1983 1998 19,000 1.0 2 100% Greenwich Hospital
Greenwich, CT - 1977 2001 11,000 0.4 4 100% Glenville Medical Center
Greenwich, CT - 1983 1993 10,000 0.2 3 100% Urstadt Biddle
Properties Inc.
Greenwich, CT 1983 1953 1994 10,000 0.2 3 87% Prescott Investors
Greenwich, CT - 1978 2000 9,000 1.0 4 100% Insurance Center of
Greenwich
--------- ---
2,216,000 398
========= ===
(1) The Company has a general partnership interest in this property.
9
Non-Core Properties
In a prior year, the Board of Directors of the Company expanded and refined the
strategic objectives of the Company to concentrate the real estate portfolio
into one of primarily retail properties located in the Northeast and authorized
a plan to sell its non-core properties in the normal course of business over a
period of several years given prevailing market conditions and the
characteristics of each property.
At October 31, 2002, the Company's non-core properties consisted of one office
building, containing 202,000 square feet of GLA, one retail property totaling
126,000 square feet and two industrial facilities with a total of 447,000 square
feet of GLA. The non-core properties collectively had 7 tenants and were 92%
leased at October 31, 2002.
The following table sets forth information concerning each non-core property in
which the Company owned an equity interest at October 31, 2002. The non-core
properties are 100% owned by the Company.
Year Year Year Rentable Number of
Location Renovated Completed Acquired Square Feet Acres Tenants Leased Principal Tenant
-------- --------- --------- -------- ----------- ----- ------- ------ ----------------
Southfield, MI - 1973 1983 202,000 7.8 3 70% Arcadis Giffels
Tempe, AZ 2000 1970 1970 126,000 8.6 2 100% Mervyn's, Inc.
Dallas, TX 1989 1970 1970 255,000 14.5 1 100% DaimlerChrysler Corporation
St. Louis, MO 2000 1970 1970 192,000 16.0 1 100% DaimlerChrysler Corporation
------- -
775,000 7
======= =
Lease Expirations - Total Portfolio
The following table sets forth a summary schedule of the annual lease
expirations for the core and non-core properties for the leases in place as of
October 31, 2002, assuming that none of the tenants exercise renewal or
cancellation options, if any, at or prior to the scheduled expirations.
Year of Lease Number of Leases Square Footage of Percentage of Total Occupied
Expiration Expiring Expiring Leases Square Feet
- ---------- -------- --------------- -----------
2003 (1) 72 105,935 3.73%
2004 56 132,959 4.68%
2005 42 212,980 7.50%
2006 39 132,862 4.68%
2007 34 342,935 12.07%
2008 34 408,378 14.37%
2009 33 339,903 11.96%
2010 20 158,741 5.59%
2011 29 361,142 12.71%
2012 26 166,694 5.87%
2013 5 62,489 2.20%
Thereafter 15 415,879 14.64%
-- ------- ------
405 2,840,897 100.00%
=== ========= =======
(1)Represents lease expirations from November 1, 2002 to October 31, 2003 and
month-to-month leases.
10
Item 3. Legal Proceedings.
In the ordinary course of business, the Company is involved in legal
proceedings. However, there are no material legal proceedings presently pending
against the Company.
Item 4. Submission of Matters to a Vote of Security Holders.
No matter was submitted to a vote of security holders during the fourth quarter
of the fiscal year ended October 31, 2002.
PART II
Item 5. Market for the Registrant's Common Equity and Related Shareholder
Matters.
(a) Price Range of Common Shares
Shares of Common stock and Class A Common stock of the Company are traded on the
New York Stock Exchange under the symbols "UBP" and "UBP.A", respectively. The
following table sets forth the high and low closing sales prices for the
Company's Common Stock and Class A Common Stock during the fiscal years ended
October 31, 2002 and 2001 as reported on the New York Stock Exchange:
Fiscal Year Ended Fiscal Year Ended
Common shares: October 31, 2002 October 31, 2001
- -------------- ---------------- ----------------
Low High Low High
--- ---- --- ----
First Quarter $ 8.60 $10.65 $6.35 $7.27
Second Quarter $10.25 $12.28 $6.99 $7.85
Third Quarter $ 9.95 $12.80 $7.64 $8.66
Fourth Quarter $10.77 $11.60 $8.02 $8.93
Fiscal Year Ended Fiscal Year Ended
Class A Common shares: October 31, 2002 October 31, 2001
- ---------------------- ---------------- ----------------
Low High Low High
--- ---- --- ----
First Quarter $ 9.35 $10.28 $6.39 $7.64
Second Quarter $ 9.88 $12.00 $7.35 $8.54
Third Quarter $10.60 $12.00 $8.12 $9.28
Fourth Quarter $10.80 $11.97 $8.55 $9.75
(b) Approximate Number of Equity Security Holders
At January 10, 2003 (latest date available), there were 1,453 shareholders of
record of the Company's Common stock and 1,459 shareholders of record of the
Class A Common stock.
(c) Dividends Declared on Common stock and Class A Common stock and Tax Status
11
The following table sets forth the dividends declared per Common share and Class
A Common share and tax status for Federal income tax purposes of the dividends
paid during the fiscal years ended October 31, 2002 and 2001:
Dividends Paid Per: Common Share Class A Common Share
- ------------------ ------------------------------- ---------------------------------
Ordinary Ordinary
Gross Dividend Income Capital Gain Gross Dividend Income Capital Gain
Divident Payment Date: Paid Per Share Distribution Distribution Paid Per Share Distribution Distribution
- --------------------- -------------- ------------ ------------ -------------- ------------ ------------
January 18, 2002 $0.185 $0.135 $0.05 $0.205 $0.15 $0.055
April 19, 2002 $0.185 $0.135 $0.05 $0.205 $0.15 $0.055
July 21, 2002 $0.185 $0.135 $0.05 $0.205 $0.15 $0.055
October 18, 2002 $0.185 $0.135 $0.05 $0.205 $0.15 $0.055
------- ------- ------ ------- ------ ------
$0.740 $0.540 $0.20 $0.820 $0.60 $0.220
======== ======= ====== ======= ====== ======
Dividends Paid Per: Common Share Class A Common Share
- ------------------ ------------------------------- ---------------------------------
Ordinary Ordinary
Gross Dividend Income Capital Gain Gross Dividend Income Capital Gain
Divident Payment Date: Paid Per Share Distribution Distribution Paid Per Share Distribution Distribution
- --------------------- -------------- ------------ ------------ -------------- ------------ ------------
January 21, 2001 $0.18 $0.18 $0.00 $0.20 $0.20 $0.00
April 21, 2001 $0.18 $0.18 $0.00 $0.20 $0.20 $0.00
July 21, 2001 $0.18 $0.18 $0.00 $0.20 $0.20 $0.00
October 19, 2001 $0.18 $0.18 $0.00 $0.20 $0.20 $0.00
------ ------ ------ ------ ------ -----
$0.72 $0.72 $0.00 $0.80 $0.80 $0.00
====== ====== ====== ====== ====== =====
The Company has paid uninterrupted quarterly dividends since it commenced
operations as a real estate investment trust in 1969. During the fiscal year
ended October 31, 2002, the Company made distributions to stockholders
aggregating $.74 per Common share and $.82 per Class A Common share. On December
12, 2002, the Board of Directors approved the payment of a quarterly dividend
payable January 17, 2003 to stockholders of record on January 3, 2003. The
dividends were declared in the amounts of $.19 per Common share and $.21 per
Class A Common share.
On June 16, 1998, the Board of Directors declared a special stock dividend on
the Company's Common stock consisting of one share of a newly created class of
Class A Common Stock, par value $.01 per share, for each share of the Company's
Common Stock. The Class A Common Stock entitles the holder to 1/20 of one vote
per share. Each share of Common Stock and Class A Common Stock has identical
rights with respect to dividends except that each share of Class A Common Stock
will receive not less than 110% of the regular quarterly dividends paid on each
share of Common Stock. The stock dividend was paid on August 14, 1998.
Although the Company intends to continue to declare quarterly dividends on its
Common shares and Class A Common shares, no assurances can be made as to the
amounts of any future dividends. The declaration of any future dividends by the
Company is within the discretion of the Board of Directors and will be dependent
upon, among other things, the earnings, financial condition and capital
requirements of the Company, as well as any other factors deemed relevant by the
Board of Directors. Two principal factors in determining the amounts of
dividends are (i) the requirement of the Internal Revenue Code that a real
estate investment trust distribute to shareholders at least 90% of its real
estate investment trust taxable income, and (ii) the amount of the Company's
funds from operations, as defined.
12
The Company has a Dividend Reinvestment and Share Purchase Plan which allows
shareholders to acquire additional shares of Common Stock and Class A Common
Stock by automatically reinvesting dividends. Shares are acquired pursuant to
the Plan at a price equal to the higher of 95% of the market price of such
shares on the dividend payment date or 100% of the average of the daily high and
low sales prices for the five trading days ending on the day of purchase without
payment of any brokerage commission or service charge.
(d) Recent Sales of Unregistered Securities - None.
13
Item 6. Selected Financial Data.
(In thousands, except per share data)
Year Ended October 31, 2002 2001 2000 1999 1998
---- ---- ---- ---- ----
Balance Sheet Data:
Total Assets $353,633 $218,352 $180,792 $183,774 $ 165,039
======== ======== ======== ======== =========
Mortgage Notes Payable $106,429 $47,115 $51,903 $51,263 $32,900
======== ======= ======= ======= =======
Preferred Stock $14,341 $33,462 $33,462 $33,462 $33,462
======= ======= ======= ======= =======
Operating Data:
Total Revenues $44,340 $36,093 $31,009 $29,430 $ 25,385
======= ======= ======= ======= ========
Total Operating Expenses $29,438 $26,154 $23,281 $21,596 $17,252
======= ======= ======= ======= =======
Net Income Applicable to Common and Class A
Common Stockholders $16,080 $10,540 $ 5,442 $ 6,043 $ 5,615
======= ======= ======= ======= =======
Other Data :
Funds from Operations (Note 1) $21,073 $14,611 $11,914 $11,878 $ 11,782
======= ======= ======= ======= ========
Net Cash Provided by Operating Activities $18,532 $21,308 $14,262 $14,423 $13,901
======= ======= ======= ======= =======
Net Cash (Used in) Investing Activities $(64,960) $(11,394) $ (3,713) $(10,556) $(31,130)
========= ========= ========= ========= =========
Net Cash Provided by (Used in)
Financing Activities $59,023 $22,040 $ (11,436) $ (5,009) $19,207
======= ======= ========== ========= =======
Per Share Data (Note 2):
Net Income-Basic
Class A Common Stock $.89 $1.01 $.55 $.62 $.57
Common Stock $.80 $.91 $.50 $.55 $.52
Net Income - Diluted:
Class A Common Stock $.87 $.97 $.55 $.61 $.57
Common Stock $.78 $.88 $.49 $.54 $.52
Cash Dividends on:
Class A Common Stock $.82 $.80 $.78 $.76 $.19
Common Stock $.74 $.72 $.70 $.68 $1.13
---- ---- ---- ---- -----
Total $1.56 $1.52 $1.48 $1.44 $1.32
===== ===== ===== ===== =====
Note 1: The Company has adopted the definition of Funds from Operations (FFO)
suggested by the National Association of Real Estate Investment Trusts (NAREIT)
and defines FFO as net income (computed in accordance with generally accepted
accounting principles), excluding gains (or losses) from sales of properties,
plus depreciation, amortization and after adjustments for unconsolidated joint
ventures. FFO does not represent net cash from operating activities in
accordance with generally accepted accounting principles and should not be
considered an alternative to net income as an indicator of the Company's
operating performance, or for cash flows as a measure of liquidity or ability to
make distributions. The Company considers FFO an appropriate supplemental
measure of operating performance because it primarily excludes the assumption
that the value of real estate assets diminishes predictably over time, and
because industry analysts recognize it as a performance measure. Comparison of
the Company's presentation of FFO, using the NAREIT definition, to similarly
titled measures for other REITs may not necessarily be meaningful due to
possible differences in the application of the NAREIT definition used by such
REITs. For a further discussion of FFO, see Management's Discussion and Analysis
on page 15.
Note 2: Per share data for 1998 has been restated to reflect the effect of the
one-for-one stock dividend in the form of a new issue of Class A Common Stock
distributed in August 1998, however, the cash dividends are presented based on
actual amounts paid.
14
ITEM 7. Management's Discussion and Analysis of Financial Condition
and Results of Operations.
General
Urstadt Biddle Properties Inc. (Company), a real estate investment trust (REIT),
is engaged in the acquisition, ownership and management of commercial real
estate, primarily neighborhood and community shopping centers in the
northeastern part of the United States. Other assets include office and retail
buildings and industrial properties. The Company's major tenants include
supermarket chains and other retailers who sell basic necessities. At October
31, 2002, the Company owned or had interest in 26 properties containing a total
of 3.0 million square feet of leasable area.
This report includes certain statements that may be deemed to be
"forward-looking statements" within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934,
as amended. All statements, other than statements of historical facts, included
in this report that address activities, events or developments that the Company
expects, believes or anticipates will or may occur in the future, including such
matters as future capital expenditures, dividends and acquisitions (including
the amount and nature thereof), expansion and other development trends of the
real estate industry, business strategies, expansion and growth of the Company's
operations and other such matters are forward-looking statements. These
statements are based on certain assumptions and analyses made by the Company in
light of its experience and its perception of historical trends, current
conditions, expected future developments and other factors it believes are
appropriate. Such statements are subject to a number of assumptions, risks and
uncertainties, general economic and business conditions, the business
opportunities that may be presented to and pursued by the Company, changes in
laws or regulations and other factors, many of which are beyond the control of
the Company. Any such statements are not guarantees of future performance and
actual results or developments may differ materially from those anticipated in
the forward-looking statements.
Liquidity and Capital Resources
Sources of Capital
The Company's sources of liquidity and capital resources include its cash and
cash equivalents, proceeds from bank borrowings and long-term mortgage debt,
capital financings and sales of real estate investments. Payments of expenses
related to real estate operations, debt service, management and professional
fees, and dividend requirements place demands on the Company's short-term
liquidity. The Company expects to meet its short-term liquidity requirements
primarily by generating net cash from the operations of its properties. The
Company believes that its net cash provided by operations will be sufficient to
fund its short-term liquidity requirements for fiscal 2003 and to meet its
dividend requirements necessary to maintain its REIT status. In fiscal 2002,
2001 and 2000, net cash provided by operations amounted to $18.5 million, $21.3
million and $14.3 million, respectively. Dividends paid to stockholders of the
Company in fiscal 2002, 2001 and 2000 amounted to $16.4 million, $11.9 million
and $10.9 million, respectively. The Company derives substantially all of its
revenues from tenants under existing leases at its properties. The Company's
operating cash flow therefore depends on the rents that it is able to charge to
its tenants, and the ability of its tenants to make rental payments. The Company
believes that the nature of the properties in which it typically invests -
primarily grocery-anchored neighborhood and community shopping centers -
provides a more stable revenue flow in uncertain economic times, in that
consumers still need to purchase basic staples and convenience items. However,
even in the geographic areas in which the Company owns properties, general
economic downturns may adversely impact the ability of the Company's tenants to
make lease payments and the Company's ability to re-lease space as leases
expire. In either of these cases, the Company's cash flow could be adversely
affected.
15
The Company expects to fund its long-term liquidity requirements such as
property acquisitions, repayment of indebtedness and capital expenditures
through other long-term indebtedness (including indebtedness assumed in
acquisitions), proceeds from sales of non-core properties and/or the issuance of
equity securities. The Company believes that these sources of capital will
continue to be available to it in the future to fund its long-term capital
needs; however, there are certain factors that may have a material adverse
effect on its access to capital sources. The Company's ability to incur
additional debt is dependent upon its existing leverage, the value of its
unencumbered assets and borrowing limitations imposed by existing lenders. The
Company's ability to raise funds through sales of equity securities is dependent
on, among other things, general market conditions for REITs, market perceptions
about the Company and its stock price in the market. The Company's ability to
sell properties in the future to raise cash will be dependent upon market
conditions at the time of sale.
At October 31, 2002, the Company had cash and cash equivalents of $46.3 million
compared to $33.7 million in 2001. The Company also had $25.1 million in liquid
short-term investments as of October 31, 2002. The Company's cash positions and
short-term investments reflect the temporary investment of the net proceeds
received from the sales of the Company's Class A Common shares during fiscal
2002 and 2001.
Financings
In fiscal 2002, the Company completed an underwritten public offering of
8,050,000 shares of its Class A Common stock. The net proceeds to the Company
(after deducting underwriting fees and expenses) was $81.9 million. A portion of
the proceeds was used to repay $16 million of outstanding revolving credit line
indebtedness. The balance of the net proceeds of the offering is expected to be
used to acquire properties. In December 2002, the Company acquired two
properties utilizing approximately $51 million in cash. In November 2001, the
Company also sold 699,222 shares to its underwriters to cover over allotments in
connection with the Company's stock offering of 4,800,000 shares in fiscal 2001.
Net proceeds to the Company amounted to $6,069,000.
In fiscal 2001, the Company completed an underwritten public offering of
4,800,000 shares of its Class A Common stock. The net proceeds to the Company
(after deducting underwriting fees and expenses) was $41.1 million. The Company
also sold 200,000 shares of Common stock and 5,000 shares of Class A Common
stock in a private placement for total proceeds of $1,435,000. The Company used
the proceeds of these offerings to complete the acquisitions of two properties,
repay outstanding credit line borrowings and repurchase 200,000 shares of its
Series B preferred stock at a cost of $16.1 million.
At October 31, 2002, the Company had a $18.75 million secured revolving credit
facility with a bank which expires in fiscal 2005 and a conditional $20 million
unsecured revolving line of credit with the same bank which expires in fiscal
2003. The revolving credit lines are available to finance the acquisition,
management and/or development of commercial real estate, refinance indebtedness
and for working capital purposes. Extensions of credit under the unsecured
credit line are at the bank's discretion and subject to the bank's satisfaction
of certain conditions. During 2002, the Company borrowed $16 million on the
secured credit line to complete the acquisition of the Ridgeway Shopping Center,
Stamford, Connecticut (see below). Borrowings were fully repaid from the
proceeds of the sale of equity securities in fiscal 2002. There were no
borrowings during the year under the unsecured credit line and there were no
outstanding borrowings on either line of credit at October 31, 2002.
The Company is exposed to interest rate risk primarily through its borrowing
activities. There is inherent rollover risk for borrowings as they mature and
are renewed at current market rates. The extent of this risk is not quantifiable
or predictable because of the variability of future interest rates and the
Company's future financing requirements.
16
At October 31, 2002, the Company's contractual obligations for borrowings are as
follows:
Payments Due by Period Amount
Less than 1 year $ 1,840,000
1 to 3 years $ 4,124,000
4 to 5 years $20,153,000
After 5 years $80,312,000
Borrowings consist of $106,429,000 of fixed rate mortgage loan indebtedness with
a weighted average interest rate of 7.53% at October 31, 2002. The mortgage
loans are secured by fourteen properties and have fixed rates of interest
ranging from 6.29% to 8.375%. The Company expects to refinance certain of these
borrowings, at or prior to maturity, through new mortgage loans on real estate.
The ability to do so, however, is dependent upon various factors, including the
income level of the properties, interest rates and credit conditions within the
commercial real estate market. Accordingly, there can be no assurance that such
refinancings can be achieved.
Capital Expenditures
The Company invests in its existing properties and regularly incurs capital
expenditures in the ordinary course of business to maintain its properties. The
Company believes that such expenditures enhance the competitiveness of its
properties. In fiscal 2002, the Company spent approximately $2.8 million for
capital expenditures including $1.5 million related to tenant allowances and
commissions in connection with the Company's leasing activities. The amounts of
these expenditures can vary significantly depending on tenant negotiations,
market conditions and rental rates. The Company has budgeted an additional $3.3
million for known capital improvements and leasing costs in fiscal 2003. These
expenditures are generally funded from operating cash flows or borrowings on its
credit facilities.
Acquisitions and Sales
During fiscal 2002, the Company acquired a 90% general partner interest in a
shopping center in Stamford, Connecticut for $86.8 million (including
transaction costs of $708,000). The property was acquired subject to a $57.4
million first mortgage loan, utilizing available cash of approximately $13.4
million and revolving credit line borrowings of $16 million. The Company also
purchased a shopping center in Danbury, Connecticut for $7.0 million subject to
a first mortgage loan of $2.0 million and acquired the remaining 15% interest in
the Giffels Building in Southfield, Michigan that it did not own for a purchase
price of $1.25 million.
In December 2002, the Company acquired two properties in separate transactions
for an aggregate purchase price of approximately $51 million. The acquisitions
were funded from available cash.
As of October 31, 2002, the Company had contracted to purchase two additional
shopping center properties for an aggregate purchase price of approximately $33
million. The properties are located in the Company's preferred geographic area
of Westchester County, New York and Fairfield County, Connecticut. The
transactions are expected to close during the first half of fiscal 2003.
In fiscal 2001, the Company acquired two properties for $9.5 million. One
property was acquired subject to a first mortgage loan of $4.2 million. The
purchases were financed from available cash and borrowings under the Company's
revolving credit lines.
17
In a prior year, the Company's Board of Directors expanded and refined the
strategic objectives of the Company to refocus its real estate portfolio into
one of self-managed retail properties located in the northeast and authorized a
plan to sell the non-core properties of the Company in the normal course of
business over a period of several years. The Company intends to sell the
non-core properties as opportunities become available. The Company has
selectively effected asset sales to generate cash proceeds over the last several
years. The Company's ability to generate cash from asset sales is dependent upon
market conditions and will necessarily be limited if market conditions make
such sales unattractive. In fiscal 2001, the Company sold two non-core
properties for $1.2 million and a shopping center for $16 million. At October
31, 2002, the remaining non-core properties total four properties with a net
book value of approximately $12 million and consist of two distribution service
facilities, one office building and one retail property (all of which are
located outside of the northeast region of the United States).
Funds from Operations
The Company considers Funds from Operations ("FFO") to be one supplemental
financial measure of an equity REIT's operating performance. FFO is calculated
as net income (computed in accordance with generally accepted accounting
principles (GAAP)), plus depreciation and amortization, excluding gains (or
losses) from sales of property and debt restructuring and after adjustments for
unconsolidated joint ventures. The Company considers recoveries of investments
in properties subject to finance leases to be analogous to amortization for
purposes of calculating FFO. FFO does not represent cash flows from operations
as defined by GAAP and should not be considered an alternative to net income as
an indication of the Company's operating performance or for cash flows as a
measure of liquidity or its dividend paying capacity. Furthermore, FFO as
disclosed by other REITs may not be comparable to the Company's calculation of
FFO. The table below provides a reconciliation of net income in accordance with
GAAP to FFO for each of the years ended October 31, 2002, 2001 and 2000 (amounts
in thousands).
2002 2001 2000
---- ---- ----
Net Income Applicable to Common and Class A Common Stockholders $16,080 $10,540 $5,442
Plus: Real property depreciation 5,459 4,463 4,571
Amortization of tenant improvements and
Allowances 2,088 2,234 1,067
Amortization of deferred leasing costs 517 851 545
Recoveries of investments in properties subject to
finance leases - 91 822
Adjustments for unconsolidated joint venture - (3,252) 534
Less: Excess of carrying value over cost to repurchase preferred shares (3,071) - -
Gains on sales of real estate investments - (316) (1,067)
------ ------- -------
Funds from Operations $21,073 $14,611 $11,914
======= ======= =======
Net Cash Provided by Operating Activities $18,532 $21,308 $14,262
======= ======= =======
Net Cash Used in Investing Activities $(64,960) $(11,394) $(3,713)
======== ========= ========
Net Cash Provided by (Used in) Financing Activities $59,023 $22,040 $(11,436)
======= ======= =========
18
Results of Operations
Fiscal 2002 vs. Fiscal 2001
Revenues
Revenues from operating leases increased 23.4% to $42.2 million in fiscal 2002
compared to $34.2 million in fiscal 2001. The increase in operating lease
revenues resulted from additional rental revenues from new properties acquired
during both years and leasing of previously vacant space at the Company's core
properties. During fiscal 2002 and 2001, the Company acquired four properties
containing 442,000 square feet of space. Rents from recently acquired properties
increased operating lease income by approximately $5.5 million in fiscal 2002.
In the current year the Company renewed or signed new leases totaling 236,000
square feet of space at its core properties. In fiscal 2002, the overall leasing
levels at the Company's properties decreased to 95% compared to 98% leased in
the year ago period. Additionally, the Company's total property occupancy levels
decreased to 92% in fiscal 2002 from 98% in fiscal 2001. The decrease in leasing
and occupancy levels was principally caused by the loss of a tenant occupying
115,390 square feet at the Company's Five Town Plaza shopping center and a
tenant occupying 94,000 square feet at the Company's office property in
Southfield, Michigan who re-leased 32,400 square feet of its previously occupied
space. The balance of the space remains vacant at October 31, 2002. The Company
re-leased the 115,390 square feet of space at Five Town Plaza.
Lease termination income of $765,000 in fiscal 2002 represents lease
cancellation payments from tenants who terminated two leases early during the
year. One of the vacant spaces was re-leased during the year. Interest income
increased in fiscal 2002 from the investment of cash proceeds during the year
into short-term investments at generally lower yields and the addition of a new
$1.2 million promissory note receivable (interest at 12.5% per annum).
Expenses
Total expenses increased to $29.4 million from $26.2 million in fiscal 2001.
Property expenses increased 11.1% to $12.8 million from $11.5 million
principally from the incremental expense of recently acquired properties, which
increased property expenses by $1.4 million in fiscal 2002. Property expenses
for properties owned during 2002 and 2001 were generally unchanged. Snow removal
costs decreased by approximately $250,000 which was largely offset by increases
in property taxes and insurance costs.
Interest expense increased principally from new mortgage loans totaling $59.4
million assumed in connection with recent acquisitions. The increase in interest
expense was partially offset by the repayments of outstanding bank credit line
borrowings. The Company also repaid approximately $6 million in mortgage notes
payable which matured during fiscal 2001.
Depreciation expense increased by $850,000 principally due to the additional
expense incurred from current year property acquisitions. Amortization expense
decreased by $354,000 principally from the write-off in fiscal 2001 of
unamortized leasing commissions related to tenants who vacated during the year.
General and administrative expenses increased to $2.8 million or 14.2% in fiscal
2002 as compared to $2.5 million in fiscal 2001. The increase is due primarily
to increased compensation costs.
In fiscal 2002, the Company repurchased 200,000 shares of its Series B Preferred
Stock for a purchase price of $16,050,000 in a negotiated transaction with a
holder of the preferred shares. The Company has recorded the excess of the
carrying value over the cost to repurchase the preferred shares of $3,071,000 as
an increase in net income applicable to Common and Class A Common stockholders.
19
Fiscal 2001 vs. Fiscal 2000
Revenues
Property occupancy levels increased to 98% from 97% in fiscal 2000. Operating
lease revenues increased 13.1% to $34.2 million in fiscal 2001 compared to $30.2
million in fiscal 2000. The increase in operating lease revenues resulted from
leasing of previously vacant space, higher tenant base rent renewal rates at
certain of the Company's properties and higher recoveries of property operating,
property tax and other recoverable costs. Operating lease income also increased
by $682,000 from the reclassification of three net leases previously accounted
for as direct finance leases in accordance with generally accepted accounting
principles. During the year, one of the properties was sold and the net leases
of the remaining two properties expired. The new leases were classified as
operating leases.
Lease termination income of $1,137,000 represents a settlement of the Company's
claims against a former tenant arising from the tenant's bankruptcy and
rejection of its lease at one of the Company's properties.
The Company had an investment in an unconsolidated joint venture which was
accounted for under the equity method. The joint venture owned the Countryside
Square shopping center in Clearwater, Florida. In fiscal 2001, the property was
sold and the Company recorded $3,864,000 as its proportionate share of the
income of the joint venture including its earnings from the sale of the property
as compared to earnings of $245,000 in fiscal 2000.
In 2001, the Company sold two non-core properties for net gains of $316,000 as
compared to net gains on sales of $1,067,000 in fiscal 2000.
Expenses
Total expenses increased to $26.2 million from $23.3 million in fiscal 2000.
Property expenses increased by 10.5% in fiscal 2001 principally from higher snow
removal costs, maintenance and repairs and property taxes. These items increased
property expenses by $1,046,000 in fiscal 2001 and resulted from higher than
normal snowfall amounts during the period and increased property tax assessments
at the Company's core properties.
Interest expense increased from borrowings of $16.5 million on the Company's
revolving credit lines during the year. The increase in interest expense was
partially offset by mortgage loans repaid during the year.
Depreciation and amortization expense increased to $7.6 million from $6.3
million in fiscal 2000 from the expenditure of $11.7 million for property
improvements, tenant allowances and leasing costs during the year. The Company
also wrote off $287,000 of unamortized tenant allowances related to former
tenants who vacated space during the year.
Application of Critical Accounting Policies
Critical accounting policies are those that are both important to the
presentation of the Company's financial condition and results of operations and
require management's most difficult, complex or subjective judgments. The
Company's critical accounting policies are those applicable to the evaluation of
the collectibility of accounts and notes receivable and the evaluation of
impairment of long-term assets.
The allowance for doubtful accounts and notes receivable is established based on
quarterly analysis of the risk of loss on specific accounts. The analysis places
particular emphasis on past-due accounts and considers information such as the
nature and age of the receivables, the payment history of the tenants or other
debtors, the financial condition of the tenants and management's assessment of
their ability to meet their lease obligations, the basis for any disputes and
the status of related negotiations, among other things. Management's estimates
of the required allowance is subject to revision as these factors change and is
sensitive to the effects of economic and market conditions on tenants,
particularly those at retail centers.
20
Rental revenue is recognized on a straight-line basis over the term of the
lease. The excess of rents recognized over amounts contractually due pursuant to
the underlying leases is included in tenant receivables on the accompanying
balance sheets. It is the Company's policy to maintain an allowance for future
tenant credit losses of approximately 10% of the deferred straight line rent
receivable balance.
On a periodic basis, management assesses whether there are any indicators that
the value of the real estate properties and mortgage notes receivable may be
impaired. To the extent impairment has occurred, the loss is measured as the
excess of the carrying amount of the property over the fair value of the asset.
Management does not believe that the value of any of its rental properties or
mortgage notes receivable is impaired at October 31, 2002.
Recently Issued Accounting Pronouncements
The Financial Accounting Standards Board (FASB) has issued SFAS No. 144
"Accounting for the Impairment or Disposal of Long Lived Assets" which updates
and clarifies the accounting and reporting for impairment of assets held in use
and to be disposed of. The Statement, among other things, will require the
Company to classify the operations and cash flow of properties to be disposed of
as discontinued operations. The Company will adopt the provisions of the
Statement in fiscal 2003, and does not expect the Statement to have a material
impact on the Company's financial position or results from operations. In
December 2002, the FASB issued SFAS No. 148 "Accounting for Stock-Based
Compensation-Transition and Disclosure." This statement amends SFAS No. 123 to
provide alternative methods of transition for a voluntary change to the fair
value based method of accounting for stock-based employee compensation and
amends the disclosure requirements of SFAS No. 123. Adoption of the provisions
of the Statement in fiscal 2003 will not have any impact since the Company will
continue to use the intrinsic value method as set forth in APB # 25.
Inflation
The Company's long-term leases contain provisions to mitigate the adverse impact
of inflation on its operating results. Such provisions include clauses entitling
the Company to receive (i) scheduled base rent increases and (ii) percentage
rents based upon tenants' gross sales, which generally increase as prices rise.
In addition, many of the Company's non-anchor leases are for terms of less than
ten years, which permits the Company to seek increases in rents upon renewal at
then current market rates if rents provided in the expiring leases are below
then existing market rates. Most of the Company's leases require tenants to pay
a share of operating expenses, including common area maintenance, real estate
taxes, insurance and utilities, thereby reducing the Company's expose to
increases in costs and operating expenses resulting from inflation.
Environmental Matters
Based upon management's ongoing review of its Properties, management is not
aware of any environmental condition with respect to any of the Company's
properties which would be reasonably likely to have a material adverse effect on
the Company. There can be no assurance, however, that (i) the discovery of
environmental conditions, which were previously unknown, (ii) changes in law,
(iii) the conduct of tenants or (iv) activities relating to properties in the
vicinity of the Company's properties, will not expose the Company to material
liability in the future. Changes in laws increasing the potential liability for
environmental conditions existing on properties or increasing the restrictions
on discharges or other conditions may result in significant unanticipated
expenditures or may otherwise adversely affect the operations of the Company's
tenants, which would adversely affect the Company's financial condition and
results of operations.
21
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
The Company is exposed to interest rate risk primarily through its borrowing
activities. There is inherent rollover risk for borrowings as they mature and
are renewed at current market rates. The extent of this risk is not quantifiable
or predictable because of the variability of future interest rates and the
Company's future financing requirements.
As of October 31, 2002, the Company had no outstanding borrowings under its
secured and unsecured line of credit arrangements. During the twelve month
periods ended October 31, 2002 and 2001, the average variable rate indebtedness
outstanding during such periods had a combined weighted average interest rate of
3.38% and 6.9%. Had the weighted average interest rate been 100 basis points
higher, the Company's net income would have been lower by approximately $12,000
and $145,000 in fiscal 2002 and 2001, respectively.
Item 8. Financial Statements and Supplementary Data.
The consolidated financial statements required by this Item, together with the
report of the Company's independent public accountants thereon and the
supplementary financial information required by this Item are included under
Item 14 of this Annual Report.
Item 9. Changes in and Disagreements With Accountants on Accounting
and Financial Disclosure.
a) The following sets forth the information required by Item 304(a)(1) of
Regulation S-K:
(i) On May 13, 2002, Arthur Andersen LLP was dismissed as the Company's
independent public accountant.
(ii) The reports of Arthur Andersen LLP on the Company's financial
statements for the years ended October 31, 2001 and October 31, 2000
did not contain an adverse opinion or a disclaimer of opinion, and were
not qualified or modified as to uncertainty, audit scope or accounting
principles.
(iii) The decision to change accountants was recommended by the
Company's Audit Committee and approved by the Registrant's Board of
Directors.
(iv) During the years ended October 31, 2001 and October 31, 2000 and
through May 13, 2002, there were no disagreements with Arthur Andersen
LLP on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure, which
disagreements, if not resolved to the satisfaction of Arthur Andersen
LLP, would have caused it to make reference thereto in its reports on
the financial statements for such periods.
(v) During the years ended October 31, 2001 and October 31, 2000 and
through May 13, 2002, there have occurred none of the "reportable
events" listed in Item 304(a)(1) (v) of Regulation S-K.
(b) The Company requested that Arthur Andersen LLP furnish a letter
addressed to the Securities and Exchange Commission stating whether or not it
agrees with the above statements. A copy of such letter, dated May 20, 2002, is
filed as Exhibit 10.23 to this Form 10-K.
(c) On May 21, 2002 the Company engaged Ernst & Young LLP to serve as its
independent public accountant. During the Company's two most recent fiscal
years, and during any subsequent period through May 21, 2002, the Company did
not consult with Ernst & Young LLP on any accounting or auditing issues.
22
PART III
Item 10. Directors and Executive Officers of the Registrant.
The Company has filed with the Securities and Exchange Commission its
definitive Proxy Statement for its Annual Meeting of Stockholders to be held on
March 12, 2003. The additional information required by this Item is included
under the captions "ELECTION OF DIRECTORS" and "COMPENSATION AND TRANSACTIONS
WITH MANAGEMENT AND OTHERS' of such Proxy Statement and is incorporated herein
by reference.
Executive Officers of the Registrant.
------------------------------------
The following sets forth certain information regarding the executive officers of
the Company:
Name Age Offices Held
Charles J. Urstadt 74 Chairman and Chief Executive Officer (since September 1989)
Mr. Urstadt has been the Chairman of the Board of Directors since 1986, and a
Director since 1975. Mr. Urstadt also serves as the Chairman of Urstadt
Property Company, Inc. (formerly Pearce, Urstadt, Mayer & Greer Inc.) and has
served in such capacity for more than five years.
Willing L. Biddle 41 President and Chief Operating Officer (since December, 1996); Executive Vice
President (March, 1996 to December 1996); Senior Vice President - Management
(June, 1995 to March 1996); Vice President - Retail (April 1993 to June, 1995);
Vice President - Asset Management (April 1993 to June 1994).
James R. Moore 54 Executive Vice President and Chief Financial Officer (since March, 1996); Senior
Vice President and Chief Financial Officer (1989 to 1996); Treasurer (December
1987); Secretary (1987-1999) Vice President-Finance and Administration (1987 to
1989).
Raymond P. Argila 54 Senior Vice President and Chief Legal Officer (since June 1990); formerly Senior
Counsel, Cushman & Wakefield, Inc. (1987 to 1990).
Officers of the Company are elected annually by the Directors.
Item 11. Executive Compensation.
The Company has filed with the Securities and Exchange Commission its definitive
Proxy Statement for its Annual Meeting of Stockholders to be held on March 12,
2003. The information required by this Item is included under the caption
"ELECTION OF DIRECTORS" and "COMPENSATION AND TRANSACTIONS WITH MANAGEMENT AND
OTHERS" of such Proxy Statement and is incorporated herein by reference.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
The Company has filed with the Securities and Exchange Commission its definitive
Proxy Statement for its Annual Meeting of Stockholders to be held on March 12,
2003. The information required by this Item is included under the caption
"ELECTION OF DIRECTORS - Security Ownership of Certain Beneficial Owners and
Management" of such Proxy Statement and is incorporated herein by reference.
23
Item 13. Certain Relationships and Related Transactions.
The Company has filed with the Securities and Exchange Commission its definitive
Proxy Statement for its Annual Meeting of Stockholders to be held on March 12,
2003. The information required by this Item is included under the caption
"ELECTION OF DIRECTORS" and "COMPENSATION AND TRANSACTIONS WITH MANAGEMENT AND
OTHERS" of such Proxy Statement and is incorporated herein by reference.
PART IV
Item 14. Exhibits, Financial Statements, Schedules and Reports on Form 8-K.
A. Financial Statements and Financial Statement Schedules
1. Financial Statements --
The consolidated financial statements listed in the accompanying index to
financial statements on Page 29 are filed as part of this Annual Report.
2. Financial Statement Schedules --
The financial statement schedules required by this Item are filed with
this report and are listed in the accompanying index to financial
statements on Page 29. All other financial statement schedules are
inapplicable.
B. Reports on Form 8-K
The Registrant filed the following Reports on Form 8-K with
the Commission:
1. A Current Report on Form 8-K dated September 13, 2002. Such report
referred under Item 9 to the written statements and certifications of the
Registrant's principal executive officer and principal financial officer
in response to Section 906 of the Sarbanes-Oxley Act of 2002 and Rule
13a-14(b) under the Securities Exchange Act of 1934 with respect to the
Registrant's Quarterly Report on Form 10-Q for the Quarter ended July 31,
2002.
2. A Current Report on Form 8-K dated October 17, 2002. Such report
referred under Item 5. to a press release published by the Company on
October 17, 2002 announcing agreements to acquire two properties for $33
million.
C. Controls and Procedures
1. Evaluation of disclosure controls and procedures. Based on their
evaluation as of a date within 90 days of the filing date of this Annual
Report on Form 10-K, the Company's principal executive officer and principal
financial officer have concluded that its disclosure and controls
procedures (as defined in Rules 13a-14 (c) and 15d-14 (c) under the Exchange
Act) are effective to ensure that information required to be disclosed by us
in reports that we file or submit under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified in SEC
rules and forms.
2. Changes in internal controls. There were no significant changes in the
Company's internal controls or in other factors that could significantly
affect those controls subsequent to the date of their evaluation, including
any corrective actions with regard to significant deficiencies and material
weaknesses.
24
D. Exhibits.
Listed below are all Exhibits filed as part of this report. Certain Exhibits
are incorporated by reference to documents previously filed by the Company
with the Securities and Exchange Commission pursuant to Rule 12b-32 under
the Securities Exchange Act of 1934, as amended.
Exhibit
(3) Articles of Incorporation and By-laws.
-------------------------------------
3.1 (a) Amended Articles of Incorporation of the Company,
(incorporated by reference to Exhibit C of Amendment No.1 to
Registrant's Statement on Form S-4 (No. 333-19113).
(b) Articles Supplementary of the Company (incorporated by
reference to Annex A of Exhibit 4.1 of the Registrant's
Current Report on Form 8-K dated August 3, 1998).
(c) Articles Supplementary of the Company (incorporated by
reference to Exhibit 4.1 of the Registrant's Current Report on
Form 8-K dated January 8, 1998).
(d) Articles Supplementary of the Company (incorporated by
reference to Exhibit A of Exhibit 4.1 of the Registrant's
Current Report on Form 8-K dated March 12, 1998).
3.2 By-laws of the Company, (incorporated by reference to
Exhibit D of Amendment No. 1 to Registrant's Registration
Statement on Form S-4 (No. 333-19113).
(4) Instruments Defining the Rights of
----------------------------------
Security Holders, Including Indentures.
--------------------------------------
4.1 Common Stock: See Exhibits 3.1 (a)-(d) hereto.
------------
4.2 Series B Preferred Shares: See Exhibits 3.1 (a)-(d), 10.13
-------------------------
- 10.15, 10.17 and 10.22.
4.3 Series A Preferred Share Purchase Rights: See Exhibits 3.1
----------------------------------------
(a)-(d) and 10.3 hereto.
(10) Material Contracts.
------------------
10.1 Form of Indemnification Agreement entered into between the
Registrant and each of its Directors and for future use with
Directors and officers of the Company (incorporated herein by
reference to Exhibit 10.1 of the Registrant's Annual Report on
Form 10-K for the year ended October 31, 1989).1
10.2 Amended and Restated Change of Control Agreement between the
Registrant and James R. Moore dated November 15, 1990
(incorporated herein by reference to Exhibit 10.3 of the
Registrant's Annual Report on Form 10-K for the year ended
October 31, 1990).1
10.3 Amended and Restated Rights Agreement between the Company and
The Bank of New York, as Rights Agent, dated as of July 31,
1998 (incorporated herein by reference to Exhibit 10-1 of the
Registrant's Current Report on Form 8-K dated November 5,
1998).
25
10.4 Agreement dated December 19, 1991 between the Registrant and
Raymond P. Argila amending the Change of Control Agreement
dated as of June 12, 1990 between the Registrant and Raymond
P. Argila (incorporated herein by reference to Exhibit 10.6.1
of the Registrant's Annual Report on Form 10-K for the year
ended October 31, 1991). 1
10.5 Change of Control Agreement dated as of December 20,
1990 between the Registrant and Charles J. Urstadt
(incorporated herein by reference to Exhibit 10.8 of the
Registrant's Annual Report on Form 10-K for the year ended
October 31, 1990). 1
10.6 Amended and Restated HRE Properties Stock Option Plan
(incorporated herein by reference to Exhibit 10.8 of the
Registrant's Annual Report on Form 10-K for the year ended
October 31, 1991).1
10.6.1 Amendments to HRE Properties Stock Option Plan dated June 9,
1993 (incorporated by reference to Exhibit 10.6.1 of the
Registrant's Annual Report on Form 10-K for the year ended
October 31, 1995). 1
10.6.2 Form of Supplemental Agreement with Stock Option Plan
Participants (non-statutory options). (incorporated by
reference to Exhibit 10.6.2 of the Registrant's Annual Report
on Form 10-K for the year ended October 31, 1998). 1
10.6.3 Form of Supplemental Agreement with Stock Option Plan
Participants (statutory options). (incorporated by reference
to Exhibit 10.6.2 of the Registrant's Annual Report on Form
10-K for the year ended October 31, 1998). 1
10.7 Amended and Restated Dividend Reinvestment and Share
Purchase Plan (incorporated herein by reference to the
Registrant's Registration Statement on Form S-3
(No. 333-64381).
10.8 Amended and Restated Change of Control Agreement dated as
of November 6, 1996 between the Registrant and Willing L.
Biddle (incorporated by reference to Exhibit 10.7 of the
Registrant's Annual Report on Form 10-K for the year ended
October 31, 1996). 1
10.10 Restricted Stock Plan (incorporated by reference to
Exhibit B of Amendment No. 1 to Registrant's Registration
Statement on Form S-4 (No. 333-19113)). 1
10.10.1 Form of Supplemental Agreement with Restricted
Stockholders (incorporated by reference to Exhibit 10.6.2
of the Registrant's Annual Report on Form 10-K for the year
ended October 31, 1998). 1
10.11 Excess Benefit and Deferred Compensation Plan (incorporated
by reference to Exhibit 10.10 of the Registrant's Annual
Report on Form 10-K for the year ended October 31, 1998). 1
10.12 Purchase and Sale Agreement, dated September 9, 1998 by and
between Goodwives Center Limited Partnership, as seller, and
UB Darien, Inc., a wholly owned subsidiary of the Registrant,
as purchaser (incorporated by reference to Exhibit 10 of the
Registrant's Current Report on Form 8-K dated September 23,
1998).
1 Management contract, compensatory plan or arrangement required to be filed as
an exhibit to this Annual Report on Form 10-K pursuant to Item 14(c).
26
10.13 Subscription Agreement, dated January 8, 1998, by and among
the Company and the Initial Purchasers (incorporated by
reference to Exhibit 4.2 of the Registrant's Current Report on
Form 8-K dated January 8, 1998).
10.14 Registration Rights Agreement, dated January 8, 1998, by and
among the Company and the Initial Purchasers (incorporated by
reference to Exhibit 4.3 of the Registrant's Current Report on
Form 8-K dated January 8, 1998).
10.15 Waiver and Amendment of Registration Rights Agreement dated as
of April 16, 1999, by and among the Company and the Initial
Purchasers (incorporated by reference to Exhibit 10.15 of the
Registrant's Annual Report on Form 10-K for the year ended
October 31, 1999).
10.16 Amendment to Shareholder Rights Agreement dated as of
September 22, 1999 between the Company and the Rights Agent
(incorporated by reference to Exhibit 10.18 of the
Registrant's Annual Report on Form 10-K for the year ended
October 31, 1999).
10.17 Waiver and Amendment of Registration Rights Agreement dated as
of September 14, 2001 by and among the Company and the Initial
Purchasers (incorporated by reference to Exhibit 10.17 of the
Registrant's Annual Report on Form 10-K for the year ended
October 31, 2001).
10.18 Amended and Restated Restricted Stock Award Plan effective
December 9, 1999 (incorporated by reference to Exhibit 10.18
of the Registrant's Annual Report on Form 10-K for the year
ended October 31, 2000).
10.19 Amended and Restated Stock Option Plan adopted June 28, 2000
(incorporated by reference to Exhibit 10.19 of the
Registrant's Annual Report on Form 10-K for the year ended
October 31, 2000).
10.20 Promissory Note and Stock Pledge Agreement dated July 3, 2002
by Willing L. Biddle in favor of the Registrant.1
10.21 Amended and Restated Restricted Stock Award Plan effective
December 12, 2001 as approved by the Registrant's
stockholders on March 13, 2002. 1
10.22 Amendment to Registration Rights Agreement dated as of
December 31, 2001 by and among the Company and the Remaining
Initial Purchasers.
27
10.23 Letter from Arthur Andersen LLP dated May 20, 2002 regarding a
change in Registrant's Certifying Accountants (incorporated by
reference to Exhibit 16.1 of the Registrant's Current Report
on Form 8-K/A dated May 23, 2002).
(21) Subsidiaries.
------------
21.1 List of Company's subsidiaries
(23) Consents of Experts.
--------------------
23.1 The consent of Ernst & Young LLP to the incorporation by
reference of its report included herein in the Company's
Registration Statements is filed herewith as part of this
report.
28
URSTADT BIDDLE PROPERTIES INC.
Item 14a INDEX TO FINANCIAL STATEMENTS AND
- -------- ----------------------------------
FINANCIAL STATEMENT SCHEDULES
Page
Consolidated Balance Sheets at October 31, 2002 and 2001 30
Consolidated Statements of Income for each of the
three years in the period ended October 31, 2002 31
Consolidated Statements of Cash Flows for each of the
three years in the period ended October 31, 2002 32
Consolidated Statements of Stockholders' Equity
for each of the three years in the period ended October 31, 2002 33
Notes to Consolidated Financial Statements 34-44
Report of Independent Auditors 45
Schedule.
- --------
The following consolidated financial statement schedules of Urstadt Biddle
Properties Inc. are included in Item 14(d):
III Real Estate and Accumulated Depreciation - October 31, 2002 46
IV Mortgage Loans on Real Estate - October 31, 2002 47
All other schedules for which provision is made in the applicable accounting
regulation of the Securities and Exchange Commission are not required under the
related instructions or are inapplicable and therefore have been omitted.
29
URSTADT BIDDLE PROPERTIES INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
October 31,
--------------- -----------------
ASSETS 2002 2001
---- ----
Real Estate Investments:
Core properties-- at cost, net of accumulated depreciation $252,711 $160,152
Non-core properties - at cost, net of accumulated depreciation 11,944 11,039
Mortgage notes and other receivable 3,447 3,507
----- -----
268,102 174,698
Cash and cash equivalents 46,342 33,747
Restricted cash 514 333
Short-term investments 25,145 -
Tenant receivables, net of allowances 5,695 3,826
Deferred charges, net of accumulated amortization 3,294 3,477
Prepaid expenses and other assets 4,541 2,271
----- -----
Total Assets $353,633 $218,352
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Mortgage notes payable $106,429 $47,115
Accounts payable and accrued expenses 1,021 2,670
Deferred officers' compensation 287 230
Other liabilities 4,218 4,142
----- -----
Total Liabilities 111,955 54,157
------- ------
Minority Interests 7,320 4,365
----- -----
Preferred Stock, par value $.01 per share; 20,000,000 shares authorized; 8.99%
Series B Senior Cumulative Preferred stock, (liquidation preference of
$100 per share); 150,000 and 350,000 shares issued and outstanding in 2002
and 2001, respectively
14,341 33,462
------ ------
Commitments and Contingencies
Stockholders' Equity:
Excess stock, par value $.01 per share; 10,000,000 shares authorized;
none issued and outstanding - -
Common stock, par value $.01 per share; 30,000,000 shares authorized;
6,578,572 and 6,242,139 issued and outstanding shares in 2002 and 2001, respectively 66 62
Class A Common stock, par value $.01 per share; 40,000,000 shares authorized;
18,449,472 and 9,600,019 issued and outstanding shares in 2002 and 2001, respectively 185 96
Additional paid in capital 254,266 162,763
Cumulative distributions in excess of net income (30,487) (31,654)
Unamortized restricted stock compensation and notes receivable
from officers/stockholders (4,013) (4,899)
------- -------
Total Stockholders' Equity 220,017 126,368
------- -------
Total Liabilities and Stockholders' Equity $353,633 $218,352
======== ========
The accompanying notes to consolidated financial statements are an
integral part of these statements.
30
URSTADT BIDDLE PROPERTIES INC.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
Year Ended October 31,
---------------- --------------- ----------------
2002 2001 2000
---- ---- ----
Revenues
Operating leases $42,206 $34,209 $30,242
Lease termination income 765 1,137 -
Interest and other 1,369 747 767
----- ------ ------
44,340 36,093 31,009
------ ------ ------
Operating Expenses
Property expenses 12,781 11,502 10,413
Interest 5,584 4,456 4,245
Depreciation 7,547 6,697 5,638
Amortization 517 871 669
General and administrative expenses 2,836 2,484 2,152
Directors' fees and expenses 173 144 164
------ ------ ------
29,438 26,154 23,281
------ ------ ------
Operating Income 14,902 9,939 7,728
Equity in Earnings of Unconsolidated Joint Venture - 3,864 245
Minority Interests in Results of Consolidated Joint Ventures (395) (432) (451)
Gains on Sales of Real Estate Investments - 316 1,067
----- ------ -----
Net Income 14,507 13,687 8,589
Preferred Stock Dividends (1,498) (3,147) (3,147)
Excess of Carrying Value Over Cost to Repurchase Preferred Shares 3,071 - -
----- ------- -------
Net Income Applicable to Common and Class A Common Stockholders
$16,080 $10,540 $5,442
======= ======= ======
Basic Earnings per Share:
Common $.80 $.91 $.50
==== ==== ====
Class A Common $.89 $1.01 $.55
==== ===== ====
Weighted Average Number of Shares Outstanding:
Common 6,089 5,881 5,351
===== ===== =====
Class A Common 12,615 5,182 5,059
====== ===== =====
Diluted Earnings Per Share:
Common $.78 $.88 $.49
==== ==== ====
Class A Common $.87 $.97 $.55
==== ==== ====
Weighted Average Number of Shares Outstanding:
Common and Common Equivalent 6,432 6,038 5,433
===== ===== =====
Class A Common and Class A Common Equivalent 13,136 5,606 5,532
====== ===== =====
Dividends Per Share:
Common $.74 $.72 $.70
==== ==== ====
Class A Common $.82 $.80 $.78
==== ==== ====
The accompanying notes to consolidated financial statements are an
integral part of these statements.
31
URSTADT BIDDLE PROPERTIES INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Year Ended October 31,
---------------- ---------------- ----------------
2002 2001 2000
---- ---- ----
Operating Activities:
Net income $14,507 $13,687 $8,589
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization 8,064 7,568 6,307
Restricted stock compensation 942 769 630
Recovery of investment in properties owned
subject to financing leases - 191 1,214
Equity in income of unconsolidated joint venture - (3,864) (245)
Minority interests in results of consolidated joint ventures 395 432 451
Gains on sales of real estate investments - (316) (1,067)
Increase in restricted cash (181) (174) (81)
(Increase) decrease in tenant receivables (1,871) 98 (481)
(Decrease) increase in accounts payable and accrued expenses (1,649) 1,448 (684)
(Increase) decrease in other assets and other liabilities, net (1,675) 1,469 (371)
------- ----- -----
Net Cash Provided by Operating Activities 18,532 21,308 14,262
------ ------ ------
Investing Activities:
Purchase of short term investments (25,145) - -
Acquisitions of properties (34,785) (5,606) (1,627)
Acquisition of minority interests (1,258) (1,013) -
Improvements to properties and deferred charges (2,814) (11,695) (6,642)
Investment in unconsolidated joint venture - (480) (535)
Net proceeds from sales of properties 275 1,216 3,921
Distributions to limited partners of consolidated joint venture (395) (432) (451)
Distributions received from unconsolidated joint venture - 6,544 1,500
Payments to limited partners of unconsolidated joint venture (600) - -
Payments received on mortgage notes and other receivables 62