ATLANTA--(BUSINESS WIRE)--
Cousins Properties Incorporated (NYSE:CUZ) today reported its results of
operations for the three months and year ended December 31, 2008. All
per share amounts are reported on a diluted basis; basic per share data
is included in the Condensed Consolidated Statements of Income
accompanying this release.
Funds from Operations Available to Common Stockholders ("FFO") was $10.2
million, or $0.20 per share, for the fourth quarter of 2008 compared
with FFO of $7.3 million, or $0.14 per share, for the fourth quarter of
2007. FFO was $61.0 million, or $1.18 per share, for the year ended
December 31, 2008 compared to $48.4 million, or $0.92 per share, for the
same period in 2007.
For the fourth quarter of 2008, the Company generated a Net Loss
Available to Common Stockholders ("Net Loss Available") of $4.1 million,
or $0.08 per share, as compared to Net Loss Available of $5.0 million,
or $0.10 per share, for the fourth quarter of 2007. For the year ended
December 31, 2008, the Company generated Net Income Available to Common
Stockholders ("Net Income Available") of $7.6 million, or $0.15 per
share, compared with Net Income Available of $17.7 million, or $0.33 per
share, for the same period in 2007.
Included in FFO and Net Income (Loss) Available for the quarter and year
ended December 31, 2008 is a $2.1 million pre-tax, non-cash impairment
charge related to the Company's 10 Terminus Place condominium project
whose units are complete and held for sale. The Company was required to
record these units at their estimated fair value on December 31, 2008.
Fourth quarter highlights of the Company included the following:
-- Sold its 3100 Windy Hill Road office building for $12.5 million,
recognizing a gain on sale of approximately $2.5 million.
-- Through its CL Realty joint venture, recognized pre-tax FFO of
approximately $566,000 from a land tract sale.
-- Commenced operations of Building 1 at Palisades West, a 216,000 square
foot office building in Austin, Texas. Building 2, which is still
partially under development, contains 157,000 square feet.
-- Continued closings of units at its 10 Terminus Place multi-family
project. The Company recognized approximately $370,000 of pre-tax gain
on closings of four of the original 137 units.
-- Sold three of the seven remaining commercial units at its 50 Biscayne
multi-family project, generating FFO before taxes and minority interest
of approximately $496,000.
-- Entered into two $75 million interest rate swaps on floating-rate,
LIBOR-based borrowings at 2.995% and 2.69% for two years.
-- Purchased approximately 1.2 million shares of the Company's Series A and
Series B Cumulative Redeemable Preferred Stock for approximately $15.8
million.
-- Entered into new leases on 183,000 square feet and renewed leases on
44,000 square feet of office space.
At December 31, 2008, the Company's portfolio of operational office
buildings was 97% leased, its portfolio of operational retail centers
was 84% leased and its operational industrial buildings were 40% leased.
"In spite of the difficult economic times, we were able to make progress
by selling our vacant 3100 Windy Hill Road building and signing several
office leases," said Tom Bell, Chairman and CEO of Cousins. "Looking to
2009, we are committed to maintaining a strong balance sheet with
liquidity, working diligently to lease the remaining space in our
development projects and holding the line on occupancy at our existing
properties. We will also continue to seek distressed acquisitions and
development opportunities, but to date have yet to see projects that
meet our requirements."
The Condensed Consolidated Statements of Income, Condensed Consolidated
Balance Sheets and a schedule entitled Funds From Operations, which
reconciles Net Income Available to FFO, are attached to this press
release. More detailed information on Net Income Available and FFO
results is included in the "Net Income and Funds From
Operations-Supplemental Detail" schedule which is included along with
other supplemental information in the Company's Current Report on Form
8-K, which the Company is furnishing to the Securities and Exchange
Commission ("SEC"), and which can be viewed through the "Quarterly
Disclosures" and "SEC Filings" links on the Investor Relations page of
the Company's website at www.cousinsproperties.com.
This information may also be obtained by calling the Company's Investor
Relations Department at (404) 407-1984.
The Company will conduct a conference call at 11:00 a.m. (Eastern Time)
on Tuesday, February 10, 2009, to discuss the results of the quarter
ended December 31, 2008. The number to call for this interactive
teleconference is (303) 228-2960. A replay of the conference call will
be available for 14 days by dialing (303) 590-3000 and entering the
passcode 11124059#. The replay can be accessed on the Company's website, www.cousinsproperties.com,
through the "Q4 2008 Cousins Properties Incorporated Earnings Conference
Call" link on the Investor Relations page, as well as at www.streetevents.com
and www.earnings.com.
The rebroadcast will be available on the Investor Relations page of the
Company's website for 14 days.
Cousins Properties Incorporated is a leading diversified real estate
company with extensive experience in development, acquisition,
financing, management and leasing. Based in Atlanta, the Company
actively invests in office, multi-family, retail, industrial and land
development projects. Since its founding in 1958, Cousins has developed
20 million square feet of office space, 20 million square feet of retail
space, more than 4,000 multi-family units and more than 60 single-family
neighborhoods. The Company is a fully integrated equity real estate
investment trust (REIT) and trades on the New York Stock Exchange under
the symbol CUZ. For more, please visit www.cousinsproperties.com.
Certain matters discussed in this news release are forward-looking
statements within the meaning of the federal securities laws and are
subject to uncertainties and risk. These include, but are not
limited to, general and local economic conditions (including the current
general recession and state of the credit markets), local real estate
conditions (including the overall condition of the residential markets),
the activity of others developing competitive projects, the risks
associated with development projects (such as delay, cost overruns and
leasing/sales risk of new properties), the cyclical nature of the real
estate industry, the financial condition of existing tenants, interest
rates, the Company's ability to obtain favorable financing or zoning,
environmental matters, the effects of terrorism, the ability of the
Company to close properties under contract and other risks detailed from
time to time in the Company's filings with the Securities and Exchange
Commission, including those described in Part I, Item 1A of the
Company's Annual Report on Form 10-K for the year ended December 31,
2007. The words "believes," "expects," "anticipates," "estimates" and
similar expressions are intended to identify forward-looking statements.
Although the Company believes that its plans, intentions and
expectations reflected in any forward-looking statement are reasonable,
the Company can give no assurance that these plans, intentions or
expectations will be achieved. Such forward-looking statements are based
on current expectations and speak as of the date of such statements. The
Company undertakes no obligation to publicly update or revise any
forward-looking statement, whether as a result of future events, new
information or otherwise.
COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited, in thousands, except per share amounts)
Three Months Ended Years Ended
December 31, December 31,
2008 2007 2008 2007
REVENUES:
Rental property revenues $ 38,050 $ 32,370 $ 147,394 $ 112,645
Fee income 10,566 7,875 47,662 36,314
Multi-family residential sales 2,985 - 8,444 20
Residential lot and outparcel 247 2,496 6,993 9,949
sales
Interest and other 867 1,490 4,158 6,429
52,715 44,231 214,651 165,357
COSTS AND EXPENSES:
Rental property operating 13,944 13,028 56,607 46,139
expenses
General and administrative 9,441 9,129 42,174 40,643
expenses
Reimbursed general and 4,534 3,668 16,279 17,167
administrative expenses
Depreciation and amortization 15,777 11,687 52,925 39,796
Multi-family residential cost 2,615 (100 ) 7,330 (124 )
of sales
Residential lot and outparcel 81 2,125 3,776 7,809
cost of sales
Interest expense 10,804 5,020 33,151 8,816
Loss on extinguishment of debt - - - 446
Impairment loss 2,100 - 2,100 -
Other 1,770 650 6,049 2,822
61,066 45,207 220,391 163,514
INCOME (LOSS) FROM CONTINUING
OPERATIONS BEFORE TAXES,
MINORITY INTEREST AND INCOME (8,351 ) (976 ) (5,740 ) 1,843
FROM UNCONSOLIDATED JOINT
VENTURES
BENEFIT FOR INCOME TAXES FROM 4,293 517 8,770 4,423
OPERATIONS
MINORITY INTEREST IN INCOME OF (690 ) (238 ) (2,378 ) (1,656 )
CONSOLIDATED SUBSIDIARIES
INCOME (LOSS) FROM 1,168 (815 ) 9,721 6,096
UNCONSOLIDATED JOINT VENTURES
INCOME (LOSS) FROM CONTINUING
OPERATIONS BEFORE GAIN ON SALE (3,580 ) (1,512 ) 10,373 10,706
OF INVESTMENT PROPERTIES
GAIN ON SALE OF INVESTMENT
PROPERTIES, NET OF APPLICABLE 408 678 10,799 5,535
INCOME TAX PROVISION
INCOME (LOSS) FROM CONTINUING (3,172 ) (834 ) 21,172 16,241
OPERATIONS
DISCONTINUED OPERATIONS, NET
OF APPLICABLE INCOME TAX
PROVISION:
Income (loss) from 82 (413 ) (1,097 ) (1,414 )
discontinued operations
Gain on sale of investment 2,472 81 2,472 18,095
properties
2,554 (332 ) 1,375 16,681
NET INCOME (LOSS) (618 ) (1,166 ) 22,547 32,922
DIVIDENDS TO PREFERRED (3,520 ) (3,813 ) (14,957 ) (15,250 )
STOCKHOLDERS
NET INCOME (LOSS) AVAILABLE TO $ (4,138 ) $ (4,979 ) $ 7,590 $ 17,672
COMMON STOCKHOLDERS
PER COMMON SHARE INFORMATION -
BASIC:
Income (loss) from continuing $ (0.13 ) $ (0.09 ) $ 0.12 $ 0.02
operations
Income (loss) from 0.05 (0.01 ) 0.03 0.32
discontinued operations
Basic net income (loss)
available to common $ (0.08 ) $ (0.10 ) $ 0.15 $ 0.34
stockholders
PER COMMON SHARE INFORMATION -
DILUTED:
Income (loss) from continuing $ (0.13 ) $ (0.09 ) $ 0.12 $ 0.02
operations
Income (loss) from 0.05 (0.01 ) 0.03 0.31
discontinued operations
Diluted net income (loss)
available to common $ (0.08 ) $ (0.10 ) $ 0.15 $ 0.33
stockholders
CASH DIVIDENDS DECLARED PER $ 0.25 $ 0.37 $ 1.36 $ 1.48
COMMON SHARE
WEIGHTED AVERAGE SHARES 51,262 51,588 51,202 51,705
DILUTED WEIGHTED AVERAGE 51,262 51,588 51,621 52,932
SHARES
COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES
FUNDS FROM OPERATIONS
FOR THE THREE MONTHS AND YEARS ENDED DECEMBER 31, 2008 AND 2007
(Unaudited, in thousands, except per share amounts)
Three Months Ended Years Ended
December 31, December 31,
2008 2007 2008 2007
Net Income (Loss) Available to $ (4,138 ) $ (4,979 ) $ 7,590 $ 17,672
Common Stockholders
Depreciation and amortization:
Consolidated properties 15,777 11,687 52,925 39,796
Discontinued properties - 174 486 846
Share of unconsolidated joint 2,010 1,273 6,495 4,576
ventures
Depreciation of furniture,
fixtures and equipment and
amortization of specifically
identifiable intangible
assets:
Consolidated properties (1,004 ) (769 ) (3,724 ) (2,768 )
Discontinued properties - (6 ) (19 ) (25 )
Share of unconsolidated joint (1 ) (4 ) (79 ) (5 )
ventures
Gain on sale of investment
properties, net of applicable
income tax provision:
Consolidated (408 ) (678 ) (10,799 ) (5,535 )
Discontinued properties (2,472 ) (81 ) (2,472 ) (18,095 )
Share of unconsolidated joint - 12 - (1,186 )
ventures
Gain on sale of undepreciated 388 622 10,611 13,161
investment properties
Funds From Operations
Available to Common $ 10,152 $ 7,251 $ 61,014 $ 48,437
Stockholders
Per Common Share - Basic:
Net Income (Loss) Available $ (.08 ) $ (.10 ) $ .15 $ .34
Funds From Operations $ .20 $ .14 $ 1.19 $ .94
Weighted Average Shares-Basic 51,262 51,588 51,202 51,705
Per Common Share - Diluted:
Net Income (Loss) Available $ (.08 ) $ (.10 ) $ .15 $ .33
Funds From Operations $ .20 $ .14 $ 1.18 $ .92
Weighted Average 51,262 52,401 51,621 52,932
Shares-Diluted
The table above shows Funds From Operations Available to Common Stockholders
("FFO") and the related reconciliation to Net Income (Loss) Available to Common
Stockholders ["Net Income (Loss) Available"] for Cousins Properties Incorporated
and Subsidiaries. The Company calculated FFO in accordance with the National
Association of Real Estate Investment Trusts' ("NAREIT") definition, which is
net income available to common stockholders (computed in accordance with
accounting principles generally accepted in the United States ("GAAP")),
excluding extraordinary items, cumulative effect of change in accounting
principle and gains or losses from sales of depreciable property, plus
depreciation and amortization of real estate assets, and after adjustments for
unconsolidated partnerships and joint ventures to reflect FFO on the same basis.
FFO is used by industry analysts and investors as a supplemental measure of an
equity REIT's operating performance. Historical cost accounting for real estate
assets implicitly assumes that the value of real estate assets diminishes
predictably over time. Since real estate values instead have historically risen
or fallen with market conditions, many industry investors and analysts have
considered presentation of operating results for real estate companies that use
historical cost accounting to be insufficient by themselves. Thus, NAREIT
created FFO as a supplemental measure of REIT operating performance that
excludes historical cost depreciation, among other items, from GAAP net income.
Management believes that the use of FFO, combined with the required primary GAAP
presentations, has been fundamentally beneficial, improving the understanding of
operating results of REITs among the investing public and making comparisons of
REIT operating results more meaningful. Company management evaluates operating
performance in part based on FFO. Additionally, the Company uses FFO and FFO per
share, along with other measures, to assess performance in connection with
evaluating and granting incentive compensation to key employees.
COUSINS PROPERTIES INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited, in thousands, except share and per share amounts)
December 31, December 31,
2008 2007
ASSETS
PROPERTIES:
Operating properties, net of accumulated
depreciation of $182,050 and $142,955 in 2008 and $ 853,450 $ 654,633
2007, respectively
Projects under development 172,582 358,925
Land held for investment or future development 115,862 105,117
Residential lots 59,197 44,690
Multi-family units held for sale 70,658 -
Total properties 1,271,749 1,163,365
CASH AND CASH EQUIVALENTS 82,963 17,825
RESTRICTED CASH 3,636 3,587
NOTES AND OTHER RECEIVABLES,net of allowance for
doubtful accounts of $2,764 and $883 in 2008 and 51,266 44,414
2007, respectively
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES 200,850 209,477
OTHER ASSETS 91,794 70,943
TOTAL ASSETS $ 1,702,258 $ 1,509,611
LIABILITIES AND STOCKHOLDERS' INVESTMENT
NOTES PAYABLE $ 942,239 $ 676,189
ACCOUNTS PAYABLE AND ACCRUED LIABILITIES 73,489 57,208
DEFERRED GAIN 171,838 171,931
DEPOSITS AND DEFERRED INCOME 6,485 5,997
TOTAL LIABILITIES 1,194,051 911,325
MINORITY INTERESTS(includes redeemable minority
interests with a book value of $2,981 and a 40,520 45,783
maximum redemption amount of $3,945 as of December
31, 2008)
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' INVESTMENT:
Preferred stock, 20,000,000 shares authorized, $1
par value:
7.75% Series A cumulative redeemable preferred
stock, $25 liquidation preference; 2,993,090 and 74,827 100,000
4,000,000 shares issued and outstanding in 2008
and 2007, respectively
7.50% Series B cumulative redeemable preferred
stock, $25 liquidation preference; 3,791,000 and 94,775 100,000
4,000,000 shares issued and outstanding in 2008
and 2007, respectively
Common stock, $1 par value, 150,000,000 shares
authorized, 54,922,173 and 54,850,505 shares 54,922 54,851
issued in 2008 and 2007, respectively
Additional paid-in capital 368,829 348,508
Treasury stock at cost, 3,570,082 shares in 2008 (86,840 ) (86,840 )
and 2007
Accumulated other comprehensive income (16,601 ) (4,302 )
Cumulative undistributed net income (distributions (22,225 ) 40,286
in excess of net income)
TOTAL STOCKHOLDERS' INVESTMENT 467,687 552,503
TOTAL LIABILITIES AND STOCKHOLDERS' INVESTMENT $ 1,702,258 $ 1,509,611
Source: Cousins Properties Incorporated
Contact: Cousins Properties Incorporated
James A. Fleming, 404-407-1150
Executive Vice President and Chief Financial Officer
jimfleming@cousinsproperties.com
or
Cameron Golden, 404-407-1984
Director of Investor Relations and Corporate Communications
camerongolden@cousinsproperties.com
www.cousinsproperties.com