Attached files
| file | filename |
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| 8-K - FORM 8-K - THOMAS PROPERTIES GROUP INC | a2011q3earningsreleasecove.htm |
| EX-99.1 - SUPPLEMENTAL FINANCIAL INFORMATION FOR THE QUARTER ENDED SEPTEMBER 30, 2011 - THOMAS PROPERTIES GROUP INC | exhibit99-supp9302011.htm |
Exhibit 99.2
THOMAS PROPERTIES GROUP, INC. ANNOUNCES
THIRD QUARTER 2011 RESULTS
Thomas Properties Group, Inc. (Nasdaq: TPGI) reported today the results of operations for the quarter ended September 30, 2011.
The results of operations presented in this release include TPGI’s results of operations for the three and nine months ended September 30, 2011 and 2010. The consolidated net income for the three months ended September 30, 2011 was $2.1 million or $0.06 per share compared to consolidated net loss of $(1.4) million or $(0.04) per share for the three months ended September 30, 2010. The increase in consolidated net income per share was primarily due to an increase in investment advisory fees and an income tax benefit. The consolidated net loss for the nine months ended September 30, 2011 was $(4.2) million or $(0.11) per share compared to consolidated net loss of $(5.3) million or $(0.16) per share for nine months ended September 30, 2010. The decrease in the consolidated net loss per share is comprised primarily of an increase in investment advisory fees and the income tax benefit, offset by fewer condominium unit sales and the increased number of shares of our common stock outstanding.
After tax cash flow (“ATCF”) for the three months ended September 30, 2011 was $5.6 million or $0.15 per share compared to ATCF of $2.3 million or $0.07 per share for the three months ended September 30, 2010. The increase in ATCF per share was primarily due to the increase in investment advisory fees. After tax cash flow for the nine months ended September 30, 2011 was $9.3 million or $0.25 per share compared to after tax cash flow of $9.4 million or $0.28 per share for the nine months ended September 30, 2010. The decrease in ATCF per share was comprised primarily of the increase in investment advisory fees, offset by the decrease in condominium unit sales and the increased number of shares of our common stock outstanding. The Company defines ATCF (a non-GAAP financial measure) as net income (loss) excluding the following items: noncontrolling interests, deferred income taxes, non-cash charges for depreciation and amortization and asset impairment, amortization of loan costs, non-cash compensation expense, straight-line rent adjustments, adjustments to reflect the fair market value of rent, and gain from extinguishment of debt. ATCF is further described in note (c) and reconciled to net income (loss) in the financial statements below.
“Net operating income from our operating properties continues to improve," stated Jim Thomas, Chairman and CEO. "For properties in which we have owned interests for both periods, net operating income calculated on a cash basis increased by 10.5% and 9.2% during the three and nine months ended September 30, 2011, respectively, compared to the same periods in 2010, and net operating income calculated on a GAAP basis increased by 4.6% and 5.0% for the three and nine months ended September 30, 2011, respectively, compared to the same periods in 2010. Our properties were, on average, 85.2% leased as of September 30, 2011, compared with 84.8% at September 30, 2010.”
"We are making progress in our efforts to sell certain assets that do not fit the long term goals of the Company and TPG/CalSTRS," continued Mr. Thomas. “Since the end of the third quarter, we have closed on the sale of a 2.2 acre land parcel at Campus El Segundo to a hotel developer. We continue our efforts to sell 2500 CityWest in Houston, Texas, Centerpointe I and II in Fairfax, Virginia, Brookhollow I, II, and III in Houston, Texas and 2121 Market Street in Philadelphia, Pennsylvania."
Supplemental Materials
The company publishes a Supplemental Financial Information package which is available at www.tpgre.com in the Investor Relations tab, Supplemental Financial Information section. For information regarding our net operating income for our operating properties discussed in the release, please see the Supplemental Financial Information. The Company also provides an estimated net asset value workbook, available for download at www.tpgre.com in the Investor Relations tab, NAV Workbook section.
Teleconference and Webcast
TPGI will hold a quarterly earnings conference call on Thursday, November 3, 2011 at 11:00 a.m. Pacific Time. To participate in the call, dial (866) 730-5768 and (857) 350-1592 internationally, and provide confirmation code 95563054.
A live webcast (listen only mode) of the conference call will also be available at this time. A hyperlink to the live webcast will be available from the Investor Relations section of our website at www.tpgre.com. A replay of the call will be available through November 10, 2011, by calling (888) 286-8010 and (617) 801-6888 internationally, and providing confirmation code 75587285. The replay will also be available on Thomas Properties Group, Inc.’s web site at www.tpgre.com. The webcast is also being distributed through the Thomson StreetEvents Network. Individual investors can listen to the call at www.earnings.com, Thomson’s individual investor portal, powered by StreetEvents. Institutional investors can access the call via Thomson StreetEvents (www.streetevents.com), a password-protected event management site.
About Thomas Properties Group, Inc.
Thomas Properties Group, Inc., with headquarters in Los Angeles, is a full-service real estate company that owns, acquires, develops and manages primarily office, as well as mixed-use properties on a nationwide basis. The company’s primary areas of focus are the acquisition and ownership of premier office properties, property development and redevelopment, and property and investment management activities. For more information on Thomas Properties Group, Inc., visit www.tpgre.com.
Forward Looking Statements
Statements made in this press release or during the quarterly earnings conference call that are not historical may contain forward-looking statements. Although TPGI believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, these statements are subject to numerous risks and uncertainties. Factors that could cause actual results to differ materially from TPGI’s expectations include actual and perceived trends in various national and economic conditions that affect global and regional markets for commercial real estate services (including interest rates), the availability of credit and equity investors to finance commercial real estate transactions, our ability to enter into or renew leases at favorable rates, which can be impacted by the financial condition of our tenants, risks associated with the success of our development and property redevelopment projects, general volatility in the securities and credit markets, and the impact of tax laws affecting real estate. For a discussion of some of the factors that may cause our results to differ from management’s expectations, see the information under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Form 10-K for the year ended December 31, 2010 and our subsequent Form 10-Q quarterly reports, each of which is filed with the Securities and Exchange Commission. TPGI disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
THOMAS PROPERTIES GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share data)
(Unaudited)
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Revenues: | ||||||||||||||||
Rental | $ | 7,446 | $ | 7,330 | $ | 22,233 | $ | 21,818 | ||||||||
Tenant reimbursements | 5,666 | 4,976 | 17,051 | 15,476 | ||||||||||||
Parking and other | 708 | 853 | 2,225 | 2,651 | ||||||||||||
Investment advisory, management, leasing and development services | 5,565 | 1,645 | 7,689 | 5,594 | ||||||||||||
Investment advisory, management, leasing and development services - unconsolidated real estate entities | 4,324 | 3,673 | 13,690 | 11,126 | ||||||||||||
Reimbursement of property personnel costs | 1,365 | 1,403 | 4,389 | 4,213 | ||||||||||||
Condominium sales | 3,084 | 5,237 | 6,122 | 14,559 | ||||||||||||
Total revenues | 28,158 | 25,117 | 73,399 | 75,437 | ||||||||||||
Expenses: | ||||||||||||||||
Property operating and maintenance | 6,211 | 5,948 | 18,384 | 18,659 | ||||||||||||
Real estate and other taxes | 1,854 | 1,745 | 5,616 | 5,221 | ||||||||||||
Investment advisory, management, leasing and development services | 3,273 | 2,953 | 9,912 | 7,987 | ||||||||||||
Reimbursable property personnel costs | 1,365 | 1,403 | 4,389 | 4,213 | ||||||||||||
Cost of condominium sales | 2,055 | 3,858 | 4,042 | 10,655 | ||||||||||||
Interest | 4,331 | 4,820 | 13,629 | 14,368 | ||||||||||||
Depreciation and amortization | 3,447 | 3,432 | 10,188 | 10,405 | ||||||||||||
General and administrative | 3,925 | 3,365 | 11,802 | 9,861 | ||||||||||||
Total expenses | 26,461 | 27,524 | 77,962 | 81,369 | ||||||||||||
Interest income | 5 | 17 | 25 | 55 | ||||||||||||
Equity in net (loss) income of unconsolidated real estate entities | (353 | ) | 538 | (1,938 | ) | (938 | ) | |||||||||
Income (loss) before income taxes and noncontrolling interests | 1,349 | (1,852 | ) | (6,476 | ) | (6,815 | ) | |||||||||
Benefit (provision) for income taxes | 1,206 | (62 | ) | 1,001 | (417 | ) | ||||||||||
Net income (loss) | 2,555 | (1,914 | ) | (5,475 | ) | (7,232 | ) | |||||||||
Noncontrolling interests' share of net (income) loss: | ||||||||||||||||
Unitholders in the Operating Partnership | (295 | ) | 530 | 1,763 | 2,039 | |||||||||||
Partners in consolidated real estate entities | (177 | ) | (51 | ) | (496 | ) | (128 | ) | ||||||||
(472 | ) | 479 | 1,267 | 1,911 | ||||||||||||
TPGI share of net income (loss) | $ | 2,083 | $ | (1,435 | ) | $ | (4,208 | ) | $ | (5,321 | ) | |||||
Income (loss) per share - basic and diluted | $ | 0.06 | $ | (0.04 | ) | $ | (0.11 | ) | $ | (0.16 | ) | |||||
Weighted average common shares - basic | 36,647,394 | 34,910,415 | 36,610,178 | 33,218,238 | ||||||||||||
Weighted average common shares - diluted | 36,873,339 | 34,910,415 | 36,610,178 | 33,218,238 | ||||||||||||
Reconciliation of net income (loss) to EBDT(a): | ||||||||||||||||
Net income (loss) | $ | 2,083 | $ | (1,435 | ) | $ | (4,208 | ) | $ | (5,321 | ) | |||||
Adjustments: | ||||||||||||||||
Income tax (benefit) provision | (1,206 | ) | 62 | (1,001 | ) | 417 | ||||||||||
Noncontrolling interests - unitholders in the Operating Partnership | 295 | (530 | ) | (1,763 | ) | (2,039 | ) | |||||||||
Depreciation and amortization | 3,447 | 3,432 | 10,188 | 10,405 | ||||||||||||
Amortization of loan costs | 153 | 211 | 580 | 694 | ||||||||||||
Unconsolidated real estate entities: | ||||||||||||||||
Depreciation and amortization | 3,277 | 3,133 | 9,088 | 11,072 | ||||||||||||
Depreciation and amortization from discontinued operations | 4 | 618 | 543 | 1,813 | ||||||||||||
Amortization of loan costs | 158 | 83 | 293 | 377 | ||||||||||||
Amortization of loan costs from discontinued operations | 4 | 18 | 19 | 60 | ||||||||||||
Earnings before depreciation, amortization and taxes | $ | 8,215 | $ | 5,592 | $ | 13,739 | $ | 17,478 | ||||||||
TPGI share of EBDT (b) | $ | 6,137 | $ | 4,018 | $ | 10,265 | $ | 12,346 | ||||||||
EBDT per share - basic | $ | 0.17 | $ | 0.12 | $ | 0.28 | $ | 0.37 | ||||||||
EBDT per share - diluted | $ | 0.17 | $ | 0.11 | $ | 0.28 | $ | 0.37 | ||||||||
Weighted average common shares outstanding- basic | 36,647,394 | 34,910,415 | 36,610,178 | 33,218,238 | ||||||||||||
Weighted average common shares outstanding- diluted | 36,873,339 | 35,149,733 | 36,863,237 | 33,462,470 | ||||||||||||
Reconciliation of net income (loss) to ATCF(c): | ||||||||||||||||
Net income (loss) | $ | 2,083 | $ | (1,435 | ) | $ | (4,208 | ) | $ | (5,321 | ) | |||||
Adjustments: | ||||||||||||||||
Income tax (benefit) provision | (1,206 | ) | 62 | (1,001 | ) | 417 | ||||||||||
Noncontrolling interests - unitholders in the Operating Partnership | 295 | (530 | ) | (1,763 | ) | (2,039 | ) | |||||||||
Depreciation and amortization | 3,447 | 3,432 | 10,188 | 10,405 | ||||||||||||
Amortization of loan costs | 153 | 211 | 580 | 694 | ||||||||||||
Non-cash compensation expense | 127 | 288 | 660 | 467 | ||||||||||||
Straight-line rent adjustments | (22 | ) | (275 | ) | (170 | ) | (1,067 | ) | ||||||||
Adjustments to reflect the fair market value of rent | 7 | — | 16 | 1 | ||||||||||||
Unconsolidated real estate entities: | ||||||||||||||||
Depreciation and amortization | 3,277 | 3,133 | 9,088 | 11,072 | ||||||||||||
Depreciation and amortization from discontinued operations | 4 | 618 | 543 | 1,813 | ||||||||||||
Amortization of loan costs | 158 | 83 | 293 | 377 | ||||||||||||
Amortization of loan costs from discontinued operations | 4 | 18 | 19 | 60 | ||||||||||||
Straight-line rent adjustments | (72 | ) | (150 | ) | (209 | ) | (557 | ) | ||||||||
Straight-line rent adjustments from discontinued operations | (31 | ) | (253 | ) | (199 | ) | (340 | ) | ||||||||
Adjustments to reflect the fair market value of rent | (369 | ) | (259 | ) | (813 | ) | (812 | ) | ||||||||
Adjustments to reflect the fair market value of rent from discontinued operations | 1 | (5 | ) | 8 | (55 | ) | ||||||||||
Gain on extinguishment of debt | — | (893 | ) | — | (893 | ) | ||||||||||
Gain on extinguishment of debt from discontinued operations | (333 | ) | (729 | ) | (333 | ) | (729 | ) | ||||||||
ATCF before income taxes | $ | 7,523 | $ | 3,316 | $ | 12,699 | $ | 13,493 | ||||||||
TPGI share of ATCF before income taxes (b) | $ | 5,620 | $ | 2,378 | 9,488 | 9,531 | ||||||||||
TPGI income tax expense - current | (48 | ) | (60 | ) | (157 | ) | (144 | ) | ||||||||
TPGI share of ATCF | $ | 5,572 | $ | 2,318 | $ | 9,331 | $ | 9,387 | ||||||||
ATCF per share - basic & diluted | $ | 0.15 | $ | 0.07 | $ | 0.25 | $ | 0.28 | ||||||||
Weighted average common shares outstanding- basic | 36,647,394 | 34,910,415 | 36,610,178 | 33,218,238 | ||||||||||||
Weighted average common shares outstanding- diluted | 36,873,339 | 35,149,733 | 36,863,237 | 33,462,470 | ||||||||||||
a. | EBDT is a non-GAAP financial measure and may not be directly comparable to similarly-titled measures reported by other companies. We define EBDT as net income (loss) excluding the following items: i) income tax expense (benefit); ii) noncontrolling interests; iii) depreciation and amortization; and iv) amortization of loan costs. EBDT provides a performance measure that, when compared year over year, reflects the impact to operations from changes to occupancy rates, rental rates, operating costs, development and redevelopment activities, general and administrative expenses, and interest costs, and provides perspective on operating performance not immediately apparent from net income. EBDT should be considered only as a supplement to net income as a measure of our performance. EBDT also assists management in identifying trends for purposes of financial planning and forecasting results. However, the |
usefulness of EBDT as a performance measure is limited and EBDT should not be used as a measure of our liquidity, nor is it indicative of funds available to fund our cash needs. EBDT also should not be used as a supplement to or substitute for cash flow from operating activities (computed in accordance with GAAP).
b. | Based on an interest in our operating partnership of 74.70% and 74.72% for the three and nine months ended September 30, 2011, respectively, and 71.71% and 70.64% for the three and nine months ended September 30, 2010, respectively. |
c. | ATCF is a non-GAAP financial measure and may not be directly comparable to similarly-titled measures reported by other companies. We define ATCF as net income (loss) excluding the following items: i) deferred income tax expense (benefit); ii) noncontrolling interests; iii) non-cash charges for depreciation and amortization and asset impairment; iv) amortization of loan costs; v) non-cash compensation expense; vi) the adjustment to recognize rental revenues using the straight-line method; vii) the adjustment to rental revenue to reflect the fair market value of rents; and viii) gain on extinguishment of debt. Management utilizes ATCF data in assessing performance of our business operations in period-to-period comparisons and for financial planning purposes. ATCF should be considered only as a supplement to net income as a measure of our performance. ATCF should not be used as a measure of our liquidity, nor is it indicative of funds available to fund our cash needs. ATCF also should not be used as a supplement to or substitute for cash flow from operating activities (computed in accordance with GAAP). |
THOMAS PROPERTIES GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
September 30, 2011 | December 31, 2010 | ||||||
ASSETS | |||||||
Investments in real estate: | |||||||
Operating properties, net | $ | 263,595 | $ | 266,809 | |||
Land improvements—development properties | 96,619 | 96,635 | |||||
360,214 | 363,444 | ||||||
Condominium units held for sale | 46,189 | 49,827 | |||||
Improved land held for sale | 2,970 | 2,819 | |||||
Investments in unconsolidated real estate entities | 8,260 | 17,975 | |||||
Cash and cash equivalents, unrestricted | 50,184 | 42,363 | |||||
Restricted cash | 8,929 | 13,069 | |||||
Rents and other receivables, net | 1,800 | 1,754 | |||||
Receivables from unconsolidated real estate entities | 2,501 | 2,979 | |||||
Deferred rents | 17,736 | 14,592 | |||||
Deferred leasing and loan costs, net | 12,468 | 13,538 | |||||
Other assets, net | 19,872 | 17,875 | |||||
Total assets | $ | 531,123 | $ | 540,235 | |||
LIABILITIES AND EQUITY | |||||||
Liabilities: | |||||||
Mortgage and other secured loans | $ | 293,380 | $ | 300,536 | |||
Accounts payable and other liabilities, net | 29,884 | 29,020 | |||||
Prepaid rent and deferred revenue | 3,129 | 2,888 | |||||
Total liabilities | 326,393 | 332,444 | |||||
Equity: | |||||||
Stockholders’ equity: | |||||||
Preferred stock, $.01 par value, 25,000,000 shares authorized, none issued or outstanding as of September 30, 2011 and December 31, 2010 | — | — | |||||
Common stock, $.01 par value, 225,000,000 shares authorized, 37,094,995 and 36,943,394 shares issued and outstanding as of September 30, 2011 and December 31, 2010, respectively | 371 | 369 | |||||
Limited voting stock, $.01 par value, 20,000,000 shares authorized, 12,313,331 shares issued and outstanding as of September 30, 2011 and December 31, 2010 | 123 | 123 | |||||
Additional paid-in capital | 208,363 | 207,953 | |||||
Retained deficit and dividends | (64,991 | ) | (60,790 | ) | |||
Total stockholders’ equity | 143,866 | 147,655 | |||||
Noncontrolling interests: | |||||||
Unitholders in the Operating Partnership | 49,866 | 51,478 | |||||
Partners in consolidated real estate entities | 10,998 | 8,658 | |||||
Total noncontrolling interests | 60,864 | 60,136 | |||||
Total equity | 204,730 | 207,791 | |||||
Total liabilities and equity | $ | 531,123 | $ | 540,235 | |||
Contact: Thomas Properties Group, Inc.
Website: www.tpgre.com
Diana M. Laing, Chief Financial Officer
(213) 613-1900